Transcript Chapter 1

Chapter 7
Leveraging
McGraw-Hill/Irwin
7-1
©2007 The McGraw-Hill Companies, All Rights Reserved
Leveraging
• Sponsorship Has Been Characterized as a
License to Spend More Money
• Sponsorship Is Not a Stand-Alone Activity
• Need to Support Any Sponsorship with
Additional Efforts Designed to Reinforce
the Awareness that the Marketer Is an
Official Sponsor of the Property
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Leveraging
• Also Referred to as:
– Activization
– Collateral Support
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Why Leverage?
• Reinforce Relationship in Consumers’
Minds
• Reduce Vulnerability to Ambush Marketing
• Increase Likelihood that the Sponsorship
Will Achieve Its Anticipated Objectives
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License to Spend
Source: IEG, Inc. Reprinted with permission.
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How Much Should Be Spent on
Leveraging Activities?
• No Universal Agreement
• Amounts Vary Significantly
• General Standard Is That a Minimum of $1
Should Be Spent on Leveraging for Each
$1 Committed to Rights Fees
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Leveraging in Practice
• IEG Reported Expenditure Ratio in 2004
Was $1.30 Spent on Leveraging for Each
$1.00 Paid in Rights Fees
• New Report Indicates that Ratio Slightly
Increased in 2005 to $1.34
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Leveraging Techniques
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Theme-Based Advertising
• Using Advertising that Focuses on the
Same Theme Germane to the Sponsored
Event
• adidas Sponsors the World Cup of Soccer;
They Use TV and Magazine Ads that
Feature a Soccer Theme
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Advertise During
the Broadcast of the Event
• Often, Sponsors Are Given Opportunities
to Purchase Advertising Time Prior to that
Time Being Offered to Nonsponsors
• McDonald’s Airs TV Advertisements during
the Olympic Broadcast in an Effort to
Leverage Its Sponsorship of the IOC
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Advertising in the Event Program
• Reach the Fans at the Event; Those in
Attendance Will Read the Program and Be
Exposed to the Sponsors’ Advertisements
• FedEx Used Ads in the Ryder Cup
Program to Reach Fans and Increase OnSite Business
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Packaging
• Incorporate Trademarks and Logos of the
Sponsored Event on Product Packaging
• Must Have Been Granted This Right in the
Contract by the Sponsee
• McDonald’s Incorporates Logos of World
Cup, UEFA, & Olympics on Its Drink Cups
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Distribution of Free
Products or Premiums
• Use Free Samples of Sponsors Product or
Promotional Giveaways that Feature the
Sponsee’s Trademarks and Logos
• Absopure Gives Free Samples of Its Water
at Michigan Stadium
• GM Gave Out Poster Featuring NFL Team
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Provision of Prizes
• Sponsor Provides Goods and Services
that Sponsee Uses as Prizes for Selected
Activities
• Southwest Airlines Provides Tickets that
MLB’s St. Louis Cardinals Give Away to
Contest Winners Selected from Fans in
Attendance
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Point-of-Sale Display (POS)
• Use of Themed Signage at Retailers; the
Signage Features the Sponsorship
• Adidas Uses Display that Feature Soccer
and the Brazilian Team in Retail Stores in
South America
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Push Strategy for Retailers
• Engaging in Activities Designed to Persuade
Retailers to Increase Exposure of the Sponsor’s
Products and Promotions within the Retail
Environment
• This May Involve Some Type of Financial
Compensation for the Retailer
• NASCAR Sponsor, Country Time, Achieved a
Substantial Increase in Display Space because
Retailers Saw a Chance to Increase Its Sales
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Consumer Sales Overlay
• Consumers Associated with the Sponsor
Can Buy Tickets at Discounted Prices
• AAA Is a Sponsor of the Detroit Tigers;
Members of AAA Have Several
Opportunities Each Season to Purchase
Tickets at Half Price (2 for 1)
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Cross-Promotions
with Co-Sponsors
• Collaborate with Another of the Property’s
Sponsors in a Joint Marketing Endeavor
• U.S. Olympic Team Sponsors (Hilton
Hotels and United Airlines) Put Together
Travel Packages While Referencing Their
Association with the USOC
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Affinity Programs
• Capitalize of the Brand Equity and the
Consumers’ Affection for the Sponsee
• Effective For CRM-Based Sponsorships,
but Applicable in Sports Marketing
• MNBA NFL “Extra Points” Visa Credit Card
Features NFL Logos and Consumer
Benefits Accumulated by Using Card
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Web Tie-Ins
• Acknowledgement of the Relationship on
the Sponsor’s Own Website – May Link
• Coca-Cola’s Web Site Has a Link for
“Citizenship.” Clicking Through Will Direct
the Browser to a Listing of All of the
Marketer’s Sponsorships Where One Can
Click Through to Any of Its Sponsorships
Including the IOC, FIFA and NASCAR
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Overview of Leveraging
• Essential for Maximizing Impact
• Expensive- Consider Cost of Leveraging
as Well as the Cost of the Rights Fees
• Sponsee Can Advise Sponsors on the Use
of Effective Leveraging Strategies
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Example of a Leveraging Effort
• Visa and the NFL
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Affinity Credit Card
Contest for Consumers Who Use the Card
Print Advertising Featuring NFL Logos
POS Featuring NFL Logos in Stores
Cross-Promotion with DirecTV
Chance to Win Tickets to Super Bowl
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Example of a Leveraging Effort
• Best Western International and NASCAR
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NASCAR Room Rate (Discounts)
Affinity Credit Card
Cross-Promotions with Co-Sponsors
On-Site Hospitality at Race Location
Access to Tickets through Hotel
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Make-Buy Decision
• Make – Sponsor Develops and
Implements Its Own Leveraging Program
• Buy – Sponsor Hires an Outside Agency to
Assist in the Development and
Implementation of Its Leveraging Program
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Who Is Use When “Buying”?
Source: IEG, Inc. Reprinted with permission.
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Closing Capsule
• If a Sponsorship Fails to Achieve Its
Objectives, the Sponsor Must First Ask
Itself: “Did We Do an Adequate Job in
Leveraging Our Sponsorship?”
• Leveraging Helps Reduce Impact of
Ambush Marketing Effort
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Closing Capsule
• Sponsorship Is Only Effective When the
Consumer Recognizes the Relationship
between the Sponsor and the Sponsee
• Effective Leveraging Makes that
Recognition Far More Likely
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