Transcript Textbook - NMSU College of Business

Chapter 4
Sponsorship Objectives
and Components
McGraw-Hill/Irwin
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©2007 The McGraw-Hill Companies, All Rights Reserved
Sponsorship Evolution
• Early Sponsorships Were Ego-Driven
– CEO likes golf; company sponsors golf event
• Focus Shifted to Philanthropic Motives
– Sponsorship was way to donate to a cause
• Most Sponsorships Today Focus on ROI
– Sponsorship as investment, not an expense
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Sponsorship Objectives
• Drive Sales
• Improve Image
• Create Greater Awareness
• Provide Hospitality Opportunities
• Enhance Employee Morale
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Drive Sales
• Sustainable Competitive Advantage Via
the Association with the Sponsee
– Fuji over Kodak (No presence at World Cup)
• Merchandising Opportunities
– Selling Coca-Cola Products at the Olympics
• Shape Consumer Attitudes
– Firestone after negative PR (Indy 500)
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Drive Sales (cont’d)
• Overcome Advertising Restrictions
– Bans against Tobacco Advertising
• Cut Through Advertising Clutter
– Not Competing with Broadcast Advertising
• Reach Small Segments and Niches
-Small specialized properties (local festival)
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Improve Image
• Attain Positive PR
– Support seen as Helping the Sponsee
• Viewed as a Good Corporate Citizen
– Contribution to a Popular Sponsee
– Especially for Causes or Local Events
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Improve Image (Cont’d)
• Shape Consumer Attitudes
– Reach New Target Market
– Selected Property Portrays Different Image
• Philanthropy
– Donations Viewed Favorably by Public
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Create Greater Awareness
• Increased Visibility
– Ability to Reach New Target Market
– Mass Reach to Introduce New Product
– Mass Reach to Inform of New Brand Name
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Provide Hospitality Opportunities
• Entertain Customers, Prospects &
Suppliers – Reinforce Relationships
• Opportunity to Attend Event
– Tickets; parking
• Provision of Various Amenities
– TV monitors, restrooms; premium seating
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Enhance Employee Morale
• Entertain Employees
– Use of free tickets & hospitality areas
– Reward high performers
• Sense of Pride
– Feeling of “My company cares”
• Employee Involvement
– Feeling of “I’m part of the corporate team”
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Importance of Objectives
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Sponsorship Components
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Category Exclusivity
Signage
Right to Use Event Trademarks and Logos
Distribution Rights
Hospitality Areas
Complimentary Advertising
Free Tickets
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Sponsorship Components (Cont’d)
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Right to Purchase Additional Tickets
Link on the Event Web Site
(Sponsorship) Designation
Inclusion in Event Promotions
Access to Property Mailing List / Database
Right of First Refusal
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Category Exclusivity
• A Guarantee that the Sponsor’s
Competitor Will Not Be Allowed to Become
Involved with the Sponsee
• Coca-Cola is a Sponsor of the World Cup
of Cricket. Category Exclusivity Provides
Assurance that Pepsi-Cola Will Not Be
Involved in Any Official Capacity
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Signage
• Actual Signs Identifying and Promoting the
Sponsor at the Event Venue
• Helps to Reinforce the Relationship in the
Consumers’ Minds
• May Be Actual or Virtual Signage
• There is a Concern About Signage Clutter
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Right to Use Event Trademarks
and Logos
• Events Generally Have Terms and
Symbols That Are Legally Protected
• It Is Illegal to Use These Intellectual
Properties Without Permission of Owner
• Sponsors Use These in Advertising, on
Packaging, and on Promotional Items
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Distribution Rights
• Right to Use Event as a Distribution Outlet
• Distribution of Free Samples of Product at
Event Venue
• Ability to Sell Products at Event Venue
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Hospitality Areas
• Facilities to Entertain Selected Individuals
• On-Site Hospitality
– Luxury Suites
– Temporary Facilities
• Off-Site Hospitality
– Temporary or Leased Facilities
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Complimentary Advertising
• Free Advertising for the Sponsor
• Often Paid as Part of Rights Fees
• Examples
– TV Advertisements
– Radio Advertisements
– Print ad in the Event Program
– Mentions by Announcers – PA or Media
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Free Tickets
• Admission to the Sponsored Event
• Important for Events that Typically Sell Out
• May Vary According to Sponsorship Level
– High level sponsors receive more free tickets
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Right to Purchase
Additional Tickets
• Valuable for Sold Out Events
• May be Used Even When Free Tickets Are
Not Provided to the Sponsor
• May be Bought at Discount if Event Is Not
Expected to be sold out
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Link on the Event Web Site
• The ability for Visitors to the Event Web
Site to Click on an Icon That Will Take
Them to the Sponsor’s Web Site
• Check out the Web Sites for the World
Cups of Soccer and Cricket
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Designation
• How the Sponsor Can Refer to Itself in Its
Own Marketing Efforts. Examples Include:
– Presenting Sponsor
– Title Sponsor
– Official Sponsor
– Marketing Partner
– Official Supplier
– Regional Supporter
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Inclusion in Event Promotions
• The Event Is Likely to Promote Itself
Through Traditional Media. It Is to the
Sponsors’ Benefit to Be Identified in the
Event’s Advertising and Marketing Efforts
• Helps to Reinforce the Relationship
between the Sponsor and the Sponsee in
the Minds of the Consumers
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Access to Property
Mailing List / Database
• Sponsor and Sponsee Likely Have Very
Similar Target Markets
• Access to Sponsee’s List Will Provide
Sponsor with Access to Potential Buyers
• Many Properties Have Lists of Ticket
Buyer and Members of Fan Clubs
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Right of First Refusal
• Current Sponsor Is Provided Opportunity
to Renew It’s Sponsorship for the Next
Period Prior to the Solicitation of New
Sponsors by the Sponsee
• Evaluate New Terms; Effectiveness of
Existing Sponsorship; Potential Actions by
Competitor if Sponsorship Is Terminated
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Which Component
Is Most Important
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Closing Capsule
• Sponsorships Should Benefit Both the Sponsor
and the Sponsee – A Win-Win Partnership
• Sponsorship Components Should Be
Considered Tools That Will Help the Sponsor
Achieve Its Objectives
• Category Exclusivity and Venue Signage Are
Viewed as the Most Important Components
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