Professional Documents
Culture Documents
Sports Marketing Chapater 5
Sports Marketing Chapater 5
Learning Outcomes
On completion of this chapter the reader should be able to:
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explain the nature of sponsorship state the importance of sponsorship for professional sporting organisations explain why companies engage themselves in sports sponsorship describe the relationship between professional sporting organisations and their sponsors discuss the options available for sports entities to engage in a benecial relationship with their sponsors describe potential conicts in the sponsorship dyad explain what professional sporting organisations and sponsors alike can do in order to make the sponsorship a success
OVERVIEW OF CHAPTER
The chapter starts off with a brief discussion of various sponsorship denitions in order to explain the nature of sponsorship. It then moves on to the description of sports sponsorship from the sporting organisations point of view before looking at sponsorship from the sponsors point of view. The main part of this chapter examines the relationship between professional sporting organisations and their sponsors with special emphasis on the concept of relationship quality. Subsequently, it will be explained how sporting organisations can serve their sponsors more effectively. The chapter contains a number of real life examples involving the LA Lakers, FC Barcelona and many other sports entities.
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INTRODUCTION
Corporate sponsorship plays a crucial role in todays top sports. There are, of course, differences with regard to countries and sports leagues. In some countries/regions commercial sponsorship is more accepted than in others. In addition, the form of corporate sponsorship varies between countries. In Europe, for example, shirt sponsorship (where the name/logo of the company appears on the shirt) and naming rights of stadiums (e.g. The Emirates Stadium in London), clubs (e.g. the Austrian soccer club Red Bull Salzburg implemented the name of their main sponsor) or even leagues (e.g. the top English soccer league is called The Barclays Premiership named after one of the biggest British nancial service providers) is more popular than in the United States, where corporate sponsorship is mainly limited to advertising and stadium names. The importance of sponsorship also differs between sports as some sports attract more revenues from sponsorship than others. According to The World Sponsorship Monitor (Sports Marketing Surveys, 2009), the top sponsored sports in a number of reported deals in 2008 were soccer, golf, tennis, rugby and basketball. In view of the fact that professional sporting organisations compete with each other for sponsorship money, relationship marketing aiming at sponsors becomes more and more important. This chapter looks at relationship marketing with regard to sponsorship.
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a business company, but which can also be a non-prot organisation, individuals or even state facilities). Second, sports sponsorship is based on the principle of reciprocity, which means that both sponsor and sponsee give and receive. There is therefore a clear distinction from patronage or charity donations. In most cases, sports organisations receive nancial support from the sponsor. However, sometimes sponsors also provide non-nancial resources such as products, people or other services, as will be explained later. Whereas older denitions of sports sponsorship (e.g. Roth, 1990; Dibb, Simkin, Pride and Ferrel, 1994) remained vague when it came to the service in return, recent denitions (e.g. Mullin et al., 2000; van Heerden, 2001; Bu hler, 2006) emphasised the commercial nature of sports sponsorship. Therefore, sponsoring companies expect a commercial relevant service in return from the sponsee. In the early days, sponsorship was mainly about sticking a logo on a shirt. Over the years, sports entities became more creative in developing sponsorship opportunities for companies. Case study 5.1 provides an example of the different sponsorship opportunities in professional sports.
CASE STUDY 5.1. Sponsorship Opportunities in Professional Sports The Example of the Los Angeles Lakers
Los Angeles Lakers Invest in a winner
The LA Lakers are probably one of the most famous basketball clubs in the world. Companies are prepared to pay huge sums to be associated with the Lakers and their surrounding fame. Although the Lakers, like most US sports teams, do not have a shirt sponsor, they still provide a multitude of corporate sponsorship opportunities for companies such as the following: Pocket Schedules, the Season Ticket Book or the Team picture.
Multimedia
The LA Lakers provide the following advertisement opportunities on their website which is consistently rated #1 among all 30 NBA teams: banner advertisement, home page advertisement button, online contests, skyscraper advertisements or sponsor editorials. Other multimedia opportunities include the Lakers Courtside Connection (exclusive contents, news, and video content), Lakers Inside (the ofcial Lakers e-Newsletter delivered monthly) and the Lakers e-Mail Blast (a targeted message designed to achieve the sponsors objective sent to all qualifying persons on the Lakers e-Mail database).
Signage
Companies can place their logo on the big video screen inside the arena, above the player entrance, the pole pads, the press backdrop or under the scoreboard.
Print
Sponsors can put their logo in different Laker publications such as the Lakers Magazine Game Program, the Lakers Media Guide, the Lakers Ofcial Yearbook, the
In-Arena Elements
Companies can present various entertainment events before, during and after the game such as the Camera
Continued
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Kids, the Celebrity Signature Contests, the Cheer Sticks, the Game Ball Delivery, the Giveaway Nights, the Halftime Contests, the High 5 Squad, the Honorary Team Captain, the Kiss Me! Cam, the Laker Girls Routines, the Lakers Opening Line-Ups, the Lobby Booths, the Lucky Row/ Seat Contests, the Noise Meter, the Post-Game Court Time, the Sponsored Replay/Game Action Bug, the Seat Upgrades, the Video Streamers, and the Video Sports/ Features.
Teacher of the Month Contest, Time 4 Kids, and the Thanksgiving Feeding.
Special Events
Sponsors can also present special events such as the Camp Lakers, the Chalk Talks, the Pre-Season Game Sponsorships and the VIP Tour/Practice.
Hospitality
Corporate sponsors can book various hospitality opportunities such as the Arena Club VIP Dinners, Receptions (including tickets, food and beverages, Lakers merchandise rafe, photo opportunities and Lakers players appearances) and Suite Nights (including 18 tickets, food and beverages).
Out-of-Arena Elements
Sponsors can also present events taking place outside the arena such as the Laker Girls Appearances, the Lakers Player Appearances, Consumer/Ticket Promotions, and the Road Trips.
Spanish Opportunities
In view of the fact that the LA Lakers have a lot of Spanish fans, companies can make use of special Spanish opportunities such as the Spanish Pocket Schedules, the Spanish section of the Lakers website and special Spanish promotions and events, e.g. the Fiesta Lakers (an annual Latino Heritage celebration featuring popular Latino artists, Lakers players, and Lakers Girls).
Community Programs
In order to prove their social responsibility companies can engage in different community programs such as the Basketball Clinics, the Casino Night (an annual fundraiser featuring ne dining, casino games and a celebrity poker tournament), a Golf Tournament, the Read to Achieve Program (a reading initiative that encourages childrens literacy), the Student &
For many years, the sponsorship literature described sponsorship as a pure transaction. However, some recent studies (e.g. Chadwick, 2004; Farrelly and Quester, 2005; Bu hler, 2006) describe sponsorship as a relational construct. Indeed, sports sponsorship is more than a transaction based on a simple contractual agreement. The modern view of sponsorship is that of a partnership where both sides trade-off advantages and reach for mutual benet. Based on the above patterns we consequently propose the following denition of sports sponsorship:
DEFINITION
Professional sports sponsorship is a business-related partnership between a sponsor and a sponsee based on reciprocity. The sponsor provides nancial or non-nancial resources directly to the sponsee and receives a predened service in return in order to full various sponsorship objectives.
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The term professional sports sponsorship indicates the commercial nature of sports sponsorship and therefore distinguishes it from so-called sweetheart-deals (i.e. sponsorship activities where the chairmans passion is the main reason to sponsor a particular sport or sporting organisation). These sponsorships are rather based on personal and emotional involvement of the decision-maker(s) than on commercial issues, which might exist as well in professional sports. However, this chapter focuses mainly on professional sports sponsorships as these are the rule rather than the exception nowadays.
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main sponsor
kit supplier
commercial partners
regional/local sponsors
of various possibilities for the main sponsor to use the sports entity as a medium for his objectives. Perimeter hoardings, announcements before and after the games, PR-activities in and around the sports venue as well as business seats and executive boxes are essential parts of sponsorship deals nowadays. In the second place usually comes the kit supplier, who equips the team with shirts, tracksuits, boots and other sports equipment. Besides the value in kind, manufacturers also pay a lot of money to use sports entities for promotional campaigns. In some cases kit suppliers renance their sponsorship investments with the revenues generated from the sales of replica shirts. Commercial partners of the sporting organisations can be found at the next level of the sponsorship pyramid. They pay usually less than the main sponsor and kit supplier, and therefore have fewer communication rights. The sponsorship packages differ from sponsor to sponsor, and the service in return depends mainly on the volume of the deal. Sponsors usually get perimeter hoardings around the pitch as well as some business seats or executive boxes. In addition, they are often named as an ofcial partner on the clubs or associations website or other publications. The regional or local sponsors respectively build the base of the pyramid. They pay less than the three other levels above, but in total can contribute a signicant part of sponsorship revenues. They usually place an advertisement in the match programme or buy a perimeter hoarding at the venue. However, the partitioning of the pyramid can vary from club to club. Some sports entities record their kit supplier on the same level as the main sponsor, though other clubs subdivide the commercial partners into premium partners, exclusive partners or team partners with clear dened services in return. Figure 5.2 illustrates the sponsorship pool of FC Bayern Munich as an example of such a sponsorship pyramid.
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The actual fee of the sponsorship deal depends on many different factors, for example, the components of the sponsorship package offered by the sporting organisation (i.e. the service in return), the attractiveness and image of the sports entity (e.g. clubs and teams with a high public prole are likely to be more expensive than smaller clubs) or the time on air and extent of media presence of the club. Clubs performing well on the pitch and qualifying for international cup competitions (such as the Champions League) nd it easier to sell their sponsorships than other clubs. Another crucial factor determining sponsorship fees is the size of the fan base and the numbers of the clubs members, because the more fans/members a club has, the more potential customers it can offer to sponsors. Finally, the individual negotiation skills of the people involved in the negotiations may also determine the price of sponsorship deals. Another aspect of sports sponsorship is the area of naming rights. More and more clubs are selling the names of their venue to companies and are therefore generating signicant additional income. For example, Arsenal receives 50 million for a fteen-year-naming-rights contract with the Middle East airline Emirates from 2006 till 2014. As we have seen, sponsorship is a very important source of revenue for sports entities. However, sponsorship offers far more opportunities for professional sporting organisations. Sponsorship partnerships can act as a branding tool not only for sponsors but also for sponsees. A sports club could benet from the image of a well-known company in the same way
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as the sponsoring organisation benets from the image of the club. Case study 5.2 provides an example where a sponsorship deal helped to boost the image of both the sponsor and the sponsee.
CASE STUDY 5.2. An Extraordinary Sponsorship Agreement The Case of FC Barcelona and UNICEF
It was obvious that the media would cover the story extensively. For more than 100 years the biggest football club in the world could afford to leave their shirt blank while all other professional football clubs accepted shirt sponsorship because of the high revenues. But now even FC Barcelona had to realise that shirt sponsorship is an established tool in professional sports. The rumours grew fast and the media was trying to nd out which company was just about to become the rst shirt sponsor in the clubs long and famous history. How much would they pay? Where would they come from? Which sector would they operate in? Some said that the Chinese government offered more than 20 million Euros in order to promote the Olympic games in Beijing 2008 on the Barc a shirts. Other sources were sure that a betting company would become the new sponsor. However, reality proved all sources wrong. It was 7 September 2006 when the president of FC Barcelona, Joan Laporta, introduced the respective shirt sponsor as follows: For the rst time in our more than 107 years of history, our main soccer team will wear an emblem on the front of its shirt. It will not be the brand name of a corporation. It will not be a commercial to promote some kind of business. It will be the logo of UNICEF. Through UNICEF, we, the people of FC Barcelona, the people of Barc a, are very proud to donate our shirt to the children of the world. We are very happy to sign this agreement with UNICEF and we are grateful for the opportunity to start this global partnership. Together, we can do a lot to improve the lives of boys and girls around the world. The media as well as sponsorship experts around the world were astounded because this news turned around the principles of sports sponsorship for a moment. In this case, it wasnt the shirt sponsor who paid the sponsee, but the club who paid the sponsor. Indeed, FC Barcelona makes an annual payment of 1.5 million Euros in order to support the United Nations Organisations humanitarian aid projects around the world. In addition, Barc a also supports UNICEFs work by allowing them to use the club as a source of publicity. In turn, UNICEF has conceded FC Barcelona the right to use its name, logo and emblem on their football shirt and therefore has granted ofcial recognition. The cooperation between FC Barcelona and UNICEF also nds its expression in joint projects such as the ght against HIV/ AIDS in Swaziland, a country in the south of Africa, where almost half of the pregnant women have the virus. The agreement between UNICEF and Barcelona exceeds a normal sponsorhip deal and is supposed to be a win-winsituation. On the one hand, UNICEF receives a lot of publicity through the partnership with FC Barcelona and therefore raises awareness for their mission and their work. UNICEF Executive Director Ann M. Veneman said during the announcement of the new partnership at United Nations headquarters: Barcelona shows us that sports can be a powerful, positive force for children. The team has opened a door of hope to thousands of children. On the other hand, the deal with UNICEF created a great deal of positive publicity for Barc a as well. For example, FC Barcelona received the International Sponsorship Award for Innovation in 2006 for an outstanding partnership in the context of international sports sponsorship. In addition, Joan Laporta was presented with the Spirit of Sport Award in recognition of the partnership with UNICEF in April 2007. The Spirit of Sport Award acknowledges those in sports who take action to create a better world. FC Barcelonas innovative decision to raise awareness about the values of UNICEF was honoured as a perfect example of how sports
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can help the most vulnerable children. In addition, FC Barcelona is able to reach other objectives through their association with UNICEF as Joan Laporta points out: Barc as slogan more than a club is open in its denition. Maybe it is this exibility that makes it so apt for dening the complex identity of FC Barcelona. There has always been the Barc a that plays every Sunday and every Wednesday, and the
Barc a that beats every day in the hearts of its people. The Barc a of Sunday and Wednesday is already a global club. Now, we want to globalize the Barc a that cares for its people, we want to globalize the Barc a of civilian duty, solidarity and humanitarianism. We have decided that the best way to do this is to associate ourselves with UNICEF.
Sponsorship is also a good opportunity to improve professionalism in a sporting organisation. Sponsoring companies usually possess more marketing skills than sports entities. Some clubs and sponsors work closely together on a regular basis. The people responsible for the sponsorship, exchange ideas and might support each other. Therefore, representatives from sporting organisations with little marketing experience might learn from their more professional counterparts. Subsequently, the cooperation with sponsoring companies can lead to a knowledge transfer from the sponsor to the sponsee resulting in increased professionalism. In addition, a sponsorship partnership could be the door opener to other potential sponsors. For example, the main sponsor of a sports clubs could introduce their sponsee to some business associates who might have an interest in sponsoring the respective sports club. In view of these opportunities, professional sporting organisations have to make sure that they do everything to attract new sponsors and keep the already existing sponsors happy.
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engage themselves in sports sponsorship for commercial motives. Only a small number of sports sponsors stated that the decision to invest in a certain sports entity was based on personal motives (Bu hler, 2006). Sports sponsorship is a popular promotional tool for companies nowadays. However, the existing marketing literature is inconclusive about where (sports) sponsorship ts into the marketing mix. Van Heerden (2001, p. 130) notes that marketing texts do not seemingly acknowledge that sponsorship is a new and vibrant addition to the marketing communication mix. He also points out that sponsors have to understand where sponsorship ts into the marketing communication mix in order to maximise sponsorship effectiveness. This subchapter describes the importance of sponsorship as a marketing tool, the objectives of sponsors and the advantages as well as disadvantages of sponsorship for companies. We would like to emphasise that the following information is not only essential knowledge for sponsoring companies but also for sporting organisations in view of the fact that sports entities have to understand the sponsors perspective in order to engage in a relationship which benets both sponsorship partners.
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Internet
Advertising
Product Placement
SPONSORSHIP
Public Relations Direct Marketing
Sales Promotion
Considering some recent examples in practice, it must be recognised that the role of sponsorship has been enhanced from that of a supporting marketing tool to the foundation of a marketing strategy, with sponsorship increasingly being a sales-oriented tool. Case study 5.3 provides some examples of how companies leverage their sponsorship properties.
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The BT Group (former British Telecom) and the English Premier League club Everton FC have launched a loyalty card for Everton supporters that doubles as a season ticket. Fans can access the turnstiles at Goodison Park as well as collect points for a range of retail partners. BT promotes its brand by being prominently displayed on the swipe cards which are distributed to 40,000 Everton season ticket holders. Carlsberg, the sponsor of the local rival Liverpool FC, provides Liverpool fans with a variety of opportunities to interact. For example, Carlsberg dedicated a section on their website to Liverpool FC and offer supporters a wide range of exclusive downloads including wallpapers or audio les. In addition, fans can participate in a Liverpool quiz and other competitions. As an ofcial sponsor of the FIFA World Cup 2006 in Germany, McDonalds has promoted their brand around the world through a range of activities during the tournament, including exclusive products offered at World Cup
venues throughout Germany, ticket giveaways, exclusive sponsorship of FIFA Fantasy Football Online Game as well as special promotions and activities in local McDonalds markets (e.g. special sandwich promotions in Brazil, special television commercials in China, indoor table football games in India, football-themed promotions in Japan, football-related mobile phone text messaging contests in the United Kingdom, and special limited editions of FIFA World Cup beverage cups in the United States). A very special activity was the McDonalds player escort programme. Through this exclusive initiative, 1408 children aged between six and ten years were getting the chance to take part in the World Cup by walking onto the eld hand-in-hand with the players. In addition, the selected children also had the chance to play friendly football matches as part of their own tournament which took place in German host cities during the World Cup.
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Table 5.1
Corporate Objectives
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Media Objectives
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public awareness corporate image public perception community involvement nancial relations client entertainment government relations employee relations compete with other companies
business relations reach target market brand positioning increase sales sampling
generate visibility generate publicity enhance ad campaign avoid clutter target specicity
with business associates by inviting them to games of their sponsored club. Some want to motivate their employees by giving away free tickets or special merchandising. Sponsorship can also be used to promote the companys involvement in the local community. Mack (1999), for example, revealed that small businesses are mainly into sponsorship in order to give the community something back. However, commitment to the local area is not only limited to small companies but can also be an objective of larger corporations as the example of Reeboks involvement with the English Premier League club Bolton Wanderers shows. Despite being a global player, Reebok became the main sponsor of Bolton Wanderers and title sponsor of the clubs new stadium in 1997 because Reebok was founded in Bolton (Busby, 2004). Furthermore, sponsoring companies use sports sponsorship more and more as an effective networking opportunity. There are a lot of examples of companies doing business together because they sponsor the same sports club. Therefore, sponsorship is a good way to get to know other companies and to cooperate on a joint basis.
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Sponsorship is highly accepted amongst target groups. Recent studies revealed that the vast majority of people have a positive attitude towards sponsorship and attach high quality attributes to the products of sponsors (Sportve, 2008) Gillies (1991, p. 2) explains the beauty of sponsorship with the unique advantage that it can reach people in numerous different ways and often when they dont expect it. Companies can target their audience at the point of consumers attention in a highly emotional situation (Gru nitz and von Arndt, 2002). Sponsorship can be cost-effective considering the media exposure of shirt sponsors or companies advertising on perimeter boards (Pepels, 2001). In addition, the desired message is likely to be spread over the view of a wide audience. Sponsorship is exible and allows a variety of audiences to be targeted (Sleight, 1989). Sponsorship packages in professional sports provide a lot of opportunities (e.g. advertising in and outside the venue, public relations, hospitality) and can therefore be used to reach a lot of various objectives.
Shirts and perimeter boards can transfer only a limited message and are often reduced to brand names or logos only (Pepels, 2001; Gru nitz and von Arndt, 2002). Therefore, sponsorship has to be linked with other promotional tools in order to get the desired message right. This, of course, could be an expensive task and therefore requires a signicant marketing budget. Sleight (1989, p. 129) mentions the problem of clutter as the most serious disadvantage of sports sponsorship in view of the fact that sports that can deliver an audience of sufcient size (.) [is] already crowded with sponsors all trying to put their message across. As Mediaedge:cia (2003, p. 1) notes in its market research report: One of the major factors driving the initial development of sponsorship was the fact that it provided a relatively clutter-free environment particularly when compared to media advertising. Success has begun to erode this critical advantage, in that increased levels of sponsorship activity have led to perceptions of a cluttered environment.
Image transfer, as a desired objective, implies that a negative image can also be transferred. This can lead to problems when the image of the
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sponsored property becomes damaged. A prominent example is professional cycling. After a series of positive drug tests during the Tour de France 2007, some sponsors such as T-Mobile, Adidas and Audi decided to pull out of their sponsorship activities in cycling. The passion and loyalty of fans of a specic club are good reasons for companies to sponsor the respective club. But sponsors must also fear a negative reaction from fans of other clubs, mainly from their direct rival (Sir Norman Chester Centre for Football Research, 2003). For example, the local Vodafone shop in Liverpool reported a signicant decrease in turnover after Vodafone announced its sponsorship deal with Liverpools archrival Manchester United (Bu hler, 2005). In view of the fact that sponsorship agreements run for several years, sponsors might nd it difcult to change their marketing strategy whenever appropriate. A main problem of sponsorship seems to be the measurement and evaluation of sponsorship effects. Isolating the sponsorship effect may be difcult because sponsorship is often linked to other promotional activities (Brassington and Pettitt, 2003; Pepels, 2001).
Despite the disadvantages, sports sponsorship still remains a popular marketing tool for companies. Therefore, sports sponsors should have a genuine interest in establishing and maintaining good relationships with the sports entity which they sponsor. The next section focuses on the relationship between professional sporting organisations and their sponsors.
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experience by any of the team players at all. If you pay somebody V3m a year, its not unreasonable that the players turn up three or four times a year to take part to promote the sponsors. (4) Two sponsors were complaining that some clubs and above all some players do not realize whom they get their money from. Some sponsors feel not appreciated enough. A club ofcial conrms this area of conict by saying that problems occur whenever opinions differ of how players should behave towards sponsors or how they should live the sponsorship. A point which was recognised by another interviewee who said that the identication of players with the club sponsors is important for the success of the sponsorship. On the other hand, some clubs representatives complained that they sometimes have to deal with sponsors who dont really understand their sport as the following two statements show: I had a meeting this morning with a new person from a company that weve done business with before. And she has no knowledge of football whatsoever. I
could tell that she was anti football. I could tell that she had a version in her mind that what football is about that didnt bear any reality. And it was a difcult meeting. And I can never understand companies who spend a lot of money and then put someone in charge who dont have any interest. I think some companies dont understand the culture and there are companies who believe that a football fan would buy anything I tell him to. And thats not the case. People just think blindly that football fans will do exactly what Ill tell them to do. And thats not the case. Finally, the interviewees made some suggestions as how to prevent or solve the conicts. Having sensible negotiations and detailed contracts is very important according to the clubs and sponsors representatives. Clubs should also implement sponsorship coordinators who focus on the need of the sponsors on the one hand. On the other hand, sponsors have to make sure to put the right people on the job. The third area of suggestions refers to regular meetings and the attempt to seek for mutual understanding.
Sports sponsorship has been seen by the sponsorship literature for many years as a pure transaction based on a contractual agreement. The transactional view of sponsorship reects reality to some extent in view of the fact that some sports sponsorships agreements are mainly transactional in nature. For example, there are denitely some sponsors looking for short-term sponsorships rather than long-term agreements, because they have short-term objectives in mind. Some sponsors also tend to be opportunistic in their behaviour by assessing the relative costs relating to the respective sponsorship deal. The same is true for sponsees. Some sports properties need short-term money and therefore look for the best deal in nancial terms on a short-term basis. Support for this view comes from a study undertaken by Chadwick and Thwaites (2005), who note that many sponsorship deals in professional English football are rather shortterm orientated. They also point out that many sponsors and sponsees move on to other sponsorship partners once the contractual obligations have been fullled. This leads to the conclusion that a lot of sponsorship
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deals are little more than contractual obligations between sponsees and sponsors who have convergent objectives or interests at a particular point in time. In other words, sponsees and sponsors might try to exploit each others attractiveness for a short period of time and therefore reduce the relationship to a purely opportunistic one. However, reducing sponsorship to a simple transaction may be somewhat limited since it ignores the consideration that sponsors and sponsees may commit resources other than money and communication rights to the sponsorship deal. For example, they invest their time, their people, and their know-how in order to make the sponsorship work. Chadwick and Thwaites (2005, p. 337) advise both sponsors and sponsees not to view sponsorship as an exclusively short-term transaction, in view of the fact that greater long-term benets may be attainable from a closer, more strategic, network related association. Support for this view comes from Cheng and Stotlar (1999, p. 1), who suggest that it is important to reconsider sport sponsorship as a durable partnership. They even compare sponsorship with marriages and conclude that both require long-term commitments to assist each other in reaching mutual fullment. Therefore, sports sponsorships should also be viewed as a business-tobusiness relationship between professional sporting organisations and their sponsors. Recent studies (Chadwick, 2005; Farrelly and Quester, 2005; Bu hler, 2006) established the relational aspects of sports sponsorship by examining the factors leading to a successful sponsorship partnership. In the context of the sponsorship dyad, an important issue is the concept of relationship quality as recent empirical studies show.
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sponsees are a key element in successful sports sponsorship deals and that a deeper understanding of the concept of relationship quality in a sports sponsorship context is necessary. To date, there are only two studies dealing with the concept of relationship quality in the context of sports sponsorship. One study (Farrelly and Quester, 2005) examined the quality of relationship between sponsors and sponsees in Australian football. The results of their study proved that trust is the essential variable in the sponsor hler, 2006) examship relationship. The second study (Bu ined the relationship between professional football clubs in the English Premier League and the German Bundesliga and their sponsors. The study served as a rst guideline for assessing the quality of relationship between professional
football clubs and sponsors by introducing the following three new dimensions to the construct of relationship quality:
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Relationship compatibility (involving a sense of understanding and fairness in dealing with each other) Long-term perspective (implying mutual commitment of clubs and sponsors) Collaborative behaviour (involving a sense of working together and doing more than needs to be done)
The above studies are a rst step. However, further research into this new area is necessary in order to examine the factors determining relationship quality of partners in the sports sponsorship dyad in greater detail.
sponsor
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Trust
Trust is an essential variable in the relationship between sports entities and sponsors. In order to build up trust, professional sporting organisations have to make sure that they deal fairly and openly with their sponsors. This implies that sports entities should not make any promises they cannot possibly keep as breaking promises reduces the condence the sponsor has in the sponsorship partner. Open dealings also imply the courage to communicate unpleasant truths such as problems or conicts. Of course, the same applies for the sponsoring company as well.
Mutual understanding
Mutual understanding of each others objectives is another crucial factor regarding successful sports sponsorships. Thus, professional sporting organisations have to make sure that they understand the objectives and the needs of their sponsorship partner. Only then can sports entities help their sponsor to reach the partners objectives. Sponsors, on the other hand, have to understand the requirements of the sports club primarily the nancial needs, but also the focus on sporting performance and the pressure sporting organisations face in view of the public and media interest.
Long-term perspective
Sports entities should see their sponsors as long-term partners rather than as companies spending money for a few seasons. Sponsorship partners who look for long-term success would be well advised to build up a relationship with each other and to take the concept of relationship quality into consideration when doing so. The segmentation into transactional-orientated and relational-orientated sponsors might help professional sporting organisations in their decision whether to establish a long-term partnership based on the evaluation of their sponsors relationship orientation. Nowadays, more and more companies seek long-term alliances with their sponsorship property. For example, the partnership between Carlsberg and Liverpool FC lasts until 1992 and is therefore seen as the most enduring brand sponsorship in football at a club level. However, every sponsorship agreement ends sometimes for various reasons (e.g. because the sponsorship partners have achieved their objectives or found better partners to do so). In this respect, it is very important to split up in a professional and fair manner. The example of the German Bundesliga club Bayer 04 Leverkusen shows how sporting organisations can deal with a leaving sponsor: when their shirt sponsor RWE decided to drop out of their football sponsorships after seven years, Leverkusen put an advert in
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Germanys leading sportsbusiness magazine, in which they said: Seven years on the chest, forever in the heart many thanks for a great partnership, in order to thank their longstanding sponsor (Figure 5.5).
Communication
Successful sports sponsorships are also based on effective communication between sponsor and sponsee. Communication can take many different forms. Some sponsorship partners keep in touch on a regular basis via phone, e-mail or face-to-face meetings. In this respect, it is important that sporting organisations make sure that they provide important information about themselves and recent developments. Some professional sporting organisations have established a regular newsletter for their sponsors which includes articles about past events, birthdays of key decision
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makers or an outlook to future happenings. Other sports entities provide information exclusively for sponsors. For example, the main sponsors of the German professional basketball club Deutsche Bank Skyliners receive information regarding new players or other important issues before the information is made public. Therefore, sponsors gain the perception of having an exclusive information advantage. Communication between sports entities can take part on an individual basis or in a group setting where several sponsors are invited to spend an evening together in order to talk about various issues related to the sponsorship and other subjects.
Cooperation
Cooperation is another important issue when it comes to successful sports sponsorships. Involvement in each others marketing and planning efforts is one form of cooperation and makes sense in view of the fact that it helps to achieve both partners sponsorship objectives. Sponsors have generally more marketing skills than sporting organisations and could therefore support the sports entities in marketing issues, whereas professional sporting organisations could provide sponsors with sports-related know-how in order to improve their communication with sports fans. Case study 5.4 provides some examples of cooperation and collaboration in the context of sports sponsorship.
Conclusions
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sponsors are invited to come together and spend a day with their families on a golf course. The golf tournament is traditionally nished off by a party in the evening. This event is a good opportunity for sponsors and the sponsee to get to know each other a little bit better in a private setting. TSV 1860 Munich invites their sponsors decision makers and their families to spend a weekend at a chalet in the mountains once a year. Here again, sponsors and sponsees meet together in a private setting which can lead to a better and more personal sponsorship relationship. Hertha BSC Berlin hosts a special VIP event whenever a new home or away kit is ofcially introduced. There, sponsors can take the opportunity to talk to the players and present themselves with the new jersey.
Some other professional sporting organisations invite their main sponsors to join the team at the pre-season training camps or at away games. Of course, the team and the sponsors stay at the same hotel which leads to a common bond. On special occasions such as away games in the Champions League, sponsors of FC Bayern Munich are allowed to take part in the traditional banquet after the match. A very special event used to be organised by Bayern Munich and VfB Stuttgart. The night before the two teams were playing each other, a football match between the sponsors of both clubs was organised. Former internationals of both clubs were thereby playing in the sponsors teams. Sources say that CEOs of major companies were happy as kids when they were travelling with the clubs team buses to such occasions.
CONCLUSIONS
Sports sponsorship is an important source of income for professional sporting organisations and an effective marketing tool for companies who wish to reach commercial objectives through sports sponsorship. However, the most
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successful sports sponsorships are based on a good relationship between the sports entity and its sponsor. Both sponsorship partners have to work hand in hand to make the sponsorship a success. In this respect, various factors such as trust, communication, mutual understanding, cooperation and a long-term perspective are likely to improve the relationship. Overall, it is the sports entitys responsibility to make the sponsorship a success. Sporting organisations should therefore proactively work on the relationship and commit signicant resources (such as time and people) to the sponsorships. A key factor in this respect is the appointment of appropriate people who look after the clubs sponsors. They should have the necessary marketing and personal skills in order to communicate with the sponsors key decision makers at eye level. In addition, the whole sporting organisation should be service orientated. In view of the fact that sports sponsorships should be considered as a two-way partnership, both sides should commit themselves in the long-term and cooperate fairly and trustfully.
DISCUSSION QUESTIONS
(1) What is sports sponsorship and how does it differ from patronage? (2) Discuss the following statement: Sports sponsorship is only a source of income for sports entities. (3) What are the main objectives of companies engaging in sports sponsorship? (4) What are the main advantages and disadvantages of sports sponsorship? (5) Why can sports sponsorship be viewed from both a transactional and a relational view? (6) What are the main factors contributing to a successful relationship between professional sporting organisations and their sponsors? (7) What can professional sporting organisations do in order to improve the relationship with their sponsors?
GUIDED READING
Regarding sports sponsorship we would like to recommend the following two academic journals which regularly publish papers on sports sponsorship: The International Journal of Sports Marketing & Sponsorship and Sports Marketing Quarterly. In addition, Sam Fullerton comprehensively covers the area of sports sponsorship in his textbook titled Sports Marketing.
Websites
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WEBSITES
Bayer 04 Leverkusen http://www.bayer04.de Carlsberg & Liverpool FC http://www.carlsberg.co.uk/LiverpoolFootballClub.aspx Emirates Stadium http://www.arsenal.com/emiratesstadium/ FC Barcelona Fundacio http://www.fcbarcelona.cat/web/Fundacio/english FC Bayern Munich http://www.fcbayern.de Galatasaray SK http://www.galatasaray.org Hertha BSC Berlin http://www.herthabsc.de/ Inter Milan http://www.inter.it Karen Earl Sponsorship http://www.karen-earl.co.uk/ Red Bull Salzburg http://www.redbulls.com Sport Markt http://www.sportundmarkt.com The All Blacks http://www.allblacks.com/ The Barclays Premiership http://www.premierleague.com The Institute of Sports Sponsorship http://www.sports-sponsorship.co.uk/index.htm The LA Lakers http://www.nba.com/lakers/ TSV 1860 Munich http://www.tsv1860.de VfB Stuttgart http://www.vfb.de/