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Eight Reasons why every Company with a Marketing Budget Should Consider Sports Sponsorship
10/11/03 by Michael Smyth
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Are you irritated by the cost of conventional advertising? Are you frustrated that your rate of return from conventional advertising is not as high as it should be? Do you feel as if you’re not really getting value for money and are simply feeding the meter of the advertising agents? If the answer to any of these questions is yes, then maybe it’s time to consider sports sponsorship as an alternative option.
Here are eight reasons why sports sponsorship is better than conventional advertising:
Reason #1: Sports sponsorship adds credibility
Any marketer will tell you that one of the best ways of selling a product is to use testimonials. The reason is because the buying public are naturally sceptical. These days people can spot a sales pitch a mile away so faced with two identical sales pitches from rival products how will they make up their mind? If one product has been personally recommended then nine times out of ten that product will get the sale – why risk your money on something which has not been tested?
Of course having a recommendation is one thing, but having a personal recommendation is another. If your best friend tells you he’s tried a product and recommends it to you, you’re probably going to give it a go. The reason is simply because you trust him or her. However, if you’re recommended by a complete stranger the temptation is less great. So the challenge for the marketer is to find someone to recommend their product who is going to add that personal touch to their target audience. Celebrities are good candidates and, for the reasons which follow, sports personalities are even better.
But even if you can’t find a sports personality, having a sports team (even a minor one) endorse your product is still better that Fred Bloggs from 26 Acacia Ave. The reason being that the buying public knows that you haven’t just made it up to get the sale. Keep it real…..
Reason #2: The Loyalty Factor
If you’ve ever been to any sports game, whether it be the All Blacks playing Australia or a secondary school playing their nearest rivals, you will have witnessed the fervour of the fans. Sport brings out a tribal instinct in most people and fans will go to whatever lengths to support their team.
First of all, they will buy their team’s kit, whether it be shirts, scarves, hats etc. If your product’s name is on any of these garments you have just won yourself some free advertising. So not only is your product advertised on the field of play but also down the High Street as well. Secondly, if you are a team sponsor the team’s supporters are likely to be just as supportive of your product as they are of their team. They will go to great lengths to buy your product over your competitors because subconsciously they believe that their purchase is helping their team win. Just because you have a favourite radio and television station, does this mean that you will buy all the products they advertise? Of course not, but sponsor a sports team and the result may be different.
Reason #3: Health and Wellness is the place to be
Have you noticed recently how everyone seems to be talking about the health and wellness industry? Some people are even saying it is going to be he next trillion dollar industry completely outstripping the internet boom of the 90s. Why is that? Well, it’s all got to do with the baby boomers, born after the second world war and now in their 50’s and fretting about having worked long hours all their lives, having neglected their health and who are now desperate to get some leisure time.
Whether you believe it or not, there does seem to be a trend towards an increasing popularity in gyms, vitamins, health farms and sport. Everyone wants to be healthy, live longer lives and have more time to themselves. So astute companies are aligning themselves with healthy causes – even McDonalds now sells salads! So the best way to do this (apart from starting to sell health products) is to sponsor a sporting cause.
Reason #4: Public perception is everything
We all know that sponsorship these days is big business. However, sports sponsorship started out more in the category of a charitable donation than a business transaction. For many that perception still remains, especially at the sporting grass roots level.
So therefore if you can find a club or team that supports grass roots sport through its activities then you will better the public’s perception of your product. All of a sudden the buyer forgets how big your advertising budget must be and concentrates on the good you’re doing for the community. Very few advertising agents could offer you that!
Reason #5: Seeing is believing
When was the last time you stared at a bill board for 80 minutes? If you’d done it at all I’d be worried! Well, that’s how long your target audience will be staring at your advertisement if you sponsor a rugby team (90 minutes if its soccer!).
But wait, that’s not the best bit. Compare sports sponsorship to other forms of advertising. If you have bill boards along the side of the road, what is stopping your competitor placing an even bigger advert right next door. Consider TV or radio advertising – you have about 6 x 30 second adverts crammed into a 3 minute ad break. For those for actually watch or listen to the ad breaks, you are competing against all the other advertisers for their attention. Conversely, sports advertising offers a relatively uncluttered arena for your advert. Most sports events or teams will at least offer you exclusivity within your industry (Note: some companies will try to ambush your sponsorship – to find out more about this read my article: Is your sponsorship missing the view factor).
Reason #6: Maximise the indirect benefits
If you think that sports sponsorship is just another form of advertising, then think again. Assuming you are an astute sponsor, you will also negotiate extra benefits in your sponsorship package or these may even be given away free. Such benefits could include free tickets to see your team play, use of your team’s facilities at a reduced rate or for free etc.
Also, have you ever heard of the feel good factor? If not, ask a politician and they will tell you all about it, because they are only too aware about how the feel good factor, or lack of it, can affect their election chances. To give an example, compare how New Zealanders felt after wining the Americas Cup in 2000 to losing the Cup in 2003. Do you think that a feel good factor affected the way New Zealanders did business after each of those years? Now this may be a bit of an airy fairy concept, but the fact remains that if you can rally your staff behind a sporting cause you stand a better chance of boasting morale than if you put a bill board up on the side of the road. Hey, you may even be able to persuade your sports team to run a team building day!
Reason #7: Cost
We had to get there eventually, so let’s look at the bottom line. How much does it cost to put an advert in a newspaper? Of course, it depends on the newspaper, but how much do you think Vodafone pays the New Zealand Herald every time a Vodafone Warrior is pictured on the back page? Nothing. How many times a year do the Vodafone Warriors get in the papers? Ok you (or your sports team) needs to do the maths, but you get the picture.
Generally speaking, sports sponsorship is much better value than conventional advertising because the benefits are greater and, of course, it’s all negotiable. You would be very hard pressed not to find a sports team or club not willing to enter into a sponsorship arrangement at a fair cost to both parties. On the other hand conventional advertising is usually a lot more expensive for a lower exposure to the public.
Reason #8: Anyone can do it
That’s right, providing you have a marketing budget, anyone can participate in sports sponsorship. You don’t need to be the likes of Vodafone or McDonalds. Of course, sponsorship of the bigger teams or high profile events attracting TV coverage may be out of your reach, but there are plenty of smaller teams being very successful in their own communities who you could sponsor. In fact, such smaller sponsorship arrangements may actually work better for you than the larger ones. My local Indian restaurant probably won’t get much return from sponsoring the Super 12, but it may from the local rugby club.
Even if you don’t have a marketing budget set aside, you may find at the end of the financial year you have a huge tax bill – why not invest some of that money into a tax deductible sponsorship arrangement? The tax man is sure not going to promote your business!
How do you choose the right deal for you?
Remember, not every sponsorship deal will be right for you. If you have had a bad experience with sports sponsorship in the past, the chances are that you chose the wrong deal. So before you reach for the company cheque book I suggest that you take a journey through my article: The Six Stop Sponsorship Shop
Sportscounsel can help with your sponsorship quest in the following ways:
- Advising on putting together a sponsorship package
- Drafting a sponsorship proposal
- Targeting potential sponsors
- Negotiating sponsorship deals
- Drafting sponsorship contracts
- Advising on strategies to retain sponsors
- Advising on strategies to minimise the risk of ambush marketing
© Michael Smyth 2003. If you would like reprint rights to this article, perhaps for your own newsletter, then please contact us and we would be happy to provide them.
PS. If you want to read more about this topic then take a look at these free articles:
Are You Failing to Apply Apartment Block Logic in Your Hunt for Sponsorship?
The Six Stop Sponsorship Shop
Is Your Sponsorship Missing The View Factor
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