In the forex industry, it’s no longer news for brokers to sponsor sporting events—for example, GKFX’s long-term sponsorship partnership with Serie A powerhouse AC Milan; broker Aetos’ sponsorship of the Sydney FC;and broker Swissquote’s sponsorship of Premier League powerhouse Manchester United, among others. Of course, there are also examples such as FXTM’s sponsorship of the Sahara Force India F1 team. Many brokers choose to sponsor sporting events to raise their profile and attract investors’ attention.
According to SMG’s findings from 2010 through July 2016, based on a survey of more than 70 major forex and binary options brokers, 58% of brokers chose to invest in soccer sponsorships, followed closely by auto racing,as well as sponsorships of sailing, equestrian events, rugby, and golf.
Why Choose to Sponsor Sports Events?
Sports event sponsorships, which often run into the millions or tens of millions of U.S. dollars, come at a significant cost to brokers. So why do brokers still choose to spend such large sums on sponsorships? Behind these sponsorships lies a very obvious marketing logic: the audience economy.
1. Target Audience: Male-Dominated / Risk-Taking
Competitive sports such as soccer and Formula 1 have a very strong gender bias—the audience is dominated by men aged 25 to 45, which aligns perfectly with the demographic characteristics of forex investors.Many forex brokers are eager to sponsor sports events precisely because the demographics of both groups align so closely; successful conversions can yield a very high return on investment for the brokers.
In terms of the experience, highly tense and thrilling competitions share significant similarities with high-risk investments. In addition to forex brokers, the gambling industry—which also features tension, excitement, and high risk—is very eager to partner with sporting events. For example, gambling companies such as Betfair, 888.com, and BWIN, all of which have a long history of partnering with numerous sporting events.
2. Target Audience Characteristics: High-Net-Worth Individuals
According to the 2017 High-Net-Worth Individuals Report released by the authoritative Hurun Research Institute, sports such as equestrian and sailing are among the activities that high-net-worth individuals are most eager to try, with equestrian ranking first at 16%. Forex brokers have consistently targeted high-net-worth investors as their primary marketing audience; therefore, sponsoring sporting events such as equestrian competitions, sailing, and golf can generate significant exposure among this demographic and foster a very positive brand image.
3. Strong brand presence and immense influence
Soccer is one of the world’s most popular sports, and the economic impact and influence generated by soccer tournaments are immense. Top-tier soccer leagues such as the Premier League and Serie A attract the attention of tens of millions of people. For forex brokers, the conversions generated by this massive exposure may be even higher than those from online marketing.Furthermore, increased brand awareness ultimately translates into highly valuable brand assets.
Marketing Insights from Audience Economics
Sports sponsorship marketing is out of reach for small brokers in the early stages of development, not only because of the enormous costs involved but also due to factors such as the lack of forex regulation in mainland China.making sports event sponsorship a highly sensitive matter. Additionally, in other regions—such as Europe—regulatory policies are tightening, with a series of strict regulations now being implemented regarding broker advertising. However, from the “audience economics” exemplified by sports event marketing, we can draw the following marketing insights:
1. Identify the Target Audience
Before launching an advertising campaign, a brokerage firm must ask itself: Where are the clients I’m looking for? What are their characteristics? What specific interests do they typically have? Through which channels can we reach these people? What kind of marketing activities will resonate with them?
To give a simple example, in addition to sports event sponsorships, some brokers choose to partner with high-end private clubs or invitation-only wine-tasting clubs. This approach perfectly aligns with the characteristics of their target audience—high-net-worth investors—while also helping to cultivate a premium brand image.
2. Evaluate the ROI of Your Marketing
Evaluating the ROI of marketing campaigns targeted at specific audiences is also a critical area for brokers to focus on, especially for those with limited budgets, where every marketing dollar must be spent wisely. Therefore, it is essential to clearly understand your marketing objectives, stay abreast of trends in the forex investment market, and continuously assess the ROI of your marketing efforts.
