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.

Lessons the Sponsorship Industry should Learn from Kickstarter 15th May, 2013

Continuing from Jackie’s most recent blog, which expressed the inherent need for an understanding of sponsorship in every industry, I wanted to lead this blog in a similar vein. The past couple of weeks have seen the re-emergence of the platform Kickstarter into the blogosphere – a crowd-funding site that offers entrepreneurs, film-makers, artists, techies etc. a platform through which they can raise funding for specific ideas and projects.

Until a few weeks ago, many were unaware of Kickstarter until Mr Zach Braff (of Garden State and Scrubs fame) launched a campaign on the website to generate funding for his new movie ‘Wish I Was Here’ a kind-of-but-not-really sequel to Garden State – find his campaign video here. Through the website, and by the click of a button, anyone is able to become an investor in Braff’s film. What is more, those willing to sponsor are offered some pretty hefty benefits – ranging from larger investors being treated to a character in the film being named after them, to escorting Braff as one of his personal guests to the premier and after party – not bad.

Within only 3 days, Braff’s target of $2 million was smashed. Of course this was due, to a large extent, to Braff’s extensive networks (1,099,497 Twitter followers) and celebrity pals who helped him reach this goal. Yet despite the project’s success, Braff’s use of the site has come under immense scrutiny, with many citing this project to be one of (soon to be many) Hollywood overhauls on the website – which they believe will overshadow projects that really need to use the site to create contacts and source funding.

Despite the Hollywood backlash, the success Braff has gained through Kickstarter and the buzz his project has generated; has led me to identify 3 things the sponsorship industry should take away from this case study:

1) It is imperative to tap into passions – Sponsorship should always be about tapping into people’s interests and passions. As a marketing tool; the brands and rights-holders that have the most success, are the ones that really connect with what the consumer wants and understand what it is they need. Braff was able to build on the cult success of Garden State and use the affinity his fans have towards the film to help fund a new project, giving fans the opportunity to join him in the films journey.

2) Not just about the idea – Despite the success of Braff’s Kickstarter campaign, an overwhelming majority of Kickstarter projects lead to failure. As Michael C. Neel’s research shows, the campaigns that are the most successful are the ones that are able to promote and leverage networks, exercise connections and generate as much buzz as possible around the project. In essence, this is similar to sponsorship – those that are deemed ‘successful’ are the ones that are able to utilise every aspect of the relationship at hand – not just rely on the basic sponsorship or ‘idea’ itself.

3) Corporates should learn from crowd-funding – Some of the best ideas and projects gain fruition from smaller, grass-root platforms like Kickstarter; and it is important that these projects are able to gain funding. Sponsorship should be accessible and understood by all; not just large corporates – the funding of such projects will in turn help generate an already stagnant economy. Websites such as Kickstarter also offer first-hand insight into projects that are succeeding and those that are failing – offering corporates in real time, trends within specific industries.

Despite the criticism surrounding Braff’s use of Kickstarter, the re-emergence of the platform has emphasised once again, the need and capacity for sponsorship in all industries whether big or small.