Transcript Document

Chapter 15
Sport Sponsorship
Introduction
• What is sponsorship?
– Cash and/or in-kind fee paid to a property in
return for access to the exploitable commercial
potential associated with that property
• One of most prolific forms of sport marketing
• Sponsorship fees often exceed $10,000,000 per year
and are structured as multiyear deals
• Provides a company with association, value,
exposure, and opportunities to leverage their
affiliation to achieve marketing objectives
History
• Increasing commercialization of sports has led to
tremendous growth in sport sponsorship.
– $11.3 billion spent on sport sponsorships in 2009
• 1984 Los Angeles Olympic Games
– Watershed year in the evolution of sport
sponsorship (President Peter Ueberroth)
• Ueberroth became commissioner of MLB
– Raised sponsorship bar for major professional
sport leagues
• Less-is-more philosophy
– 2-2-1 Plan
History: Reasons for Sponsorship
Growth
• Increased media interest in
sports.
• Companies can “break
through the clutter” of
traditional advertising.
• Sponsorship can reach its
target consumer through
consumers’ lifestyles.
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History: Reasons for Sponsorship
Growth (cont.)
• Enable corporate marketers to reach specific
segments, such as the following:
– Heavy users, shareholders, and investors; or
specific groups that have similar demographics,
psychographics, or geographic commonalities
• Today sport sponsorship has become a discipline
involving serious research, large investments, and
strategic planning
Sales Promotion: In-Venue
Promotion
• Increase the amount of “value-added” benefits that
teams provide their paying customers
• Traditional giveaways: Sponsor underwrites the cost of
a “premium” item in exchange for its logo on the item
and advertising support that prepromotes the event
• Continuity promotions: Require fans to attend multiple
games to obtain giveaways
• Success of promotion varies widely based on time of
season, teams’ win–loss record, day of promotion,
opponent, and perceived quality of the item
• Incremental increase in fans
Sales Promotion: In-Store Promotion
• Companies often leverage sponsorships at retail level
• Premiums
– Merchandise offered free or at a reduced price as an
inducement to buy a different item or items
• Contests/sweepstakes
• Sampling
– One of the most effective sales promotion tools to
induce consumers to try a product
• Point-of-sale or point-of-purchase materials
– Used by marketers to attract consumers’ attention to
their product/service and their promotional campaign
at the retail level
• Coupons
Cross-Promotion
• Joining together of two or more companies to
capitalize on a sponsorship is becoming increasingly
popular and effective
• Creates more “bang for their buck” under the premise
that two sponsors working together can generate more
interest and awareness among targeted sport
consumers
• Used to gain exposure in nontraditional and
unexpected retail settings
• It has become increasingly important to think outside
the box as to how sponsors can be joined to increase
the overall effectiveness of sponsorship investments
Sponsorship Packages: Sponsor
Benefits
• Exclusivity in one’s product or service category
• Official designations
– Leagues and teams offer multiple designations tied to
the sport and to the sponsor’s product or service
category
• Rights to utilize the sport organization’s intellectual
property in advertising and promotion campaigns
• Advertising support
• In-stadium signage and promotional announcements
• Access to tickets
• Potential new business through access and opportunity
Sponsorship Packages:
League/Team Benefits
•
•
•
•
Rights fee
Multiyear commitment
Advertising commitment
Commitment to team-oriented promotions
Sponsorship Platforms
• Governing body sponsorship
– Entails securing “official sponsor” status
• Team sponsorship
– Appropriate platform for local/regional
companies or companies with smaller marketing
budgets
• Athlete sponsorship
– Involves some type of endorsement of the
sponsor’s product or service
Sponsorship Platforms
• Media channel sponsorship
– Companies that purchase advertising or
programming during sport-related broadcasts
• Facility sponsorship
– Enables companies to tie directly to the event
atmosphere
• Event sponsorship
– Tie directly to event atmosphere
• Sport-specific sponsorship
– Enables company to direct its sponsorship
efforts to a specific sport
Evaluating Sport Sponsorship
• Vital due to growing financial commitments
necessary to effectively activate sport sponsorship
programs
• No one exact formula for measuring ROI
• For ROI, companies use the following:
– Internal feedback, sales/promotion bounceback
measures, print media exposure, television
media exposure, primary consumer research,
dealer/trade response, and syndicated consumer
research
Evaluating Sport Sponsorship
• Difficult to determine precisely how much
incremental sales are directly attributable to a
specific sponsorship program.
• Many companies conduct periodic consumer
surveys to determine ROI.
• Companies often hire professional sport research
firms to perform media evaluation research that
examines corporate sponsorship and brand
exposure through television and print media
coverage of sports events.
Sponsorship Agencies
• Many companies engaged in sport
sponsorship outsource the negotiation
and/or implementation of their sponsorship
programs
• Rely on agencies because they do not
possess the expertise, the experience, or the
resources to negotiate and implement
sponsorship programs
Current Issues
• Ethnic marketing
– Sport organizations have begun to
adopt strategies to target ethnic
groups more effectively.
• Overcommercialization
– Do consumers have an emotional
threshold for accepting a constant
bombardment of corporate
names, logos, and messages?
• Gambling
– Sport organizations have
embraced gambling as a growing
source of sponsorship revenue.
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