32 www.sportbusiness.com • No.226 • 09.16

BRANDS & MARKETING

SHORTSTOP � NIKE: The US sportswear giant has followed the lead of German rival adidas by announcing that it will scale back its investment in golf. The company, which registered an 8.2-per-cent drop in golf revenues in the year through to May 2016, will no longer sell equipment such as clubs, balls and bags, and will instead focus on developing golf footwear and apparel.

� TELSTRA: A Federal Court judge has dismissed the Australian Olympic Committee’s (AOC) claim that its former commercial partner launched a misleading advertising campaign ahead of the 2016 summer Olympic Games. The AOC said Telstra’s ‘I go to Rio’ campaign implied they were still in a partnership, a claim denied by the telecommunications firm. Justice Wigney ruled in favour of Telstra.

� NATWEST: The banking group has upgraded its long-running association with the England and Wales Cricket Board (ECB) to become the body’s principal partner. The four-year deal will run fromMay 2017 until 2021.

� HYUNDAI: The Korean automotive company has extended its title sponsorship agreement with the A-League, the top tier of club football in Australia. The new four-year contract will cover the 2016-17 to 2019-20 seasons, with Hyundai also supporting the W-League women’s competition and Australia’s men’s and women’s national teams.

� ANZ: The banking group has agreed a deal to become the title sponsor of the Netball Elite League, New Zealand’s newly-formed domestic club competition. The three-year deal will start in 2017, with the competition set to be known as the ANZ Netball Elite League.

� MOTOGP: Shopping community Lyoness has entered into a partnership with the motorcycle-racing world championship. Under the agreement, Lyoness will sponsor three races, with its branding to be displayed on one corner of the track during each event.

� RUGBY: The Indian Rugby Football Union national governing body has agreed sponsorship deals with French financial services group Société Générale, German sportswear company Puma and solar energy company Proinso.

For breaking news, go to www.sportbusiness.com/sport-news

IT DOESN’T TAKE a Mark McCormack to realise that there is a very obvious logic to a Nike or an adidas sponsoring a famous sports team or athlete. The real ‘art’ of the sports sponsorship deal lies in forging successful partnerships between brands and sports that aren’t immediately apparent.

Over the years, rights-holders and the agencies that represent them would probably admit that they have taken advantage of the grey areas in this art to make some pretty tangential links between sports properties and brands. According to Adrian Staiti, executive vice-president, global partnerships, Lagardère Sports, this is predicated on the need to deliver maximum revenue in as fast a time as possible and in the worst extremes has not always been to the benefit of the brands the rights-holders are pitching to.

“Historically, the sponsorship sales industry has relied on intuitive feel, relationships and more often than not, a numbers-driven, shotgun

approach to making enough calls when it comes to finding sponsors,” he says.

Although Staiti thinks an exponential growth in global sports sponsorship spend over the last decade shows that this approach has worked to some extent, he warns that brands are getting much better at identifying the best places to spend their money and rights-holders ought to take note.

“Corporate buyers are challenging the industry to provide better and stronger business cases to justify their investments. They want turnkey packages and they want their return on investment quantified and they want assurance that their return on objectives can be achieved,” he says.

Data-drivenJust as data and analysis are improving sports performance, and creating new markets for media and betting companies, the art of matching brands

How do you match a sponsorship brand with a sports property and what do the best partnerships have in common? Ben Cronin looks at how a part of the industry that was once based on intuition and feel has evolved to a more data-driven approach.

THE SHOE FITS

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The sell side needs to be well prepared, structured and knowledgeable, not just about their product, but also about the brand they are pitching to

to sports properties has also evolved into more of a science. In fact, in some cases brands are getting infinitely more accomplished at evaluating return on investment for themselves, before they have even begun to speak with a sports property.

Misha Sher, head of sport and entertainment, EMEA for MediaCom, plans and buys sports rights for some of the largest advertisers in the world. He explains how the company has developed a four-stage evaluation tool that helps brand clients to identify exactly what sort of sport or entertainment assets would work best for them and to make sure they pay the correct market value. The system also continues to monitor the success of a partnership once it has begun.

“We as a business want to create the most efficient marketing communications strategy for our client,” he says. “If you’re considering a sponsorship, it should be valid in the context of everything else you do.”

In a demonstration at the agency’s London headquarters, account manager Dexter Tate shows how a bespoke preliminary questionnaire has been created to establish which sports partnerships match the objectives of an airline brand that the company represents. This instantly eliminates the non-starters and identifies those sports rights which are worth a fuller investigation.

“The sales agency should have defined their approach well enough that you should be able to answer each of these questions easily,” Sher says.

Strategic fitThe initial questionnaire asks things such as whether other airlines already sponsor the sports property, whether there is the possibility of a crash – airlines don’t tend to want their brand associated with motorsports where there is a chance of their logos appearing on wreckage – and whether the sports property has any relevance to the company’s travel routes. This is then cross-referenced with parent company WPP’s TGI product usage database, which provides insights about the interests and behaviours of the sport’s audience, and the size of this audience in specific markets.

“There’s no point in having a strategic fit if you don’t reach anyone, but also there’s no point in having a massive audience in your target market if the sport doesn’t match the brand objectives,” Tate says.

This allows the brand to stop wasting time on speculative approaches from rights-holders and to catalogue information about these approaches for future reference.

“Prior to this, the chief marketing officer was bombarded by sponsorship approaches week in, week out,” he says. “There were 15 to 20 approaches a week from various rights-holders and they didn’t have any process in place to actually define what worked for them. She didn’t know what was worth pursuing, how much time she should spend engaging with these different sales agencies and teams and organisations. We positioned ourselves as someone who could help.”

So far so logical. However, the real insights are provided when the tool is given the green light to analyse a partnership in much closer detail. Rights-holders who fail to put accurate market valuations on their advertising inventory ought to know that the tool allows brands to examine the value of their assets in granular detail.

“We can identify what the asset is and we can identify what the nearest equivalent media proxy for that is,” Tate says. “Being MediaCom and being the largest media agency and media network in the world, we have the insights and access to what the actual buying rates are for each of our different clients rather than the rate-card buying rates.”

Online betting company Betfair has renewed its second-tier official partner deal with English Premier League club Arsenal for three years, from 2016-17 to 2018-19, and reprised a deal with Spanish Liga club FC Barcelona as the brand returns to a strategy of partnering high-end football clubs to drive customer acquisition and revenue growth.

Hasn’t Betfair been here before?In its initial growth phase as a peer-to-peer betting exchange, Betfair took a similar two-pronged approach as an official partner with Barcelona, from 2009-10 to 2010-11, and Manchester United, from 2009-10 to 2011-12, to convert traditional, fixed-odds betters to its peer-to-peer betting exchange service. Betfair then exited team sponsorships in favour of cheaper player endorsements as betting exchange customer acquisitions plateaued.

Why the switch back to top football?When chief executive Breon Corcoran took on the role in 2013, he introduced a fixed-odds sportsbook alongside Betfair’s betting exchange. The football-driven sportsbook business, combined with Betfair’s flair for innovative betting products, has helped revenue grow by double-digit percentages per year. In February this year Betfair merged with Paddy Power in a £5bn (€5.7m/$6.4bn) deal to create one of the world’s largest gambling businesses. The new company is listed on the London Exchange as Paddy Power Betfair Plc.

Why just English and Spanish football?Corcoran has limited Betfair, which is also a partner of EPL club Sunderland, to markets where there are clear regulations on gambling, like the UK, Spain, Denmark (Betfair is a sponsor of the Danish SuperLiga) and Bulgaria. The UK is the most important of these, while English football has the advantage of international appeal. Companies from the online gaming sector are scrapping to get exposure for their sportsbook offerings through English football. Ten Premier League clubs have shirt deals with mostly Asian-facing online betting companies, while UK bookmakers such as William Hill and Ladbrokes have also been active recently. �

MATTHEW GLENDINNINGEditor

DEAL OF THE MONTH

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34 www.sportbusiness.com • No.226 • 09.16

STADIA & FACILITIES

If people can instantly understand why you’ve done something, that’s often very helpful

SPONSORSHIP SCORECARD

We asked Ed Wooller of the Prism sponsorship agency to evaluate two recent sponsorships using his firm’s sponsorship evaluation tool. The tool measures a potential partnership across three dimensions: affinity, presence and influence (API).

Wooller says ‘affinity’ is the most important dimension and consequently is weighted more heavily – 40 per cent versus 30 per cent for the other two. Each of the dimensions is calculated using five or six key metrics reflecting brand and business objectives. The individual metric scores are then weighted and combined to give an overall composite score, which is the unique value of the property to the brand in question.

“Crucially, the framework provides the unique value of the property to the brand rather than just the generic media value of the property,” Wooller says.

When scored using this evaluation framework, Reebok’s sponsorship of the Ultimate Fighting Championship scores significantly higher than Turkish Airlines’ sponsorship of Euro 2016.

The tool can also go into greater detail about an advertising asset. As an example, he says the quality of LED advertising inventory can differ massively in terms of the quality, positioning and exposure.

“What we can establish from this analysis is not only where they’re getting their value for money, but also in negotiation really amplify and identify which rights are the most valuable to the client, and really identify instances where they can leverage their own value against the rights-holder in the negotiation process,” Tate says.

AffinityEd Wooller, the strategy and insights manager at Prism, looks after the global sponsorship agency’s proprietary tools that rate ambassadors and assess sponsorship value in a similar way to those used by MediaCom. He agrees that sports sponsorship has moved on from the days of the blanket media buy.

“It’s no longer good enough to rely on working out what the generic or market value of a property is. It needs to be much more specific in terms of what the value is to the brand specifically,” he says.

Prism’s evaluation tool for partnerships places an equal emphasis on how closely a sports property matches a brand’s strategic aims.

“It looks at three dimensions of properties, those being ‘affinity’, ‘presence’ and ‘influence’,” Wooller says (see box below).

Wooller explains that ‘presence’ measures the reach and exposure that the property enjoys, while ‘influence’ captures the depth and quality of fan engagement. ‘Affinity’ is the most important of the three dimensions and consequently is weighted more heavily – 40 per cent versus 30 per cent for the other two. It estimates the degree of fit between the property and the objectives of the sponsor in question.

When Prism worked with African mobile company Vodacom, the agency conducted interviews with all of the senior management

at the firm to capture and distil the company’s objectives. The resounding response was that the company wanted to create customer loyalty in a notoriously fickle market. The decision was taken to pair the brand with South Africa’s two biggest football teams – the Kaiser Chiefs and the Orlando Pirates – which have extremely loyal fan bases and therefore enjoy a high degree of affinity with the brand’s objectives.

“The way to generate most impact and value as of today for Vodacom is to create content and activations of those properties that mean you, as a Kaiser Chiefs fan, know the only place you can get that content is through Vodacom and you will be very reluctant to switch out of Vodacom into other operators,” Wooller explains.

The example proves how the increased use of analysis can cut both ways for sports properties. Although rights-holders are increasingly having to have their wits about them when pitching and negotiating with new brands and there might be fewer deals based on what some agencies refer to as the ‘chairman’s whim’, data analysis also has the potential to identify partnerships that would not have been obvious previously. It can also identify areas where the rights-holder is not extracting the maximum value from its assets.

Social mediaEarlier this year, London-based visual analytics company SnapRapid sent out a provocative press release in which it claimed that newly-crowned Premier League champion Leicester City delivered £15.3m (€17.6m/$19.7m) of exposure on still images and video on social media platforms against an overall shirt sponsorship fee of just £1 million. The research was carried out using technology developed by the company which allows sponsor branding on still and video images on social media to be tracked, analysed and valued.

Tate acknowledges that it hasn’t always been easy to analyse cut through on social media, but that third party tools like this and MediaCom’s own proprietary data are helping to improve the science.

“We work very closely with our paid social teams. It is probably the version [of analysis] that takes the most upgrades because of how quickly it’s evolving,” he says. “We’re getting more and more sophisticated at it as we’ve begun to work with more third party analytics providers, as well as Twitter themselves. Twitter are the most forthcoming with their information; Facebook have a lot more privacy.”

Rik De Veirman, managing director of Belgian company New Agency World, reflects the views of Wooller and many in the sponsorship domain when he says that the most important thing is for a brand to be able to ‘tell stories’ and sport is still one of the most effective vehicles. His firm uses a multiple logistic regression model, which analyses 1,400 parameters to define the sort of exposure a brand can expect from a sponsorship, but the most interesting insights can be gleaned from a sport’s fan base and following on social media.

“We use social media to build a customer

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BRANDS & MARKETING

A CHECKLIST FOR RIGHTS-HOLDERS

MediaCom’s Misha Sher says there are a number of things sports properties can do to keep their sponsors happy. Here he provides a checklist for rights-holders.

T Consistent record-keeping: Rights-holders should be able to provide the data that matters most to their sponsors. Digital and social impressions, the use of tickets and hospitality, and the use of talent, amongst other things, should be tracked by the rights-holder throughout the partnership period.

T Data transparency: Rights-holders should be transparent about what they deliver for sponsors. If rights-holders choose to withhold information or attempt to make excuses, not only does this reflect badly on the rights-holder, but it also diminishes the trust that a brand has in the partnership. If an element of a partnership under-delivered, then there is always room for improvement, but trying to cover up mistakes only makes things worse.

T Consider value beyond media exposure: Rights-holders typically like to focus on what media value a sponsorship delivers through television exposure – but this isn’t

always important for every partner. Sponsorships offer a lot more value

than exposure and rights-holders should consider the value of their

entire sponsorship inventory, not just what is seen on TV.

T Proactive response to client objectives: A brand’s campaign strategies are subject to change during a multi-year partnership and rights-holders should be willing to adapt to a change in objectives and be flexible to provide assets that might help achieve their objectives. A rights-holder knowing the value of their sponsorship inventory helps make this easier, as it would allow them to facilitate swapping assets that are an equivalent value (hospitality tickets for talent appearances or increased social posts for a reduction in venue signage, for example).

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relationship management system, where we offer big and small stories. The big stories are ones where people have to register to receive exclusive and relevant information,” he says.

“Based on that, we can see who is interested in what we are telling and we can go into specific client identification. It’s not an IP address anymore; it’s actually a name and a person, and we know this person because he’s interested in what we are telling him. He wants to receive this information and it makes our advertising and our campaigns, more direct and concrete.”

ExposureThe most important metric for De Veirman is not return on investment (ROI), but rather return on exposure.

“If you sell garden furniture and you have the best sponsorship or the best advertising campaign but it rains every day in the summer, you aren’t going to sell a lot of garden furniture,” he says.

In spite of all the science and the fact that his company has an evaluation tool of its own, Hill & Knowlton Strategies’ senior associate director sports and partnership marketing, Anthony Scammell, still thinks there is a place for intuition and feel in matching brands to sports.

“I still feel that the most intuitive links are the best,” he says. “I describe it as the ‘get it factor’ – if people can instantly understand why you’ve done something, that’s often very helpful.”

His company paired battery brand Duracell with the UK Great Run Series and reanimated the brand’s legendary pink Duracell bunnies as race pacers.

“I was at a race when the bunny pacers were going around and you do your secret shopper and you go out and listen to what people say,” he says. “I heard a number of people say it was a good idea – there’s an intuitive link, they get it, they know Duracell as a brand is purported to go longer. Batteries are low interest apart from when your remote control runs out, so how do you make the brand a bit more engaging for people more of the time or in their leisure time?”

Successful activationsAlthough there is an increasing onus on sports properties to quantify value and provide return on investment, Luisa Fernandez, managing partner at global agency Bartle Bogle Hegarty (BBH), warns brands not to rest on their laurels after signing off a sponsorship deal.

“The brand has to enhance the experience of the fan and they can only do that if they play a credible role within that partnership,” she says.

The agency was recently behind the Samsung School of Rugby campaign, in which the brand educated first-time fans at

the 2015 Rugby World Cup about the rules of the sport. “The insight behind that was actually there are a huge number of people who come to the Rugby World Cup that don’t actually understand all of the rules,” she says. “Therefore, we could enhance the fans’ experience by explaining to them rules in a funny and engaging way.”

She thinks sports rights-holders should also be aware of the value that they bring to their fans and should identify brands that are looking to achieve the same things.

“Sports need to treat themselves as brands. We’re starting to see that with the LTA. We’ve already seen that with the NFL – they have a brilliant understanding of who they are. If you understand who you are, it’s a lot easier to sell,” she says. “We always say to brands that the beauty of sport is that it gives you the chance to be relevant at a period when you might not be relevant. It’s really hard to try to be relevant all year around as a car brand, but by being a credible and relevant sponsor of the right sport, you can have a place in the conversation all year around.”

There are clearly a large number of differentiators that need to be assessed when weighing up a partnership, but no matter how detailed the analysis becomes, Lagardère’s Staiti thinks rights-holders and their sales agencies should embrace a more forensic approach from sponsors.

“The sell side needs to be well prepared, structured and knowledgeable, not just about their product, but also about the brand they are pitching

to. They need to have a good understanding of the brand objectives, market, target audience, and they need to be armed with key data as well as analytics. This is the process of shifting sales people into being corporate marketers,” he says.

“Mixing the art of the deal with the data and insights will be the future of our industry. This is more time-consuming and requires more back-end support – perhaps best suited for a marketing research or insights team that sits behind the front-line sales team – but the success ratios will increase because there will be far less sales wastage.” T

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