Definition of sponsorship

The word ‘sponsorship’ first entered the English language at the turn of the nineteenth century, when it was used in a novel to describe those called to stand and witness church baptisms. Like so many other words, it has now come to represent something entirely different in the modern world of business and brand promotion – but its impact has been equally uplifting.

Clearly, sponsorship and sponsors have moved a long way from the Protestant interpretation nearly 200 years ago. The path was created primarily by a series of ‘patrons’ who, during the Victorian age, devoted enormous time and resources to supporting causes that set them apart, both as individuals and as business entrepreneurs.

One of the most gifted and successful patrons of his illustrious generation was Sir Thomas Lipton, founder of the world-famous tea company that still bears his name. He was also the founder of what remains as the world’s most prestigious and famous ocean racing event, now known as the America’s Cup (so named after it was won at the first attempt by the American challenger off the Isle of Wight in 1851).

Sir Thomas was a true marketing genius who used his investment in an exciting new event to increase international awareness of his teas and expand the sales of his flourishing domestic grocery store chain. Just think what he might have achieved had his own yacht been successful in the choppy waters of the Solent!

Perhaps what Sir Thomas demonstrated most of all was a capacity to measure the level of risk involved (sinking boats and potential loss of life) against the degree of initiative required to deliver his main objective – to put Lipton teas on the map of the world.

In fact, combining risk with initiative is a common factor not only among successful entrepreneurs of the past, but also, I suggest, effective sponsorships of the future.

Sir Thomas was much more than simply a patron of ocean racing. He set out to gain commercial advantage from his investment and devised ways in which he could exploit the interest he created. His was a fresh approach that distanced him from numerous Victorian patrons of the arts.

Ironically, the origins of commercial sponsorship as we know it today are attributed to the arts. In 1931 the Philco company sponsored the Philadelphia Symphony Orchestra and established a trend that others were quick to follow.

But perhaps the boom period for sponsorship came 30 years later, when the tobacco companies found themselves increasingly restricted in the conventional areas of advertising and turned to sponsorship to create awareness for a growing number of different brands. It heralded the transformation of top class sport and entertainment, and set the blueprint for sponsorship for years to come. What marked the period for special attention was the extent of innovations introduced to distinguish one brand from another. Some visionary sponsorships, like the Rothmans Cricket Cavaliers, introduced a completely new dimension into the sport – in this case, Sunday cricket – that secured a commercial arrangement of mutual benefit.

At that time, sponsorship was seen simply as a cost-effective, legitimate alternative to traditional advertising; one that enabled the sponsor to stand out from the crowd and even shape the image it wished to portray; and one that gave the recipient sport a new status and source of income.

Today, sponsorship has its own rightful place in the marketing mix and is seen to offer specific benefits that neither advertising nor public relations alone can deliver.

Most important of all, sponsorship can bond a company or brand closer to its ultimate markets and create a climate for sales success that is beyond any other form of promotion because it works at several levels – branding, corporate hospitality, staff relations, community relations and sales development.

In some areas, like motor racing – the most heavily sponsored sport in the world – sponsorship actually dictates the role of other marketing disciplines, and brings global prestige and awareness.

The visionary Sir Thomas Lipton would surely approve.

What makes a successful sponsorship?

1 Sponsorship can work for a variety of different reasons: good customer and staff relations, positive media coverage, enhanced brand profile and image, wider public awareness and even community support. But the true defining factor of any successful sponsorship is the meeting of the original objectives for the exercise; namely, did it fulfill the requirements set out when the investment was first considered?

2 Twenty years ago, most sponsorships – especially those in sport – were considered to have no more justification that being the chairman’s favourite pastime. Some cynics even went as far as saying that those in the arts were the favourite pastimes of the chairman’s mistress!

3 Given the amounts of money now invested in sponsorship and the reputations at stake, it is reasonably safe to assume that more commercial criteria have been applied to the subject, although I have not seen a sponsorship survive for long without the commitment and active support of senior management.

4 What remains true, however, is that unless the objectives for the investment are clearly identified from the outset, the prospects for a successful sponsorship are slim. Too often, confusion on the part of sponsors over what the sponsorship was supposed to deliver leads to disillusionment and a gradual slide into decline.

5 A clear definition of objectives is therefore a prerequisite for success and in this respect, sponsorship, however glamorous the activity, is no different from any other form of promotion.

6 Another essential ingredient in success is originality. The fact is that to be first in sponsorship is a major plus; while to be second is often a costly mistake with little or no prizes attached. Being first with a new sponsorship involves more than its fair share of risk, but the rewards for success are far higher than any offered to those who may come after. One of the classic examples of coming a poor second was the announcement made to introduce cricket fans to the NatWest Cup. ‘NatWest’, they were informed, ‘are the new sponsors of the Gillette Cup!’

7 Once, after several years of association with the same event, a brand becomes synonymous with it, then it takes a considerable amount of time and money to supplant the name of a new sponsor. It is better to be first and foremost.

8 Another key factor in successful sponsorship is the level to which the sponsor integrates the activity within the organization. The chairperson may still be the person who presents the trophy, but he or she is not alone in devoting time to the sponsorship – and nor need the chairperson be the only member of the team to be identified with it. There is no reason why, for example, the marketing or sales director cannot also appear in his or her trade press using the sponsorship as a platform for sales promotion. In fact, every member of staff within a sponsoring organization needs to relate to the investment and feel a sense of corporate pride. In recent years, some multi-million sponsorships have even been undertaken with staff in mind, rather than simply reaching consumers with a well-established brand name.

9 So successful sponsorship should operate at different levels both inside and outside the sponsoring organization. It forms part of the corporate culture, and reflects the values and aspirations of the organization to each target audience. Targeting the audiences and deciding on the messages each should receive from the sponsorship is an integral part of getting the basics right. The task then is to ensure that the messages remain consistent and the commitment to sponsorship stays strong. This is where a good public relations agency can play a crucial part.

10 But who says whether a sponsorship has been successful or not? If the setting out of objectives was conducted properly in the beginning, then it is just as possible to determine the means of measuring those against the results year on year. Evaluation and monitoring are now major elements in the world of sponsorship. Sponsors in the heady world of Formula One motor racing have been largely responsible for driving this trend and adding a much-needed touch of professionalism to the discipline.

11 Gone are the days when sponsorship was considered a success because the intoxicated chairperson remained upright long enough to make a short speech at the presentation before being carried from the stage! The employment of sponsorship directors, managers, assistants and agencies has brought a thoroughly disciplined approach which demands comparison with rival brands and greater emphasis on results, especially television exposure. Effective monitoring and evaluation are now essential requirements for both sponsors and the activities being sponsored – how else are they to quantify the value and worth of the activity and, perhaps, find another sponsor in the future?

Do’s and don’ts of sponsorship

Sponsorship is a relatively new tool of marketing that can deliver stunning results if the basic planning has been done to ensure that the sponsor uses the investment to best advantage.

The do’s

Therefore, any would-be sponsor should do the following.

· Align the sponsorship with the general marketing strategy. The strategy should itself dictate the nature of the sponsorship (ie demonstrate how effective a new brand of bath cleaner can be, so sponsor scouts ‘bob-a-job’ to clean baths nationwide). This will ensure that the targeting is accurate.

· Set realistic objectives that relate to other corporate aims. There is no point expecting a modest investment to project the company name on News at Ten, but it may serve to take the image of the organization in a different direction and communicate the fact to key audiences.

· Plan for the longer term, since no sponsorship investment will pay off in the short term. Most sensible sponsors consider a three-year commitment as offering the best value, since by the last year the sponsorship is better understood and utilized.

· Consider other options to confirm the value of the ultimate choice. It makes sense to look at other sponsorships which may be appropriate in order to define the best selection and how it might work.

· Speak to other sponsors to find out what to expect and avoid. Sponsors are often only too pleased to advise others, as long as they are not rivals in the same field.

· Examine how the sponsorship might work in other forms of promotion. For example, can it translate to advertising or sales promotion activity that enhances the investment and helps consolidate consumer loyalty and recognition? In the mid 1970s, Rothmans sponsored the Rothmans Rugby Yearbook and used it to expand trade in rugby clubs through quiz evenings based on its contents.

· Seek the opinions of key customers and associates on the prospect. It may seem an obvious thing to do, but will it be popular with target groups and others involved in the business? It is worth finding out before taking the plunge and making a big mistake that causes embarrassment.

· Determine the resources necessary to run the sponsorship well and to exploit its value as a platform for other forms of promotion. Who is going to carry out the work and are they equipped to do so? Are they capable of moving the investment forward to make the most of the opportunities on offer? Can it be achieved by adding to existing in-house resources alone, or will an agency have to be appointed?

· Look at the promotional effort of rivals to compare the approach and potential impact. In what way could the sponsorship further distinguish your company from its competitors and score valuable sales points?

· Commit sufficient funds to publicize the investment and launch it with maximum effect. So often sponsors meet the asking price, but have nothing left to tell anyone about it! The best maxim is to budget at least as much again (preferably twice as much) for making the investment pay off and putting a significant figure for the initial announcement. The launch is a special opportunity for publicity and should be treated as such.

· Become involved in other activities surrounding the sponsorship that could help enhance its status. Supporting other events in the life of the sport, the theatre or the gallery – with an advertisement or hospitality box – can only serve to reinforce the connection and add value to the sponsorship.

The don’ts

· Don’t take a short-term view of the project. Someone once said thank God the Pope didn’t give up on Michelangelo when he painted the Sistine Chapel. While no budget should be infinite, time above all else helps sponsorship fulfill its objectives.

· Don’t follow a major brand into a sponsor it has dominated. Unless you have large pockets, patience beyond belief or a hidden agenda! The world is full of other sponsorships where a mark can be made and an image established.

· Don’t assume the sponsorship itself will deliver all the publicity. Once the announcement is out of the way or the event staged, there is no divine right to space in the media, so it needs planning and more investment to gain a good level of exposure.

· Don’t expect instant success. Not everything will work as planned, especially with a brand new sponsorship where the learning curve can be pretty steep!

· Don’t take on too much too soon. Build on the sponsorship year on year to develop staff experience and limit the number of mistakes.

· Don’t invest so much in the sponsorship that there is nothing left to promote. This is a common mistake that has slowed the progress of sponsorship and called marketing skills into question.

Date: 2015-12-18; view: 810