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Ystrad Mynach CollegeYstrad Mynach College

Sponsorship is a process by which a company, Sponsorship is a process by which a company, organisation or individual provides an individual organisation or individual provides an individual organisation with funds, products or services for organisation with funds, products or services for commercial advantage.commercial advantage.

Sponsorship is a business relationship and should be Sponsorship is a business relationship and should be mutually beneficial to the sponsored individual and the mutually beneficial to the sponsored individual and the sponsoring company.sponsoring company.

Most companies seek a return to their support or Most companies seek a return to their support or investment, ranging from goodwill within the community investment, ranging from goodwill within the community to more complex benefits such as media exposure, to more complex benefits such as media exposure, increased sales and brand awareness.increased sales and brand awareness.

Sponsorship is about building a long term relationship. Sponsorship is about building a long term relationship. The longer it lasts, the more its worth.The longer it lasts, the more its worth.

There are many different reasons why companies enter the There are many different reasons why companies enter the sponsorship marketplace, ranging from brand awareness to sponsorship marketplace, ranging from brand awareness to satisfying a Chief Executive’s personal passion!satisfying a Chief Executive’s personal passion!

Here are a few of the most common objectives that companies Here are a few of the most common objectives that companies seek from sponsorship programme:seek from sponsorship programme:

To increase salesTo increase sales Develop customer loyaltyDevelop customer loyalty Heighten brand awarenessHeighten brand awareness Develop new marketDevelop new market Develop business to business relationshipsDevelop business to business relationships Launch new brandsLaunch new brands Broaden customer baseBroaden customer base To develop community relationsTo develop community relations To change or revitalise brand image.To change or revitalise brand image.

The bulk of major sports sponsorship deals in the UK and The bulk of major sports sponsorship deals in the UK and Europe are shared amongst the following industry sectors:Europe are shared amongst the following industry sectors:

AutomotiveAutomotive Consumer ElectronicsConsumer Electronics ClothingClothing Information TechnologyInformation Technology Fast Moving Consumer Goods (FMCG)Fast Moving Consumer Goods (FMCG) TobaccoTobacco AlcoholAlcohol Financial ServicesFinancial Services

These are not the only industries and athletes may have to These are not the only industries and athletes may have to think outside the box for companies to approach.think outside the box for companies to approach.

ADDED VALUE ADDED VALUE - Sponsors look to sport to add value to the brand - Sponsors look to sport to add value to the brand proposition. In almost all sectors of all markets there is intense proposition. In almost all sectors of all markets there is intense competition among companies and brands. Often there is little to choose competition among companies and brands. Often there is little to choose from in terms of quality, content or price. In order to make a brand stand from in terms of quality, content or price. In order to make a brand stand out from the crowd a sponsor will use sport to create a unique position in out from the crowd a sponsor will use sport to create a unique position in the mind of the consumer.the mind of the consumer.

At the highest levels, sport involves gold medals, world records, At the highest levels, sport involves gold medals, world records,

championship cups and global awareness. A world-wide, leading brand championship cups and global awareness. A world-wide, leading brand such as Coca-Cola wants to associate itself with such excellence and such as Coca-Cola wants to associate itself with such excellence and ubiquity so has chosen the Olympics and football World Cups for its ubiquity so has chosen the Olympics and football World Cups for its sponsorships. But in order to personalise and localise its image and sponsorships. But in order to personalise and localise its image and activity, Coca-Cola also supports grass roots sport to reinforce its global activity, Coca-Cola also supports grass roots sport to reinforce its global message.message.

Smaller companies can also benefit from improved, awareness images Smaller companies can also benefit from improved, awareness images and sales through sponsorship at a local or regional level: the principles and sales through sponsorship at a local or regional level: the principles are the same, the only difference is scale. Companies use sports are the same, the only difference is scale. Companies use sports sponsorship for a variety of reasons, and to attract sponsorship it is sponsorship for a variety of reasons, and to attract sponsorship it is important to understand which objective a company is addressing: important to understand which objective a company is addressing:

Brand/Corporate image:Brand/Corporate image: attempts to create a personality and style attempts to create a personality and style which distinguishes a product from another in the market and which distinguishes a product from another in the market and allows, for example, premium pricing. allows, for example, premium pricing.

Customer relations:Customer relations: sports sponsorship can open dialogue sports sponsorship can open dialogue between companies, showing the sponsor as a global player worthy between companies, showing the sponsor as a global player worthy of recognition and suitable to do business with. Sponsorship can of recognition and suitable to do business with. Sponsorship can also provide suitable hospitality vehicles to meet and do business also provide suitable hospitality vehicles to meet and do business with clients.with clients.

Employee relations: Employee relations: sports sponsorship can encourage company sports sponsorship can encourage company

pride and loyalty to help attract and retain staff.pride and loyalty to help attract and retain staff. Community relations:Community relations: sponsorship can show that a company cares sponsorship can show that a company cares

about it community and is prepared to invest in its future and the about it community and is prepared to invest in its future and the welfare of its citizens.welfare of its citizens.

Brand/Corporate awareness:Brand/Corporate awareness: seeks to put a name in front of the seeks to put a name in front of the consumer so that he will give it favourable recognition when consumer so that he will give it favourable recognition when exposed to other, specific marketing messages.exposed to other, specific marketing messages.

A UNIQUE PROPERTYA UNIQUE PROPERTY - Sponsors are looking for sports properties that can - Sponsors are looking for sports properties that can make a valuable and quantifiable contribution to existing or planned brand make a valuable and quantifiable contribution to existing or planned brand communications. To do so the sponsorship must have a good fit with the communications. To do so the sponsorship must have a good fit with the brand’s personality and, ideally, be unique to that brand so that there is no brand’s personality and, ideally, be unique to that brand so that there is no consumer confusion.consumer confusion.

A sponsor wants to create activities that are enjoyable and memorable for A sponsor wants to create activities that are enjoyable and memorable for audiences and participants and provide them occasions to build the brand audiences and participants and provide them occasions to build the brand values and to develop sales opportunities and volumes. A beer company, for values and to develop sales opportunities and volumes. A beer company, for example, will gain national television awareness through sponsoring a rugby example, will gain national television awareness through sponsoring a rugby international but will also have the chance for thousands of spectators to international but will also have the chance for thousands of spectators to sample its products in a favoured environment leading, hopefully, to repeat sample its products in a favoured environment leading, hopefully, to repeat purchase away from the match. purchase away from the match.

Top of the list of most sponsor’s requirements is media coverage. Sporting Top of the list of most sponsor’s requirements is media coverage. Sporting events create thousands of opportunities for exciting and interesting newspaper events create thousands of opportunities for exciting and interesting newspaper photographs and television images showing sponsor logos on shirts or photographs and television images showing sponsor logos on shirts or banners. Such exposure creates brand familiarity for consumers making the banners. Such exposure creates brand familiarity for consumers making the logo stand out from competitors when consumers are in the supermarket or logo stand out from competitors when consumers are in the supermarket or high street looking to spend money.high street looking to spend money.

The biggest sponsorship deal in football belongs to The biggest sponsorship deal in football belongs to Juventus.Juventus.

They get £15m a year.They get £15m a year.

Manchester United now have the second largest sponsorship in the world behind that of Italian side Juventus, who have a deal with Tamoil worth in excess of £15 million per year.

AIG - Official kit sponsor AIG - Official kit sponsor Nike - Official kit manufacturer Nike - Official kit manufacturer AirAsia - Official airline AirAsia - Official airline Audi - Official automobile and dugout seat provider Audi - Official automobile and dugout seat provider Betfred - Official gambling partner Betfred - Official gambling partner Budweiser - Official beer Budweiser - Official beer Tourism Malaysia Tourism Malaysia On 23 November 2005 Vodafone ended their £36 On 23 November 2005 Vodafone ended their £36

million, four year shirt sponsorship deal with Manchester million, four year shirt sponsorship deal with Manchester United. United.

Manchester United now have the second largest Manchester United now have the second largest sponsorship in the world behind that of Italian side sponsorship in the world behind that of Italian side Juventus, who have a deal with Tamoil worth in excess Juventus, who have a deal with Tamoil worth in excess of £15 million per year. of £15 million per year.

OBJECTIVE ASSESSMENT OBJECTIVE ASSESSMENT - Self evaluation of a project is an essential tool to - Self evaluation of a project is an essential tool to measure performance against objectives and to provide a reporting process for measure performance against objectives and to provide a reporting process for the sponsor. It demonstrates to a sponsor that their investment is valued, what the sponsor. It demonstrates to a sponsor that their investment is valued, what return they have achieved and provides data to help sell future sponsorships.return they have achieved and provides data to help sell future sponsorships.

KEY PRINCIPLES KEY PRINCIPLES Measuring participationMeasuring participation - A sponsor wants to reach a specific sector of the - A sponsor wants to reach a specific sector of the

market so data on participants that details age, sex, ethnic origin or socio-market so data on participants that details age, sex, ethnic origin or socio-economic groups can help measure success. economic groups can help measure success.

Measuring skills Measuring skills - Achievement of sporting objectives can be measured by noting - Achievement of sporting objectives can be measured by noting before and after performance levels of participants. Sports match needs to know before and after performance levels of participants. Sports match needs to know this and the data will aid the search for future sponsorships. this and the data will aid the search for future sponsorships.

Photographic recordPhotographic record - One of the best ways of showing the impact of a - One of the best ways of showing the impact of a sponsorship is photographs: participants, spectators, sponsor branding will all help sponsorship is photographs: participants, spectators, sponsor branding will all help tell the story of your success.tell the story of your success.

Media MonitoringMedia Monitoring - Collect press clippings, count column centimetres of - Collect press clippings, count column centimetres of coverage and the number of photographs and sponsor mentions. Record or note coverage and the number of photographs and sponsor mentions. Record or note broadcast mentions and keep copies of advertisements and other branded broadcast mentions and keep copies of advertisements and other branded materials.materials.

Sponsorship is a commercial agreement Sponsorship is a commercial agreement between a company and a sport to enter into between a company and a sport to enter into a joint venture to promote their mutual interests. In return for a financial contribution a a joint venture to promote their mutual interests. In return for a financial contribution a sports organisation will allow the use of its name in commercial activities. These activities sports organisation will allow the use of its name in commercial activities. These activities can be as varied as the imaginations of the participants. Some of the most obvious are:can be as varied as the imaginations of the participants. Some of the most obvious are:

Display of the brand name on kit, banners around the venue, advertisements in Display of the brand name on kit, banners around the venue, advertisements in programmes, and on other merchandise. programmes, and on other merchandise.

Use of the club, event, team or individual in advertisements and other promotions Use of the club, event, team or individual in advertisements and other promotions undertaken by the brand. undertaken by the brand.

Personal endorsement of the sponsors products by teams or individuals by use of their Personal endorsement of the sponsors products by teams or individuals by use of their products, kit or equipment products, kit or equipment

Production of joint websites or developing close links between separate websites. For Production of joint websites or developing close links between separate websites. For examples of this in action you only have to think of the Vodafone sponsorship of examples of this in action you only have to think of the Vodafone sponsorship of Manchester United, Tiger Woods endorsement of Nike products or the website work Manchester United, Tiger Woods endorsement of Nike products or the website work done by Guinness as a sponsor of the Rugby World Cup. done by Guinness as a sponsor of the Rugby World Cup.

Most sponsorships are paid for in cash, but in-kind sponsorship can be Most sponsorships are paid for in cash, but in-kind sponsorship can be useful and effective. Instead of money, the sponsor provides equipment, useful and effective. Instead of money, the sponsor provides equipment, services or management expertise as all or part of its fee for the rights to a services or management expertise as all or part of its fee for the rights to a sporting activity. Companies may also provide money to sporting sporting activity. Companies may also provide money to sporting organisations in other ways.organisations in other ways.

Charitable donations Charitable donations - No commercial return is expected although a - No commercial return is expected although a company make use donations to be seen as a good corporate citizen. company make use donations to be seen as a good corporate citizen.

Corporate patronageCorporate patronage - A half-way house between donations and - A half-way house between donations and sponsorship, patronage generally provides only some recognition of a sponsorship, patronage generally provides only some recognition of a company’s activity among a relatively small, though influential, group. It is company’s activity among a relatively small, though influential, group. It is more common in the arts than sport. more common in the arts than sport.

Corporate hospitalityCorporate hospitality - The opportunity to meet customers and contacts in - The opportunity to meet customers and contacts in informal enjoyable circumstances to pursue business objectives. It is often informal enjoyable circumstances to pursue business objectives. It is often part of a sponsorship package. part of a sponsorship package.

Public/community relations Public/community relations - Sponsorship of sport can be used to meet - Sponsorship of sport can be used to meet objectives on a company’s social or political agenda. The aim is not to sell objectives on a company’s social or political agenda. The aim is not to sell products but to improve a company’s image as an employer, corporate products but to improve a company’s image as an employer, corporate citizen or contributor to the economy. citizen or contributor to the economy.

Sponsorship is very wide ranging. It can be sponsorship of one-off events such as a tennis of golf tournament, or it can be a long-term three year sponsorship of a league such as the football league.

Sponsorship can be of individuals such as the Adidas sponsorship of tennis player Ivan Lendl. Finally, sponsorship can be of a group of individuals forming a team or club, such as the 02 sponsorship of Arsenal Football Team.

SPONSORS pay all the costs of the administration of the scheme as well as providing the badges and certificates. The sponsor gets publicity when the certificates and badges go home to parents with sponsor's name prominent. The SPONSORS also hope to get credit from the public for encouraging young people to take part in sport and to improve their ability.

SPONSORS sometimes pay for running coaching and teaching courses which lead to official recognition. These awards are for adults in clubs, schools or sports organisations

For the SponsorFor the Sponsor

PUBLICITYPUBLICITY –The sponsor's name will be brought to the attention of the public. –The sponsor's name will be brought to the attention of the public. An event may be named after the sponsor, or the sponsor's name will be An event may be named after the sponsor, or the sponsor's name will be prominently displayed on advertising boards or on the shirts of the players. The prominently displayed on advertising boards or on the shirts of the players. The sponsor's name will be seen on the TV and in newspapers, and will be heard sponsor's name will be seen on the TV and in newspapers, and will be heard on the radio and in everyday conversation.on the radio and in everyday conversation.

FINANCIALFINANCIAL - Companies who put money into sponsorship are able to reduce - Companies who put money into sponsorship are able to reduce their tax bill.their tax bill.

IMAGEIMAGE - It is good for a sponsor's image to be linked with a popular, healthy - It is good for a sponsor's image to be linked with a popular, healthy pastime like sport. It is also good to be associated with success (e.g. if a great pastime like sport. It is also good to be associated with success (e.g. if a great athlete like Steve Cram is seen to be wearing Nike running shoes, then people athlete like Steve Cram is seen to be wearing Nike running shoes, then people will assume that Nike shoes are the best and will buy them). Companies will will assume that Nike shoes are the best and will buy them). Companies will pay the top athletes many thousands of pounds to wear their goods.pay the top athletes many thousands of pounds to wear their goods.

FOR THE SPORTFOR THE SPORT

EXTRA INCOMEEXTRA INCOME - In professional sport, sponsorship means that big prize money can be paid and - In professional sport, sponsorship means that big prize money can be paid and events can be organised on a very large scale without the spectators having to pay huge admission events can be organised on a very large scale without the spectators having to pay huge admission prices. In amateur sport, sponsorship often means the difference between an event or team surviving prices. In amateur sport, sponsorship often means the difference between an event or team surviving or having to fold. The extra income can be used to pay for new kit, or for transport costs which or having to fold. The extra income can be used to pay for new kit, or for transport costs which otherwise would be too expensive for the players to afford. Other expensive items are league entry otherwise would be too expensive for the players to afford. Other expensive items are league entry fees and registrations, hire of facilities and payment of referees. Some or even all of these items may fees and registrations, hire of facilities and payment of referees. Some or even all of these items may be paid for by the sponsor.be paid for by the sponsor.

RAISES STANDARDSRAISES STANDARDS - If a team is sponsored it may attract more or better players, thus raising the - If a team is sponsored it may attract more or better players, thus raising the quality of the team. If an event is sponsored it will be better organised and may be able to expand to quality of the team. If an event is sponsored it will be better organised and may be able to expand to allow more teams/players to take part. Sponsorship often means a team or athlete can receive high allow more teams/players to take part. Sponsorship often means a team or athlete can receive high quality coaching. In some cases sponsorship has allowed athletes to give up full-time work and quality coaching. In some cases sponsorship has allowed athletes to give up full-time work and concentrate on their sport. The top track and field stars are able to do this. Skaters torvill and dean concentrate on their sport. The top track and field stars are able to do this. Skaters torvill and dean were able to become world champions after Notts County Council's sponsorship enabled them to were able to become world champions after Notts County Council's sponsorship enabled them to give up work.give up work.

STATUS STATUS - Being sponsored gives a team status. If a company is prepared to give money to a team, - Being sponsored gives a team status. If a company is prepared to give money to a team, then people will tend to think that the team must be a then people will tend to think that the team must be a

FOR THE SPONSORFOR THE SPONSOR

POOR VALUE POOR VALUE - The sponsor may feel they have not received enough publicity for the - The sponsor may feel they have not received enough publicity for the amount of money they have given. There are many ways a company can publicise itself, amount of money they have given. There are many ways a company can publicise itself, and doing it through sports sponsorship is fairly risky. If a team or event is a massive and doing it through sports sponsorship is fairly risky. If a team or event is a massive success and attracts media attention, then the sponsor has had good value. If the team success and attracts media attention, then the sponsor has had good value. If the team or even was a failure with little or no media coverage, then the sponsor will have had or even was a failure with little or no media coverage, then the sponsor will have had poor value for money.poor value for money.

BAD IMAGEBAD IMAGE - During the time a sponsor is under contract with a sport, the image of the - During the time a sponsor is under contract with a sport, the image of the sport may suffer and thus damage the image of the sponsor. (Canon Electronics who sport may suffer and thus damage the image of the sponsor. (Canon Electronics who sponsored the Football League for 1984-86 were rumoured to have pulled out of their sponsored the Football League for 1984-86 were rumoured to have pulled out of their sponsorship because of the very bad image of football caused by the Bradford and sponsorship because of the very bad image of football caused by the Bradford and Brussels disasters).Brussels disasters).

ONLY 1 WINNERONLY 1 WINNER - It is important to the sponsor to be associated with a team or - It is important to the sponsor to be associated with a team or individual that is successful. Sponsors associated with teams who are failures will not get individual that is successful. Sponsors associated with teams who are failures will not get the right kind of publicity. (E.g. if team is relegated from the Premiership this is not the the right kind of publicity. (E.g. if team is relegated from the Premiership this is not the right kind of publicity, but if a team is champion this is a different matter).right kind of publicity, but if a team is champion this is a different matter).

FOR THE SPORTFOR THE SPORT

DEPENDENCE ON SPONSORDEPENDENCE ON SPONSOR - Many sports become too dependent on - Many sports become too dependent on sponsorship. when National League Basketball was televised by Channel 4, the sponsorship. when National League Basketball was televised by Channel 4, the sport was inundated with sponsors and a lot of money, but when Channel 4 sport was inundated with sponsors and a lot of money, but when Channel 4 pulled out so did most of the sponsors and almost caused a collapse in the pulled out so did most of the sponsors and almost caused a collapse in the League.League.

MAJOR-MINOR GAPMAJOR-MINOR GAP - The difference between the heavily sponsored major - The difference between the heavily sponsored major sports (Football, Cricket, Motor Racing, etc.) and the minor sports who attract sports (Football, Cricket, Motor Racing, etc.) and the minor sports who attract little or no sponsorship, has grown enormously in the last two or three decades. little or no sponsorship, has grown enormously in the last two or three decades. this over-emphasis on a few big sports is bad for sport generally.this over-emphasis on a few big sports is bad for sport generally.

NO CONSULTATIONNO CONSULTATION - When there is an agreement between a large sporting - When there is an agreement between a large sporting body and a sponsor, the sports players may have to wear or use their body and a sponsor, the sports players may have to wear or use their equipment whether they, as individuals, approve of the sponsor of not. There is equipment whether they, as individuals, approve of the sponsor of not. There is often no consultation of the people who have to wear the sponsor's name.often no consultation of the people who have to wear the sponsor's name.