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Five Common Mistakes by Brands in Sponsorship

by AJ Maestas
28 06 2010

As the president of Navigate Marketing, where we specialize in the research, measurement and analysis of sports sponsorships, I frequently work with properties and brands making the most of their sponsorship opportunities in the sports world. But too often, I witness brands making some common mistakes. Here are five examples, all of them easy to make, and all of them necessary to avoid.

Investing Based on Gut Feel
Too often, a top individual in a company will decide to sponsor a property based on a personal affinity for that property, or a personal belief that the property is hot or increasing in popularity. But this is akin to playing the stock market without really researching any stocks. It’s a recipe for fiscal failure. 

Brands need to perform their own due diligence prior to investing with a property.  It sounds obvious, but this involves looking at various potential sponsorships and comparing them on a number of levels, including, but not limited to:

  • The specific demographics reached by the properties.
  • The opportunities for activation with each property.
  • The sponsorships already in place with each property.
  • How each property aligns with the brand’s identity and objectives.

By making these comparisons, a brand gives itself a much better chance to find the best possible partner for executing a successful sponsorship.

Failure to Cultivate the Sponsorship
Once the decision – and investment – has been made, the tendency for some brands is to believe that the work is done. They can sit back and let the sponsorship perform. Of course, it doesn’t quite work that way. More effort, and more money, is typically required to create a successful investment.

There is some debate in the industry over exactly how much should be spent on activation, but the general consensus is approximately two to three times the cost of the sponsorship agreement. It may be tough for a company to accept spending $2 million in activation efforts for a $1 million sponsorship, but without proper activation, the initial $1 million will likely not be leveraged properly.

Research and measurement is also necessary, and much less costly. We generally advise brands to spend between 1-3 percent of the sponsorship investment cost on research, so between $10,000 and $30,000 for a $1 million sponsorship. The exact type and timing of the research depends on the sponsorship and the objectives desired by the brand.

  • For a naming rights deal, the brand can commission a sponsorship valuation before landing a partner to determine the fair market value – much like using Kelly Blue Book before purchasing a car.
  • For a bank striving to entice more people to sign up for checking accounts, the research can involve tracking those numbers throughout the sponsorship and surveying people exposed to the sponsorship via a sponsorship impact study.
  • For a company selling widgets, a return on investment (ROI) study should be conducted toward the end of the sponsorship term to aid in the renewal process and make a determination on the success of the sponsorship investment.

Measuring ROI Incorrectly
As important as it is to perform research and measurement, the results will be meaningless if the process is flawed.

One common mistake is measuring ROI based solely on the comparison of exposure value to sponsorship cost. While adequate exposure value is a helpful complement to ROI, measuring the incremental sales that can be attributed to the sponsorship is the more  insightful method.

This type of study is somewhat complicated, and certainly the process has yet to be perfected (and employed industry-wide). But the advances in these calculations are providing valuable feedback to brands, who are able to learn not only how much exposure value they’re receiving, but also if that exposure is yielding actual results for the company’s bottom line. If a brand is going to pay for an ROI study, it needs to make sure this method is being used.

Putting Too Much Stock in 1st Year Results
The excitement of signing a sponsorship deal is often accompanied by high expectations, especially as the dollar figure grows, and there’s an almost immediate desire to see if the sponsorship is meeting those expectations. Research and measurement efforts assist a brand in determining this, but executives tend to lack something necessary for managing a sponsorship – patience.

Very rarely does a sponsorship investment become a huge success in year one; it traditionally takes 2-3 years for a sponsorship to gain traction. This is simply a result of the time it takes to break through the clutter and become more engrained in the minds of the fans and the public.

When brands start making sponsorship decisions based on first-year performance – especially decisions that scale back activation or drastically change the long-term strategy – they run the risk of dooming the sponsorship before its had a chance to grow. That’s not to say the first year isn’t important; it just shouldn’t be the basis for an overreaction.

Ignoring the Potential Success of Investing in Sports
With the combination of a struggling economy, government bailouts and a cynical public in the past few years, there’s been an understandable hesitancy by some brands to invest in or maintain sports sponsorships. But this is generally a mistake.

Sports have been and are still a great way to reach a group of passionate, loyal customers who have the potential to help a brand grow. Time after time, it’s been proven that sports sponsorships yield positive results when managed correctly.

It’s important not to let fear or temporary public opinion prevent a meaningful partnership that will produce long-term benefits. If a brand does have the financial wherewithal to invest in a sports sponsorship – both the initial expenditure, and then the activation and research/measurement that follows – it should do so with confidence.

AJ Maestas is the founder and president of Navigate Marketing. If you have any questions or would like to learn more information about sponsorship or Navigate’s services, contact him at [email protected] or call (312) 762-7477.

Categories:   ROI | sponsorship activation | tips
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The College World Series - More than Baseball, it's an Experience!

by Emily Taylor
22 06 2010

As a resident of Omaha, Nebraska, I’m pretty proud of our city!  I love Omaha.  I really do – you’ve never seen fans until you’ve witnessed the passion of Husker fans, you’ve never seen harder workers, nor a more inviting city.  It’s true that we’re often perceived as a small fly-over state with very little action.  No matter how hard we try to argue against the stereotype it’s tough to gain ground – unless you’re here during the College World Series!  This last weekend was opening weekend, and you could just feel the excitement level raising.  I went to the grocery stores and overheard a conversation in the checkout line of one lady wondering aloud if maybe Obama would be in attendance, my neighbors left their home at 5:30 in the morning in order to get a good spot for the tailgate, everyone’s plans were somehow touched by this experience in some way last weekend.  If you were here on Saturday, you would have exited off the Interstate near Henry Doorly Zoo and to head to the infamous Rosenblatt stadium, watched miles of people pouring in with tickets and lawn chairs, food and brightly colored clothes reflecting their favorite team.  Parking is insane, but everyone is in a GREAT mood, and this all American sport becomes an experience from the moment you pick out your clothes that morning until you crash in exhaustion at the end of the night – with or without your voice. 

Almost as exciting as the games themselves is the experience at Rosenblatt; from getting ice cream at Zesto’s, tailgating among hundreds of fans, eating funnel cake at the games, watching the sponsors and local businesses at their creative and fun booths, the list goes on.  Not to mention, this is the last year that the College World Series will be held at Rosenblatt.  There’s a new, fancy stadium (TD Ameritrade Park) being built in our developing downtown area, so the wrecking ball will be visiting Rosenblatt this fall.  Very bittersweet.   Lots of memories for lots of people at this beloved stadium, and it’s really an honor to be playing here this year.  You’ll hear varied responses from different audiences of involved fans – and honestly that’s more the talk of the town this year than the games themselves!  And I can’t help but noting that this kind of conversation is prevalent for the reason that there’s an entire experience of a CWS fan that touches their lives that goes beyond the excitement of the baseball game!  Isn’t it wise to keep in mind that true fans live and breathe for the experience the event and their sponsors can bring that’s so much bigger than the event by itself.  

I sat down for an appetizer at Kona Grille just earlier this evening with a contact from Performance Research (fantastic company), and Stephanie Lochmiller (our New Media Manager).  After we exchanged formal introductions with our out of town guest, and learned about one another’s efforts more accurately, the conversation easily transitioned into what we’ve all seen or experienced around the CWS this year.  We all agreed that Omaha was one of the friendliest towns ever, and we all agreed that there was some serious hype around the change in locations for the stadium, and our contact is specifically here to analyze what people like about the experience (sorry – I can’t ruin the report and offer any info here!), but brilliant effort to uncover ways to make sure activation efforts are going to keep fans happy in the years to come! 

So what are you doing to keep your finger on the pulse of your fan’s interpretation of an experience?  Do you know if your activation efforts are good or bad?  Do you know if your event or program is raising the energy level in the city you’re impacting or with a target audience who has loyalty with you?   If you’ve ever had any major transitions within your program or event, are you doing your homework to find out how to make it seamless and positive to those you directly impact with the experience?  Being able to answer these questions is imperative to the success of your activation efforts.  As we like to say at SponsorPark: “Are you lucky or are you talented?”  Make sure you’re not just lucky to impress your audience – luck runs out, talent doesn’t.


Categories:   industry happenings | sponsorship activation
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When to Say Yes, and When to Say No - Thinking Before You Speak

by Emily Taylor
15 06 2010

Everyone likes to be liked by everyone.  Especially us feelers – we love it.  I have yet to meet a person who enjoys being mistreated or disliked for any reason.  Sadly enough, it’s never going to happen, so it’s a good idea to develop some thick skin, learn to act with integrity regardless so you can stand behind your efforts, and create some boundaries.  It’s the developing proper boundaries that I’m going to address here, specifically how saying “yes” all the time is not always a good thing.

If you’re in some kind of sponsorship sales, (and you probably are if you’re reading this blog!)  It’s probably in your genes to say yes as a reflex!  Babies curl their hand around your finger when you gently tap their palm, men spit off of high towers or bridges, women must stop for a shoe sale… and sales persons LOVE saying yes – it’s a reflex.  We have this results oriented tunnel vision of, get the signature on the dotted line!”  And sometimes we have to stop and think about what we’re promising before we go there.  At SponsorPark (which granted is not sponsorship sales), when we were first launching our business into beta testing, we were so excited to get those first proposals up on the site that I was likely to say yes when really it was to no one’s ultimate benefit that I do. 

For example, for one new client I ended up consulting over their opportunity, reviewing their marketing information, their boilerplate language, and their history and event effort summaries in order to actually write their proposal for them.  I consulted, reviewed their data, wrote the proposal, and pushed it live to the site.  In exchange for literally no dollars.  Now, it’s not uncommon to do more than normal when you’re just getting started, but there were a few things I finally realized.  First of all, we now have almost 7,000 clients and nearly 4,000 active proposals on the site.  There’s no way we can offer that kind of support to each of our clients, there’s just not enough hours in the day.  And if we did spend that kind of time, there would be other efforts we offer in the growth of our services that benefit our members that we wouldn’t have time to invest into!  In addition, the truth is that a sponsorship opportunity representative is going to know the ins and outs of their opportunity better than anyone, and there’s really no better person to communicate that in the initial proposal.  It’s to the best interest of the sponsorship opportunity representative that they do the writing, and I offer my insights after the fact – which is now the way we make sure to do things. 

When it comes to sponsorship sales, do you offer to do things for the sponsor that would honestly benefit them more if they had their own hand in it?  Do you promise things or say yes to things that you can’t control?  Like that their company WILL grow 15% as a result of their partnership, and if it doesn’t, you’ll personally hand them back their check?  Do you say yes to being present for all activation efforts when you have a team that you can just as effectively delegate to?  Do you say “yes” if they ask you to grow a third arm?  There are some things that it’s not good to say yes to, and here are a few questions we think you should ask before saying “yes:”

  • Is saying yes going to ultimately benefit our sponsor and why?
  • Is saying yes going to ultimately benefit our property and why? 
  • Is there a better alternative I can suggest instead that will better support both of our goals in order to truly be mutually beneficial? 

There’s a fine line between sacrificing convenience for a sponsor, and being walked on.  Sacrificing convenience might be a necessary part of compromising within the partnership, but allowing yourself to be walked on is a whole different thing.  If saying yes will support your sponsor and it won’t hurt your property, do it!  But if you are hurting either the sponsor, or your own property (by taking away from your resources, abusing your talent, crippling your efforts to achieve your own goals, etc) , be prepared to offer an alternative solution with a good explanation for your thought process.  It will ultimately establish trust, loyalty, productivity, and mutual respect and admiration. 

Think about it – if you’re in a marriage, do you honestly prefer your spouse to always say yes?  Before you instantly scream, of course I do!  Consider it honestly – don’t you respect them as a partner for respecting themselves as valuable contributors to the relationship?  And don’t you take them seriously when they demonstrate the ability to communicate value as well as contribute to solution oriented conversations from time to time?  The same is true for a sponsorship relationship - allowing yourself to get walked on doesn’t strengthen your team, and it doesn’t earn you’re the respect of your partner.  So exercise your discernment, and do whatever you can, but remember sometimes the magic word is not: “yes!” 


Categories:   sponsorship sales
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