Using Tech to Empower Decision-Making
How do you know if you’re making the right sponsorship choices? This is a hard question to answer because sponsorship is a complex industry with lots of moving parts. But when you start with the data and use tech to track your progress, it empowers you to make better, more informed decisions.
All good things come to an end, and partnerships between sponsors and properties are no exception. Financing sponsorships is becoming an increasingly costly endeavour, and when a contract comes up for renewal, there are times when a brand decides to walk away. The results of the above study suggest that even if pulling out of a sponsorship is negatively perceived by consumers, brand sponsors can mitigate that response by paying special attention to how they announce the news and when they decide to make it public.
Have you ever heard of 3Com Park or Monster Park in San Francisco? No? Despite attempts to name the 49ers stadium after a brand, the team ended up going back to Candlestick Park after San Francisco residents voted largely in favour of bringing back the original name. Fans around the world often react negatively to branded name changes by protesting, boycotting or refusing to acknowledge the new name.
Though title sponsorships attract sponsors that see them as a powerful tool to increase brand awareness and improve their image through association with the property, there are a number of downsides to the deal. Fan resistance can have a negative impact on attitudes towards the sponsor and on word-of-mouth. Fans who identify deeply with the property and the region where their team resides react more strongly to name changes. When a property is steeped in tradition and heritage, a title sponsor can pose a serious threat to its identity.
2005 was a year with no Olympics, no soccer World Cup and no rugby World Cup. So how could it deliver one of the most unforgettable sporting events of the last few decades? Ask Liverpool fans who celebrated the 10th anniversary of their team’s riveting Champions League Final last week—perhaps the most enthralling in the history of the competition. In 2005, in front of more than 70,000 spectators in Istanbul’s Atatürk Olympic Stadium, with three billion more watching the game on television, Liverpool, trailing AC Milan three goals to nil at halftime, rallied during the second period, scoring three times in a six-minute frenzy. After a scoreless extra time, Liverpool carried their momentum through to the penalty shootout, where they came out on top, thanks to a stunning save by their goalkeeper.
When sponsorship deals are up for renewal, we often see a tide of change when it comes to the organization’s partnerships. And that brings about a communications problem: the public continuing to associate the event with the previous sponsor.
This series takes a look at the academic literature on sponsorship and offers a condensed summary and managerial implications.
By Hakim Azrour, M.Sc.
For the past few years, morality clauses have been cropping up in a lot of endorsement contracts, enabling companies to end their association with a celebrity and distance themselves from a negative event should it occur. That’s how endorsement contracts came to an end between McDonald’s and Kobe Bryant, Kate Moss and Chanel, and H&M and Burberry, not to mention Tiger Woods with Accenture, Gatorade and Gillette.
Because of the extravagant nature of celebrities—or maybe just because they’re human—endorsement scandals are inevitable. Unfortunately, such scandals are also totally unpredictable, and a company generally has no advance warning when its highly paid spokesperson decides to stray from the script. The one thing a company can control is its reaction when the media is in an uproar about its association with an offending celebrity.
Social sponsorship is no longer a bland vehicle for corporate social responsibility or philanthropy. Brands use it more and more to achieve marketing or corporate communication objectives. In that light, the authors discovered that social sponsorship, like its traditional counterpart, is most effective when strategically planned and executed. To achieve desired results, it is paramount for a strong natural fit to exist between the brand and the selected non-profit. Managerial implications are covered below.
Sponsorship evaluation is built by pulling together the hard and soft assets a property owns. The “hard assets” are the media value equivalencies for every elements offered to a sponsor. These media values are adjusted to the specific nature of the benefits and visibilities sponsorship can provide. Intangible values, or “soft assets”, are measuring the qualitative aspects of a property.
This article outlines an effective approach to the problem of assessing the financial impact of sponsorship investment, which has a track record of successful implementation in the sponsorship industry. The approach is outlined as a five-step process.
Companies are known to use sponsorship as a means to associate with a particular event as part of their marketing efforts. Many companies, whether their products or services have some association with a sport or not, are using sport sponsorship. Real Estate companies being prominent sponsors of sports in the country, a qualitative case study methodology has been used, based on documents of two Real Estate companies.
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