Slingshot: Brand Side. 19th December, 2018

Chances are – if you’re reading this – you’re aware of Slingshot and what we do. Or are you?

Our work with rights holders all over the world has been well documented, whether through our own channels or through numerous industry awards. We have worked as the exclusive sponsorship agency for many of the world’s most innovative platforms to identify and secure strategic brand partnerships. But what may be less known is our brand consultancy service: working also on the other side of sponsorship with global brands to highlight the most relevant partnership platforms in order to achieve the biggest cut-through, awareness and equity.

Our expertise, developed over many years working on the rights-holder side, has led us to understand exactly what brands are looking for when they are considering sponsorship opportunities. Thus, on the flipside we know precisely what assets are needed to be secured to achieve brand marketing objectives, regardless of industry or budget.

How can Slingshot help?

Dream Package:

 A crucial step which is often overlooked by brands is the creation of an asset list or dream package. By creating an essential asset list, brands can identify exactly what they require to achieve key objectives and generate a strong ROI. Too often we see brands being one dimensional when it comes to aligning with events and failing to make full use of the opportunity and their budget. A classic case being the purchasing of activation space without making use of the wider PR, marketing and social benefits that would help them cut through at a much higher level with their intended audience (sometimes these extra assets can be bargained within the original price!)

Negotiation:

Many agencies, when given a brief and a budget by a brand will look to spend the whole wad of cash, even if the package offered isn’t worth its price in the current market. With extensive knowledge of sponsorship valuation and sales: Slingshot can negotiate on the brands behalf to get the assets they require at the best possible value. Saving valuable sponsorship monies which can be used to leverage the partnership through activation instead.

Efficiency:

Our extensive network within the industry provides the perfect platform to take a brands’ vision for their sponsorship strategy to market. Building a network takes time and surprisingly, approaching a rights holder for sponsorship enquiries can actually be a lengthy process. However, by utilising an agency who already has an established name in the sponsorship field your brand can save exponential amounts of time, helping you to understand and evaluate the available opportunities more promptly.

Unique Events:

 Lastly, Slingshot is renowned for being at the forefront of the industry as one of the most innovative sponsorship agencies. Our position within the sponsorship industry means that we regularly work with niche, innovative and exciting events. Rather than pitch you the same old generic properties, we have access to platforms with specific demographics and highly engaged audiences which stand out from the crowd and can deliver a far better ROI at generally a far better price too. Some of our current clients include Extreme Tech Challenge, a start-up competition held on Necker Island with a B2B focus and a HNWI audience and London New Year’s Day Parade a mass consumer event with 650,000 attendees. Thus, we may already be working directly with a rights-holder which would deliver the cut-through needed for your next product release, re-brand or campaign push!

If you are looking for advice on any aspect of the sponsorship industry, we would be more than happy to offer our expertise, please email info@slingshotsponsorship.com or call 0207 145 0150 to get started.


The Pitfall of Long Term Sponsorship Deals 27th July, 2016

English football team Chelsea and global sportswear brand Adidas outline the potential challenges that long termed partnerships can create. In early May this year, a mutual agreement was made to end the sponsorship deal that short-fell Adidas’ potential and failed to reflect the value of Chelsea FC.

The 10-year sponsorship deal ended after only four year on the basis that the partnership was not benefiting either party.  Chelsea felt the £300million deal did not reflect their success nor their value, whilst Adidas felt the deal was not in line with their new business strategy of maintaining a lesser number of sponsorships at an increased sponsorship sum for their sponsees.  Having recently made a £750million sponsorship deal with rival team Manchester United, Adidas left Chelsea FC feeling undervalued and believing they could achieve greater sponsorship than what had been offered to them 4 years ago. On the other end, with Chelsea’s shocking performance this past season, there was no incentive for Adidas to increase the amount of the sponsorship deal in a way that offered enough benefit and still aligned with their new strategy.

Whilst the partnership proved to be mutually beneficial for the initial years, in recent times with both parties growing and evolving it only proved to be a hindrance to their futures. With the sponsorship industry constantly growing and as a result its costs ballooning, Adidas prioritising their new strategy of a more focused portfolio.  Additionally, Chelsea’s acknowledgement that their partnership did not reflect their market worth today was vital in their growth with a new partner.

The sponsorship industry evolves at a rapid rate, shifting away from logo badging to strategic business deliverables. Simultaneously the sporting world, and more specifically the football industry remains somewhat volatile – with politics and the economy affecting players and transfers amplified by team performance (Leicester City).

Although signing a 10-year contract may seem beneficial, the pace of the industry and media landscape evolution creates more risk.  Long termed contracts in such changing conditions mean that partnerships can get to a stagnant point where neither party can maximise the initial benefits sought. The idea that an extensive contract will provide security is predominantly only viable when looking at the monetary side of sponsorship, but sponsorship is more than money.  This façade of security tends to be a contradictory ‘benefit’ – potentially being more risky than short term contracts that evolve as both partners evolve.


It’s Not Who You Know 25th July, 2016

Far too many of our new business meetings focus purely on who Slingshot knows at Board level with brands. Undeniably, we know a lot. But that’s our business – it’d be like if McDonalds didn’t know what types of condiments to use for their hamburgers. It would be ludicrous if after 6 years of selling sponsorship rights to global brands, we didn’t make a friend or two along the way.

Unfortunately, almost all sponsorship sales agencies use this angle in their pitches – providing a false sense of security, to the potential new client, that sponsorship sales is all about speaking to the right person. This couldn’t be farther from the truth.

In my 15 years of selling “stuff”, it’s almost never about who you know. Bad salespeople focus on this in a new business pitch because it’s easy. Rather than take time to review the boring strategic processes that underlie sponsorship sales, it’s easier to provide wow factor by name dropping. This masks the fact that the challenge of selling sponsorship actually is controllable by a rights holder and can be fixed without hiring a specialist sponsorship sales agency, and no one really wants that do they?

Slingshot’s approach is never about the black book, which many think is unconventional and also means we lose a lot of pitches to those that guarantee sponsors and often unachievable revenue targets. The smoke and mirrors sales pitch champion who they know, but if you are struggling to maximise your full sponsorship potential it’s not because of your sales people, your property or your access to LinkedIn – it’s your commercial strategy.

Without a commercial strategy that understands what assets you have, what assets brands require to drive ROI, your fair market value and a pretty spectacular proposal – you honestly don’t really have a chance. I am pretty good friends with a lot of big brand buyers, but even I can’t flog something without the above. Gone are Chairman’s Whim days, but it means you have got to start thinking about your proposition if you are going to invest time and resource into selling sponsorship.


“Enter At Your Own Peril” : Sponsor Association With Controversial Brand Ambassadors 23rd September, 2013

 

“The role of a brand ambassador – the brand ambassador is a marketing model that employs trusted, credible personalities to promote and give greater visibility to its brand products

It seems, historically, that sport and scandal have gone hand-in-hand. Over the past five years there have been multiple athletes in the upper echelons of their respected fields that have been subject to a public fall from grace. For the sponsor, the usual protocol will be to run for the hills, and withdraw any association with the respected star. However, there are some exceptions, and brands do, in some cases, stick by or re-invest in their asset – but under what circumstance and why?

Level Of Association

If the player is either an integral part of the sponsors make up, or headline star, then it makes the job of getting rid of them, and keeping to your marketing strategy a lot harder. Woods, of course, has been embezzled with the swoosh his entire career, this can also be said of Wayne Rooney. However Ryan Giggs has not been so fortunate, despite being held up as headline moral ambassador for his maturity, the star ended up being shunned by a number of his sponsors for a comparable offense to that of Rooney or Woods.

Bankability

The commercial revenue generated by any ambassador is integral to their credentials, and can play a significant role in the decision making process. In Woods and Rooney’s case, both EA games and Nike had complete product ranges centered on them, and commercially had too much to lose.

Sponsor’s market place

Accenture was Woods’s big loss in the aftermath of the scandal around his affair. The firm could not justify sporting a star whilst marketing themselves as a trusted Business Consultancy. Brands have ambassadors for a multitude of reasons, but they must be able to link their common values and business goals. In contrast, Alex Rodriguez, was still used by Guitar Hero in their adverts even after he admitted to taking banned substances. The business case for this was that Guitar Hero’s product was not affiliated with his sporting attributes, but his public personality.

The Offense

The line with which most brands have consistently taken when suspending contracts, has been when the ambassador’s actions directly affect the relationship they have with the respected brand’s promotional attributes. In the case of Drugs there has been a 100% termination rate in sport. However, in the case of Kate Moss and the fashion industry, the offence was taken very differently. Although she did lose substantial contracts, Moss managed to retain seven, and go on to re-build her career, something which has never been seen on such a scale in sport.

There is no doubt that trust in ambassadors has publically waned, as such, there has been a shift in how brands market their ambassadors. Recent campaigns by brands such as Nike illustrate that the focus is now upon empowering the consumer, rather than showboating the skills of an untouchable star. Even in fashion, couture designers are collaborating with high street fashion chains to bring their products to a consumer level. This shift undoubtedly showcases ambassadors but does much to bring the star or garment to the consumers level, retaining brand loyalty, which is essential in a very fickle market place.

It’s the end product that matters

As the quote above states, ambassadors uphold the values of the product they promote, and being the lucrative tool which they are, brands will do anything to protect them. However no one is bigger than the brand and on a case-by-case basis, the outcome of each offense is dictated by the relationship between the star and the value of the product they endorse.


Can too many Sponsors Dilute a Rights-Holder’s Brand? 22nd August, 2013

In sports leagues around the world, success on the field is ultimately driven by commercial revenue. As a consequence, their response has been to bring in sponsors to help facilitate the gap in funding.  But this growing emphasis upon sponsorship has left many people asking – are too many sponsors diluting the right-holder’s brand?

Sponsors make the brand more vibrant

When discussing the ever increasing number of sponsors in sport, it would be hard not to mention Manchester United, having just signed another spread of partners across the globe. The club has recently signed the Indonesian tyre producer bringing the club’s sponsorship total to 33. It begs to ask the question – are these sponsors devaluing the Manchester United brand?

Jonathan Rigby CM for MU, has rejected that the club has anywhere near reached its limit. He states that by implementing a local model amongst the 77 countries they have sponsors in currently, they are appealing to each fan individually, making the brand more vibrant and producing a follow on effect which will ultimately benefit all sponsors involved.

This certainly seems to be the case when you look at their operating profit, which has increased this year by 13.7%. The club has also just signed a new shirt deal worth nearly £500 million over 8 years, increasing their commercial sponsorship revenue to £118 million annually.

More value lies in fewer partners

In comparison, Juventus believe going the other way is more rewarding. The club believes that having valuable relationships with fewer brands will bring you more credibility amongst your following, and as a result will lead to greater financial weight behind the deals. This is the case for Jeep who is currently their headline sponsor, and one of 15 corporate partners.  In a public image driven market, and where it is only public interest which governs your reach; keeping it close to home can be seen as vital.

It’s the end product that matters

Brands enter into sponsorship for a multitude of reasons, but generally speaking, brands sponsor rights-holders for the audience, exposure, association and to fulfill their own brand objectives.  For rights-holders, one of the main things they rely upon, aside from funding, is the fans/ their audience.  As a platform, sponsorship allows both the rights-holder and brand to connect to their audience in a wholly tailored way.

The focus, therefore, shouldn’t be based on the amount of sponsors, but upon the end product – what the partnership has created for the fan, the overall experience and the club. MU’s model works because it has such a wide fan base and global sponsorship platform that allows them to associate with their following in all corners of the world. Juventus, on the other hand, has had success through its emphasis upon a few partners that have a strong affiliation to the club, keeping it close to home allows them to stay true to both the sponsor and the rights-holder’s objectives.

The Outcome

So long as the sponsorship is delivered and is aligned to the brand’s objectives and these objectives align with those of the rights-holder, the end product should ultimately benefit both club and sponsor.  Dilution of the brand will come when parties lose sight of their overall objective.

Red Bull Challenges F1's Sponsorship Stallion 5th December, 2012

In the last couple of weeks, the Red Bull Racing and Sebastian Vettel vs. Ferrari and Fernando Alonso rivalry has dominated sporting headlines. In the end it was yet again the former who took both the Constructers’ and the Drivers’ World Championship titles in the thrilling Formula 1 season finale in Brazil. This nail-biting end to the season has prompted a closer look at the team’s and driver’s success off the track and their contention for the commercial crown.

The Constructers’ (Sponsorship) Championship:

Despite prize money being in the millions, sponsorship is by far the key source of revenue for both teams and their drivers which begs the question: who is leading the commercial championship?

According to Forbes’ latest list of the ‘Formula One’s Most Valuable Teams’ Ferrari’s total revenue is estimated to be around £240m with £190m being generated from sponsorship alone. Nearly £155m is generated via three major deals with Shell, Santander and title sponsorship partner Marlboro. These three deals are worth more than any other team’s total sponsorship revenue.

But what about Red Bull Racing? Out of all teams on the grid, they are surprisingly down in fourth in the overall revenue standings at £100m in 2011. 60% of this revenue comes from Red Bull’s success on the track earning them more prize money than any other team in the championship however the contribution from sponsors falls significantly shorter than Ferrari, coming to £38m positioning the team in the middle of the sponsorship field. The main reason for this is that the brand does not seek sponsors for most of their advertising space as this is generally used for self-promotion. As opposed to Ferrari (whose title sponsor is Marlboro at £100m) and other leading teams like McLaren Mercedes (Vodafone, £47m) and Mercedes AMG F1 (Petronas, £35m), Red Bull is sacrificing a significant amount of commercial opportunity in this area. However, this may all be about to change with the constructors’ champions securing their first title sponsorship deal with Nissan’s luxury arm, Infiniti.

When reviewing the revenue potential of both teams, Ferrari should still be out of reach in the short-term with regards to team value however with Red Bull being the fastest growing team in the paddock, the commercial gap is certainly narrowing.

The Drivers’ (Sponsorship) Championship:

Are Vettel and Alonso also competing for a sponsorship title? In his latest blog post, Mark Mylam asked whether sports men and women as brand ambassadors were really worth the money from a sponsor’s perspective as there is always a risk associated with their image deteriorating and affecting the image of the endorsed brand. An almost risk-free sportsman for instance could be Sebastian Vettel. The driver is unarguably one of the most charismatic Formula 1 drivers, as demonstrated at last year’s Autosport Awards and although his interview at the podium ceremony of Abu Dhabi included some strong words, nothing seems to be able to tarnish his image. This is why Sebastian Vettel, who manages his endorsement deals himself, enjoys lucrative sponsorship deals with Casio and Procter & Gamble’s Head & Shoulders worth around £2m in total, according to a study carried out by Sport + Markt.

Fernando Alonso, on the other hand, seems to have a completely different persona. One could perceive him as being rather introverted although he is not one to shy away from commercial opportunities with earnings upwards of £6m through his deals with Santander, Tag-Heuer and Puma in 2011. This positions Alonso at the top of the sponsorship leaderboard with Michael Schumacher way behind at £3.5m and Lewis Hamilton (£2.5m) ahead of both Sebastian Vettel and Jenson Button, both at £2m. Marcel Cordes, Executive Director at Sport + Markt, points out that it is unlikely that Vettel will be able to close this gap as “he (Vettel) is already very strongly associated with the Red Bull brand”. Also, Sebastian Vettel is not interested in signing sponsorship deals just for the sake of securing a higher income. He’s already stated in the media: “It is not a goal for me to earn more money. For me, it is important that the brand is ideally suited to me”.

Compared to other sports stars like Roger Federer or Kobe Bryant, sponsorship earnings of Formula 1 drivers are minimal because in most cases, the teams control almost all of their driver’s sponsorship rights.

It is interesting to see that championship wins have by no means been reflective of either team’s or drivers’ respective commercial successes but will this continue into 2013? With the pressure mounting on Sebastian Vettel, could we see Ferrari’s sponsorship stallion overtake the Red Bull both on the track as well as off or will the power of the ‘Vettrick’ prove too much to contend with? Let us know your thoughts!

Experiential: 3 Ways to Maximise Your Assets 20th January, 2012

With the London 2012 Olympics fast approaching we are due an influx of experiential campaigns in 2012. With headline sponsors of P&G, Coke and McDonald’s taking the majority of the London 2012 marketing opportunities – both in sponsorship as well as ramped up advertising campaigns, other brands will be engaging in shorter term experiential marketing to capitalise on this once in a lifetime opportunity.

Experiential marketing at its basics is a live brand marketing campaign allowing consumers to experience the product through their senses.  It occurs in real time and is a two way communication between the brand and consumer – creating a lasting connection with the brand, which is then amplified through other marketing channels. Experiential activation offers a great way to showcase a brand’s products, or simply demonstrate what the company can offer with immediate feedback.  Some examples of experiential campaigns we’ve run include Tracker’s Photo Booth for the What Car Awards 2012 and the EA Sports’ Game Hub at the London Irish Rugby Club’s St. Patricks Day Party.

Maximising Assets for Experiential Sponsorship Campaigns

1) Brand Positioning

With immediate feedback, experiential activities first need to ensure their audience is the right audience to be receiving feedback from.  Ensure that you are very clear who the target audience is first and then decide how best to reach them and more importantly where to reach them.

Being relevant to the right consumers will provide both the correct feedback, but also will enable you to drive the communications further through additional marketing campaigns.

2) Engagement is Essential

You have to be engaging in activity consumers can relate to and want to engage with. The message and positioning should be clear and concise ensuring cut through.  Providing people an experience that is on brand for the experiential activation, on brand for the company and also on brand for the sponsorship platform will create a cohesive message with all parties building resonance with the audience.

3) Make it Last

Even if your experiential activity is a one-off campaign, ensure you are making the most of it and that you have resources to support this.  If the objective is to create a viral campaign through the experiential activity, do not forget to include a social strategy that will drive this communication forward through user networks and your own company network through user generated content, videos, competitions, etc.

Top 10 Sales Tips for Sponsorship Rights Holders 12th December, 2011

With an increasing number of platforms available for corporate partnership, the selection process for brands is becoming more complex, with a wide range of factors influencing the allocation of marketing budgets. Therefore when approaching potential partners, it is important for rights holders to ensure that each of the following factors is taken into account:

1.  Price

The fees asked by the rights holder play a key role in the decision-making process for a sponsor to come on board with a property. The price of association is often the first aspect of a proposal to be looked at and it is therefore imperative that rights owners understand how to value their sponsorship assets correctly.

2.  Timing

Depending on the company and industry, budgeting can take place at different times of the year. However, as a rights holder, the important thing is to understand the general time of year that marketing budgets will be allocated by your prospects in order not to miss the boat.

Depending on the size of the investment relative to the prospective sponsor, opportunities with lower fees may be handled on a tactical basis. However generally, companies will be much less open to new partnerships once budgets have been set and it is therefore crucial to get in there early.

Typically planning periods are September/October and March/April.

3.  Prospects

It is important that rights holders understand the key demographic of their property’s audience as misunderstanding this can lead to approaching an inappropriate market and wasting valuable time.

Once understanding the relevant brands to approach, the next step is to understand their behavioural tendencies in terms of their general sponsorship partnerships and activations and how they have utilised these relationships in the past. This will highlight which assets are relevant to each sponsorship category and in turn allow for a more tailored approach.

4.  Audience Resonance

Are the prospect’s consumers interested in the sponsorship? And furthermore, will the sponsorship audience be interested in the prospect’s products and services? A sponsor will always have their target audience in mind when activating a sponsorship and therefore you as a rights holder must also adopt the same thought process, ensuring that the needs and wants of your prospect’s consumer base align with the benefits of your property.

5.  Attendance

In the case of an event-based platform, the attendance is always of high priority to prospective sponsors. Whether the focus is on engaging with a specific audience or allowing for key networking opportunities, the attendance must present the prospect of new business opportunities.

A common error in the sales approach of a rights holder is approaching all companies within their property’s industry rather than taking the time to break down it down by relevance. By evaluating the industry and which areas will be most relevant, sales teams can prioritise their approach, generally receiving more positive feedback and in turn taking less time to close new partnerships.

6.  Reflection of Company Values

The more a company can see of itself in a property, the more willing they will be to forge a partnership as a key aspect of a sponsorship is to emphasise brand values. This again relates to audience resonance and the tailoring of a sales approach as different selling points will appeal to different brands depending on their relative markets.

7.  Comparison of New Business Figures with Previous Sponsorships

Producing financial, attendance, or media value figures are one of the most effective ways in which to sell a property as they are cold hard facts that cannot be easily manipulated. Tangible figures and facts provide a clear indication of such highly influencing factors as ROI, media coverage, attendance and give the prospect an immediate understanding of the tangible benefits they would receive from their investment.

8.  Prioritisation of Company Goals

Each sponsorship platform caters to different aims and objectives of sponsors, this being a huge factor in the prospect’s decision making process. What is the largest benefit of sponsoring your property? There may be more than one but at least one of them should align with the core objective of the brand.

9.  Cross Marketing Opportunities

Sponsorship platforms can attract brands from different industries with similar audiences.  These rare opportunities can create cross marketing benefits that add substantial value to a sponsorship. This tends to occur with Media Sponsor rights and we’d highly recommend considering bringing on board something like this to strengthen your event or program.

10.  Data Provision

Another advantage of sponsorship is the opportunity to carry out research amongst a captive sample of a brand’s target audience. If you are able to offer behavioural data to your sponsor helping them streamline their products and services, this brings a whole new level of value to the sponsorship – gaining important exposure whilst receiving precious qualitative feedback.

By putting in the time and research to evaluate each of the above factors before pitching to prospective sponsors, rights holders are able to carry out a truly time and cost effective sales approach. This will in turn allow for a more streamlined prospect list, resulting in fewer knock-backs and improved close-ratios.

Furthermore, adopting a more methodical approach will significantly increase sales staff motivation, driving the property forward in terms of investment and the opportunities for expansion that come with it.

Price Follows Prestige: Brand Asset Valuations 22nd September, 2011

Do you know how much your sponsorship proposal is truly worth?  We do.

One of the key causes of poor sponsorship sales is over-priced fees. This is often down to a methodology which focuses on covering the production costs of a property, rather than looking into the actual market value of the assets offered. Although making a property available for sponsorship can be a lucrative revenue stream, key factors such as the quality and quantity of rights and benefits, establishment of the property and brand exposure are all highly influential in determining the degree of investment a sponsor will be willing to make for association.

Therefore despite an event potentially carrying high production and running costs, rights holders need to be realistic ensuring that sponsorship fees rise in correlation with the calibre of the assets offered. The concept of price following prestige can also be seen by other rights holders within their respective industries, such as a start-up magazine, with the initial focus on publishing quality content and building circulation figures in order to then attract advertising revenue.

In order to create a fair and realistically priced sponsorship proposal, each of the following factors need to be taken into account:

Tangible Assets

These are benefits of a sponsorship package that can be measured and in turn given a specific monetary value, including such factors as signage, media collateral and tickets. Tangible assets are useful in giving the sponsor a direct insight into where a percentage of their investment will be spent.

Intangible Assets

These are qualitative factors that cannot be given an exact value but are also of significant benefit to the sponsor, such as audience engagement, branding prominence, property establishment etc. Intangible assets can only be measured by the opinion of the audience and therefore their value will alter from person to person, depending on perception. However, by conducting research such as surveys, which offer structured and quantitative feedback, a qualitative benefit can be given an estimated market worth.

Exposure and Reach

Whether a brand is looking to reinforce or alter its image via association with a sponsorship platform, this will only be worthwhile if a sizeable audience is going to be reached. Therefore the PR reach and geographical exposure of a brand’s association is a key factor in determining the overall value of a sponsorship package.

Lead-time

Approaching prospective sponsorship leads can be a time intensive process and therefore properties with short lead times (from commencing of sales approaches to execution) should be prepared to lower their fees if wanting to secure any sponsor investment at all. Corporate sponsorship responsibles have a strong knowledge of the properties within their market along with the value of the assets offered. Therefore by reducing fees, companies will be much more likely to invest when presented with a good deal, much more so than paying full price for something that they know the rights holder is in fact desperate to sell.

How can a sponsorship agency help?

Hiring an agency will bring experience and expertise in the area of optimising and valuating existing brand assets as well as discovering new beneficial aspects of a property that the rights holder may not have even thought of. With unjustifiable valuations being one of the key reasons behind unsuccessful sponsorship sales, an agency will help improve a rights holder’s understanding of the assets they are selling plus create additional benefits to offer, instilling confidence in the salesperson whilst providing a significantly more attractive proposition for prospective sponsors to invest in.

For further information on how Slingshot can provide professional advice on brand asset valuations, plus additional insight into your sponsorship potential, see the Slingshot Sponsorship Boot Camp.