Sports - Sponsorship 1.07

What are 4 risks of sponsorship?

1. Can be expensive 2. May not hit your target market 3. The event/individual/organization could create a bad image and your associated with it Example: Jaguar and Stephanie Rice comments in 2010 Example: Super Bowl wardrobe malfunction in 2003 4. Could encounter ambush marketing

what are the 2 ways a sponsorship might be formed?

1. First, a business may have a particular sport/event entity in mind that is aligned with its brand image. If so, it might contact the entity with an offer to provide support in exchange for certain sponsorship privileges. 2. or the sport/event entity may be the one to submit a sponsorship proposal to the business.

Why is a confirmation letter not recommended for a sponsorship agreement?

A confirmation letter is not recommended because it does not provide solid legal backing in case of a dispute.

What is a sponsorship contract?

A legally binding description of what both organizations will do/give/receive within the sponsorship agreement

What issues should someone consider in their sponsorship strategy?

Goals of the sponsorship, selection of a sport/event entity, and sponsorship risks

Explain how the terms of a sponsorship are agreed upon.

If the terms of a sponsorship proposal are not acceptable, the business may try to negotiate with the sport/event entity. For instance, rather than paying a single, up-front sponsorship fee of $12,000, the business may agree to pay three equal payments of $4,000. Payments and other sponsorship terms are written in a formal contract, a letter of agreement, or a confirmation letter.

What is exclusivity in sponsorship?

It is when one sponsor is the only one with a particular line of product (coke and pepsi not at same event, for example)

What drives the sport/event industry?

Sponsorship

What are sponsorship designations?

There could be different levels of sponsorship of an event that offer different amounts of exposure or benefit at the event. For example a Gold level sponsor might pay $10,000 for signs and a tent and their name on a program. A Silver level sponsor might pay $5,000 to have tent to provide their product.

Explain how a small business that does not want to pay a cash fee can still be a sponsor.

They could provide a product or service at the event.

What are common sponsorship risks?

ambush marketing sponsorship clutter guilt my association strike (player or union strike/walkout) a losing streak

what forms can financing take in sponsorship?

money, products, equipment, services, or any combination of the four

What is the key to building successful partnership programs?

to match the correct products or services with the people who want to purchase them - so...it must be your/their target market!

What type of information might a sponsor require from an event/organizaiton?

Large corporations receive hundreds of sponsorship proposals each year. Often, they won't even look at a proposal unless it follows specific guidelines. Among other things, Kodak requires detailed information about the sponsorship, sponsorship costs, marketing opportunities at the event, list of committed sponsors, expected attendance at the event, and audience demographics. This information helps Kodak determine if the sponsorship will be a good investment.

What types of things might be goals of sponsorship?

keep existing customers, gain new customers, keep up with the competition, attracting media attention

What is a letter of agreement?

letter of agreement is more commonly used Jupiterimages/Photos.com/Thinkstock for smaller investments, and it requires the signature of both the sponsor and a representative of the sport/event entity.

What does exploit mean?

make full use of and derive benefit from (a resource).

Discuss ways in which sponsorship relationships are formed (formal contracts)

--Must be their target market --Communication and develop partnership --Ongoing dialogue to expand relationship --Both parties benefit Formal contracts spell out exactly what each party will do Avoid legal conflict Details include: cost, marketing opportunities, audience demographics, conflicts and time parameters

Describe the significance of exclusivity in sponsorships. (4 things)

--Must be your target market to be significant --Most sponsors will only sponsor an event if they receive exclusivity for their product line Example: You will not find Coke and Pepsi sponsoring the same event --Companies are spending money to sponsor an event to reach their target market and wish to avoid confusion --Naming rights cost a lot more and also offer exclusivity

What are 8 benefits of being involved with sponsorships?

1. Good Public/community relations - improve image 2. Communicate directly with your target market of consumers 3. Reach a larger number of consumers through recognition 4. Increase sales and profits through affiliation & brand awareness 5. Increase market share or introduce new products 6. Enter new markets 7. Entertainment clients, (new and current) 8. Entertain your employees

What characteristics might larger organizations have with regard to sponsorships?

1. Larger organizations may have staff or be able to hire consultants to develop a good sponsor program and generally communicate more completely 2. Larger organizations may have unrealistic expectations about their event and expect a higher monetary amount than smaller events - You may get lost in the shuffle

what challenges do smaller organizations face in terms of sponsorships?

1. Small organizations may not spend the time to develop good sponsorship programs and they also may provide unrealistic deadlines and have limited staff 2. Small organizations may have more difficulty communicating with the sponsors and tend to develop sponsor disengagement and lack of follow through

What percent of NASCAR fans report that they are willing to patronize (use or buy products from) sponsors of cars?

70%

What is a partner?

An event might designate its top sponsors as corporate partners. In fact, the term partner is frequently used to describe the relationship between a sponsor and a sport/event entity. The two are basically a brand extension of each other, like gatorade's sponsorship of the NBA

Why should business owners not spend their entire sponsorship budget on sponsorship fees?

Because then they have no budget to fully exploit the sponsorship with other marketing activities. Some marketing experts recommend that sponsors plan to spend at least twice as much on exploiting the sponsorship as they do on sponsorship fees. Sponsors attempt to exploit their sponsorships by building marketing activities around their initial investment.

Using NASCAR as an example, explain why businesses should exploit their sponsorships.

NASCAR claims that many sponsors do not maximize what they can do with their target market at races. Don't just advertise: 1. Driver and show car appearances at retail store events 2. Photo opportunities for consumers/fans 3. Pit/garage passes and tours during race day 4. NASCAR driving schools 5. Employee thank you events and participation 6. Public Relations opportunities 7. Contests, sweepstakes, coupons and other promotional tools Brainstorm and develop opportunities to exploit your sponsorship

Give an example of business to business marketing?

On the PGA golf tour tournaments, sponsors can set up lavish tents filled with great food, beverages, air conditioning and other perks that other business people then visit creating an atmosphere to woo other clients.

What do sponsors want from the sponsorship partnership?

Recognition and affiliation (associated with something good or relevant)

What is a common mistake business owners make when choosing an event to sponsor?

Sometimes, business owners choose a sport/event entity that they like rather than one that their customers are passionate about. A more logical approach is to determine what sport/event entity makes the most business sense.

What is one of the fastest growing marketing activities of today?

Sponsorship

What is sponsorship?

Sponsorship is the act of providing financial or other support to a sport/event entity in exchange for public exposure.

What is owning an event?

There is also the option of creating an entirely new sport/event entity. Sometimes this is referred to as "owning an event." VANS created its Triple Crown of Surfing event to build awareness of its extreme-sports products. Among other things, this allows VANS to maintain more control over all marketing activities during each event. The company can wisely choose cosponsors that share similar dedication to building extreme sports.

A sport/event entity should also reflect the interests of the business's __________________?

target market

What is brand awareness?

the extent to which consumers are familiar with the distinctive qualities or image of a particular brand of goods or services.

What is ambush marketing?

when a company will expose their products/logo at an event without authorization or payment Example: Coke is a sponsor but Pepsi is outside the event handing out free Pepsi tees or coolies Example: Company employs airplane/blimp to fly over event and advertise their logo/product