30% of sport spectators see "great value" when advertisers and sponsors engage with local sports groups to promote sportsmanship over major international sporting season
Sports Marketing Set To Boom In 2012
A piece written
by SAIL CEO Justin Sampson. Justin has
won more sponsorship awards than any other individual in South Africa.
Fuelled by the hosting of the 2010 FIFA World Cup, the South African sponsorship industry experienced significant growth from 2006 through to 2010.
As was expected, 2011 has provided a period of industry consolidation and reflection as all stakeholders look to define their positioning and focus areas going forward. This period, which we have called the 2010 Hangover is nearing an end and all indications are that 2012 will be a bumper year for the industry as brands look to harness the interactive platform that sponsorship provides with their chosen target market.
When correctly partnered with sport, sponsorship creates a powerful blend of emotion, alliance and association reaching beyond borders and uniting all markets.
The bottom line is that through advertising we ask consumers to do something for us but through sponsorships we get to do something for them, engaging on a whole new level.
When comparing sponsorship to other marketing initiatives such as advertising, the benefits of sponsorship are clear: sponsorship allows for the brand to interact with the consumer; it also allows for exclusivity within a specific industry code to ensure that the sponsor breaks free from the clutter of other marketing mediums.
Sponsorship has been the fastest growing form of marketing for the last decade to the extent that the most active of sponsors are allocating approximately 25% of their marketing budget towards sponsorship properties.
Global statistics indicate that the number of companies spending more than 30% of their marketing budgets on sponsorship grew from 3% in 2000 to 18% in 2010 with a projected global sponsorship spend of close to $50 billion.
The manner in which brands utilise their sponsorships is the key: Companies do not use sponsorship to replace advertising, public relations or sales promotions. Rather, smart marketers integrate sponsorships throughout the marketing mix, not the other way round.
Sponsorships provide content that can be used in advertising, promotions, employee incentives, online media and various other platforms to generate maximum impact for the sponsor.
Therefore if used correctly sponsorship has a very important role to play in the marketing mix of the future, but it is not for everyone. Sponsorship requires a research-led approach to ensure a thorough understanding of the sponsorship property that leads to a clear strategic plan that is measurable against actual objectives.
As the most watched event in the world, the Soccer World Cup improved the level of professionalism in our country and was a clear demonstration of how if correctly utilised, sports sponsorships has the power to sky-rocket your brand.
We see it almost every day when brands not previously dominant within the sports arena are now advocates of sponsorship and are currently surveying the market place for opportunities. Hyundai is one such brand where locally they had very little experience of the value sponsorship could provide, yet post the 2010 Fifa World Cup they have been looking for the opportunity to utilise their new found belief in sponsorship across other opportunities.
Since being awarded the right to the host the 2010 FIFA World Cup in 2004, the South African soccer industry has been able to command large rights fees not yet seen in the local sponsorship industry.
With corporates lining up to involve themselves with the round ball, rights holders were able to charge premium rights fees. 2012 promises to be a watershed year for the commercial future of South African soccer as a number of long term sponsorship deals come up for renewal if the recent Supersport renewal of the broadcasting rights agreement is anything to go by, then bigger and better deals are still to come.
Even for a broadcaster such as Supersport, owning exclusivity on content and specific broadcasting rights is of critical importance. Since first signing the broadcasting agreement with the PSL in 2007, Multichoice has sold close to 1 million compact decoders at an average subscription in excess of R200 per month the numbers certainly add up!
Hosting international sporting events such as the 2010 FIFA World Cup, the British and Irish Lions and the IPL gives our sponsorship industry (agencies, rights holders, broadcasters) the opportunity to work with international brands and personnel that can only add value to the creative leveraging of sponsorship platforms going forward. What we should see happening is for other International sporting bodies to realize that we are a country that is capable of hosting very successful international events outside of cricket, soccer and rugby union. This will unearth the true sponsorship potential of these previously disadvantaged sports in South Africa.
Naturally there will be teething problems but ultimately South African sport will become stronger in terms of its off field performance which will inevitably grow the market through increased sponsorships and greater returns.
Have faith in our qualified professionals who understand both business and sport. As we continue to digest our learnings one year later, we are aware of the potential that exists and the desire to deliver and have absolutely no doubt that SAIL will continue to surprize and delight both sponsors and partners.
Written for and on behalf of SAIL by The PR Machine (Caroline@theprmachine.co.za).
More information on SAIL:
SAIL is a wholly owned subsidiary of Marc Group Limited which has been operating for the past 13 years in the sport and entertainment fields. Operating throughout South Africa, SAIL plans to expand into Africa.
SAIL, a commercial agency with a staff complement of 60, boasts an impressive client portfolio including Vodacom, Investec, Cricket South Africa, Sports Science Institute, Chelsea FC and the Alfred Dunhill Championships. SAIL has successfully partnered with Vodacom for a number of years on sponsorship properties which they either manage or co-own including the Vodacom Challenge, Vodacom Blue Bulls and the Vodacom Origins of Golf tour. Although not strictly a consulting agency, SAIL does consult with rights holders and advise them from a commercial perspective.
Free gifts and seeing favorite sports icons on advertising among a list of things that sports spectators in South Africa see as "great value", during major international sporting seasons
Formula One is a massive sporting event, attracting a global audience of over 500 million people and reportedly generating revenue of $3.5 billion per year.
The key is not to view sports sponsorship as classical advertising, but as a marketing tool in its own right.
Sponsorship is the business link between commercial companies and events or activities, through the provision of funds and services to achieve a predetermined marketing and communication objective. Primarily this tends to be the corporate or brand exposure via the media and in addition, superb PR, promotional and business returns, which benefit the sponsor's internal and external relationships