Anheuser-Busch InBev slashing number of property deals as industry transforms
It’s a shot across the bow from the sponsor that has long been sports’ biggest sugar daddy: Anheuser-Busch InBev recently began paring its extensive sponsorship portfolio by around 25%. The cuts will take place across sports, music and other entertainment properties, eventually reducing A-B InBev’s roster of property deals from around 400 to between 280 and 300.
Given the pandemic dynamics, which included months without live sports followed by spectator sports played without live spectators, nearly all marketing inventory, and certainly sports marketing assets, are operating in a buyer’s market and will be for some time. It’s also put pressure on every sponsorship budget. However, Nick Kelly, A-B InBev vice president of partnerships, beer culture and community, said the brewer will not be spending less on sponsorship marketing once the cuts are completed.
“This is not driven by cost,” he insisted. “Our commitment is that we’re not going to pull money out of sponsorship, but you may see us shift where exclusivity is vital and where it’s not. There are some places where we have every single sports property, and the reality is: We don’t need every property in every single market. But there’s no property we feel like we can’t lose any more.”
ABI’s aggressive move follows a study commissioned by the brewer with research firm Navigate over the summer which attempted to optimize ABI’s burgeoning portfolio of sponsorships, which includes rights with every big stick-and-ball league, along with more than 20 team deals in each big league sport and across the NCAA.
Certainly, it’s a time where ABI can take advantage of a soft market, but this also represents an opportunity for ABI to regain exclusivity in its deals. Years ago, those rights even excluded rival spirits brands from cutting sponsorships with ABI (then known as A-B) properties. More recently, as rival alcoholic beverages like hard cider, craft beer and hard seltzer found their audiences, the brewer of Bud and Bud Light found itself unable to market its own growing roster of brands, as properties carved up the category with different sponsors in beer, import beer, canned mixed drinks and even its Babe Wine, one of many brands ABI was marketing on site at this year’s Super Bowl in Miami.
“Hard seltzer has been one of the biggest battles we’ve been fighting this year,” said Kelly. “Our priorities now are all beer, and all seltzer. Exclusivity is important, but the most important thing now with any partner will be an arrangement where there’s no one product that we can’t activate. We will share some categories, if we have to, but we can’t have ‘You can activate everything but X,’ that doesn’t work for us anymore. … And this isn’t us trying to take advantage of a down economy, we just had the time now. What’s really driving this is the ability to drive our whole product portfolio at once against a property. If we don’t have that, we’re likely to walk away.”
ABI’s sponsorship reassessment comes at a time when, because of the pandemic, those on both the buy and sell side of sponsorship are increasingly challenged to demonstrate value.
“Brands are challenged within sports by varying consumption patterns, a crowded [TV] sports calendar and not having live fans to activate against,” said Emilio Collins, Excel Sports Management chief business officer. “But I wouldn’t say everyone is cutting partnerships. Spending is up across our sponsorship-related businesses, year-to-year, because brands are looking to find new ways to break through a consumer landscape that has really changed.”
Added Scout Sports & Entertainment Managing Partner Michael Neuman: “The reality of sports today means we’re all restructuring contracts to go along with assets that can’t be delivered. The biggest question mark still is when fans will return.”
With so many properties involved, Kelly estimated that it will take as long as a year and a half to reset ABI’s sponsorship mix. The brewer has shown before it has patience in marketing matters, along with considerable influence. It is still working to include incentive-laden performance clauses in all of its sponsorships — a process that began around 2 1/2 years ago. “This may take 18 months,” said Kelly, “but the reality is that it should put us in a position where we’ll be set up for at least the next five years.”
■ COMINGS & GOINGS: Tuck Burch joins Excel Sports Management as head of brand marketing, a new position, in which he will direct the agency’s expanding brand marketing consulting business, with clients including Red Bull, Supercuts and Porsche. Burch, who will eventually relocate to Excel’s New York City headquarters, had been with Octagon for more than 17 years, most recently as executive vice president, sports and entertainment. … Veteran sponsorship executive Tom Manchester has resurfaced as CMO at the 200+ location Pizzeria Uno chain, where a relaunch/repositioning is imminent. Most recently, Manchester was senior vice president of integrated marketing at Dunkin’ Brands, where he spent 19 years directing sponsorship and marketing efforts for the Dunkin’ Donuts and Baskin-Robbins chains. Manchester has also held marketing positions with Gillette and Ocean Spray. … At Scout Sports & Entertainment, Carrie Skillman adds an S to her VP title. She’s been at Scout since 2012. Also, Sean Singletary joins Scout as a vice president after two years at Spectra by Comcast Spectacor, where he was director of business development and corporate partnerships. … Margaux Miller joins Sponsor United in a recruitment role, as the company’s first senior vice president of people, helping to maintain SU’s vast scouting network of more than 1,000 people. Miller has been with the NFL league office since 2018 as a talent acquisition specialist.
Terry Lefton can be reached at email@example.com.