Sports sponsorship: How Indian companies can increase marketing return on investment
For many brands, conventional ads & sponsorship are components of marketing strategy, providing ways to build brand awareness and equity.
By James Dick
For many major brands, conventional advertising and sponsorship are not alternatives but are components of the overall marketing strategy, providing different methods to build brand awareness and equity. With the entry of global sporting events into India, such as Formula One, golf and tennis events, Indian companies have a great opportunity to benefit from sports sponsorship strategies that complement their conventional advertising activities.
It is well understood that advertising provides mass-market media exposure for the brand. Dozens of Indian advertisers follow this strategy in cricket and spend millions in outdoing their competition in getting their brands publicized. But, for the consuming public that is bombarded with advertisements, recall levels are low because of 'noisy' and crowded cricket advertising. This is where sponsorship differs from advertising, in addition to a mass-market exposure, the sponsor has the opportunity to connect with the values and audience perceptions of the sports property and engage directly with fans.
To be able to best achieve this, the sponsor needs to also have a well thought out activation strategy in place. Done the right way, sponsorship can demonstrably lead to a direct improvement in the sponsors' bottom line. So if you are spending your marketing budget on sponsoring cricket and all you are getting for your brand is reach and publicity, then you might be missing out on numerous opportunities to differentiate yourself in the eyes of your target audience that create loyalty towards you and also to create a measurably higher return on your marketing spend than just awareness.
Engage with the right audience
Sponsorship of marquee worldwide sporting events, such as the Olympics, FIFA World Cup or Formula One, can quickly create a connection with the audience that would cost far more and would take far longer to achieve through conventional advertising activities. Sponsoring these events communicates global scale, ambition and quality.
To engage a relatively smaller audience, numerous luxury goods companies sponsor polo events drawing upon the "exclusivity" values related to this sport.
Effective media coverage
In a world of increasing choice of media platforms and channels, and the growth of digital video recorders and time shift TV, audiences skip or avoid conventional advertising. By contrast, in sport sponsorship the advertising message is embedded in the actual sport programme and cannot be avoided by the viewer - branding is constantly visible on players' uniforms, perimeter advertising or match interview boards.
Memorable experiential marketing
Sport sponsorship also provides a range of benefits which, depending on the property, may include a combination of entry tickets, corporate hospitality, onsite presence to provide experiential marketing, exclusive access to sports stars and use of facilities outside of event times. Usually, this involves creating a "money can't buy" experience for attendees that one cannot recreate just by buying a general admission ticket to the event.
The days of logo slapping and perimeter advertising as the limits of sponsorship are over. Today it is not enough to purchase sponsorships rights- to maximize return companies have to spend on activation programmes to promote the sponsorship. These may include in-store promotions, competitions, employee incentives, experiential marketing and advertising.
Sports sponsorship and CSR
The benefits of sponsorship are not limited to just the marquee events. One major area of growth in recent years has been localized, community and grass roots sponsorships.
As with other areas of sport, sponsorship in India is at a relatively early stage compared to Europe, the Americas and some other Asian countries due to the relatively low number of regular mass-appeal sports competitions in the country.
That is changing with the arrival of world class events such as IPL cricket and Formula 1 Grand Prix.
The author is Managing Director - Asia, Rush Sports Marketing