SBJ/June 4 - 10, 2001/No Topic Name

Tune-up will help sports properties manage hazardous selling conditions

The economic slowdown is having its impact on the overall economy, and the sports business isn't immune to the effects. At a period when sponsors and advertisers are taking a more critical look than ever at their expenditures, it's an appropriate time for sports properties to re-examine how they are pitching and packaging their deals.

There's no doubt that marketing budgets at many companies have been cut. Media spending reports compiled by analysts CMR show advertising expenditures dipped 8.5 percent in February, the last month reported. That's the third straight month spending has declined, the first instance in many years of a trio of down months. While there's no specific report on the status of spending in the sports industry, the consensus is that budgets haven't dried up, but negotiations are getting tougher and companies are willing to walk away from deals that don't address their specific needs.

Clearly the sports marketplace that exists today is much different from the climate of even 18 months ago. If sports marketers want to continue to thrive, they'll need to make some adjustments. Here are my suggestions on how sports sales executives can respond to the changing advertising climate.

  Listen and respond

I can't remember ever speaking to a sports sales executive who hasn't said he customizes packages for each sponsor. And, of course, all sports sales executives say they listen intently to the needs of the sponsor. It's ironic, therefore, that so many of these deals end up looking remarkably similar. In reality, these packages are a lot more about meeting the needs of the property than the needs of the sponsor.

As budgets continue to tighten, there will be no way to hide elements of a package that don't relate to satisfying the goals of the sponsor. To get deals done, it's not enough just to listen to a sponsor. Sports marketers also must respond in abundance with ideas and programs to help companies reach their goals. If a sales executive can make his program so invaluable to a company, there shouldn't be a concern about the direction of future budgets.

  Cut the fat

Leaner times demand leaner sponsorship packages. During times of robust spending, many sponsorship deals got bloated to include elements not pertinent to the core business goals of a sponsor. A company might find tremendous value in a ticket promotion that increases foot traffic at its stores. But when an expensive piece of signage gets included in the package, the deal starts to veer off course.

If companies are cutting back on spending, they are not going to buy anything that seems extraneous. This is the time to keep packages laser-focused on the sponsor's goals. The short-term result might be some inventory that goes unpackaged, but longer term, it means successful relationships with companies that know there will be a payoff on the dollars invested with your property.

  Work from strengths

Companies might cut back on spending, but no reasonable firm completely eliminates marketing programs. Deals will always be out there, so it's more important than ever to emphasize your strengths. If your property is a great draw with families, then sell that hard to the companies looking to reach this audience. Likewise, if your fans are legendary for their loyalty to sponsors' products, then focus your sales pitch on this point.

In this type of ad spending downturn, companies are looking to cut the stuff that isn't essential. But if selling to families or developing repeat business is their core business strategy, they won't drop programs that deliver answers to their business challenges.

Alan Friedman (alanf100@excite.com) is founder of Team Marketing Report.

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