SS Lazio Partners with Chinese-based HQ Bet
One of the giant clubs of the Italian Serie A football division SS Lazio has formed a new partnership with Chinese sportsbook HQ Bet. Sports betting in Asia has been growing in scale and market share for the past three years, and its dramatic expansion has brought a host of interest from wealthy European partners.
As part of a wider expansion strategy into the emerging markets in Asia, SS Lazio is one of many football clubs to adopt this strategy. The high concentration of capital, the hugely receptive audience, and the synchronization of corporate goals have made this an incredibly easy and natural fit for the new partnership between HQ Bet and SS Lazio.
Clubs across Europe have long been courted by Asian business interests. Every year the continent’s biggest clubs travel to Asia to showcase a series of matches in pre-season friendlies. The support and interest from Asia in European football is absolutely pivotal for the economic stability of the model, and clubs receive enormous remuneration from selling merchandise, brand partnerships, and TV deals to Asia.
Italian Laws Prevent SS Lazio Shopping Locally
The current stance in Italy is particularly strict, and the Serie A clubs looking to form betting partnerships are unable to work with local firms due to the red-tape regulation. Laws introduced last year have prevented the Rome-based SS Lazio from working with Italian operators, and so, the club sitting in 2nd place in Italy’s top football division has decided to partner with a Chinese firm. The deal is favorable, and certainly more lucrative than any offer a European firm would have been able to offer. In many ways, this is a win-win situation.
The deal appears to be part of the Asian growth ambitions of SS Lazio. After launching a considerable online presence in the continent through popular social media channels Weibo and WeChat, the Italian football club announced their partnership just 24 hours later. The intent here is clear, and the deal which lasts until late 2022 will provide a significant boost to their international commercial development strategy.
In terms of the marketing of Italian football in China, SS Lazio has certainly taken the initiative compared to its rivals in the same division. Many clubs have Asian links, but this important agreement will launch SS Lazio ahead of the competition and allow it to continue the ambitious growth path in one of the world’s most fundamental markets.
Since 2018, Italian football clubs have been unable to sign deals with Italian betting partners. The revenue supply from these industries is absolutely essential for the balance sheet of football clubs, so many have been forced to shop elsewhere. The legislation pushed through by the Italian government known as the Dignity Decree was a pivotal moment in the government’s efforts to overhaul the labor market and reverse the previous administration’s Jobs Act.
At its core, the new legislation prevents Italian football clubs from signing partnership agreements with Italian better operators in Italy. This has been the situation since early 2019, and since then several of the top clubs in the league including AS Roma and Bologna have also turned to Asia as a means to raise the required capital needed to sustain their operating model.
Italian Football Facing Financial Uncertainty
The Italian league is going to struggle in the immediate future, and given the wider macroeconomic outlook, European football faces huge financial uncertainty. The existential threat currently facing European leagues is significant, and by most estimates, they are facing a shortfall of nearly €6.6bn across major leagues.
All of this uncertainty is causing player markets to dramatically decrease in size, and the wealth of player wages reducing simultaneously. Nearly all clubs in Europe’s top divisions are suffering right now, and the onset of COVID-19 has prevented stadiums hosting fans that would normally bring in a large percentage of the revenue. In these extraordinary times, it has never been more important for clubs to build a strong network of corporate partners.
With the heavily strict bean applying to all forms of gambling-related products in Italy, SS Lazio has taken the initiative and made a decision that will undoubtedly benefit the long-term outlook of the club and strengthen their financial stability. The Dignity Decree affects many other aspects of the sport too, all forms of media platforms from website streaming to television and radio have had to change their sponsorships, as any gambling advertisement from an Italian betting company is banned within Italy.