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Sponsorship has come of age and is now one of the fastest-growing areas of marketing as brands strive for innovative ways to get noticed and be remembered.
The European sponsorship market is worth £4.5bn, according to the European Sponsorship Association, and globally its value is expected to grow 10% this year, from £16.2bn in 2005 to an estimated £18bn.
Sport continues to dominate the sector in terms of investment, accounting for 91% of spend, according to The World Sponsorship Monitor. However, music, film, the arts, TV and community activity are all seeing a surge in interest.
The most obvious attractions of sport sponsorship are the huge audiences it delivers and the energetic attributes with which sponsors wish to be associated. Stephen Hall, head of sports sponsorship at McDonald's, and a panellist at Marketing's Sponsorship Conference in November, says: 'Ninety-eight per cent of our customers like sport, so they buy into the values that sport sponsorship, and especially football, provides'.
However, sport sponsorship has become a victim of its own success. It has become highly competitive, resulting in increased clutter as well as spiralling costs for sponsors, and a key challenge is to ensure that brands stand out. 'Perimeter boards are no longer enough,' warns Hall. 'They don't engage with consumers on an emotional or individual level, which is why we decided to focus on training football coaches and providing sponsored equipment.'
There is also a danger that if brands spend all their money on perimeter boards, they leave themselves with few funds left to promote their association with the sport.
Not surprisingly, many brands have begun to look to other sectors for partnerships that can offer them better value for money and a unique way to engage with consumers.
Music has been a significant beneficiary. 'People are passionate about music, which means they are more open to engaging with brands that associate with it,' says Stephen Rogan, head of sponsorship at Virgin Mobile and also a panellist at Marketing's Sponsorship Conference. 'Music can be a powerful motivator for young people to adopt brands, and sponsoring music events gives brands access to this sought-after audience.'
Partnering music events also gives brands the opportunity to add value to an experience. 'It is the little things that connect with people,' says Rogan; at this summer's V Festival, the operator set up a branded van offering free kebabs to Virgin Mobile customers.
Virgin Mobile is a relevant sponsor of music festivals, given its parent brand's strong music heritage and the latest mobile phones' ability to play and download music. But for other brands there is a danger of a poor fit that could alienate a savvy youth audience. As much of the music industry is not yet fully set up to accommodate sponsorship opportunities, partnerships can also be much more difficult to develop.
The arts are relatively new to the consumer sponsorship arena, but accounted for 7% of sponsorship deals in 2005, according to The World Sponsorship Monitor. 'Sponsoring the arts provides a creative way to engage with an audience resistant to traditional advertising,' says Lucy Milton, head of sponsorship at BSkyB.
A partnership in this area infuses a brand with associations of innovation and creativity and reaches an opinion-forming audience. The popularity of the arts, dance and opera is also booming. 'A recent TGI survey revealed that 50% of the UK population are interested in the arts,' says Milton.
However, public reaction to sponsor brands' involvement in this sector is unpredictable - and so, therefore, is the equity to be gained from an association. Film, for example, can be a particularly tricky arena for sponsor brands. 'You are totally out of control of the publicity surrounding a film, which means it can work in your favour or against,' says Greg Nugent, marketing director of Eurostar, and a speaker at Marketing's Sponsorship Conference.
However, the big advantage of film sponsorship is its scale. 'Good films, no matter what their size, have the ability to get people talking and thinking, so borrowing their equity can be a powerful driving force,' Nugent adds.
Eurostar tied up with The Da Vinci Code, which, with its Paris-London connection, was an excellent fit with the Eurostar brand, and resulted in record summer sales for the rail operator. However, there is a danger of sponsors lacking such a strong connection, leading to a confusing association and ultimately loss of credibility for the brand.
TV sponsorship is another growth area, as brands seek to escape the cluttered ad market. 'The biggest advantage of TV sponsorship over TV advertising is that you get more media value for your money,' says Robin Ault, head of marketing at Domino's Pizza, which has sponsored The Simpsons on Sky One for the past nine years. This relationship has led the pizza delivery chain to strike a licensing deal with 20th Century Fox, allowing it to create Simpsons-branded pizzas and side orders, and use the characters on menus, packaging and in promotions.
Programme sponsorship allows brands far greater exposure than one ad slot and they can benefit from the halo effect of the perceived values of the programme, as well as effective cut-through to specific target audiences. While the advent of PVRs allow viewers to skip ads, Ault explains that idents act 'as signposts for when to skip the ads and when to stop', so viewers are likely to take even greater note of them than if watching the programming live.
The obstacle faced by TV sponsorship, as with advertising, is that success is highly dependent on the creative approach, but it also must have a close fit with the programme. The deal must be carefully chosen, involve a relevant property and be supported by an integrated campaign. With these boxes ticked, it should secure brands the attention they crave, as well as significant return on investment.
DATA FILE - CONFERENCE
Marketing Sponsorship Conference
Date: 22 November
Venue: The Oval, London
Speakers include Dr Anthony Marsella, chief marketing officer, Samsung; Sean Jefferson, global category director, sponsorship, events and PR, Diageo; Toby Hester, head of sponsorship, T-Mobile; Kevin McQuillan, sponsorship manager, Stella Artois; Greg Nugent, marketing director, Eurostar; Daniel Gates, head of brand marketing EMEA, Hewlett-Packard; Adam Freeman, head of commercial development, Guardian Newspapers; Marc Sands, head of marketing, Guardian Newspapers; Susan Irwin, head of public relations, Yell; Lucy Milton, head of sponsorship, BSkyB; Robin Auld, head of marketing, Domino's Pizza; Philip Beard, marketing and sponsorship director, London 2012; Stephen Rogan, head of sponsorship, Virgin Mobile; Stephen Hall, head of sports sponsorship, McDonald's.
To book a delegate place
Contact Haymarket Conferences
Tel 020 8267 4011