SponsorClick
News - Issue 28 - April 2003
Dear reader,
Are you over paying for your sponsorship rights? Find out if you
are through an exclusive article by Xavier Quattrocchi-Oubradous, CEO of SponsorClick.
Also, in this issue, SponsorRating™ tells us about Chelsea FC
web site's update.
If you have any questions, comments and/or concerns please e-mail
us.
Best wishes,
Shadyra Santiana
Editor
In this issue:
1. Sponsorship Marketing: How and Why? Don't
Overpay Your Rights
2. SponsorRating™ : "Chelsea FC Web Site"
Assigned "B" Rating
3. Hot Off The Press!
4. Unusual Transactions
5. Looking For the Most Professional Services
in Sponsorship Marketing?
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.1. Sponsorship Marketing: How and Why? Don't
Overpay Your Rights
by Xavier Quattrocchi-Oubradous, Chief Executive Officer,
SponsorClick - top
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Linking the value of sponsorship rights to TV visibility
can be dangerous for advertisers and sponsor seekers
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As most advertisers have
noted, the cost of sponsorship rights for large events or organizations
(be they sports, arts or other popular properties) has inflated considerably
in the past 10 years.
We believe that this escalation in costs is mainly due to the
strong but misguided link between TV rights and sponsorship rights.
This trend is dangerous for advertisers as well as for sponsored organisations.
The Link
The link was created based on a formula used for classic airtime
purchases (i.e. advertising). There are very few variables implied in
media space buying: namely, the supply and demand of available space.
Advertisers then fill the purchased space or airtime with their message
or image, showcasing their product or service in their environment.
There is no risk and no uncertainty. It is this link that has sponsors
paying approximately one U.S dollar per 1,000 TV viewers according to
our proprietary research.
But in the case of sponsorship marketing, TV visibility is uncontrolled,
irregular, and unpredictable. Visibility can vary from nothing to stellar,
without any possibility of control from the Advertiser.
Take the example of Audemars Piguet, a Swiss watch manufacturer, who
invested as a second rank sponsor of the Alinghi Swiss Challenge during
the America's Cup. Alinghi's victory was visible everywhere, in all
media, and when you saw a picture of the winning team, most of the time
you also saw the Audemars Piguet name on the boat's boom. When compared
to Telecom Italia Group's marginal visibility on the Mascalzone Latino
Challenge, we can see the difference was probably 1 to 100, while the
initial investment was in the same range.
In theory, a probabilistic coefficient should be applied to the value
of visibility, so that the Advertiser will not over-pay for it.
Another factor in the link that is driving up the cost of sponsorship
rights is undoubtedly the number of spectators. SponsorClick had conducted
research which shows that there is no clear correlation between number
of spectators and the price of sponsorship packages.
SponsorClick has also reviewed the correlation between sponsorship prices
and access to databases, corporate hospitality, access to content etc.
Again, no correlation was found.
Data shows that only TV visibility seems to correlate with sponsorship
prices.
The Dangers
(1) For Sponsors
Because of the link sponsors tend to invest large amounts of money inefficiently
and are discouraged when expected results are not evident. The vast
majority of less experienced sponsors may find their sponsorship campaigns
unsettling: they see over-optimistic media-driven returns, while commercial
return and improvement in notoriety remain unchanged. They can see their
brand, product or service on TV but are frustrated by the inability
to measure the real impact of their sponsorship investments.
The risk, then, is top management cutting these budgets, damaging years'
worth of effort. This "worst case scenario" is quite common,
and is a direct consequence to the TV rights/sponsorship rights link.
(2) For Sponsor Seekers
The large properties SponsorClick has reviewed influence the whole market,
despite the fact that mega-deals represent less than 20% of sponsorship
marketing investments, globally.
Such sponsor seekers, by linking the offered sponsorship packages to
TV visibility only, will be able to raise more money in the short term.
However, the sponsor seeker's short-term interest is not to educate
or assist their sponsors to make better and more diversified use of
their sponsorship rights.
In the long term, such entities incur the risk of generating many frustrations
amongst their sponsors, who could decide to stop their partnerships.
Given the recent stagnation in prices of TV rights, the loss of one
or few sponsors at the same time could prove critical.
Is There A Way Out?
Our recommendation to both sponsors and sponsor seekers is to return
to basics: sponsorship marketing is a matter of association and partnership.
Sponsorship marketing is a totally multifaceted relationship that must
go beyond the purchase of visibility.
Sponsorship marketing can be extremely beneficial and can produce higher
returns than any other marketing/communication channel. In order to
achieve its purpose its better to use tools and methodologies that you
are familiar with, such as those used in advertising or direct marketing.
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You will find a more detailed version of this article along with comprehensive
data in the March/April issue of our Chronicle
of Sponsorship Marketing™.
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.2. SponsorRating™: "Chelsea FC Web Site"
Assigned "B" Rating
London, March 25, 2003 - top
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In this section, SponsorRating™
- the sponsorship rating agency - applies its methodology and expertise
to a specific sponsorship right
Chelsea FC Web Site - London, 2004
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Chelsea FC is a professional
soccer club located in London, England, currently engaged in the BarclayCard
Premiership League.
Legendary players like Roy Bentley, Ken Armstrong, Eric Parsons, Peter
Sillet, Reg Matthews have been replaced by world champions Marcel Desailly
and Emmanuel Petit, and first class strickers Eidur Gudjohnsen, Jimmy
Floyd Hasselbaink and Gianfranco Zola.
The Team's Web production team is looking to select non-traditional,
customized marketing partnerships.
Our "B" rating is justified by the following:
- Track record hints at a good level of confidence in Chelsea
FC's ability to deliver to corporate partners
- Site will undergo a
well-deserved technological upgrade, so it can deliver a the
full fan experience
- Claimed audience
of 5 million hits per month was benchmarked with similar properties
in the market
- Pricing is in
line with similar properties in the UK, justified by excellent visibility
provided to sponsors
- Quality of package
structure is slightly below market practice
- Marketing orientation
of management assures good understanding in corporations and brands
requirements and the need for measurable impact for their sponsorship
dollars
- Existing sponsors
include prominent corporations and brands such as Emirates.
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Buy full SponsorRating™ report on Chelsea FC Web Site for US$
2,500.
Ratings are determined by methodologies similar to those of Standard&Poors
and Moody's, and are assigned on a broad range of sponsor seeking organizations,
events, individuals, and media in various fields such as sports, culture,
education, charity, and B2B.
Click
here for more information on SponsorRating™.
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.3. Hot Off The Press!
London and New York - March
26, 2003 - top
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SponsorClick is committed to providing you with the best sponsorship
research work:
Click here for information on publications on key topics, or contact
our Research
Department for any tailored study you need.
The Chronicle of Sponsorship Marketing™ - Bi-monthly
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The first analytical periodical focusing on the sponsorship
marketing market. Subscription launch offer is $790 for 1 year (includes
shipping). Click
here for more details.
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Sponsorship Marketing Global 2003 - Market Study
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The first study featuring the global sponsorship picture
and detailed market review is available for $1,300. Click
here for more details.
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Formula 1 Sponsorship Marketing - Category Report
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Analysis of the market structure and the best practices
in Formula One, as well as opportunities for additional leverage and
involvement for brands: a full report made by F1 specialists.
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TV Ratings & Sponsorship Valuations – Study
on Global Events
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Based on solid background analysis of detailed TV ratings
data related to the world's largest events, this study provides a clear
understanding of sponsorship valuation mechanisms.
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Sponsorship Marketing France 2003 - Focus on France
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A unique study dedicated to sponsorship marketing in France,
thanks to the exclusive results of a nationwide survey led in partnership
with CB News magazine. Click
here for more details.
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.4. Unusual Transactions
In partnership with Sports Marketing
Surveys - March 2003 - top
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In this section, in partnership with Sports
Marketing Surveys, read about original sponsorship transactions
around the world:
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Li-Ning Sports Goods Company - Li Tie
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Li Tie, a player for British soccer team Everton, has switched
from Nike to the Chinese sportswear company Li-Ning Sports Goods Company
who will pay him $1million over four years.
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King Solomon's - Ronnie O' Sullivan
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Ronnie "The Rocket" O'Sullivan, the number one
ranked snooker player has signed the sports first deal to use branding
on the arm. The sponsor is UK online casino King Solomon's. Previously
branding in snooker, a variety of billiards, was restricted to waistcoat
breast pockets and lapels.
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But - Top 16 Rugby Playoffs
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More evidence of the trend for sponsoring referees comes
from France where electrical retailer But will be sponsoring referees
in the "Top 16" rugby playoffs.
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Petco - The Padres Baseball Team Stadium
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The pet food market in the US is big enough to enter into
major sponsorship. This is evidenced by the San Diego home of the Padres
baseball team being named Petco Park after the pet food firm paid over
$20 million dollar for naming rights for the next 22 years.
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.5. Looking for the Most Professional Services
in Sponsorship Marketing?
by e-mail, telephone or fax
- top
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SponsorClick is the only one-stop-shop for sponsorship marketing
globally.
We provide global and local brands and products with the best research
and consulting services.
Our sponsorship marketing experts will be happy to serve you. Feel free
to contact our teams below with any questions or comments.
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U.S. &
Canada
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Tel (646) 365-3159
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fax (646) 349-2784
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United Kingdom
(European Head Office)
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Tel +44 (0)20 7900 2612
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fax +44 (0)20 7900 2614
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Germany
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Tel 0306 90 88 138
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fax 0306 90 88 122
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Italy
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Tel 02 95 441 296
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fax 02 95 441 271
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Spain
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Tel +44 20 7900 2566
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fax +44 20 7900 2614
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- Meet us on http://www.sponsorclick.com
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© SponsorClick, 2003, all rights reserved.
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