Hollis Sponsorship Bulletin

This week saw the sponsorship industry descend on Le Meridien Piccadilly for Marketing Week magazine’s annual Sponsorship Summit. And the general message was that  the sector is coping pretty well with the economic slump.

This is not to say that there haven’t been changes, however. ESA chairman Karen Earl spoke for many when she said that the downturn has led to a greater focus on ROI. Greater attention is being paid to the rights that sponsors need and the areas where they channel their budgets, she said. Brands are also looking carefully at their sponsorship portfolios to see if anything might be surplus to their requirements.

Not surprisingly, sponsorship measurement and evaluation was also a key theme. Increasingly, brands expect rights holders and agencies to provide evidence of effectiveness. This has forced sponsorship sellers to look at new ways of doing so - for example by pooling knowledge and budget with partners which have a similar commercial agenda. The main health warning in this area is that too much emphasis on data-defined ROI may distract companies from more intangible goals such as brand-consumer engagement.

Sport England has signed a ground-breaking partnership with social networking site Facebook designed to deliver a lasting Olympic legacy of more people playing sport.

The aim is to use the social networking site’s unrivalled influence to bring people together around sport, and transform the way sports bodies reach out to the public in the run up to London 2012. Central to the partnership is the Facebook ‘Sport Hub’ which will enable national governing bodies to engage with over 20 million people who use Facebook in the UK. The partners claim that it will be possible to provide tangible measurement of the number of participants reached through the Facebook Sport Hub.

The Hub will enable sports bodies to organise and market grassroots sports events. Facebook users will also be able to challenge other people in their area to compete against them – whether in a squash match or a running race – and then share the results with their Facebook friends and networks.

The value of the partnership is put at £20 million - which breaks down as an in-kind investment of £5 million a year until March 2013. This will cover the development of the hub as well as pound-for-pound matched ad spend on Facebook for brands and NGBs to use ads to encourage people to play more sport. Commenting on the deal, Sport England chair Richard Lewis said: “This partnership with Facebook will fundamentally change the way sports engage with participants, helping them to reach out beyond existing club structures to the young people who are the future of sport. Four out of five youngsters have a Facebook account, so this is a key way to make sport a part of people’s lives.”

Aegon’s huge investment in British tennis was reinforced this week with the decision to add The Royal Albert Hall Masters to its tennis portfolio. The event, which features tennis legends such as Bjorn Borg and John McEnroe, was launched in 1997 and takes place during every December.

Aegon burst onto the tennis scene last September when it signed a £30 million five year deal to become the first-ever lead partner of British Tennis. The new deal is also for 5 years and will see the event renamed as the Aegon Masters Tennis. Commenting on the deal, Aegon UK director of marketing Steve Clode, said: “Aegon’s partnership with British Tennis supports the sport at all levels, from grassroots development to major tournaments like the AEGON Championships at The Queen’s Club. The Masters celebrates the greatest champions of the sport and is a natural next step for us. Already this year our tennis activity has reinforced our brand credentials, and the AEGON Masters Tennis will enable us to continue this success.”

Frozen food manufacturer McCain has teamed up with Sky Movies and DVD rental firm LoveFilm for a sponsorship based around the idea of a movie night in. Under the terms of the deal, both partners will promote the McCain wedges range. In the case of Sky Movies, McCain has a year-long sponsorship based around comedy movies. Idents will feature taglines imitating famous quotes such as: Frankly my dear, I don’t give a wedge. As for LoveFilm, McCain will run online banner ads on the company’s website which says: McCain Wedges and movies - a great combination.

Formula One is this week facing up to the fallout from the Renault race-fixing scandal. Following the World Motor Sport Council’s ruling that the Renault F1 team conspired to cause a deliberate crash in last year’s Singapore Grand Prix, its lead sponsor ING has pulled out with immediate effect.

The ING deal was worth an estimated £40 million a year to Renault - which has also seen Spanish insurance firm Mutua Madrilena withdraw. In a statement, the Dutch bank said: “ING is deeply disappointed at this turn of events, especially in light of an otherwise successful sponsorship.”

In reality, the decision to terminate early is not a major blow to ING - which was due to end its relationship with Renault at the end of the current season anyway. In light of the severity of the accusations against Renault, it would have been strange if ING had stayed involved with the team for the sake of a few extra races. Far more important was to distance the brand from the any association with cheating.

Still on the subject of cheating, sponsorship trade body ESA waded into the debate about ethics in sport this week. In light of recent controversies surrounding sports such as football, rugby union, athletics and F1, ESA issued “a stark warning” to sports governing bodies and rights holders of the threat to future potential sponsorship funding if acts of cheating are seen to persist within sport. “Sponsors quite rightly are highly sensitive about their brands and their ability to protect them,” says ESA chairman Karen Earl. “Like the fans watching live at events and on television, sponsors will start to feel cheated and will certainly not want to have their brand linked with a sport, a team or individuals who have deliberately cheated in order to win.”

ESA says it will be advising members to include extra clauses within their sponsorship contracts to provide them with extra protection. Commenting on the issue, ESA legal advisor Nick Johnson said there were reasons to be positive, “Drug abuse and match fixing scandals have cast shadows over sport. However, improved technology and more detailed examination is beginning to lead to quicker and more conclusive exposure of cheats. This will strengthen the rights of sponsors enabling them to react appropriately and making the rights holders much more accountable”.

Swatch own watch brand Omega has extended its partnership with the International Olympic Committee until 2020. Under the terms of the deal, Omega  is a top sponsors and also the Olympic Games designated official timekeeper. 

While some National Olympic Federations and local organising committees have been struggling to generate revenue during the downturn, the IOC has managed to come through in pretty good shape - with the likes of Acer, Atos, Coca-Cola, GE, McDonald’s, Origin, Panasonic, Samsung and Visa also on board for the current cycle. In addition, the IOC has managed to strike some impressive TV rights deals - most recent securing U$100m in Spain.

After sustained criticism of the BBC’s commercial activities by rivals, moves are now taking place to control the corporation’s money-spinning activities across a range of business sectors. One area set to be curtailed is sponsorship - with the BBC Trust this week introduced tough new guidelines on what is acceptable. As a result, a wide range of activities will now be thrown out by the corporation.

The big change is that sponsorship of BBC activities will now be required to further the BBC’s public purposes and should not give the impression that a BBC programme has been sponsored. So it is highly unlikely that Robinson’s overt partnership with the BBC Sports Personality of the Year would fit within the new regime. There would also be question marks over the kind of set-up which saw Proms in the Park sponsored by National Savings & Investments.

Sponsorship is still regarded as important - as long as it passes the tough new tests. For example, there is room for commercial brands to sponsor off-air events (ie those which don’t get high-profile TV or radio mentions). As for on-air events, sponsors will primarily be drawn from organisations such as charities, trusts, foundations and local authorities.

The new rules take effect immediately, with the BBC deciding not to sign or renew any commercial sponsorships. Commenting, Richard Tait, chair of the Trust’s editorial standards committee, said: “Sponsorship can bring important events into licence fee payers’ lives - but producers need a clear understanding about when and how such  sponsorship may be accepted in support of the BBC’s public purposes. That’s what we have set out today.”

Entries for the ESA European Sponsorship Awards close on Friday 25^th September, which means that there is still time to submit an entry in one of five categories:   Business to Business, Business to Community, Business to Consumer, Business to Employee, and the coveted International Award.

The Awards provide a platform for campaigns from across all sectors, budgets and European countries to be judged against each other.   Karen Earl, Chairman of the European Sponsorship Association commented: “The past year has been an interesting time for the industry, with many exciting campaigns defying the credit–crunch doom and gloom, and proving that good sponsorship works.  I am looking forward to seeing campaigns from culture, sport, entertainment, media and corporate social responsibility go head-to-head, in a bid to be crowned the best in their field. What makes the ESA Awards so exciting is that you don’t need to have a multimillion-euro budget to succeed.  Small-budget projects can compete on equal-terms against household-name campaigns.”

Winners will be presented at London’s Café de Paris on November 25^th, which will feature as part of its annual flagship conference, Future Sponsorship.

Havas Sports and Entertainment has been appointed by airline bmi to activate its sponsorship of England Rugby through a partnership with the Rugby Football Union. Commenting on the agency’s appointment, Charlie Wylie, account director at HS&E UK, said: “This partnership is very exciting for us. It’s great for us to be working at the top level with the England management and team.” 

HS&E also negotiated the sponsorship with the RFU - making bmi the preferred carrier of England. Wylie consulted to bmi on all levels from grassroots CSR to professional player appearances - also securing exclusive naming rights of Twickenham Stadium’s business debenture lounge which will be renamed the bmi Diamond Club. 

Commenting on its sponsorship deal itself, bmi sales and marketing director Katherine Gershon added: “We are very excited to be the official airline of the England rugby team and feel they are a great brand fit for bmi, a predominantly business class carrier. HS&E used their extensive knowledge and contacts within rugby to enable the deal to be completed in time for this year’s major games.”

In tough times like these, it’s no surprise that we hear so many clients talking about the need for proof that sponsorship delivers return on investment. So it’s interesting to note that consultancy MEC Access is launching a research tool that will analyse the impact of sponsorships.

The tool, which is called Rose, uses consumer research to explore how sponsorship activity affects the way in which consumers feel, think and act towards a brand. It then goes on to assess how much influence the partnership is having on brand buying intention. This information can then be used to calibrate the sponsorship as it progresses.