Today’s appointment of China to host the 2023 Asian Cup in football has “significantly increased” the probability of agency DDMC Fortis exceeding its financial targets in selling the commercial rights for the tournament, chief executive Patrick Murphy has told SportBusiness.
DDMC Fortis is selling the global media and sponsorship rights for Asian Football Confederation national team and club competitions in the 2021 to 2028 period under a landmark deal agreed in June 2018.
The agency today officially launched its sales process for the first four-year cycle, 2021 to 2024, to coincide with the award of the 2023 Asian Cup hosting rights at the AFC Extraordinary Congress in Paris.
“Having China as the host nation for 2023 is a huge boost,” Murphy said. “It wasn’t something that was confirmed at the time of the tender process. Our commercial model wasn’t based on having China as the host for the Asian Cup in 2023. So it’s a tremendous bonus that we weren’t expecting…the probability of us hitting and exceeding our targets has significantly increased.”
DDMC Fortis was widely considered to have agreed an aggressive minimum guarantee with the AFC. At about $2.4bn (€2.1bn) over the eight years of the contract, it is nearly eight times that earned by the AFC in its current deal, with Lagardère Sports.
China was considered a critical market for DDMC in terms of hitting its sales targets, but there were question marks over the scale of the opportunity for increased revenues, particularly from media rights. With the country hosting the 2023 Asian Cup, strong broadcaster and sponsor interest is now assured.
Although official sales talks will start later this month, the agency has already received notice of strong interest in the AFC rights from Chinese brands. Murphy said: “We’ve had a lot of inwards enquiries from Chinese sponsors, and now with the Asia Cup going to China, we expect a surge in interest.”
DDMC Fortis is introducing an important change to the AFC sponsorship structure in the new cycle aimed at increasing revenues from China and Japan in particular – a new range of localised sponsorships enabled by virtual signage technology. Virtual signage is typically used to show different pitch perimeter board advertisements to viewers in different markets.
These sponsorships will allow brands that are focused on their home market or region, rather than Asia as a whole, to acquire packages aimed at their audience. China and Japan have many brands that fall into this category.
“What we’ll be looking to do is to create more local, regional opportunities for the bigger markets in Asia,” Murphy said. “So, for example, we’ll be offering local sponsorship opportunities in China and Japan, at least. We can essentially customise the sponsorship packages to a much greater degree in those markets. And the way we’ll do that is to use…virtual advertising, to create more localised inventory.”
DDMC Fortis will commence sales talks later this month, Murphy said. The agency will be selling the rights for both national team and club competitions in parallel. The aim is to complete the sale of national team rights ahead of the first games of the cycle in September 2020, and the same for club competition rights ahead of their start early in 2021.
The agency’s remit covers all media and sponsorship rights, except for media rights in the Middle East and North Africa, for: the Asian Cup, Fifa World Cup Asian qualifiers, the AFC Champions League, the AFC Cup, the AFC Women’s Cup, the AFC men’s and women’s youth championships, and the AFC Futsal Championships.