UK Economy is Turning Corner, George Osborne says | What does that mean for sponsorship?
9th September, 2013
This morning George Osborne announced that the UK economy was turning a corner (full article here). This is of course particularly relevant for our business and a question I often get asked at any and all business networking events I attend. Being that Slingshot is a sponsorship sales agency, people often assume that we are best placed to identify whether the economy is picking up or not. However, that isn’t actually the case.
If we were flogging socks, we may be in a better position to answer the question of whether the economy is picking up. People often need to purchase socks, but if times are tough, they tend to darn the holes rather than make a new purchase.
Instead, Slingshot sells sponsorship and secures clients based on a need to fulfil a strong commercial and marketing objective. In our case, sponsorship is often invested in and/or chosen (despite popular belief) because marketing budgets are tight, not because they have excess money to spend. As such, sponsorship is often critically analysed and only chosen if it meets all objectives.
This is the case for the brand, but even more so for the rights holder. In many cases, rights holders tend to invest in their offering and delivering that offering if they are in a critical financial situation. On the brand side, marketing budgets are under more scrutiny than before. If the sponsorship is the right platform for the brand, it inevitably needs to deliver a very strong business case for ROI.
We view our agency as people that find the right fit out of necessity for business – rather than floggers of something that is a luxury in marketing.
This case does not always ring true for all rights holders and brands who undertake sponsorship. However, a good indication of doing sponsorship to create true partnerships can often be seen in the churn. If the rights holder sponsor churn is high or the brand sponsorship decisions are frequent, then it is likely that a strong sponsorship strategy is not in place for either.
I am a firm believer that through difficult economic times businesses that rise to the challenge and adapt will be stronger moving forward. I hope George Osborne is right and the economy will pick up allowing more brands and rights owners to invest into sponsorship. However, I hope the lessons we’ve learnt over the past three years do not get thrown out with the darned socks.