Sharper score for sports sponsors

Relationships with individual athletes such as Valerie Vili are good tools for corporates. Photo / Getty Images

Sporting organisations say their relationship with sponsors has undergone a renaissance thanks in no small part to the global financial crisis.

The marketing technique formerly known as sponsorship is these days a carefully constructed business arrangement with packages tailored to meet the partnering corporate's specific aims.

The New Zealand Olympic Committee says after the 2008 Beijing Olympics it had to go back to the drawing board.

Just as it began the next four-year cycle running up to London 2012 the market died, said commercial director Terry Daly. Ironically, it gave the committee breathing space because it was not possible to get anything done, and Daly used the time to research the options.

"It became massively obvious to me and it's now very basic - we need to understand the objectives of the companies we were talking to."

Instead of offering corporates a "gold, silver or bronze" package, or category-based sponsorships such as being the only car company, NZOC was saying "how can we take our product and deliver on your objectives?", communications manager Ashley Abbott said.

For example, new partner Cadbury wanted to be involved at a grassroots fundraising level.

As part of that, the confectionary maker has become the official fundraiser for the New Zealand 2010 Commonwealth Games team and has launched the Cadbury Chocolate Grants.

Ten athletes will receive fundraising chocolate worth $20,000 and the company will help them to sell it, with all of the proceeds going towards the athlete's Commonwealth Games preparation.

This was the first time NZOC had set up a scholarship with a commercial partner, Daly said.

Cadbury New Zealand managing director Matthew Oldham said the company always liked to come in at this level and NZOC were "really open and collaborative".

Daly said another example was its relationship with electricity retailer Meridian Energy. The company was South Island-based but wanting to be a national provider, so had created a programme with the NZOC whereby supporters of the 41 sports can gain funding for their code by switching their electricity account to Meridian.

Daly said there was no agreed level of switch-over before Meridian would offer the support, but "it's on NZOC is make sure that it's returning at the level that Meridian wants it to".

Another tool now more open to sponsors was relationships with individual athletes, Daly said.

While people such as gold medal-winning shot-putter Valerie Vili already had sponsorship arrangements, it had 1136 athletes in its community so there was plenty of opportunity.

However, having an athlete representative did not suit everyone, Abbott said. "As a commercial entity you have to be quite careful when you go with a personal endorsement."

Mike Hartley, managing director of sponsorship consultancy Dart Consulting, said the new era of sponsorship had been talked about for a number of years but only really kicked in when organisations found they weren't able get what they historically had from their partnerships.

"It's a long time ago since the concept of sponsorship meant a way to advertise your products and services.

"The global financial crisis pushed what would have been an inevitable outcome ... It's very much now about a genuine commercial partnership."

Fragmentation of the media had also driven change, with marketing budgets not what they used to be.

"You've got a push to alternative means of marketing driven by media fragmentation, and you've got an economic stimulus through the global financial crisis."

Rowing New Zealand CEO Simon Peterson said although rowing's successes in recent years meant existing sponsors had stayed loyal, comments about the partnership approach were valid.

Sponsors were looking for answers earlier on in the piece. "So when you go into negotiations it's a bit more detailed than in the past where it was nice to have a relationship and 'let's see how we can make it work'."

An example was its connection with Corporate Traveller, formerly Flight Centre Corporate. It helped with international travel for elite athletes but was also looking to tap into secondary school rowing. "We're tailoring that sponsorship to try and provide opportunities for tour packages for parents and all levels of athletes."

New Zealand Cricket commercial manager Peter Dwan said cricket had been dealing with its sponsors as business partners for some years.

"There's no point offering someone 100 tickets to a game if in fact they've only got the need for 40 but they want to bulk up some other part of [the relationship]."

For example, long-time sponsor the National Bank had helped create the National Bank Family Zone at one day internationals, offering discounted tickets and giveaways.

"We jointly developed it with them - not as an add on to their sponsorship but as part of their existing relationship with us."