There is no such thing as Sponsorship

sponsor_me1What we know as sponsorship is most likely an exercise in philanthropy or an attempt at business development…and generally aims to be a bit of both.

But there are pitfalls and disappointments ahead unless you are clear of your overall objectives.

I am sure these days that most people realise that hanging a sign on the fence when the local footy club plays is at best philanthropy…you like the club and you get a few lurks and perks as a result.

If you are happy with the philanthropy model and don’t have any real business expectations from “sponsorship” that’s fine…no need to read any more.

Firstly why am I qualified to express strong opinions here?

Well having been Chairman of a State League Football Club, Marketing Director of a State Athletics Association and a national league netball team plus coached a Commonwealth Games Gold Medallist and managed a World Athletics Champion, an Olympic Silver Medallist…and along the away one of the greatest legends of the AFL…I have seen sponsorship and endorsement from every possible angle.

The first thing I can say is expect to spend 3 – 5 times the amount of the “sponsorship” on telling the people that you are the sponsor and why.

If you are prepared for that you may as well stop reading as once again you won’t get real benefits beyond some philanthropy and Corporate Entertaining along the way.

So what are some things to do when it comes to choosing who, what, when and where to sponsor if you are looking for some business development to result.

Three key things:

  • Alignment with your brand and your target market
  • Maximum bang for your buck…and a win win relationship
  • An understanding by the sponsored of what you expect to get in tangible terms and more so why

The main reasons for sponsoring anything for the purposes of business benefits – an event, a sportsperson, a team, an artist etc is to leverage their credibility and their supporter base. In doing so your need to do your homework to make sure you have got it right and chosen well but also have an exit strategy in case you have it wrong and avoid damaging your brand in the process.

Let me give you a couple of examples of the good and the bad and possibly the ugly side of sponsorship.

A good client is a passionate supporter of the Port Adelaide AFL team and was keen to support them if, in doing so, there was significant business benefit in doing so.

Our plan was to pay a base fee for some very basic rights and then pay very significant fees for all sales that came via their supporter base or as a direct result of leveraging their brand. We estimated this would be worth in excess of $100,000 over 12 months.

But it was clear that we would never get what we wanted from the relationship as AFL clubs expect to get money for standard packages and are not prepared to meet specific needs so we looked elsewhere.

We looked for something with universal appeal (AFL Teams generate tribal support at best) and something more in line with our message – Doing Good is Good Business. This led us to a combination of International Sport and Women’s Sport.

As we believed our sponsorship could make a difference, would be appreciated and also resonate very well with our target market we chose two young local female Beach Volleyballers aiming to medal in the Rio Olympics.

Source: Facebook.com/BeccharaBeachVolleyball
Source: Facebook.com/BeccharaBeachVolleyball

Suffice to say it is working well as we have structured the deal to meet everyone’s needs including growing the sponsored athletes fan base from our client base.

Our client sells Investment Property and every time an existing client buys another property or introduced friends etc that buy, the girls get a few hundred dollars. We also provide our clients with regular updates on the girls and they run motivational sessions for our clients and training sessions on the beach for their kids.

It’s a win all round. Our clients appreciate we are supporting young struggling athletes to realise their dreams (as my client helps young families realise their financial dreams) and we are supporting women’s sport (seen as a key factor by female clients) and of course fit healthy young ladies in bikinis always attracts attention.

On the negative side I am sure when KIA entered into a sponsorship arrangement with top AFL team Essendon they thought they had kicked some major goals.

But as is the case with all major professional sports these days, I hope they have some escape clauses to cover any possible brand damage done by negative publicity about the club and/or individual players.

Drugs and anti social behaviour continue to dog sports and will do so for years to come.

This has been very much the case with Essendon who are now facing many charges by the AFL and Australian Sports Drug Agency for bringing the sport into disrepute.

Source: News.com.au
Source: News.com.au

Major sporting sponsors such as Nike have had clauses in their contracts to guard against potential damage caused by negative publicity etc generated by their sponsored athletes for more than 10 years. These clauses allow them to at least recover fees paid in the past…however once the damage is done there is little more that a sponsor can do other than make a very public withdrawal.

Of course many, as we saw with Tiger Woods, choose to tough it out…different brands have different values.

There is no such thing as sponsorship…it is brand development or philanthropy.

Plan it properly and even bad outcomes can be good.

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