Using Sports Marketing in heavily regulated Forex territories


There are quite a lot of parallel between the Forex sector and other heavily regulated industries. And that includes how they go about marketing in jurisdictions where marketing is either not formally allowed, or is heavily restricted.

What can Forex brokers do in these situations?

What lessons are there to be learned from other regulated industries?

We are please to present a special guest post on the subject by Stephen Pearson, CEO of Sports Media Gaming Ltd (SMG). SMG is a leading international sports marketing agency, and has been involved in brokering a number of the recent sports sponsorships by leading Retail Forex and Binary Options brokers. Stephen has held Board roles at UEFA Champions League and English Premier League.

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The effects of an evolving regulatory environment was brought to the fore recently when France and Belgium placed a block on advertising by online trading companies. This effectively wiped out existing marketing campaigns that have often taken months to plan and execute. 24option’s sponsorship of La Ligue team Olympique Lyonnais was effectively terminated and OptionWeb’s sponsorship with champions Paris Saint Germain remains unclear.

Stephen Pearson, Sports Media Gaming
Stephen Pearson, Sports Media Gaming

Adapting to existing or changing regulatory situations can be challenging, especially when media organizations and sports rights holders are increasingly looking for longer term agreements with advertisers and sponsors.

It is vital that brands ensure there are contractual clauses that cover these types of regulatory swings, but at the same time brands who are engaging in sports sponsorships are looking for long relationships, they don’t want to be seen to be jumping from one sponsorship to another, one day sponsoring one club, the next day a different one. This can disorientate marketing departments especially when trying to co-ordinate messages in multiple countries, in turn disorientating the consumer. Likewise clubs don’t want to be constantly changing sponsors in the same category.

France has a history of setting the trend with the adoption of stringent regulation. The Loi Evin which was passed in 1991, was introduced to ban the advertising of alcohol in France.

Sports marketers and alcohol brands were faced with a number of challenges in continuing to target French consumers without advertising on the ground. Brands like Heineken and Carlsberg who were at the time major European sports sponsors were forced to find innovative ways to keep brand presence in the French market. European football matches started to feature advertising hoardings from Heineken that were simply green boards whilst Carlsberg adopted a marketing approach around the word “probably”, neither campaign actually mentioning the brand name.

The difference from Heineken and Carlsberg to the online trading market is that these brands are long established, they have an instantly recognizable brand presence that can be readily adapted for such situations. They also engage in multi million global campaigns whereas online trading companies have to date focused investment on single team based sponsorships, still at the embryonic stage of their brand development.

But sports marketing can play an important role in regulated markets. Whilst an on-ground advertising presence may no longer be possible in France or Belgium, the coverage in these countries of non-domestic sports is extensive. Billionaire Patrick Drahi-owned Altice Group has for example secured the rights to broadcast the English Premier League in France and Monaco for three years allowing its French customers to view all the 380 games between England’s top-tier teams on Television, internet and mobile. Any trading brand that is now sponsoring a Premier League team or buying LED at Premier League matches (now permitted as previous League title sponsor Barclays exclusivity has now ended) will be highly visible to French viewers. Similar deals are in place for broadcasts of La Liga and Serie A matches and other big sporting events.

It’s not the first time Premier League football has been used to target consumers in regulated markets. For several years Asian sports bookies have been using Premier League shirt sponsorship to target consumers in Asian markets where on-ground regulation also prohibits advertising.  This has in turn more recently led to the UK Gambling Commission requiring all betting brands to have UK regulation prior to advertising on-ground in the UK. But this is no longer a cumbersome process since white-label piggyback agreements with existing licencees are now the norm and the actual licence application time is significantly reduced.

Asia is indeed also a core target for online trading brands, the same strategies are being employed with brands aligning with teams in La Liga, Premier League and SerieA so that they can be seen in all corners of the world, including the regulated markets.

Going forward, brands need to therefore ensure that they are contractually protected in the event of a change in regulation. Warning signs were coming out of France several months before the actual ban, so attention needs to be constantly given to a markets possible change of conditions.

Brands should also stay tuned into how to target regulated markets via the use of non-domestic opportunities, and without doubt sports sponsorship can continue to play an important role.

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Using Sports Marketing in heavily regulated Forex territories

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