Sports Sponsorships: Considerations and Configurations
The sponsorship of sports has become a highly visible and powerful variable in professional sports, and to a lesser degree, in scholastic sports. The field of sports sponsorship has evolved to such a degree that sponsorship strategies have been classified into benefits packaged identified by color: Gold, silver, and bronze. Selection of sponsorship packages has become de facto, which undoubtedly creates advantages for the sponsor. Recently, there has been a shift to more flexible sponsorship proposals that are referred to as tailored sponsorship arrangements.
Further complicating the sponsorship arrangement is that the public's response is not always predictable. Sponsors and sports organizations would do well to recognize the need for market research before they engage in costly or complex sponsorship agreements. Steinbach (2005) provides an interesting example of how sponsorship can go seriously awry. In May of 2004, Columbia Pictures and Major League Baseball (MLB) came to an agreement that would enable Spider-Man 2 logos to be printed on the pitchers' mounds, the bases, and the on-deck circles at all MLB parks for just three days in June. The sponsorship would have netted $3.6 million for the MLB. Across the U.S., when fans heard of the deal, they were openly opposed. The league was able to end the promotion in time to risk offending fans on a grand scale and racking up a probably all-time public relations disaster.
This story is a good reminder that there really are three parties in a sports sponsorship arrangement: The funding party, the sports organization, and the fans (Roy & Cornwell, 2001). This paper will review and discuss the pertinent merits and shortcomings of both the packaged sponsorship agreements and tailored sponsorship arrangements, for all three stakeholder groups.
Sponsorship agreements that are offered to grassroots sports organizations are nearly always of the tailored version. Packaged sponsorship arrangements are generally not available at this level fundamentally because the stakes are not sufficiently high. The sponsors of grassroots sports organizations are looking for very specific types of exposure: Increases in business revenue and enhanced company image as engaged community members. Large national corporations tend to rely on gatekeepers to weigh and pass along sponsorship opportunities to key corporate decision-makers (McCook, et al., n.d.). McCook, et al. found also that "the top three sport sponsorship objectives for Fortune 1000 companies were to increase awareness of company, to improve company image, and to demonstrate community responsibility."
The configuration of grassroots sponsorship typically shows the highest sponsorship expenditures to be for uniforms -- at 69.6% in a study conducted with community baseball and softball teams (Obsniuk & Smith, 2007). This category was followed by the following, in order of expenditure: Facility (43.5% for scoreboard, outfield signs), equipment (34.8% for gloves, cleats, bats, and balls), and field (26.1% stadium, diamond) (Obsniuk & Smith, 2007). The study results showed that 76.7% of all respondent organizations had sponsorship arrangements and that 86.4% of the respondents from organizations that had been in place for 20 years used sponsorships (Obsniuk & Smith, 2007). Interestingly, sponsorships were not effective in reducing the individual expenses of players (Obsniuk & Smith, 2007).
Corporate sponsorships are of a different caliber than grassroots sponsorships, but not necessarily for reasons one might surmise. Certainly, increased revenue is a goal for corporations that fund sports organizations, but there may also be other very particular goals on the docket. It is not uncommon for corporate sponsorships to be embedded in public relations goals designed to cast the corporation in a particular light or to actually achieve -- through the sponsorship -- specific changes indicative of an organizations' mission.
Crisp and Swerissen (2003) found that contract specification was an issue for collaborations between funding bodies and sporting organizations. Particularly in cases where the funding body is interested in taking a programmatic approach to their sponsorship arrangements, it is important that a framework for monitoring and evaluation of expectations be included in the contract language (Crisp and Swerissen, 2003). One outcome measure that funding organizations may request is structural changes at the venues where the sponsored sports activities are played. An example of a structural change that could be measured and monitored is the establishment of a smoke-free sports environment as requested by the sponsor -- generally, there is a logical association between the structural change criteria and the mission, service, or product of the funding organization. The contracts in the study by Crisp and Swerissen contained just "a paragraph regarding structural change, which stated only the outcomes to be achieved with few, if any, details as to how structural changes were to be implemented…there were only a couple of examples in which an incentive was paid if the structural change was achieved" (2003, p. 150). Crisp and Swerissen also found "that the requirements of structural change were not tailored to fit the varying capacity and structure of sponsored organizations" (2003, p. 150). The underlying issue then became that sponsored organizations were asked to implement structural changes that they had not been able to collaboratively develop with the funding partners, nor did they receive any funds to implement the structural changes, or as an incentive should they manage to effect the structural changes for which they assumed the cost.
Application to Career Path
This section of the paper will discuss the importance of knowledge about and understanding of different types of sponsorship arrangements, and the manner in which these different strategies can impact the future career path of individuals who work in the field of sports. Sports sponsorship, as the literature illustrates, is not a simple undertaking. The days when a hardware store would purchase, install, and paint a stadium board with its logo -- to help support the local team and maybe drum up some business -- are relegated to the smallest of venues and budgets. The four verticals of sports sponsorship include sports marketing, media, events, and sports hospitality. The stakeholders across these verticals include renowned sponsors, event organizers, media owners, sports clubs, and the governing bodies of sports associations. A wide range of media can be engaged in sports sponsorship services, including radio and television broadcasting, online digital content strategies, traditional offline advertising. All of these strategies can be further complicated through association with talent and celebrity representation.
Take the case of a sports marketing offering by a university athletics program. The university sports marketing program has targeted corporate sponsors with this marketing collateral:
BSM provides a full range of marketing opportunities designed to give corporate partners maximum visibility in the marketplace. With this goal in mind, BSM will tailor a package that meets your marketing and advertising needs. Sponsorship opportunities include: Permanent and temporary signage, broadcast opportunities (radio & television), print advertising, internet advertising, game sponsorships, pre-game, in-game and half-time promotions, hospitality events, and C.A. arena.
The appeal of this menu of sponsorship opportunities to a corporate partner is that funds can be targeted toward the elements, aspects, and venues that hold the most promise for visibility and that signal community engagement. For instance, if the regular attendees and boosters of this university athletics program lean toward technology -- particularly use of mobile digital devices -- then the sponsorship can pick up marketing opportunities that appeal to that target population. Announcements during half-time about sponsorship have short temporal life, while stadium signage or score-boards provide a permanent signal to fans and the community. Clearly, corporate spend on sports sponsorship can be configured to provide a fairly precise type of promotion. A pre-established package deal would not be as likely to appeal to a corporate sponsor for several reasons. Corporations are quite accustomed to negotiating for the best outcomes for their investors and stakeholders. Most would not shy away from playing hard-ball with their own money. The public relations department in a corporation is…