Pepsi spends millions of dollars annually to sponsor sports. From football to baseball, Pepsi uses its sponsorship deals to create intimate and loyal relationships with fanbases. PepsiCo penetration of pop culture through sports is incomparable. As a title sponsor for most sports and sporting events, Pepsi has billion of eyes around the world on its products for days, weeks, months, or even years.
For instance, in 2002, Pepsi replaced Coca-Cola as the official soft drink of the National Football League in a five-year mega deal worth $200 million. In 2015, PepsiCo announced another big win over its adversary. The sponsorship of NBA, ending Coca-Cola’s nearly 30-year run.
These were landmarks for Pepsi in its cola war with Coca-Cola. They marked PepsiCo recent marketing strategy that centralizes on sports. However, Pepsi’s involvement in sports is a decades’ long story.
The first sport sponsorship
The first Pepsi sports sponsorship was in the mid-1960s. Pepsi-Cola, as the brand was known at the time, sponsored The Buffalo Bisons, an American Hockey League team. The team adopted the beverage’s red, white, and blue colour scheme along with a modification of the Pepsi logo (with the word “Buffalo” in place of the Pepsi-Cola wordmark).
The Bisons ceased operations in 1970, making way for the Buffalo Sabres.
PepsiCo has active sponsorship deals with the National Football League, National Hockey League, and National Basketball Association. It was also the sponsor of Major League Soccer until December 2015 and Major League Baseball until April 2017. The two leagues signed with Coca-Cola after Pepsi.
The company has the naming rights to the Pepsi Center, an indoor sports facility in Denver, Colorado.
It has been in a long-term contract with Jeff Gordon since 1997. The retired NASCAR Sprint Cup Series driver turned Fox NASCAR announcer drives with the Pepsi logos on his car with various paint schemes for about 2 races each year, usually a darker paint scheme during nighttime races.
Pepsi continued the strategy by entering into deals with footballing stars tars over the years. The company has used the professional athletes to create some of its best football commercials.
Pepsi has also sponsored the NFL Rookie of the Year award since 2002. It also has deals with international cricket including Pakistani and Indian national teams.
The company’s involvements in the World Cup, the Super Bowl, and Champions League events are notable achievements.
In July 2009 Britvic, the soft drinks company that owns the UK and Ireland franchises of Pepsi recorded a 5.9 per cent jump in overall revenues. The surge in sales is attributed to Pepsi’s US$6 million annual sponsorship for the International Cricket Council (ICC).
The sponsorship allowed Pepsi to have a visible presence during the 20th World Cup cricket tournament in England. The deal was instrumental in Britvic’s growth in cola soda sales and revenue compared to its competition. This is the concept behind all Pepsi sponsorship deals – to give its products the much needed visibility to improve sales and revenue.
PepsiCo marketing has always driven the company’s products towards publicity. Sports provide a better platform to connect to the people. Sponsorships provide access to these platforms.
In 2018, PepsiCo signed a deal to extend its decade-long North America partnership with NHL and NHLPA. In response to the 5-years extensions, the NHL Chief Revenue Officer Keith Wachtel said the league highlighted the in-arena exposure, and the league’s continued expansion of its events calendar, during the renewal process.
These are attributes that Pepsi seeks in its sponsorship deals – unlimited publicity and visibility platforms.
In a sports sponsorship relationship, the aim of the sponsor is to generate brand awareness and customer loyalty, while the sponsee seeks to find a financing source. Pepsi’s corporate partnerships through sports seek to accomplish major goals that include:
- Driving consumers to retail,
- Driving sales,
- Increasing brand awareness,
- Brand engagement,
- Increasing brand sentiment, and
- Increasing brand preference.
These factors form the basic objectives of sports sponsorships. PepsiCo has been adept in exploiting them as evidenced through its recent commercial campaigns that centre on sports and sports personalities.
Sports sponsorships are the most effective platform for reaching out to the masses. It allows brand presence in the culture of sports lovers.