IEG SPONSORSHIP REPORT THE LATEST ON SPORTS, ARTS, CAUSE AND ENTERTAINMENT MARKETING

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1 IEG SPONSORSHIP REPORT THE LATEST ON SPORTS, ARTS, CAUSE AND ENTERTAINMENT MARKETING MAY 20, IN DEPTH BEST PRACTICES: SELLING NEW EVENTS New properties need to be as creative as possible to mitigate sponsor risk. As if selling sponsorship wasn t hard enough, new events face a major challenge in gaining the attention of prospects. More often than not, sponsors are wary of properties that do not have a proven history or sponsorship track record. New properties typically raise a number of red flags: Will the event be a success? Who will attend? And, just as importantly, does the event organizer know how to work with sponsors? To make matters worse, the growing importance of return on investment has made the need for audience demographics, media coverage and other historical data more important than ever for a sponsorship decision-maker to justify an investment. IEG SR asked sales agencies and event producers for tips, tactics and strategies on selling untested properties. Below, they share their advice. Have a story to tell. With new events seemingly popping out of the woodwork on a daily basis, properties need to have a compelling story to stand out from the competition and gain the attention of prospects. The story should tie back to the concept behind the property. Does it support a niche passion point? What is it that makes the event unique? What is it that sets you apart? If you don t have a story to tell, you re in trouble, said Chad Issaq, executive vice president of business development and partnerships with Superfly Marketing Group., the marketing arm of Superfly Presents, the producer of the Bonnaroo Music & Arts Festival and other events. Rightsholders should also be able to tell a story on why a prospect should align with the property, said Uzma Syed, director of corporate partnerships with Premier Partnerships, a sponsorship sales agency. If you don t believe there is a fit, they probably won t either IEG, LLC. ALL RIGHTS RESERVED. 1

2 Play up track record. Where possible, event producers should play up their history of producing events and working with sponsors. Stress the credibility of events that you have produced in the past, and get testimonials from clients you have successfully activated, said Howard Freeman, president of Promo One, the producer of the QuickChek New Jersey Festival of Ballooning in association with PNC Bank and other events. Share in the upside. Properties may be able to gain the interest of sponsors by offering financial structures that mitigate risk. Tim McGhee, principal with MSP Sports, recommends that properties lower the price tag in the first year of a relationship in exchange for a higher fee in the following year if predetermined metrics are obtained. The metrics which should be jointly established at the beginning of a relationship can range from on-site attendance to TV ratings, he said. It shows that the property believes in itself by taking a little less upfront with more upside going forward if a sponsor achieves its goals. Build up media bank. Some events have found success by doubling down on media. If you can develop a scenario where a client gets 95 percent of benefits before you open the doors, it s a no-risk situation, said Freeman. The event producer and sponsorship seller put that strategy into action with the inaugural Rock, Ribs and Ridges Festival in Vernon, N.J. Looking to acquire media to promote the festival and its sponsors, Freeman approached the president of Franklin Sussex Auto Mall the largest advertiser in the local market. Freeman pitched a sponsorship and a handful of promotions designed to drive traffic to the dealership. The price tag? Whatever the company wanted to pay. I said here are five ways you can sell cars with this new festival. There is no price tag you can pay whatever you want. The catch: Franklin Sussex had to promote the festival in 80 percent of its media buy in the months leading up to the event. While the dealership came in with a lower-than-expected fee, the company now pays four times as much, said Freeman. It was a win-win with little financial risk, he said, noting that the dealership has presented the festival over each of the past four years. Promo One also uses the media to promote other sponsors, added Freeman, noting that Franklin Sussex must preapprove each company IEG, LLC. ALL RIGHTS RESERVED. 2

3 Speak in the present tense. When discussing and pitching new events, properties should speak in the present tense. New properties tend to say things like we re thinking about doing this or that. They need to take out tentative language from their proposals and pitches, said Bruce Erley, president of Creative Strategies Group, a sponsorship sales agency. There can be nothing conditional about the words you use to describe an event. It may not exist yet, but it still exists. At a minimum, new properties should have a Web site and a social media presence to give prospects a point of reference about the property and the sponsorship opportunity. People are visual by nature, and you need to have something to point at to inspire interest, said Issaq, noting that a sponsorship decision-maker will likely pass on an opportunity that does not have a digital presence. Approach companies that sponsor similar types of events. Both new and established properties should monitor sponsorship activity at similar types of events to identify potential categories and companies to pitch. The first thing I do is look at what companies are sponsoring similar events because then I know they have a history of supporting like events, said Brett Gorrell, vice president of sponsorship with Festivals, Inc. The sponsorship seller has used the strategy to identify prospects for four new events over the years: Tall Ships Tacoma, Cinco de Mayo-Seattle, Oktoberfest Northwest and Oktoberfest Monroe. Borrow audience demographics. One of the major challenges in selling new events is the lack of audience demographics. To get around that challenge, Erley borrows research from outside resources. For example, the sales vet pulled data from Competitor Magazine when selling the inaugural Denver Century Ride, a 100-mile bicycle ride through the Mile High City and the Front Range of Colorado. I went to the Competitor Magazine website and looked for the demographic profile of cyclists that participate in 100 mile rides, said Erley, who attributed the data to the magazine in the event s sales material. Sellers can take a similar tack by borrowing audience demographics from similar types of events located in other markets, he added. Involve relevant stakeholders. Sellers may need to involve relevant stakeholders in the sales effort to help explain the vision of the project. For example, BDS Sponsorship invited the owners of the London Eye to participate in sales calls and educate prospects about the oversized attraction. They could sell their vision better than anyone, said Fraser Houlder, general manager of BDS Sponsorship. The sales agency subsequently secured British Airways as the attraction s title sponsor IEG, LLC. ALL RIGHTS RESERVED. 3

4 Be realistic with pricing. When hitting the market, new properties need to be realistic about the value of their sponsorship packages. Have an understanding of what the market will bear and be realistic with pricing, especially since there is not an established sponsorship history or case studies to use as examples of past successful sponsorships, said Syed. Sources BDS Sponsorship, Tel: 44/ Creative Strategies Group, Tel: 303/ Festivals, Inc., Tel: 425/ MSP Sports, Tel: 908/ Premier Partnerships, New York office, Tel: 919/ Promo One, Tel: 973/ Superfly Marketing Group, Tel: 212/ IEG, LLC. ALL RIGHTS RESERVED. 4

5 IEG SPONSORSHIP REPORT THE LATEST ON SPORTS, ARTS, CAUSE AND ENTERTAINMENT MARKETING MAY 20, RESULTS PENNZOIL SEES SUCCESS FROM TIM MCGRAW PARTNERSHIP Pennzoil uses country music to drive preference and brand affinity. Pleased with its inaugural partnership with Tim McGraw, Shell Oil Co. ( Pennzoil Launches Integrated Partnership With Tim McGraw ) has extended the relationship into Shell last year partnered with the actor and country mega musicstar to support Pennzoil s Long Love Cars marketing campaign. Pennzoil activated the tie with a 360-degree marketing program that included tour sponsorship, digital and traditional media and consumer and B2B promotions. The partnership was a success: Pennzoil saw an increase in purchase intent and brand affinity among consumers who were aware of the sponsorship, said Aimee Cronfel, North American Pennzoil marketing manager. Based on learnings from year one, Pennzoil has expanded the tie to engage more consumers and maximize retail promotions. For example, Pennzoil this year stepped up to present McGraw s Two Lanes of Freedom tour. The brand last year cosponsored McGraw s Brothers of the Sun tour, an outing co-headlined by Kenny Chesney and presented by Corona Light. Pennzoil expanded the relationship to increase visibility and drive more sales. The people aware of the sponsorship were more likely to purchase product, but that group was fairly small because we were not the presenting sponsor. We want to increase the number of people aware of the sponsorship. As presenting sponsor, Pennzoil gains promotional spots on video boards, exposure on tickets and brand integration into the tour logo. In addition to presenting status, Pennzoil this year has introduced a national promotion that dangles a Challenger SRT customized by McGraw. Consumers can enter the contest at as well as Advanced Auto Parts, Wal-Mart and other retailers IEG, LLC. ALL RIGHTS RESERVED. 5

6 The national sweeps replaces smaller promotions conducted last year, said Cronfel, noting that some retailers were reluctant to participate in There was some wariness but everyone bought in this year. The presenting sponsorship and lack of restrictions give us more freedom. Some retailers have tweaked the promotion with account-specific overlays. For example, Wal-Mart is running a promotion that dangles a free song download with product purchase. Pennzoil also is running sales promotions at Jiffy Lube, Chrysler dealerships and other DIFM (Do it for Me) channels. The promotions dangle concert tickets and other perks for service writers. To further extend its reach, Pennzoil is leveraging the tie with videos and other exclusive content. For example, one video shows McGraw customizing the car and the big reveal, while another shows the musician preparing for the tour. Pennzoil shows the videos prior to each concert. It also posts the content on its Facebook page and other social media platforms. Other new components for 2013 include the following: A new:15 TV spot A three-part Vevo webisode series that showcases McGraw and other musicians driving and discussing their love for cars. A user-generated promotion in which consumers can upload images and videos to be part of a McGraw music video to be released at the end of the tour. A partnership with Live Nation that includes on-site support and exposure on LiveNation.com and TicketMaster.com. The tour sponsorship also includes title of the Tune-Up Series, a pre-show acoustic concert for McGraw fan club members and other VIP guests. Morgan Buksbaum, vice president of GroupM ESP, helped Pennzoil develop the sponsorship strategy and negotiate the deal. (IEG SR publisher IEG, LLC and GroupM ESP are both are all GroupM businesses, part of the media investment management operation of WPP Group plc) Source Shell Oil Products U.S., Tel: 713/ IEG, LLC. ALL RIGHTS RESERVED. 6

7 IEG SPONSORSHIP REPORT THE LATEST ON SPORTS, ARTS, CAUSE AND ENTERTAINMENT MARKETING MAY 20, STRATEGY INSIDE ROUSH FENWAY RACING S NEW SPONSORSHIP STRATEGY Rightsholders can increase the odds of closing deals by taking a consultative approach to sponsorship sales. A new sales approach is paying off for Roush Fenway Racing. Moving beyond selling exposure on cars and an affiliation with drivers, the NASCAR team has taken a consultative approach to sponsorship by offering turnkey activation platforms that move the marketing needle. And the strategy is gaining traction: RFR last week announced a three-race deal with Pillow Pets, a marketer of plush toys. The company will title Trevor Bayne s No. 6 car at the May 25th History 300 NASCAR Nationwide Series Race at Charlotte Motor Speedway followed by races in Indianapolis and Dover, Del. While the deal is small in NASCAR standards, the partnership highlights the team s new sales approach. Pillow Pets had not previously considered NASCAR and was skeptical if a sponsorship would work, said Steve Newmark, RFR president. The team overcame those concerns by offering a handful of activation programs targeted at mothers, the company s primary audience. Those platforms included access to military families. Pillow Pets will activate the race at Charlotte Motor Speedway by supporting the track s Memorial Day activities. The company will distribute more than 2,000 toys to the families of military veterans who have recently returned home from active duty. Pillow Pets also will sponsor a bus that will transport troops and their families to the race. The bus will take a parade lap around the track before dropping off the veterans at their seats. This partnership is indicative of the direction we re going. We re talking to companies who may not have been interested and showing them how they can achieve their marketing objectives, said Newmark IEG, LLC. ALL RIGHTS RESERVED. 7

8 Reorganizes Marketing Operations Roush Fenway Racing earlier this year restructured its marketing operations division to support the new sales strategy. That includes the creation of the strategic marketing group, a team of employees charged with bridging the gap between RFR s sales group and sponsor operations group, the latter of which manages the fulfillment of tickets, hospitality and other sponsorship deliverables. The strategic marketing group serves as a de facto agency charged with developing activation programs for both current partners and new prospects, said Newmark. To help sponsors generate ROI, we need to offer turnkey activation programs based on a company s specific marketing objectives. The group is managed by Kevin Thomas, vice president of strategic marketing and a former employee with GMR Marketing, an activation agency. The strategic marketing group also has hired a dedicated staffer to develop and manage social media programs and behalf of the team and its sponsors. When we looked at our strengths and weaknesses, one of our strengths is unlimited content. We need to do a better job educating partners how they can use content to advance their objectives. The strategic marketing group also is charged with helping sponsors cross-promote with assets outside of NASCAR. For example, United Parcel Service, Inc. ( Shipping Companies Take New Approach To Activation ) earlier this month activated its RFR sponsorship with an event that featured driver Carl Edwards and pro golfer Lee Westwood. The event brought the two athletes together under the theme of driving, with Edwards giving Westwood tips on driving a race car and Westwood offering advice on driving a golf ball. The event was held at the Charlotte Motor Speedway prior to the PGA Tour Wells Fargo Championship in Charlotte, N.C. RFR is exploring similar activation programs with Best Buy Co., Subway and other partners, said Newmark. The motorsports team also helps partners implement programs. We recently talked about a quote in our management meeting from Thomas Edison: Vision without execution is hallucination. It s not sufficient to say here are good ideas on how to use our assets. We have to help implement them. Source Roush Fenway Racing, Tel: 704/ IEG, LLC. ALL RIGHTS RESERVED. 8

9 ABOUT IEG IEG leads the way in sponsorship solutions. With over 30 years providing insights, evaluation, and guidance, our teams bring unparalleled perspective and proven methodology to every challenge. We partner with top brands and properties to create fresh strategies, evaluate opportunities and maximize results. Our clients redefine what s possible, exceed expectations and achieve lasting impact. A unit of WPP s GroupM, IEG is connected to specialty sibling communications companies in media, digital and activation. GroupM is the leading global media investment management operation that also serves as parent company to WPP media agencies including Maxus, MEC, MediaCom, and Mindshare. INSIGHTS EVALUATION GUIDANCE IEG LEADS THE WAY IN SPONSORSHIP ANALYSIS, INSIGHT, VALUATION & MEASUREMENT For more information about IEG and the sponsorship industry, please visit or call 800/ (outside the U.S. and Canada, 312/ ). WWW. SPONSORSHIP.COM 2013 IEG, LLC. ALL RIGHTS RESERVED. 9