Fuelled by the hosting of the 2010 FIFA World Cup, the South African sponsorship industry experienced significant growth from 2006 through to 2010.
"It is no longer sufficient to sponsor the right thing - you have to do the sponsorship right."
David Butler - API Group Media Director
The trend in the industry is to become more focused on developing a relationship with the consumer - your customer/potential customer - that connects your product with your market in a more intimate manner.
Alternative marketing as in sports sponsorships is growing in that it has become a year-round opportunity market, e.g. television, radio and other media on specialists sports and sport shows, amateur and professional events, local and global and celebrities.
The key is not to view sports sponsorship as classical advertising, but as a marketing tool in its own right (one tool amongst a great number of other opportunities). It is there to cut through the clutter and provide you with 'ownership' opportunities.
Different industries are becoming more and more involved in sponsoring sport as part of their alternative marketing plans. They use it to create brand awareness and to position their company and its products in line with the lifestyle of their customers - integrated into their overall marketing strategy. Companies are as diverse as cellular networks, banks, fuel and beer manufacturers, cigarette and alcohol companies, banks, etc.
Companies are looking for the best exposure for their money. Return on advertising Rand spends. It is estimated that not more than approximately 20% of your advertising budget should be spend on sponsorships.
To ensure that your investment is secure you need a Sponsorship Blue Print that will establish your strategic foundation for all sponsorships. It will also eliminate getting lost in your competitors programs and initiatives. The Blue Print should pin-point your quantifiable objectives and target markets and ensure that you meet the objectives and requirements of the sport that you sponsor, e.g. profile and marketing alignment between both parties.
The drawbacks in sport sponsorship are that it cannot accurately be measured. It can become unfocused and not trackable. People are more concerned with their sport than the people who have brought it to them. 64% of the people say that their purchasing habits were in no way influenced by sponsorships. (90% of SA sports sponsorships fail from a marketing point of view.)
Your market penetration will be affected depending on the number of sponsors on a particular sport. In SA the trend is towards sport development programs for the previously disadvantaged people. Get involved early and grow with it rather than later because of the expense. Also use it as a springboard into the market of opportunity.
Merchandising follow-through is an important ingredient in the make-up of a successful sports sponsorship. Rand for rand investment.
The fundamentals of an effective sponsorship:
- It must be active, e.g. placing representatives in retail outlets, etc.
- It must be innovative. Focus from visibility to likeability and interact with your market.
- It must be meaningful. Concentrate on developing intrinsic and marketing value.
- It must be experiential. Interactive involvement adds value between client and product.
30% of sport spectators see "great value" when advertisers and sponsors engage with local sports groups to promote sportsmanship over major international sporting season
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.
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