Sports Sponsorships: Nothing But the Truth

Be authentic.

That was the mantra uttered by various sports marketers in August at the annual Sponsors Only conference conducted by IEG, Inc. in New York City. It’s a concept which has been put into practice in a variety of ways throughout the year.

“[Consumers] have never scrutinized companies so closely, especially Generations X and Y,” says Laren Ukman, managing director of Chicago-based IEG’s valuation service group. Thus, honesty in both evaluation and activation go a long way — especially in a slow economy.

Santa Fe, CA-based sneaker maker Vans was cited by conference speakers as the brand which best exemplifies the concept. “Vans is the poster child for authentic sponsoring,” Ukman says. “They know the only way to sell to these kids — who’ve blocked out Nike and Reebok — is to know what they care about.” That has put heavy doses of alternative music (the Warped Tour) and extreme sports (branded skate parks) into Vans’ marketing plan.

“Real, authentic, and relevant. Those big words that people use are extremely relevant to us,” says Mark Livingston, Vans’ director of strategic alliances and sponsorships (reached after the conference). “If someone thinks of reaching Gen Y as a pure media buy, there is a time and a place for that. But to truly interact and experience what they experience, you have to get in the trenches with them and try what they are trying.”

The need for authenticity makes it even more vital for marketers to properly evaluate potential sponsorships, determine their worth, and measure their performance. “It’s so important that anyone considering a sponsorship takes the time to understand what the program is and what its purpose is,” Livingston says. “Putting your name on an event doesn’t work. You as a sponsor have to demand more and you have to ask, ‘How is this investment going to benefit my brand?’ and ‘How are we going to activate it?’”

Spending on sponsorships is expected to post only single-digit growth in 2001 — one of the slowest increases in the last 16 years, according to IEG Sponsorship Report. In a survey conducted by IEG and Performance Research, Newport, RI, 55 percent of companies said their sponsorship budgets decrease in a down economy, while 41 percent said it stays the same.

Nonetheless, the strategy remains one of the most effective marketing tools, says keynote speaker Pamela Riehl, management supervisor of Clarion Marketing & Communications, Greenwich, CT. “With advertising budgets being downsized and tightened, it’s much more useful to get your message out to people [through] a hands-on approach.”

But watch your expenses, Riehl advises. “Sometimes the amount of money you are going to pay isn’t worth it. Typically, there’s another [more cost-efficient] property down the road — if not a better one.”

Keeping it Real

For its four-year-old Triple Crown extreme sports competition series, Vans limits the number of partnering sponsors it brings on board to prevent glut and maintain control, Livingston says. “This way, [sponsors] aren’t one of 20, but one of seven or eight.” The North American program boasts such partners as Mountain Dew, Casio G-Shock, Ford Ranger, Gillette’s Right Guard Xtreme Sport, Rolling Stone, Transworld Media, Fox Sports Network, NBC Sports, and Microsoft Corp.’s Xbox. Irvine, CA-based McElroy:FCB handles for Vans.

“We sit down with every partner and its agency and create a plan that makes the most sense for them, the athletes, and consumers,” Livingston says. “We want to reach Gen Y within their own ‘life frame.’”

Livingston doesn’t view the strategy as convincing Gen Y to accept Corporate America, but as uniting the two “in a natural way. It’s not your traditional marketing model — it takes a lot of lessons from that, but it’s also a model for the future.”

Among those boogie boarding on the wave of Vans’ success with the Warped Tour is Atlanta-based Cartoon Network’s Powerpuff Girls franchise, which presented a Ladies Lounge at the 43-city tour this summer for the second straight year. (Although the TV show targets six- to-11-year-olds, Cartoon Network’s consumer products division focuses on teen trend-setters.)

Inside the lounge, attendees hang with the tour’s female acts as well as athletes participating in the tour’s sidelight skating and bicycling demonstrations. Visitors walk off with T-shirts, toys, stickers, temporary tattoos, and CD samplers. New this year was a Ladies Lounge Girls Skate USA competition, held at five stops. The network handles in-house.

The Powerpuff Girls also sponsored the Philips Electronics U.S. Open of Surfing in Huntington Beach, CA, last summer and the Boarding for Breast Cancer Snowboard + Music Festival in Sierra-at-Tahoe, CA, last spring. Cartoon Network’s team worked with Fuse Marketing, Burlington, VT, on both events.

“We wanted to embody powerful female athletes,” says Julie Gibbons, the network’s director of off-channel commerce. “To do this, we couldn’t just throw products at our consumers — we needed a comprehensive program. We did a lot of legitimate advertising with real athletes instead of just models in bathing suits in front of surfing boards.”

The action-sports marketing plan for Powerpuff Girls also includes sponsorships of individual female athletes, a contest identifying amateurs, and a style guide focusing on snowboarding, surfing, and skating fashion.

Road Games

In the drive for authenticity, sponsorship activation more often means moving out of the arena. General Motors’ Warren, MI-based Chevrolet division this fall joined forces with four National Football League teams for a campaign called Drive the Distance: Ultimate Game Day Experience. Chevy dealers in Cleveland (home of the Browns), Cincinnati (Bengals), Green Bay, WI (Packers), and Indianapolis (Colts) conduct sweepstakes giving winners and three guests rides to home games in a Chevy Avalanche, tailgate parties, and chances to win the pick-up/SUV at halftime competitions. (Fans can also enter at the stadiums or at chevyfans.com.) At the game, an Avalanche is placed on the field to serve as a marker for the pass, punt, and field goal trials that award the vehicle.

In Cleveland, McDonald’s joins the squad by displaying P-O-P including Browns-logoed Avalanches. Advertising support includes TV, radio, print, dealer P-O-P, and Internet (at clevelandbrowns.com). General Motors’ in-house R*Works events division, Detroit, handles for Chevy; Stern Advertising, Cleveland, handles for McD.

“It’s all about driving people back and forth between retail locations,” says Bruce Popko, the Browns’ vp-marketing and development. “It’s a great partnership.”

“You have to have trial — which is a little more difficult with an automobile than it is with a soft drink,” says Jim Swinson, Chevy regional marketing director. “This promotion drives traffic back to our retailers and exposes the Avalanche to 35,000 to 50,000 people at each game.”

Back east, Randolph, MA-based Dunkin’ Donuts last month united all six of New England’s professional sports teams in a peel-and-win game run on more than 45 million coffee cups and donut boxes at nearly 1,200 stores in the Boston, Providence, RI, Springfield, MA, and Hartford, CT, regions.

The Dunkin’ Donuts Sports Dream program featured a $50 million prize pool that presented at least coupons or free product with every gamepiece. The “Dream” prizes included personal delivery of coffee and donuts by a Boston Bruin, a chance to watch a portion of a Red Sox game from inside the “Green Monster” left-field wall in Fenway Park, and the chance to have a player from the New England Revolution coach a local soccer team.

“We’ve had sponsorships with these teams for some time, and we’re taking them to a new, strategic level,” says Ken Kimmel, vp of Dunkin’ Donuts Concepts, the chain’s marketing group. “It’s way beyond the traditional enter-and-win experience.” Cohen Friedberg Associates, Framingham, MA, handled, with TV, radio, and outdoor ads via Hill, Holliday, Connors, Cosmopulos, Boston.

Driving Loyalty

Gentlemen, start your sponsorships.

Atlanta-based NASCAR and its many marketing partners don’t need to worry as much about making sponsorships authentic: Seventy-two percent of fans say they actively seek to purchase sponsoring products over non-sponsoring products. For the NASCAR fan, sponsorships are already reality.

“If you develop that intangible, the audience ends up sponsoring you,” says Lesa Ukman, president of IEG, Inc., Chicago. “There is no better group of fans than NASCAR fans.”

“Sponsors are the sport in NASCAR,” says Brett Yormark, the racing association’s vp-corporate marketing, based in New York City. “It’s the Dupont team, the Kellogg’s team, the Anheuser-Busch team.”

Fans truly understand the role of sponsorships: The more sponsoring products they buy, the more support that sponsor will provide to their favorite drivers, Yormark says. “If the New York Giants were called the McDonald’s Giants, and you knew that the more you ate at McDonald’s, the more money they would invest in getting a better quarterback, you’d keep that in mind.”

Primary NASCAR sponsorships cost between $8 million and $11 million. The association encourages powerful activation programs to produce better returns.

“In addition to activation through media and promotion, you’ll also see a lot of business-to-business programs,” Yormark says. “There are more Fortune 500 companies in our sport than in any other.”

Just The Facts

A recent survey of 200 sponsorship decision-makers conducted by IEG, Inc. and Performance Research offered some interesting information on goals, spending, and evaluation. Here’s a quick rundown:

• Presented with a list of 15 possible goals, 68 percent said increasing brand loyalty was of the highest importance, followed closely by creating awareness/visibility (65 percent) and changing/reinforcing image (59 percent).
• Sponsorships on average account for 12 percent of total marketing budgets. But most respondents said they devote little to activation and even less to ROI measurement: 70 percent spend $1 or less on activation for every rights dollar paid; only 15 percent spend according to the recommended $3-to-$1 ratio.
• Only 47 percent of sponsors conduct primary consumer research when deciding whether or not to renew or change deals; 94 percent said they rely on internal feedback from colleagues in the corporate office.

That’s water-cooler research taken to the extreme.