Sponsorship Q&A with David O'Connor and Crispin Bolt
How much attention is paid to the way in which other sports and markets operate?
David: It is important to keep a close eye not only on other sports but also on other areas such as entertainment and music.
Football sponsorship in Europe has always been something of a front runner in the sports sponsorship field, with many best practice examples stemming from our sport, however there is no doubt that we can learn a lot from observing how some of the large US rights holders are activating, particularly in the areas of fan engagement and community management.
There are some fantastic examples of fan engagement emerging from the MLS, in particular where clubs such as the Seattle Sounders are extremely effective in nurturing a fan-centric culture. Following the lead of the great work achieved by Manchester City, the work done by City Football Group in promoting the launch of their new club in New York has also been very interesting to observe. They’ve put fans at the heart of a number of key decisions including logo design as one stand out example. This has resulted in great attendances for their opening home games. There’s no doubt that such great work can only help to accelerate the impressive growth of interest in the MLS and football in general in the US.
Crispin: Where F1 teams can learn from football teams and other sports is in their ability to engage their fan base via content creation and social media amplification. McLaren, Lotus and Mercedes seem to have taken learnings from football teams such as Arsenal and Manchester City and applied these learnings to their proprietary channels. F1 is far more niche than football, so the number of fans engaging with this content will always be considerably less. I think the challenge is how this gap is closed. To do that, the sport needs to change as a whole though.
Where there is a transfer of information is from F1 out. F1 teams are now monetising their IP and adding value to business sectors outside of their core business area. These include auditing, transportation, healthcare, and mining, but also other sports such as cycling, sailing and bobsleigh. F1 engineers and data analysts have huge amounts of relevant experience which can provide innovative solutions beyond the racing circuit.
How has sponsorship in your sport evolved in the past 6 years?
David: In the football world the traditional role of the sponsor is evolving hugely with many sponsors playing in the same area as broadcasters and media partners. There are huge opportunities for brands to connect with their consumers in new and innovative ways through their sponsorships. For example, the way in which adidas approached their 2014 campaign was extremely impressive. They identified at an early stage that they wanted to drive their story-telling from the very heart of the action, implementing innovative marketing tools such as the @brazuca Twitter handle. In addition, they had a huge amount of content available, ready to plug in and push out via their social channels as the World Cup story evolved.
We have also seen the emergence of new product categories utilising high-profile sponsorship opportunities. The past two FIFA World Cups highlight this, with solar energy companies and language schools rubbing shoulders with World Cup veterans such as adidas and Coca-Cola.
Geographical segmentation of sponsorship rights has also been an interesting trend to observe. The success of regional deals for large football clubs such as FC Barcelona and Manchester United has been impressive. On a global level FIFA’s decision to offer sponsorship opportunities on a regional level was a significant move. It will be interesting to see how brands look to unlock the value of these opportunities.
Crispin: The growing importance of social and digital media as a channel of communication has been the most obvious evolution. Rights owners are having to provide opportunities beyond TV for its fans to engage with the sport. This is reflective of the general shift in media consumption, but F1 has maybe been slower to embrace this change than others. Second screening is now a significant part of watching a race. Formula One Management (FOM) has just launched F1 Access which allows fans to consume content on a level which until now has never been seen. F1 Access provides rich media content and live race data. Teams are at a disadvantage in this respect as FOM own the majority of the rights, however the likes of McLaren have launched their own live race feed, McLaren Live.
What still hasn’t really been understood from a team perspective, although I believe some teams have attempted to do so, is how to place a monetary value on their digital and social media presence. This is particularly important to brands as they begin to observe teams’ activity in this space, and the levels of engagement this activity has with fans. Teams have responded by increasing the amount of content created so as to drive fan engagement, but importantly also as a means of attempting to drive sponsorship revenue.
What can rights holders do to improve relationships with their partners?
David: The evolution of the digital space has provided brands with a huge amount of new opportunities to market their products and services. In order to ensure rights holders are demonstrating the value of their properties, they need to take a hard look at their own marketing efforts and the ways in which they are managing their communities. Whilst rights holders have huge online followings through social media, these groups of followers are managed predominantly via 3rd party platforms. So, whilst basic content pushing, conversation and engagement can be facilitated here, the question of how to truly own these audiences, provide valuable opportunities to sponsors and monetise the relationships on social media is one which has not yet been answered by the majority of rights holders.
Crispin: As the world has “fragmented” in just about everything that brands traditionally associated themselves with [music, sport, media etc.] it has become necessary for brands to create dynamic partnerships that allow for deep customer engagement. To achieve this level of engagement, rights owners need to be far more creative in how they approach partnerships. They need to demonstrate how they can deliver on a commercial level, not just media value from TV exposure. Partners need to become fully integrated in to the rights owner in order for their marketing and business objectives to be realised.
Rights owners also need to create more opportunities for collaboration and accountability. By this I mean not just servicing a partnership, but working together to achieve the sponsor’s goals, understanding the consumer experience, and jointly developing multiple means of engaging with them. Ultimately, brands and rights owners need to work together to either improve the fan experience or, depending on the partner’s business sector, demonstrate relevance to a potential or existing customer. It means the values of the rights owner and brands need to be more closely aligned.
What makes your sport such an attractive proposition for sponsors?
David: The beauty of football sponsorship is the scalability and the wide variety of opportunities which are available. Large global events such as the FIFA World Cup and the UEFA Champions League will continue to deliver the huge global audiences and events which dominate the media landscapes worldwide. In addition to the traditional TV audiences, the large rights holders can now boast huge online followings through social media channels. If leveraged properly this can provide a huge amount of additional value to sponsors which simply wasn’t achievable in the past.
At the other end of the scale football connects with consumers on an emotional level. By tapping in to their passion points, the sport can provide extremely powerful and relevant sponsorship opportunities on a much smaller, local or regional level.
Similarly to Formula One, football sponsorship has a huge B2B value and will continue to be a strong driver in sponsorship deals in both sports in the years to come.
Crispin: Despite a recent decline in TV audiences, Formula One is still a powerful global property which runs from March to November every year. This creates opportunities for brands to tell their story to millions of fans across almost the entire year at both a global and local level.
Formula One appeals to different brands depending on their business sector. For a clothing brand like Hugo BOSS it’s the association with the lifestyle image of Formula One and the retail opportunities this creates. For SAP it’s both the association with a highly innovative and technology driven sport which creates an engaging storytelling opportunity for them, but also the ability to use its partnership with the McLaren Technology Group to drive commercial revenue.
Which brands are the most successful within your sport?
David: The most effective sponsorships stem from a mutual understanding between the sponsor and the rights holder. The most successful sponsors are those who have clear objectives, are able to clearly define their strategy, allow themselves enough time to plan and execute the strategy together with the rights holder and have a strong understanding of their role in the event. There is so much noise and clutter surrounding major events nowadays that it is vital for consumer-facing sponsors to identify their specific role and in turn know what they will deliver to fans.
Among the success stories of adidas and Coca-Cola at the 2014 FIFA World Cup, it was interesting to work with Apex Brasil who were a National Supporter of the tournament. The governmental agency responsible for promoting Brazilian services and products to foreign buyers had one very clear objective. They set out to achieve it through a wide reaching hospitality programme where they welcomed over 3000 guests from over 100 different countries to FIFA World Cup matches. Through their engagement with FIFA, they recorded an upswing of US$6 billion in business for Brazilian companies.
So, whilst the majority of football fans worldwide would barely have noticed the name of Apex, the results which they achieved for their business goal were spectacular.
Crispin: It clearly depends how you are measuring success. If it is by media value and brand exposure, then performance will play a significant role. During the Red Bull Racing period of domination, Red Bull was the most recognised brand in F1. It will be interesting to note whether there is a change as we seem to be entering a period of Mercedes GP domination.
My personal opinion is brands who have a clearly defined strategy to their sponsorship, and invest in activating, are those who generate the most value. Johnnie Walker has a clear strategy to support its wider brand position on responsible drinking with its “Join the Pact” campaign. It uses its partnership with McLaren to communicate responsible drinking and driving by engaging audiences through content, and promotional activity such as #ImNOTdriving.
Shell’s technical partnership with Scuderia Ferrari clearly has product category relevance, as its products allow the team to perform at the level required to win in Formula One. However it also provides a test bed for product innovation that transfers from track to road. The partnership delivers a powerful technical showcase to engage consumers on the track and via the retail environment.
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