'Psychographic' sponsorship is key

By Helen Vause

Sponsorships are becoming a growing part of the marketing activities of many companies. Alongside that, the events industry - where those sponsorship dollars are being spent - is moving out of its infancy with a steady proliferation of events based on a wide range of partnerships.

With the coming of age of sponsorship comes a sober overview from Australasian consultant Kim Skildum-Reid. She estimates that 75 per cent of sponsorships do not work to anywhere near their potential because one or both parties do not know how to maximise the sponsorship opportunities.

Far too many sponsors, she says, sign a cheque and walk away, expecting great returns with little further input from them.

Skildum-Reid is the co-author of The Sponsorship Seeker's Toolkit. The recently launched book has been well received as a much needed text on sponsorship and is into a second print run of 25,000. A second book, The Sponsor's Toolkit is in progress.

With a great number of millennium and international sporting events coming up on both sides of the Tasman, it is a timely scrutiny of a marketing activity that the author says is maturing fast but is still too often poorly practised. While we will soon have the chance to observe some very well-managed relationships. she anticipates there will be plenty of sponsorships that will end in an angry parting.

The fault lies with both sponsorship seekers and sponsors.

"Many sponsorship seekers do not know how to put together strong proposals that will deliver great results and many sponsors do not have a clear idea of what they want or how to go about maximising the relationship.

"For many of them, sponsorship is still a concept floating outside of their marketing mix. There is a feeling that it is a luxury or philanthropic thing you do when all else in the marketing agenda is paid for. The big difference between sponsorship and philanthropy is value."

When the relationships turn sour, invariably the sponsor blames its partner for failing to deliver, says Skildum-Reid.

Successful sponsorship, she says, is based on clear objectives and is integrated into every aspect of a marketing programme. Companies who do this well are finding that their sponsorships have a higher, more lasting impact on the perceptions and buying behaviour of their customers than any other marketing option.

Tracking investment from both the Sydney and US offices of her organisation, she estimates worldwide spending on sponsorship is about $US10 billion and that it has grown to around $A660 million between Australia and New Zealand.

In the US, sponsorship budgets in the last decade have grown from 2 to 5 per cent of the overall marketing budget to as much as 20 per cent.

"The trend in our countries will parallel that," she says.

"There is a growing understanding that sponsorship is the most powerful marketing tool of all because of its potential for very effective integration throughout all marketing activity. It is the most integratable of all marketing activity. This is because it is a two-way medium able to create relationships between sponsors and their target markets."

"Clever sponsorships give the chance for tremendous emotional connection with consumers. Where your target market is identified 'psychographically', rather than by age, as people with certain interests and values, you can achieve a powerful emotional connection by telling them your company cares about the same things they care about. That has terrific marketing value."

Seekers of sponsorship today include many newcomers alongside the traditional areas of arts and sports. With funding cutbacks in many areas, schools, hospitals, government agencies and city councils are looking to join hands with commerce to support social programmes, parks, youth projects and festivals.

To the sponsorship seekers Skildum-Reid's new book gives a detailed guide to achieving win/win relationships. It outlines how to identify likely sponsors, how to pitch a proposal, how to figure out areas of responsibility, accountability and most importantly, how to persuade a sponsor that they must be on board as a working partner.

There are techniques for dragging horses to water - and to keep them there, satisfied with their investment.

Sponsors need well reasoned persuasion to bring into the sponsorship, representatives from all areas of marketing and sales, including their public relations and advertising agencies.

"For the investment of a couple of hours and a tray full of sandwiches, you will gain insight into many untapped resources and unearth potential trouble spots that could cause problems further down the track.

"You will gain the support, cooperation and understanding it takes to create a fantastic sponsorship programme.

For the many companies pushing endless sponsorship proposals around desks or wondering how well it could be working, she suggests the first step is to develop a policy and guideline form on the sort of proposals they would consider. This includes lead time requirements, need for exposure, core brand values and the positioning sought for the organisation.

The sponsor should be looking for creative ideas for the utilisation of the sponsorship and considering the many options for getting value well beyond exposure, which is frequently not the major consideration it once was.

When writing the cheque, sponsors need to be committed to supporting every sponsorship dollar with twice as much investment to maximise opportunities through existing marketing options.

The obvious opportunities are through media promotion, retail promotions, working with other sponsors on joint promotions. There will also be significant opportunity to generate database information around sponsorships from dozens of sources including ticket sales, competitions, event surveys, registration, internet sites, trial offers and information inquiries.

An old hand in events and sponsorships, Rendall McIntosh (NZ Events Ltd) has seen many sponsorships fly or fall over with many a bridge burned on the way to the sponsorship business growing up. He points to the 10-year-old "Wild Foods Festival" in Hokitika as a very successful model in sponsorship for all parties involved. Fifteen thousand people now attend the home-grown annual festival with a national reputation. It is jointly sponsored by West Power, Westland District Council and by the West Coast beer, Monteiths. The latter has driven the sponsorship with activities outside the festival that have been a great benefit to all parties.

Last year the beer brand established a "Wild Foods" challenge with restaurant chefs nationally competing to create a coast style dish and match it with Monteith's beer. The brand also funded a television documentary on the annual festival. The result has been many spinoffs for the brand, the region and the festival - and a trio of happy sponsors.

* The Sponsorship Seeker's Toolkit (McGraw Hill).