As a free service we present a regularly updated selection of useful facts and figures on the world of sponsorship:


1. Sponsorship Ideas  New ideas for inspiration 6. Sponsorship is More Commercial
2. What Do Sponsors Value Most? 7. Even Philanthropic Sponsorship Is More Commercial
3. Do you Need Connections to Get Sponsorship? 8. Higher Value Agreements & Smaller Sponsorships
4. Five Questions Every Sponsor Should Ask 9. Links
5. Glossary of Terms Commonly Used in Sponsorship  


1. Sponsorship Ideas Express

As a free service to the clients and friends of Sponsorship Ideas, and to help promote ideas and creative sponsorships, we highlight what in our opinion are some significant recent deals and trends seen in the world of sponsorship.

Soccer Is A Global Business

Further proof of the globalisation of soccer came in November with both Premiership clubs, Manchester City and Manchester United signing deals that leverage their brands on behalf of telecom operators in countries far from the UK. Manchester United has linked with the African network Globacom, which enjoys a presence in Nigeria, Ghana and Benin. Whilst the other Manchester club, Manchester City, owned by Abu Dhabi, appointed Etisalat the exclusive Telecommunications Partner of Etisalat's operations.

Manchester City chief executive Garry Cook explained the basis of the deal. "The profile of the club is already growing globally, and the ability to effectively expand this growth with tailored communications forms the core of our agreement with Etisalat. This strategic opportunity allows us to connect to passionate football fans around the Middle East and African regions, providing customised Manchester City content through mobile communications channels."

One of the themes we are tracking is the growth in the youth development component of elite level sports sponsorships. The Etisalat sponsorship contains a development scheme for players in the UAE whilst players from West Africa will have a chance to enter Manchester United’s youth programme.

It is an acknowledged fact amongst the various sport federations that youth talent development programmes would not be possible without investment. Globacom are said to be paying as much as $5 million a year whilst Etilsat’s contribution for Manchester City is probably at a similar level. Much of this financial aid is driven by the huge development in mobile communications in the developing world. It is no coincidence that Telkom Kenya paid $175,000 to name the Council for East and Central Africa Football Associations (CECAFA) Senior Challenge Cup using the Orange brand. This latest competition adds to Orange's domination of soccer sponsorships on this continent through its multi-million dollar deal with governing body CAF, which sees it backing the African Nations Cup, the African Champions League, the African Confederations Cup, the Super Cup, the African Nations Championship and the African Youth Championship for the next eight years.

IndyCar Roars Back to Life

   

This series appears to be regaining its health after patching up a 12 year row that caused a ruinous split in open wheel racing in the US Furthermore, they have broken new ground in sponsorship terms, acquiring a clothing company rather than the traditional title sponsors such as oil, tyres or fuel. In a sense the current depressed market and the fact that IndyCar was not too cluttered by other sponsors, certainly compared to NASCAR, allowed the title sponsorship deal to happen. Phillips-Van Heusen’s Izod brand had been IndyCar’s official apparel in 2008, and after what were apparently quite gruelling negotiations the deal was signed last month. The value has been reported as being between $40-50 million for at least five years. The lesson here is the persistence of the rights holder and the desire to service the sponsor so well that stepping up to title sponsor became possible. Also admirable is that Izod will activate away from the race tracks and in locations like Macy’s which helps is great for IndyCar. As Zak Brown of Just Marketing International said "It's lifestyle, it's trendy, it's fashion, and as you go down the list it's about as good as you could get."

IndyCar have also exposed the Eureka Chemical Company to sponsorship for the first time by having their Fluid Film brand as title sponsor of qualifying day at Infineon Raceway’s IndyCar Series weekend. Although it is a relatively small sponsorship, it is significant as the chemical industry is notoriously hard to market and sponsorship is a good way of showing the benefits of chemical products to end users.

Finally, the series is blessed with two very marketable female competitors. Sarah Fisher recently renewed with AAA Hoosier Insurance, and Angie’s List and Dollar General also sponsor her team. Danica Patrick goes one better by having her Twitter page sponsored by Twitter and is considered likely to move to NASCAR where she could command some significant endorsement deals.

Get Solar Sponsorship

Something that is bound to be copied were two soccer clubs last month receiving sponsorship in the form of solar panels as Trina Solar supplied 500 KW of photovoltaic modules generating $300,000 of power per alum. An even bigger installation was The Juwi Group installing a one-megawatt photovoltaic plant on the roof of Verona's Bentegodi stadium, enough for the annual demand of at least 300 households.



FedEx’s partnership with the European Rugby Cup deserves praise

This provides a “money can’t buy”  moment to the lucky rugby fan who will deliver the Heineken Cup to the winner's podium at the Stade de France in May. FedEx has renewed its sponsorship, which started in 2005, and refreshed it with this “FedEx Rugby Dream Day“ initiative which is absolutely contempory in using sponsorship to deliver the benefits bought as rights straight to the fans. Jean-Pierre Lux, President of ERC summed it up nicely in saying.” The feeling of carrying the Heineken Cup across the pitch in front of 80,000 fans towards the winning team at the podium will be an incredible moment for the winner. This really is a sensational prize, not just in rugby but across sport in general."

A Sponsor For Life? 

There was a curious renewal of the Staples naming rights deal with AEG for the Staples Center in Los Angeles when AEG boasted “the first lifetime naming rights extension for a major market arena."  The definition of lifetime is strange, is it the lifetime of the building, or the Staples company or something else? Most of all though, it seems odd to have a sponsorship running forever with no parameters or criteria for success.

Goodbye Recession?

Things may well be turning a corner as the latest results from the IFM Sports Marketing Surveys sponsorship business survey sees two thirds of business leaders seeing a settling down period over the next few months, with 20% looking at growth on the horizon towards the end of the year. This is set against a backdrop of an expected decline of an average 8% on sponsorship revenues in 2009. The survey of 450 professionals across the world was conducted via IFM Sports Marketing Surveys network of 18 specialist offices and covered topics such as market trends, sponsorship, sports goods, leisure & tourism and entertainment. The key findings can be downloaded free of charge on the IFM Sports Marketing Surveys website (www.sportsmarketingsurveys.com) and covers hot topics such as accountability using return on investment analysis, fan engagement, relationship building in the sports goods market, the benefits of cross platform campaigns and the rising importance of the economic benefits of sports based tourism in hosting events. 

Three Sponsorship Trends We Saw In 2009
 
  1. Shorter durations of new sponsorships. Typically new announcements seem to be for two years rather than three.
 
  1. The insurance sector is signing quite a few new sponsorships. The problem for insurers is that of the perception that insurance is a commodity product with consequent low involvement in the purchase. Sponsorship helps to give some personality and is favoured when it can produce lead generation, or niche marketing to targeted markets, event hospitality and sales incentives for agents. It can also be used for building a sense of community, as is the case for Aviva in renewing with Norwich City soccer club where they are a massive employer.
  
  1. There seem to be few mega deals - though there was some optimism as IFM Sports Marketing Surveys launched their Business Survey by saying that early indications from the movers and shakers in the industry suggest that the sponsorship market is beginning to recover. A fifth of respondents are looking forward to growth towards the end of the year and almost a half believes that the market will settle down in the next six months.
 
 
Fans Get The Perks

A good activation idea from the All Blacks new $6 million sponsor Telecom when players called fans to give away 200 free tickets to the team's clash with France in June plus the chance to stand alongside the team's legendary pre-match haka. The All Blacks and adidas have already used the great idea of using nanotechnology to etch fans' names and messages of support onto an 'Adithread' woven into the team’s rugby jersey.  

Win a Shirt Sponsorship
While not a totally new idea, the third division Bristol Rovers soccer side showed some guile in successfully selling 100 tickets at £1,000 to enter a draw for the team home shirt sponsorship and some advertisng space. The managing director of training and recruitment company N-gaged said "We are delighted. We are a new business, set up in October, so the publicity this will generate is wonderful for us. … As a new business there was no way we could afford to be the sponsor as a one off payment, so this was a great opportunity."
Sponsorship Still Under Pressure
 
While most people are wondering if we are in recovery, and just when that will feed into sponsorship, anyone involved in day to day selling of sponsorship will confirm that only the most special opportunities are worth pitching at the moment. It is painful to hear just how tight budgets are from companies in every sector, cars, FMCG, foods and almost everyone else.

A recent study supports this market feedback. According to Asia Sponsorship News, about 70% of all sponsors across the Asian region plan to cut their sponsorship budgets as a result of the global financial crisis. 51% are expecting budget decreases in the order of 10%-24% while only 19% expect decreases of less than 10%. The study indicated that budget cuts will be across all aspects of sponsorship including rights fees, direct marketing, activation, corporate hospitality, talent endorsement and creative production.

However, the survey also showed that overall declines in spending across Asia were expected to be lower than in Europe and the US. This indicates that many global companies still see Asia as their growth engine in the medium term.

The idea of staying with sponsorship rather than making cuts was backed by a study in Ireland by Dublin Consultancy Onside showing that three-quarters of Irish adults believe that in today's economy it is more important than ever for companies to invest in sponsorship and would like to see brands either maintain or increase their current levels of investment in sponsorship. 22% called on companies to actually increase their spend on sponsorship of sport in Ireland while almost 4 in 10 felt it is the right time to spend more of a company's overall marketing euro on sponsorship of their favourite causes or not-for-profit organisations.

So, there will be rewards from relationships built up now but it looks like hard work for a good while yet. The silver lining is that the greater consideration of whether and what to sponsor in the current environment raises the standard overall and will pay off long term.


What Do Sponsors Do in The Credit Crunch?

In our opinion sponsors will behave the same way as everyone else, that is to pull in the belt and try and do more with less. I fear for the arts where the banks for one have long used for corporate hospitality, and I think there will be less buying of new sponsorships and more activation of existing sponsorships to squeeze more out of them. It will be hard to find sponsorship managers who are sure of their budgets and maybe these people will be less keen to be locked into the long term. It will take even longer to sell sponsorships, and sponsors will be even more demanding and will want discounts and deals on every part of the inventory. Even more then ever people who take the time to propose a specific business solution to a sponsor, rather than just talking about their event or sport will be rewarded for doing that.

Middle Eastern Airlines Take Off
Etihad Airways is the national airline of the United Arab Emirates and is based in the UAE’s capital, Abu Dhabi. Etihad Airways signed a major new sponsorship deal with the Ferrari F1 team, the current Formula One world championship holders. While Gulf Air and Qatar Airways are signing more and more sponsorships, Emirates stands out above all the others in using sponsorship. Emirates first became involved in sponsorship in 1987, only two years after the airline began operating. HH Sheikh Ahmed bin Saeed Al Maktoum, Chairman of Emirates, sees sponsorship as vital in the airline’s marketing strategy: “We believe sponsorship is one of the best ways to integrate with our passengers. It allows us to share and support their interests and to build a personal relationship with them.”  The airline industry in general has chosen very much the most heavily sponsored sports worldwide such as soccer, but with a noticeable tilt to reaching the upscale demographics of rugby and golf.

Cruise Lines Use Sponsorship To Reach Younger Customers
The average age of a cruiser is 49 years old and the companies are targeting younger first time customers, who like airline passengers, rely less on travel agents and more online to sell tickets. One of them, MSC Cruises is a trackside sponsor at four rounds of F1 this year and also sponsor Bayern Munich and Alinghi, the holders of the America’s Cup. In the arts, an interesting exploitation is Cunard’s title sponsorship of the BAFTA/LA Cunard Britannia Awards. This plays into the history of hosting famed entertainers, royalty, and society luminaries aboard its fleet of liners. With around 12 ships launching each year we expect see more sponsorship from cruise lines.  
 
Environmental Sponsorship is Becoming Mainstream
There has been a lot of speculation that the environment will be a big theme in sponsorship and we are now beginning to see more volume coming through. Examples so far in 2008 include Enterprise Rent-A-Car, the largest rental car company in North America promoting carbon credits and alternatively powered vehicles.
Sponsorship in Second Life
Online worlds such as Second Life where users can create an alter-ego or “avatar” is seeing growth. Second Life currently has seven million “residents” or registered users, with about 1.8 million who have logged on in the past two months. It is interesting to see how real worlds sponsor such as ING and the NBA enter these virtual worlds to fulfill the aims of their realm world sponsorship activity. The trick with such a world is to attract participants without being overly commercial, and there is a whole economy of clothes shops, teaching, design help, and other virtual goods trying to attract passing avatars. Recently the NBA opened an NBA Headquarters in Second Life that includes a merchandise store as well as venues and activities sponsored by three existing partners: Cisco Systems, Inc.; T-Mobile USA, Inc.; and Toyota Motor Sales U.S.A., Inc. Charities are also reportedly running virtual sponsored walks and other events inside Second Life.
 
Sponsors New Emphasis on Building Community Ties
There is much more focus on sponsorship as building a bridge to fans and giving something tangible to create a closer relationship. The Nationwide in the UK will make available 100% access to its ticket allocation to its customers for matches played by the home international sides. In addition, other benefits include the chance for customers to see their names appear on match programme advertisements, have their children lead out the national team for a match, attend team training sessions, meet the players and management and receive exclusive signed merchandise. Its sponsorship objectives can be summarised as increasing awareness, increasing brand preference and ultimately driving sales of its products and services.
    


Extracted with kind permission of The World Sponsorship Monitor.

http://www.theworldsponsorshipmonitor.com