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SBJ/December 12 - 18, 2005/SBJ In Depth
Experts Sound Off: Grading the sponsorship industry’s performance in 2005
Published December 12, 2005
Executive VP, Octagon
Sports marketers must remember that the fans are the reason why we’re here. If we can step back just for a minute and spend a little more time thinking about the fans, we’ll all be better at our jobs. We need more people focused on “The Idea” and not just “The Deal.” What happens after the sale is ultimately the best justification for “The Deal” itself. Those mainly focused on cutting/raising rights fees, and increasing/decreasing assets, need to think more about the sponsorship itself being an on/off strategy or if it lacks assets that have real leveraging potential.
It would be great if all marketers were on the same page on how to define and implement sponsorship. The changing landscape of marketing will make this even more of an imperative. New media is the future of sponsorship. We have a chance to reach agreement now on how to best approach ownership, development and distribution of content before everybody starts running around claiming to be in the content business.
The ability to generate a measurable return on specifically stated objectives is the best barometer of success. “Return on investment” is an ambiguous phrase, attempting to homogenize all the disciplines into one single results reporting package, regardless of brand and program nuance.
“Convergence” and “integration” are actionable terms that need to be improved upon. The convergence of sports and entertainment shouldn’t just mean “there’s a concert at halftime.” New technologies can bring sports and entertainment together in ways that appeal to more tech-centric consumers.
Integration has to extend beyond a logo on a Web site and a free-standing insert using athlete imagery. A significant sponsorship investment has to be integrated throughout the entire marketing mix. Again, sports marketers must remember that the fans are the reason why we’re here.
President, Genesco Sports Enterprises
Branded content continues to be a hot trend in marketing circles with sports and entertainment properties being the primary vehicle for branded content activity. Marketers are increasingly under pressure to deliver ROI to their corporate boards, and declining TV ratings are not helping their quest to justify their marketing and media budgets. As a result, marketers are trying new ways to deliver their brand message to their ever elusive target audiences. Some are clearly doing it better than others:
“Pontiac Game Changing Performance.” Pontiac, through its massive buying clout, has done a great job of taking ownership of a platform that delivers compelling content to viewers. Launched during the 2004 college football season, Pontiac has extended the platform to the NCAA basketball tournament and continues to enhance the program this year for college football. The concept is simple … every fan enjoys watching a highlight of a key moment that impacts a game, and Pontiac has put its stamp on it through the “Pontiac Game Changing Performance” platform.
Sears “Extreme Home Makeover with Ty Pennington.” Sears integrates its brand in the program through actual product and store integration that is seamlessly woven into the story line. It also does a nice job of creative integration through closing vignettes that reinforces its sponsorship of the program. And, best of all, through Pennington’s new product line and other products featured in the show, it merchandises its affiliation in-store to sell more products.
Mountain Dew “MD Films presents, First Descent.” Mountain Dew has taken control of content development by underwriting and executive producing a feature film documentary about the rise of snowboarding. Having already firmly entrenched its brand in action sports, it has taken a “higher-road” approach to branding and has almost gone the other direction. For Mountain Dew, the goal is to continue to own action sports by “giving back” compelling content to this hard-to-reach, skeptical and highly desirable audience.
VP, Passage Events
“It was the best of times, it was the worst of times.” I’m sure Charles Dickens is turning in his grave at the very thought of my applying his quotation to sponsorship. But, ask yourself how many sponsors are well served by their investments? Many are and many are not.
Veteran sponsors know that this is tricky business. Many who sell sponsorships are caught up in maximizing the value of their “inventory.” For them it is simply a matter of squeezing every last drop from the proverbial “turnip.” Others hope to be in a position to build a real partnership. Ultimately, it is up to the sponsors to protect themselves from costly mistakes. Consumers do notice if the “Official Widget” changes every year, and poorly conceived partnerships create cynicism and cause consumers to “tune out.”
Why do most sellers continue to “bundle” elements (read: leverage sponsors to buy stuff they don’t want)? This practice demonstrates the need for some honest reflection on what is being offered. Instead of the all too common “one size fits all,” interchangeable sponsorship, it would really benefit all stakeholders to take the time to learn about the sponsors’ business. I receive way too many proposals that tell me what is right for my clients.
Marketers turn to sponsorship in hopes of finding a better, cost-effective, measurable way to connect with consumers. Instead of finding “middle ground,” all parties would be better served to keep at it until they both can win.
The cold, hard fact is that the sponsorship marketplace is really no different than any other marketplace. An educated sponsor will always be more successful. New offerings and technology will present new opportunities, but they don’t guarantee a “win.”
Captain, FishBait Marketing
I saw three significant trends emerge in sports marketing in 2005.
Firstly, we saw the continuing growth of collegiate sports. Ratings for the NCAA men’s basketball tournament on CBS were up significantly overall, with huge numbers for the [NCAA] Final between North Carolina and Illinois. College football is more popular than ever with expectations for a Rose Bowl ratings bonanza with the dream game of USC vs. Texas for the national championship.
There was significant interest in college sports by the media companies. ESPN launched ESPNU, the new digital all-college sports network. Fox Sports successfully bid to be the broadcaster of the BCS for the next four years, and CBS acquired CSTV, setting up a real competition with ESPN. Corporate America has embraced tie-ins with collegiate sports. Successful examples include “Cingular at the Half,” The Hartford’s “Playbook for Life” program, “Pontiac’s Game Changing Performance,” “Gameday Built by the Home Depot” and the “Siemens Trophy.” These types of advertising enhancements should continue to prosper in the New Year.
Secondly, 2005 will be known as the year the U.S. men’s soccer team finally arrived. Bruce Arena’s team easily qualified for the World Cup and is a legitimate contender for the championship. The TV networks have responded, setting up a showdown for the U.S. television rights for the 2006 World Cup. A successful showing by the men’s team at the World Cup should provide the fuel for more corporate involvement in soccer activities, from grassroots to MLS.
Thirdly, corporate involvement with motorsports continues to explode. Nextel’s integrated marketing program has won over NASCAR fans and companies, such as Bank of America, that had previously ignored motorsports, jumped in with both feet in 2005. While NASCAR continues to lead the pack, the emergence of Danica Patrick helped find new fans and sponsors for IndyCar. Watch for both NASCAR and IndyCar to aggressively pursue the Hispanic audience in 2006 and beyond.
President, CEO, Just Marketing Inc.
Best Use of Motorsports Property/Driver in National Ad Campaign: UPS: Dale Jarrett “Race the Truck.” Fun ad series continues keeping race fans in anxious expectation.
Most Overexposed Motorsports Athlete: Dale Earnhardt Jr. He’s one of NASCAR’s most captivating superstars. He’s also one of the most popular product endorsers, representing the likes of Budweiser, NAPA, Menards, Chevrolet, Bass Pro Shops, Gillette, Wrangler, Domino’s, Kraft, Nabisco, Volvo, Sherwin Williams and Sunoco, among others. Result: Consumer overexposure, sponsor clutter.
Cleanest Race Car Sponsor Branding: Brut/Don Schumacher Racing Funny Car, NHRA Powerade Drag Racing Series. Achieving brand recognition at 320 mph isn’t easy. The answer lies in graphics that are bold and easily read. The venerable Brut brand set itself apart from the pack.
Best Marketing Effort By Motorsports Series: NASCAR Nextel Cup. Long considered a regional, redneck pastime, NASCAR has endured and prospered to prime-time status. Its abundant sponsors are a Who’s Who of Fortune 500 corporations; top drivers now enjoy rock-star popularity.
Motorsports Series On The Move: Grand American Road Racing. Keep your eye on this one — sports car racing from the makers of NASCAR. Readily gaining sponsor interest and featuring its best season schedule in 2006.
Best Motorsports Property/Personality Grab: Office Depot — Carl Edwards sponsorship. With a flurry of late-season wins and a shot at the title, the back-flippin’‚ smooth-talking Edwards was a major headline grabber in 2005 and promises to be a NASCAR darling for years to come. Office Depot’s initial leap of faith has already paid big dividends.
Worst Motorsports Corporate Stumble: Michelin — handling of the U.S. Grand Prix debacle. Lots of blame-casting and spirited finger-pointing over Formula One’s U.S. Grand Prix debacle. Deserving or not, generally receiving the biggest black eye was Michelin for its tire problems and initial handling of the eventual Indianapolis Motor Speedway faux-race, leaving the respected tire manufacturer with a very public black eye.
We are experiencing the dawn of sports marketing utopia. The dispersal of marketing expenditures throughout the marketing mix is changing every day — in our industry’s favor. The CMO suite in every category is looking for “non-traditional” opportunities to reinvest marketing dollars. The golden opportunity is demonstrating how to reallocate into sports marketing:
Rich consumer insights provide the perfect opportunity to inject relevant messaging within a consumer’s lifestyle.
We can demonstrate success with well-designed, integrated measurement strategies.
Content delivery into the expanding array of digital devices ensure viewing habits will be largely shaped through sports.
The latter is most exciting and most worrisome. Rights holders that cultivate their most-valued assets will be rewarded with rich rights fees (already happening). Sponsors that “get it” will gain exclusive content, grabbing consumer share of mind. One thing is certain: there will be big winners and big losers (e.g. rights buyers who find their content offering diluted through multiple delivery channels).
Categories of most interest include wireless and pharma. It’s anybody’s guess if Sprint makes its $600 million NFL investment pay off. Cingular has been decidedly more cautious, eschewing large rights fees while placing a premium on content. The wireless companies which grade “A” will most quickly monetize the content they purchase.
Pharma will be the favorite piñata of legislators in the upcoming election year. This portends movement from mass advertising and gives opportunity to use sponsorship/events to influence consumer behavior. Our work for Cialis demonstrates how moving consumers into an “indicated” lifestyle Web environment is a successful alternative.
I marvel that this has been the year of the super deal: FedEx/PGA Tour; Sprint/NFL (and previously NASCAR); Coors/NFL. Perhaps these are also signs of the emerging utopia.
Chairman, CEO, Momentum Worldwide
What gets me excited is the emergence of truly great creative work in the sponsorship arena. When it’s done right, sponsorship goes way beyond the conventional notion of “borrowed equity” which has driven a lot of past sponsorship activity. When it’s done right, the focus — and the hero — is the brand. It’s less and less about being an “official something or another.”
Case in point: USA’s entry into the Volvo Ocean Race — for my money no more effective way to break through the clutter of movie promotion than the skull and cross-bones of Disney’s next “Pirates of the Caribbean” emblazoned on the sail, and its name “The Black Pearl.” They didn’t miss a trick — right down to its boat number of USA 7706, as in the movie’s July 7, 2006, release date. I almost expect to see Johnny Depp at the helm.
But there’s still a long way to go. Disney’s sponsorship is the exception, not the rule. There is still too much sponsorship only for the sake of borrowing equity, not driving home the creative idea. With the sophistication of today’s consumer, this old-school thinking will make it hard for our clients to justify the continued increase in spending in our space. We owe it to them and us to think more about the big idea and less about the rights-to-activation-spend ratios.
In today’s marketing environment, great ideas break through, and sponsorship marketing is one of the strongest platforms to ideate from.
Founder, Rule 1.02 Sports & Entertainment Marketing
Sponsorship stories that caught my eye in 2005:
Adam Vinatieri It’s Goooood! Award: Allstate Field Goal Nets. Centerpiece of BCS platform included 55 schools, mobile marketing, media on ABC/ESPN, print and Internet, with charitable component to boot.
Switch Hitting Award: Office Depot. Ended six-year Olympic sponsorship, exited naming-rights deal with Sunrise Sports/Florida Panthers and jumped into NASCAR with full activation of league, teams, tracks and media via national and local promotions to the tune of $20 million-plus.
Best in Show Award: 24 Hour Fitness. Partnership with “Biggest Loser” on NBC is genius via product placement integration and non-obtrusive nature. Activation in-gym as well as in advertising makes it win-win-win for NBC, 24 Hour Fitness and their mutual consumers.
Winston We Have a Problem Award: Nicorette. With NASCAR becoming more fan/marketing friendly with Nextel/Sprint naming rights replacing Winston after 33 years, Nicorette jumped at sponsoring the No. 41 Target Chip Ganassi Team with Casey Mears, which included primary paint schemes and activation at NASCAR races.
Home Field Advantage Award: Chevrolet. MLB partnership in open category created terrific activation around Detroit (massive outdoor campaign broke through), multiple team deals as well as the Chevrolet MLB Latino Legends All-Time team during Game 4 of the World Series
Good to be King League of the Year: NFL. Nailed three huge categories with Sprint, Burger King and Samsung and has moved the needle on activation. I can’t recall a season where NFL partners utilized rights/talent more.
As for 2006, I’m keeping my eye on non-traditional platforms, especially Internet streaming broadcasts and VOD programming in the sports sector. Hot properties: Professional Bull Riders, Ultimate Fighting Championships and World Series of Poker. Next “liquor”-type category — offshore online sports betting companies, which are already advertising “non-gambling” sites.
Executive VP, partner, Paragon Marketing Group
Sponsorship has grown up over the decades from an ego-driven investment to “this could be interesting,” to “our competition is doing it‚” to comprehensive, strategic and well-integrated platforms that enable brands to touch and interact with consumers in authentic and compelling ways.
We may look back at 2005 as a watershed year. More than ever, sponsorship marketing has seen more activity (including a move toward non-traditional properties), bigger budgets, more resources and consequently, more validation as a marketing strategy. The fervent discussion and initial development of tools to measure sponsorship ROI and to track and value hospitality usage are telltale signs that sponsorship is firmly embedded in the overall marketing mix landscape.
Brand marketers are recognizing the sustainable power afforded by strategically activated sponsorship marketing programs. Moving forward, we will see the evolution of more sophisticated measurement tools that enable marketers to justify sponsorship investments while also holding properties accountable.