Chapter 10
Sponsorship
Chapter Objectives
1. Define and distinguish between different
levels of sponsorship in the United States
2. Uncover possible sponsors and determine
who is responsible for making the decisions
3. Identify a good sponsorship fit
4. Identify trends regarding sponsor–property
relationships
5. Outline the importance of objectives,
activation, and evaluation
6. Explain the components of sponsorship
agreements
Sponsorship
• Legal contract between a sport property and another
entity exchanging something of value, whether cash
or in-kind, wherein the sport property allows the
sponsoring organization the rights to
commercialization of its brand and the resulting
benefits derived from these actions.
• A company or sponsor pays for the right to be
associated with the sport organization or property.
• Can occur in a direct cash payment or by exchanging
some service for these rights such as a local media
outlet running television advertisements in exchange
for tickets to games.
Levels of Sport Sponsorship
• National, large regional, regional, small regional, large
local, local, small local
• National level sports involve interest from one or possibly
two countries such as the Super Bowl or the World Series.
– These events have national television coverage, as
well as spectators who travel from around the country
and are not focused only on the host city.
• Regional organizations or events are more geographically
limited.
– This may include individual professional teams such
as the Atlanta Falcons of the National Football League
(NFL) or college sports teams like the Ohio State
University.
• Local levels have the narrowest geographic focus, usually
a city or community, and usually appeal to a specific
segment in the area (e.g., high school sports, minor league
sport).
Interconnectivity of Levels
• One of the reasons it can be difficult to clearly
differentiate the levels is due to the marketing
activation process.
• A company buying at a national level will still want
to create platforms for activation down through even
to specific local areas.
• Simply running a national television advertisement is
not enough to engage consumers with the products or
develop more personal relationships with them.
• Sport can be useful for these levels of activation.
Sponsorship Inventory
• Facility naming rights
• Perimeter advertising
• Logo placement around and throughout the facility
and hand-out materials
• Facility signage
Finding and Acquiring Sponsors
• Understanding one’s own sport organization is critical
to then be able to establish the best sponsorship fit.
• Then it is possible to identify companies that match in
the way that the property can positively impact their
business model.
• “Who values your market?”
Is a Sponsoring Organization a Good
Partner?
• A sport organization may want to uncover this
intention for several reasons.
• First, plans for solid marketing practices can indicate
to the sport organization that this company may be a
good business partner.
• Second, it is highly desirable for the sport organization
to be the recipient of additional advertising for its own
purposes.
• Third, a property should uncover sponsor intent to
properly invest in a healthy business relationship that
has a better chance at longevity.
– This concept is key to the most successful sport to
sponsor relationships. Longer relationships allow
for time to build the connection between sponsor
and property in the mind of the fans.
Determining Objectives of
Sponsorship
• There are two main categories under which an array
of objectives can be housed: direct and indirect.
• Direct objectives are intended to drive immediate
sales.
– These objectives may provide an opportunity to
quantify revenues.
• Indirect objectives are the larger group of ways to
utilize sport sponsorship to achieve desired results;
including influencing brand awareness, brand
attitudes, and brand image.
– Objectives of this nature will take time to execute
and can be difficult to establish clear returns with
standard measurement tools.
Relationship Marketing
• The concept of uniquely multi-faceted relationships
helps to encompass the ultimate uniqueness behind
this particular style of business arrangement.
• Relationships in sport are multidimensional in ways
other businesses or advertising alone simply cannot
reproduce.
• Sponsor to fans, property to fans, property to
sponsor’s consumers and fans to fans are more
relational aspects present at every sporting event.
• Finding out how to truly deepen these many
relationships should be at the center of a sport
marketer’s focus.
Evaluation
• There are many reasons companies choose sport
sponsorship as a marketing strategy.
• Ultimately, most sponsoring companies would like to
see a positive impact in sales.
• Return on investment (ROI) may be more obtainable
with direct objectives. Direct objectives do not
contain many variables and are thus fairly easy to
assess.
• Return on objectives (ROO) involves driving traffic
to stores and websites and media measurements for a
better overall understanding of effectiveness.
Activation
• Activation is the portion of the sponsorship that
engages with the fan, ideally with some sort of close
interaction that enhances the fans’ experience.
• What a sponsor does with and at the sport event or
facility is vital to the entire relationship.
• A valid question to ask would be “Who sets the
objectives and implements the plans of action?” The
answer is not so simple.
Activation (cont.)
• The sponsors must know their own objectives and
what they want from the property.
• It is sport event managers’ responsibility to lead the
way with helping the corporate sponsors in doing just
this.
• It is not enough to just provide a list of inventory but
to help them understand the how and why for
activation.
• When making recommendations for successful
activation, the sport property should pay careful
attention to involvement of the sponsor organization
on-site as well as the types of activities offered.
The Agreement
• After a sponsor and a property have determined they
will be a good fit, the documentation and literal
agreement must be created.
• These will vary largely across the national to recreation
and leisure levels.
• There are certain areas that should be included at each
level.
– Determine and define the length of contract, which
must be clear, for example January 1 to December
31.
– Benefits to the sponsor should be outlined. This may
be challenging and focus mainly on the inventory
being purchased, such as signage placement and
media inclusion.
The Agreement (cont.)
• Payment obligations of the sponsor: The agreed upon
price along with how to provide payment and
repercussions for late payments. Type of capital
exchanged should be considered and outlined as well,
monetary and/or in-kind.
• Contingency plans resulting in the partnership not
taking place, termination, or an event not taking
place. There are two main categories for this.
– Indemnification: Noting legal action can occur
when a party is at fault, resulting in possible
financial losses.
– Force Majeure: Termination of agreement
upon even cancellation when neither party is
considered at fault due to causes beyond either
party’s control.