SBD/April 3, 2014/Marketing and Sponsorship

Hershey Signs On For Seven-Year Deal With USA Track & Field Tied To Youth Program

USA Track & Field has signed The Hershey Co. to a seven-year, multimillion dollar sponsorship of the organization's youth program. Under terms of the agreement, Hershey will become the presenting sponsor of a new educational initiative for youth called “Run Jump Throw,” which teaches kids about track and field. The brand will also underwrite 1,000 youth scholarships for USATF memberships for low-income youth interested in track and field. Hershey is the first youth sponsor USATF has had in more than a decade. Financial terms of the deal were not available, but it is estimated to be in the mid- to high-six figures annually. The deal makes Hershey USATF’s second-largest sponsor behind Nike.

SWEET TALK: Hershey’s, which owns brands such as Reese’s, Kit Kat, Twizzlers and Jolly Rancher, hosts thousands of track meets for youth nationwide, and identifies 480 participants for its annual Hershey’s Track & Field Games. It relies on volunteers to run the program. Bernie Banas, who serves as Hershey’s VP/Customer Innovation and Hershey’s Track & Field Games BOD chair, said the company believed that partnering with USATF would allow it to expand the program and reach more youth. Banas recently spoke about the program.

Q: What was it about this opportunity that appealed to Hershey?
Banas: We started thinking a few years back about how we could expand our reach and bring more youth into the program. The opportunity came up and we looked at what USATF had. We’re both aligned against the same goal to provide something to children to be active in physical fitness.

Q: Will you be dismantling your volunteer workforce and your program, and shifting responsibility to USATF for the meets?
Banas: No. It’s a combining of efforts. Through the Hershey youth program, we run thousands of meets. With USA Track & Field, we have the opportunity to double the number of meets. I like the idea of one-plus-one-equals-three, and that’s what we’re going to get out of this arrangement.

Q: This is a big marketing expense. How does it help the bottom line?
Banas: There’s no direct correlation here between getting an increase in a particular brand or program. We do a number of things corporately, and this is a corporate investment on our part that’s not tied to branding.

Q: Is there any need for a return on investment here at all?
Banas: We’re not haphazardly spending dollars on anything that doesn’t have return. The return we’re looking for here is for the future of our program, to increase our impact and increase our reach. That’s the return we’re looking to garnish. We want to sit back and look at our program and say, “Yes. We are touching more children. We are increasing the experience kids are having as part of this program.”

Q: Will there be signage for Hershey brands like Reese’s and Jolly Rancher at events?
Banas: We have a separate logo for Hershey’s Youth Track & Field. It will just be the corporate name. We won’t do sampling (of product) (Tripp Mickle, Staff Writer).

TRACK RECORD: The WALL STREET JOURNAL's Sara Germano reports top track and field athletes "are preparing for collective action" against USATF that "could lead some athletes to boycott the U.S. national track and field championships in June." Discontent has "been building among athletes" over how USATF "runs its meets and applies rules." Anger "peaked after a pair of controversial decisions at the indoor national track and field championships in February, including the disqualification of a runner at the insistence of a coach with USATF principal sponsor Nike." The athletes' demands "are entangling sponsors such as Nike and Brooks Running, which use the affiliations to drive sales of shoes and other running gear." The $7B running-shoe industry is the "main source of income for athletes," as well as USATF, as the organization "relies on sponsorships for about half" of its $19M budget. Saucony, Brooks and small women's apparel maker Oiselle Running "have pledged to continue supporting athletes in the event of any collective action." Nike is "on the other side of the feud, as the largest sponsor" of USATF. The company "hasn't made its position clear and didn't respond to requests for comment." USATF said that it is "convening a working group that includes athletes to look into questions raised during the February championships" (WALL STREET JOURNAL, 4/3).
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