Driving Business Through Sport

In Europe many markets are still immature and many companies fail to exploit fully the rights that they have acquired. The Northern countries such as Germany, Britain, Scandinavian and the BeNeLux states have a more sophisticated approach than the rest of Europe that is in line with their overall marketing approach. Even in these countries, however, many companies don't have an in-house professional or a specialist agency to arrange and manage their sponsorship activities. And yet many will spend significant budgets on sponsoring a sports property.

Sponsorship is, therefore, often run in total isolation to all other business/marketing activity, decisions are still made for the wrong reasons, no objectives are set and no measurement of success or failure is made.

The table below illustrates how the sponsorship market varies throughout Europe.

Table 1.2 1998/99 Sponsorship expenditure by country and in relation to advertising

Source: SRi

Not surprisingly Germany, Europe's biggest consumer market, is the biggest spender on sponsorship. Relative to the size of their populations, however, Scandinavian countries and Switzerland are also heavy spenders. Although countries in these regions have a GDP higher than the European average, their per capita spend relative to GDP, still significantly outstrips southern Europe and the United Kingdom.

This is explained partly by the more sophisticated marketing industry in northern Europe, although an advanced marketing infrastructure has not prevented the UK from being a low spender on sponsorship as a proportion of marketing budgets.

The figures demonstrate an increase in sponsorship spend in relation to advertising, in line with previous year's results. As a percentage of advertising expenditure, Europe (8.9%) outstrips the USA (6.1% - source: IEG). Indeed only South Africa (12.1% -source: BMi) and Australia (10.6% - source: Brian Sweeney and Associates), have higher levels in relation to advertising spend.

Despite Germany's lead in sponsorship expenditure, the specialist research community for the industry is largely based in the UK. Both sports marketing giant ISL and one of the world's leading research agencies, the French company IPSOS, have their specialist sports research subsidiaries, SRi and RSL respectively, based in the UK.

Chart 1.3 European sponsorship expenditure by country by percentage

Source: SRi

This is explained, to an extent, by the UK's position in European marketing services. Britain has followed the U.S in developing a sophisticated marketing industry - more so than any other European country. The infrastructure in the UK to support sponsorship activities is, therefore, Europe's most sophisticated, despite spend representing the lowest proportion against advertising in Europe.

Table 1.22 Le Tour de France sponsorship rights costs

Source: Vélo

Table 1.23 Tour de France team budgets p.a

The Tour de France teams pay only a token entry cost of 125k francs. The race organisers also pay a major contribution towards transport and accommodation for teams and in some cases will actually provide team cars. The teams, all fully sponsored, therefore, require the sponsorship income to pay wages and other team costs. The main sponsorship cost involved in running a team is to pay the cyclists. Obviously this can vary enormously depending on the success of the cyclist.

The specific objectives of using sport in marketing brands can vary enormously and examples include:

Increasing sales

Ultimately almost every sports marketing initiative is designed to increase sales. In many cases, however, the sport association creates the platform from which sales can grow. To change brand image, generate loyalty, foster business-to-business relationships etc are pre-requisites for sales growth for many brands. There are, however, many cases where involvement in sports has been designed to create a direct influence on sales volume. Carling (see Event Sponsorship - Chapter4), for example, used its sponsorship of English Premiership football primarily to increase sales. The brand's marketing budget was geared towards support of the sponsorship, which resulted in significant sales growth. In 1998, for example, the brand sold an extra 98 million pints of beer, an increase of 10% against the previous year. Sales growth was faster than at any time since the brand was launched and the brand was 50% larger than its nearest competitor.

Allied Dunbar has used its club and children's rugby sponsorship to create an opportunity for its sales force to build networks. In the case of children's rugby, the philosophy was 'where there's a child - there must be a parent'. This in turn led to opportunities to arrange appointments from which sales conversions were high.

Developing customer loyalty

The 1990's heralded the importance of customer loyalty as marketers realised that it is more cost-effective to retain existing customers than it is to find new ones. Given the strong passions and loyalties evident between sports fans and their chosen sport, the opportunity to buy into such loyalty is clear. At a basic level, any involvement with sport can help to promote loyalty through the philosophy that 'I support my team, brand X supports my team, therefore I will buy brand X rather than brand Y'. This link, however, is not necessarily strong. The customer is likely to choose brand X over brand Y only when presented with the direct choice at the point of purchase. Generally speaking loyalty programmes have to provide something more tangible to be effective. Typically, this entails a form of collection mechanic such as points systems as part of reward programmes, or the issue of collectable items. In sport there are several good examples such as the Bank of Scotland Affinity Card Scheme (see Direct Marketing in Sport - Chapter 6) in which a percentage of any purchase goes to the designated sporting body. Supermarket group Sainsbury's, issued an England team medal collection for the 1998 FIFA World Cup (see Sales Promotion - Chapter8) and both Vittel and Disney ran long-term grass roots sports projects (see Special Events - Chapter 7) that tied interest in sport to a close association with the brand.

Growing brand awareness

Brand awareness is an integral part of sponsorship in particular. The use of perimeter advertising and branded apparel, although offering a degree of image transfer, is mainly used to generate awareness. Given that the messages rarely go beyond a brand logo, the exposure in isolation can do little more than increase awareness. The power of sponsorship to deliver awareness is clearly demonstrated by the Green Flag case study (see Research and Evaluation - Chapter 3). Using sponsorship as the sole launch vehicle, Green Flag achieved 27% peak spontaneous awareness levels from its England National Football Team branding. Given that such branding was limited in the main to perimeter advertising (not including World Cup Finals matches) and training apparel, it is arguable that the profile of sponsorship was not particularly high. Clearly the fact that the public had not previously encountered the brand actually helped because there was a quizzical reaction to the branding. Nevertheless, the case study demonstrates the potential sport has to generate brand awareness.

Developing new markets

Because one of the key components of sports marketing activity is the generation of awareness, sports marketing can be used as a brand presence platform in new markets. An association with sport, however, can also be used for specific marketing activity in new territories. Opel, for example, used its sponsorship of Bayern Munich to help open markets in the former East Germany following re-unification with West Germany. The company arranged a club tour of major cities in the region linked to promotions in new dealerships.

Internal communications/motivation

The role of internal communications is becoming more important as businesses have to react to the increasing pace of change. Sport can play a major role in such programmes, especially among those companies that have an investment in a sport property. Employees can immediately have an emotional investment in the success of the sports property, which can impact on morale and working relationships. Specific initiatives such as internal fantasy leagues, motivation and hospitality programmes linked to the property, can enhance the success. Similarly, safety programmes or communications programmes using the sport as an analogy, can also be successful. UPS (see Major Case Studies - Chapter5) used its Olympic partnership to create a major internal communication programme that included team building, motivation, safety awareness, quality development and an investment in any employee with Olympic potential.

Improving staff recruitment

To attract and retain high calibre staff requires the creation of a suitable corporate image. If employees feel that their company is a leader in its field and has the best possible prospects for career development, improved staff loyalty is likely to follow. Sport can be used as part of the process of such an image shift. Arguably the best example concerns EF (see Major Case Studies - Chapter5) which had a series of problems facing its personnel department. They included:

• employees being over-worked
• high staff turnover
• low morale
• a sense of isolation in regional centres
• high demand for new employees
• difficulty in attracting high calibre staff

The company's sponsorship of an entrant in the Whitbread Round the World Race included objectives to counter these problems using the event to improve internal communications and to drive both the level of recruitment and increase the calibre of staff recruited.

Developing business-to-business relationships

The use of hospitality is arguably the best method available for developing business-to-business relationships. Guests can be entertained in a prestigious, controlled environment, free from competitor activity. Most major sponsorship packages now include a hospitality element and many companies find this to be one of the most valuable parts of the package. Schweppes, for example, (see Major Case Studies - Chapter 5) used its Formula One hospitality rights to develop relationships with its bottlers and key trade buyers. Fragrance and flavouring developer Quest (see Corporate Hospitality - Chapter 8), has used the technique virtually in isolation to improve customer relationships. Hospitality is also used frequently to entertain press, business partners and members of the financial community.

The growth of sponsorship from the technology sector has also seen an increase in opportunities to showcase products and services through sport. BT, for example, has used the BT Global Challenge and the Rugby World Cup to create technology showcase areas, separate from the main hospitality suites, to demonstrate its technical expertise to customers and key business contacts. Most technology sponsors also use their practical involvement in sport to demonstrate their systems in action at the event.

Launching new products

Although sport is rarely used as a primary element of a product launch, it is regularly used to support such initiatives. Sports personalities can be used in the public relations effort and launch events, and a sports theme can be included in advertising and promotions.

A good example of brand support during a launch period concerns the use of special football events to promote Opel's new Zafira model. In 1999, when Opel sponsored both German champions Bayern Munich and Italian champions AC Milan, the company arranged a three-day event in Mainz, Germany, where Opel is based.

Bayern Munich visited the Opel headquarters to take part in a one-and-a-half hour live television broadcast (transmitted throughout Germany and other parts of Europe on ZDF) celebrating their record breaking championship - the first time such a large scale event has been televised from a sponsor's headquarters. The following day, both teams visited the Opel factory and met employees. The teams played a friendly game in the local stadium giving the fans/employees a unique opportunity to see and meet their idols from both countries. Bayern Munich also organised a friendly game against a selection of Opel's best 'players' (Opel employees). The local dealership was the ticket outlet for the game, allowing the dealer to pursue PR opportunities and promote the launch of the Zafira.

A large number of employees at the factory came to view the two teams either at the factory or in the stadium. The friendly game between the two champions was a sell-out, and the friendly against Opel employees was a success, creating a valuable platform to promote Opel's partnerships, while simultaneously using television broadcasts and media coverage to promote the new vehicle. The bonus of having two national champions competing within days of topping their respective leagues, further raised the visibility of the Opel/Zafira brand names throughout Europe.

Broadening the customer base

Awareness is a prerequisite for attracting new customers and, to an extent, all sponsorship and sports marketing projects should help to achieve this goal. There are, however, numerous examples where sports involvement has been designed to attract new custom. Perhaps the best examples are in the credit card sector. Bank of Scotland's sports affinity card programme has added over 700,000 new card users. Similarly MasterCard used its World Cup 1998 sponsorship to launch a new affinity card and issued over 125,000 in Europe during the campaign.

Developing community relationships

Community relationships can be developed in various ways using sport. A club sponsor, for example, can use its association to create initiatives at a local level. At Leeds United, former team sponsor Packard Bell was closely involved in the youth education programme at the club's Elland Road stadium and supplied the computers. Many brands have also run grass roots schemes independently such as Coca-Cola's soccer skills camps. Companies, which have major manufacturing bases in local areas, have also used local club sponsorship or grass roots funding to help demonstrate a commitment to the area. Philips' long association with PSV Eindhoven, based close to the company's global headquarters, is a particularly good example of such a commitment.

Broadening distribution

Sports marketing can help to broaden distribution in several ways. First, it helps to create awareness, a prerequisite for demand. Because distributors/retailers like to see brand promotion plans before signing contracts, a sports marketing plan that is both active and visible in the territory, demonstrates a marketing commitment. Another technique is to use corporate hospitality to invite important distributors and key retail buyers to prestigious events to foster the business relationship. Schweppes (see Major Case Studies - Chapter 5) used this technique extensively in its Formula One sponsorship.

Developing product knowledge

The most obvious area in which sport has been used to develop product knowledge is in the technology sector. Many of the world's leading systems suppliers have become partners in major sports events. IBM (see Technology Sponsorship - Chapter 4), for example, became an Olympic partner primarily to demonstrate its systems to potential buyers - brand awareness was not an issue facing the company. Apart from the technology sector, there are opportunities to improve product knowledge or underline the unique selling point. Sensodyne toothpaste, for example, which is marketed as a product for those with sensitive teeth, has sponsored British figure skating. The link to ice is powerful and immediate and a good example of a creative approach to underlining the key attribute of a brand.

Reassuring the financial community

Sports sponsorship can be used to develop relationships with the financial community, mainly through the use of hospitality packages. A good example concerns Ballantine's (see Special Events - Chapter 7), which invited a group of financial analysts to its Urban High event in Spain. Ballantine's management claims that this had a direct bearing on the subsequent £258 million increase in the value of the company stock.

Good Citizenship

Research commissioned by the International Olympic Committee (see Research and Evaluation - Chapter 3) suggests that 'Good Citizenship' is one of the key attributes that the public associates with the Olympic movement and its sponsors. Although many high budget associations do not deliver this attribute on such a scale, the opportunity does exist at grass roots level.

In 1998, for example, Yorkshire Electricity launched its PowerPlay initiative of sponsoring disabled sport at grass roots level. The programme was run against a background of cynicism directed at former public utilities in the UK. Many made huge profits from resources that had only recently been in public ownership. Prices had gone up above the rate of inflation, profits leapt as did directors' pay.

The objectives were part of a strategy aimed at retaining the company's existing customers and converting them to dual fuel customers, taking both gas and electricity supplies. Name awareness, however, was not an issue - the programme was designed to build on customer loyalty by supporting activities that built on its strong Yorkshire brand. Another key influencing factor to supporting sport at grass roots level was the opportunity to obtain matched funding from the Governments Business Incentive Scheme for Sport - Sportsmatch.

Yorkshire Electricity was also closely involved in supporting the setting up of the Yorkshire and Humberside Federation of Disability Sports Organisations. This is an umbrella body for the regional units of British Blind Sport, British Deaf Sport, Disability Sport England (representing people with physically disabilities), and English Sports Association for People with Learning Disabilities.

The PowerPlay scheme ranged from; the introduction to sport for those not previously involved, events and competitions to develop skills, and coaching for those that had the ability to go on to compete at national and international level in their chosen sport.

Experience had shown that previous media coverage of disability sport tended to fall within the news pages. A major objective of PowerPlay was to move media coverage on to the sports pages. This was to acknowledge the sporting achievements of people with disabilities and also because it was recognised that sports editors were much more likely to credit sponsors than news editors.

The programme was geared towards brand association rather than exposure. Yorkshire Electricity demonstrated its commitment towards good causes in the community and established a reputation for good citizenship.

Development of post-merger identity

The growing incidence of corporate mergers has created a need for a re-evaluation of corporate identity in many organisations. Alasdair Ritchie, worldwide president of Octagon, believes that this will be a major growth area in sports marketing:

"The one thing that is common to many of the newly merged companies is that they have large marketing budgets at their disposal and very little awareness. They are, therefore, likely to become high spenders on any activity that delivers awareness at a cost-effective rate. Such companies are unlikely to be brand owners e.g. Diageo, but those whose brands are eponymous, such as HSBC which is already involved in Formula One and arts sponsorship to help raise its profile."

A re-branding exercise is obviously designed to create a new identity, HSBC's re-branding of Midland Bank, for example, was designed to unite the new company under a single identity and to underline the message that the new player was a global force in world banking. Its association with the Stewart (now Jaguar) Formula One team certainly delivers that global message.

Swedish Match is another good example of a company using sponsorship to marry objectives of increased awareness to an image of being a global player. It used the 1997/98 Whitbread Round the World Race to achieve such goals. The company was in the process of bringing together a number of companies throughout the world under a variety of names, to form the common brand name, Swedish Match. The sailing event coincided with this process and gave the company a worldwide event, which provided a platform to develop a series of specific objectives:

• to reflect the global nature of the organisation
• to further its marine profile
• to stimulate growth
• to support the implementation of the company's aggressive business plan
• to provide an opportunity for contact creating activities with customers, business partners and business/financial market players
• to strengthen the group community and consolidating its culture
  

Miscellaneous

There are numerous other objectives that can be addressed using a relationship with sport. In some cases this requires a degree of lateral thought. UK railway track operator, Railtrack, for example, launched a scheme with London football club Charlton Athletic, aimed at cutting vandalism in the club's vicinity in 1998. Within a year of the initiative, incidents of vandalism had fallen from 160 to 31, and delays caused by vandalism had dropped by around 20%.

Changing/revitalising brand image

Changing brand image is one of the most common reasons for embarking on a sports related programme because it offers the opportunity to create an image transfer from the sport to the brand.

To achieve similar results, the only alternatives are to use advertising and PR. In the case of advertising, such a campaign can be very costly and doesn't provide a platform to integrate a full range of marketing activity. PR, although, generally requiring lower budgets, takes much longer to have an effect. A sponsorship programme, however, can create image shift in itself as well as provide a platform to integrate the full range of marketing and communications activity.

Using specialist research agencies (see Research and Evaluation - Chapter 3), it is possible to match the brand image objectives to a sport that has a similar profile and target audience. In most sponsorship arrangements there is an element of image transfer, even if it is not an overriding requirement. For example, British Aerospace's primary reason for Formula One involvement was to leverage hospitality rights to entertain key buyers in a controlled environment. It chose Formula One above other sports, partly because it offered an international and prestigious platform, but also because the advanced engineering, that is integral to the sport, has an obvious match with the company's own products. In most of the case studies featured in the report, image transfer is a key consideration in the choice of property:

• Schweppes needed to align its brand with a younger more sophisticated and international audience and chose Formula One.
• Mercedes sought to reinforce its image of sophistication, glamour and international appeal - it chose tennis and Formula One.
• MasterCard wanted to be seen as a truly global, exciting and 'democratic' brand, and chose the FIFA World Cup, The European Championships and the Champions League.
• The Daily Telegraph wanted to appeal to a younger audience and highlight its sports coverage, it chose to run a football fantasy league.

In all cases, the choice of property demonstrates an understanding of the image of the sport and how it can be used to re-position and/or underline core brand values.

For truly global brands, such as MasterCard and Mercedes, an association with sport is one, albeit important, part of the marketing strategy. It doesn't represent a major re-positioning of the brand, the objectives are part of a strategy to gradually develop image and maintain awareness. There are cases, however, where a more radical and urgent re-positioning of the brand is necessary.

In the mid-1980's, the Opel brand was suffering from an old-fashioned and stodgy image. The perception of the company and the product was not up to par with recent technological and design advancements of the Opel vehicle range. Opel management decided that a new communications platform was required to bring the image of the company back in line with reality.

It was decided to integrate sports sponsorship into the overall communications strategy, with the primary objective being to transfer sport's well-known attributes - performance, youthfulness and dynamism - back towards the brand.
Brands that have suffered from neglect or have been caught in a declining market, may require a major image overhaul but face budgetary constraints that prevent major advertising campaigns. In such cases a successfully leveraged sponsorship has proved to be an effective tool for revitalisation. One of the best examples is Van den Burgh's Flora spread, which was facing a number of problems and turned to sponsorship to seek remedy.

Case Study: Flora London Marathon

Background

Van den Burgh undertook a revitalisation of the 30 year-old brand, primarily as a result of the declining market that Flora was competing in. There were several reasons for the decline in the spreads market:

• people increasingly tend to skip breakfast leading to a reduction in bread consumption and a consequent decline in the use of spreads
• home baking, in which spreads are an ingredient, has fallen
• health concerns have reduced the amount of spread usage

The London Marathon was selected as an ideal vehicle to enable Flora to promote its brand messages by making the relevant link between the health benefits of Flora and taking exercise as an important part of this healthy lifestyle. It was also seen as involving the consumer with over 40,000 runners and hundreds of thousands lining the race course and the sponsorship was used as a springboard and central theme for all marketing communications.

Objectives

The overall objective of the sponsorship, in operation since 1995, was a revitalisation of the brand but specific objectives were set for each year. In the first year of Flora's involvement the event met its objective of achieving spontaneous public awareness of 35% (Source: Ipsos-RSL). By 1999 this had increased to 56% and branded impact on TV had doubled.

Continuous research has since driven the objectives, planning and execution of the event so that, by 1999, a new, but complementary range of objectives had been set:

Awareness- continue to build Flora's association with the event with an aim of maintaining spontaneous awareness at 56% (and to remain above that of a previous sponsor, Mars) whilst aiming for an increase in BBC TV viewing figures.

Longevity - leverage association outside race week

Impact - optimise brand impact on course

Internal buy-in - increase group and internal involvement

Sense of occasion - improve the 'live' experience for spectators and participants and to stage 'the best London Marathon yet'

Implementation

To meet the objectives a strategy was planned in association with Ketchum Sponsorship that included:

• Research into course branding to evaluate the most efficient use of branding on signage and competitor apparel.
• An extension of the PR activity to increase the 'shelf life of the sponsorship from the immediate period surrounding the event to several months prior to and following the race.
• An on-pack offer made in conjunction with the charity, the British Heart Foundation.
• 'Whizzkidz' initiative in which Flora teamed up with children's wheelchair charity WhizzKidz to generate media coverage around the regions via roadshow activities.
• Advertising campaigns used to raise the profile the event including:

TV ads featuring Richard Wilson

(Victor Meldrew in the BBC's One Foot in the Grave)

National television ads featuring the Flora pantomime horse.

London bus sides throughout April promoting a healthy lifestyle.

National and regional radio campaigns.

Internal employee activity included:

• Recruitment of a Van den Bergh's team of over 300 runners.
• Regular internal staff updates and newsletters.
• Branding of the Van den Bergh's office headquarters with a finish tape enveloping of the building.
• The Diana Princess of Wales Territorial Army regiment, led by a Van den Bergh's employee distributed supporter's boards on course. 200 other employees helped on the day at hospitality sites and along the route.

Evaluation

Awareness (Target 56% spontaneous awareness)

• Spontaneous awareness of the sponsorship held firm at 56% in race week (versus 40% in 1997) and remained at 53% one month after the event.
• Awareness of Mars has dropped from 20% to 6% in the same period (Source: Ipsos:RSL).
• BBC TV viewing figures on race day peaked at 6 million

Longevity
Press and TV coverage extends consistently across a six-month period spanning many sectors of the media including general news, health and lifestyle features, sports press, Panorama, a BBC religious broadcast (First Light) and even The Weather Programme. The event attracts national press and television such as a full morning of GMTV coverage in 1998.

Impact
(Target: 20% increase) Total branded TV has increased to almost 2 hrs of clear Flora sightings, representing almost half of the race day coverage. The course branding has now reached the point where virtual saturation has been achieved.

Internal buy-in
Internal entries for the event were greatly over subscribed. This year Van den Bergh Foods runners included the company Chairman and a team from its Dutch headquarters. Important Flora National Accounts including multiple retailers Sainsbury's, Asda, Somerfield and Tesco supermarket groups entered teams.

On going activity

Research from 1999 is being used to set objectives for 2000 and beyond, aimed at working with the London Marathon to ultimately create the biggest and most successful street party ever.
The Flora Light Challenge for Women held in July now boasts a field of 10,000 runners - many first timers - which in its second year is now a third the size of the Flora London Marathon itself.

The Flora case study demonstrates how a single overriding objective can be achieved through devolving the programme into a series of more specific objectives, each of which can be measurable. This not only helps to deliver the main objective, but also helps to formulate an on-going strategy with new objectives.

For major event sponsorship arrangements such as the Olympics and the World Cup, the sporting bodies have detailed, up to date, marketing analysis designed to demonstrate how an association with the event can benefit brands.

To a certain extent the information is portrayed in the best light because it is used as a sales tool, but such material is generally accurate and is supplied by the industry's reputable research agencies. The danger for the potential client is, therefore, not that information is false, but that some negative information could be omitted. The use to a potential sponsor depends on the depth of the research and its relevance to the brand. For example, the research is generally based on a cross section of the general public rather than the brand's target market.

Regardless of whether it is considered that such material is sufficient to base a sponsorship decision on, the reports need to be used in conjunction with commissioned research. If the brand objective is to create an image transfer in line with that apparently offered by a particular sporting property, a benchmark still needs to be set for the brand to evaluate success. The main benefit of the reports, therefore, is that they can provide an initial insight into how a property might fit brand objectives and, in some cases, they can save money by providing information that would otherwise require research. They are not, however, a substitute for bespoke research.

Case Study: The International Olympic Committee -The Power of Brand Olympic

In 1998 the International Olympic Committee (IOC) published The Power of Brand Olympic, a comprehensive report into the Olympic brand which provides sponsors with a clear assessment of the public perception of the Olympics and provides the IOC's viewpoint on why brands can benefit from an Olympic partnership. The report complements other material produced by the IOC such as the Broadcast Analysis Report for each Games and Olympic Marketing Matters, a newsletter that addresses marketing issues and provides news updates.

Objectives

The IOC commissioned The Power of Brand Olympic to 'develop a strategy to protect, build and leverage the Olympic Movement and 'Brand Olympic'. The report is particularly detailed in its look at the brand equity rather than, for example, a detailed analysis of the demographic/lifestyle profiles of the Olympic audience. Given the vast following of the Games across the world, this is understandable and its use to brands is mainly concerned with establishing the potential image fit and consequential benefits. To discover the Olympic brand equity, the IOC undertook the most comprehensive research programme ever gathered on the Olympics.

Table 3.8 IOC research methodology

* France, Greece, Senegal, Brazil, USA, Japan, Germany, Indonesia, Russia, China Source: IOC
** as above but includes Mexico

Olympic attributes

Consumers ranked the following attributes to indicate how closely associated and how important each was to the Olympics:

Table 3.9 Olympic attributes according to consumer research

Chart 3.9 Olympic attributes by consumer ranking (importance and associate = low)

Source: IOC

Chart 3.10 Olympic attributes by consumer ranking (importance and associate = high)

Source: IOC

The results of the survey suggest that the attributes that consumers deem most relevant to the Brand Olympic are highly emotional and aspirational. Significantly, many of the attributes used to describe the Olympics are not the normal sporting terms such as 'Competitive', 'Dynamic', 'Glamorous' etc. Such terms as 'Peaceful', 'Honourable', 'Dignified' and 'Festive' are unlikely to be included in most other sports, and almost certainly not alongside 'Determination/dynamic' and 'Being the best'. This is obviously the result of the great tradition that the Olympic Games has managed to achieve. The brand, now 3000 years old, has, in many respects, gone beyond sport to represent mankind's most worthy values.

Figure 3.1 Global Average Rankings of consumer defined Olympic attributes

Consumer- defined attributes

Consumer-defined attributes

It would, however, be interesting to see what effect the scandals surrounding the Salt Lake City bidding process would have had on the survey. Although the overall feel among consumers towards the Games would probably have remained positive, it is possible that some of the negative attributes listed could have appeared in the top half of the chart. Post scandal opinion polls, however, undertaken in February and March 1998, indicated that the public differentiates between any individuals or organisations associated with poor judgement/bad behaviour and the brand itself.

This would also explain why the Olympics has not suffered severely from the effects of drug taking scandals. Although the issue has plagued many sports (see Understanding the Risks - Chapter 9), the only other competition to have suffered such high profile drug abuse embarrassment is the Tour de France. Despite this, the Olympics appears to have managed to retain high ratings for the attributes that could have been damaged by such scandals. 'Fair competition', 'Honourable' and 'Integrity' are all high on the scale of 'Importance/Association'. Arguably the attributes of 'Pure' and 'Trustworthy', although scoring over seven in 'Importance', fair less well on 'Association' and this could, in part, be a result of such damaging incidents. Although 'Commercialised' appeared in the top half of the scatter graph, the research suggests that the majority (3/4) of consumers 'welcome commercial associations' and will support sponsors:

Table 3.10 Public perception of Olympic sponsors by statement and percentage approval

The report also breaks down each attribute according to country so that a comparison of the brand equity can be made. For brands with specific objectives in different markets this could be particularly useful.

Chart 3.11 Olympic games importance rating -'global'

For brands wishing to project a global image, clearly an Olympic association will stand a better chance of creating the desired image transfer in China, Brazil, Greece and France than in other nations surveyed.

Competitive Comparison

The report also includes a comparison of how the Olympics is regarded in comparison with other global events/organisations:
"How highly do you regard each of the following organisations and events?" (0 = no regard; 10 = highest regard)

Table 3.11 Global average rankings of Olympics and other major organisations

Indeed the report continues to present the Olympics in a positive light in comparison with the FIFA World Cup, in which, the report suggests, the Games has a clear advantage in terms of brand attributes (Chart 3.12). This is arguably an example of where the IOC is, not unsurprisingly, presenting its findings in the best light. Certainly no one could argue that the Olympics out-performs the World Cup on the brand attributes in the chart. It would, however, be interesting to see results if the attributes included: 'Passionate', 'Patriotic', 'Dynamic', 'Exclusive', 'Competitive' and 'Festive'. That is not to say that the World Cup would necessarily out-perform the Olympics in all of these areas, although it almost certainly would on the attribute 'Passionate'.

Chart 3.12 Attribute comparison - Olympics and the FIFA World Cup

Indeed the IOC acknowledges this in another chart in the report in which it compares the positive equities and limitations of the World Cup and other brands. It does not, however, mention any limitations regarding the Olympics. Despite the Games' obvious positive equities it does have limitations such as the lack of passion, and interest in the core sports in general. The World Cup, for example, generates interest for a period of around two years prior to the event as the qualifying matches are played. Despite comparable viewing figures for the finals of the World Cup and the Olympic Games, the viewing figures for football in general, dwarf those for athletics in general. World Cup viewers, therefore, are arguably better acquainted with the personalities than those who perform in the Olympics and the period of related marketing activity is, theoretically, greater.

The World Cup also generates passion on a much greater level, with much larger numbers of fans travelling to matches to support their team and creating a more intense atmosphere in the stadia and greater interest on a national level where a home team is involved. Obviously the Olympics has a relevance to more countries and there are hundreds of opportunities to win medals, whereas the World Cup can, of course, be won by only one team.

Table 3.12 Equity comparison - The Olympics and major global sports/brands

The IOC points out that it is not attempting to be pejorative of other brands, it merely seeks to demonstrate the differences between itself and them. Obviously those differences highlighted are the ones it is most keen to impress on potential partners. The report does, however, acknowledge areas of strength in other brands.

Demographics

The IOC has researched how the Olympic values appeal across different demographic segments. On a global basis the results demonstrate a very even appeal:

Figure 3.2 Olympic appeal by age/sex/income profile

The results are broken down on a national basis to demonstrate variations. To make full sense of the figures would require census information from the countries to compare the age make up of the population with that of the viewing figures. In Western countries, for example, there is an ageing population profile, so it is not surprising that 35-49 year olds represent a large percentage of viewers surveyed.

Chart 3.13 Age profile of respondents with Olympic TV viewing interest

The income profiles are pretty much in line with expectations and demonstrate an interest in the Games proportionate to the income characteristics of the countries surveyed. In wealthy western nations, for example, there is a fairly even split between high, medium and low-income viewers. This reflects the wealth distribution patterns of those countries. In less developed countries, with a greater percentage of the population on low income, the pattern of viewership again corresponds to the distribution of wealth.

Chart 3.14 Income profile of respondents with keen tv viewing interest

Brand opportunities

The basic premise of the Olympic offer is that it provides a uniform and universal appeal with a powerful marketing advantage:

Figure 3.3 Marketing advantages presented by the Olympic Games

Source: IOC

The report also includes an illustration of how the Olympic brand equity can benefit specific categories of Olympic partner:

Figure 3.4 Marketing advantages presented by the Olympic Games by product category

Source: IOC

Conclusion

The report concludes with a graphic demonstrating the how a partnership between the Olympic movement and its commercial Partners provides powerful advantages to both parties:

Figure 3.5 Commercial partner opportunities and Olympic attributes - a summary

The Power of Brand Olympic covers wider areas than those demonstrated above. The samples are a snapshot of the type of information increasingly being made available to potential sponsors by sports properties in an attempt to aid understanding. Major sports properties, such as the Olympics, will obviously use such research material as a selling tool, but it is in their interest to attract suitable sponsors/partners rather than simply attract revenue. The chart above demonstrates that the IOC is keen to gain partners that provide a synergy in terms of both marketing mix and practical aid, from which both the partners and the Olympic movement benefit.

The TOP Partner programme is a good example of how a 'family' of complementary partners can be structured to ensure that the commercial associations become more than a sum of the parts. For a sports property to achieve such a position obviously requires an understanding of the challenges it faces and the solutions commercial partners can provide. Part of that understanding is found in researching the property's equity, which in turn can be used to help partners make marketing decisions. The key word, however, is help. The information in The Power of Brand Olympic is useful to partners and potential partners. It does not constitute an overview of a brand's target market, nor does it demonstrate how a brand should use an association to fulfil its objectives.

There are several advantages to the use of programme sponsorship over other forms of sponsorship.

• the amount of exposure is guaranteed
• the exposure can be handled in a more creative fashion
• the costs can be less than those of 'official event' sponsors
• the geographic market is defined
• top of mind awareness is often greater than event sponsorship
• the medium can change brand image attitudes

One of the best examples of the power of broadcast sponsorship concerns the Rugby World Cup, both in 1995 and 1999. In 1995, for example, Heineken was the broadcast sponsor of the UK programming. The creative treatment included the official theme tune of the competition with rugby balls flying into the screen from a graphic featuring the competing countries around the world.

Research commissioned by TSMS Connector, which handled broadcast sponsorship rights for broadcaster ITV, suggested that Heineken's association with the event outstripped other sponsors by a huge margin:

Table 4.6 UK awareness of 1995 Rugby World Cup sponsors

Source:TSMS

There is an argument to say that Heineken's overall sponsorship of the event was thorough and professionally handled by agency ICS and therefore its awareness rate should exceed that generated by co-sponsor activity. A similar argument is applicable to Guinness for the 1999 Rugby World Cup. The project, handled by Octagon, had a key objective to make Guinness appear as the 'owner' of the event. Despite being an equal title sponsor with SAA, Visa, Coca-Cola, Ford, BT, Xerox and Lloyds and Outspan in the UK and Ireland, Guinness was keen to be seen as overall title sponsor. Its marketing effort surrounding the competition went well beyond the activities of the other primary sponsors (see Major Case Studies - Chapter 5). Nevertheless, its awareness rating of 94% would have been impossible to achieve without the broadcast sponsorship element. That said, however, the cost of broadcast sponsorship, estimated at between £4-5 million, was roughly twice the cost paid for the official sponsorship rights. In terms of finance and effort, therefore, Guinness acted as a sole title sponsor even though the bulk of the expenditure did not end up in the coffers of the sport.

The official sponsorship rights provided a credible link to the sport and created the platform for a wide range of marketing activity. In this case, however, the broadcast sponsorship was arguably the most potent tool. It created the awareness and enhanced the official sponsorship. The leveraging of the property came from that platform.

One of the criticisms of broadcast sponsorship is that it is a one-dimensional medium that simply offers awareness. To an extent this is valid in that it is not possible to leverage rights it the same way that title sponsors can. Event-related promotions, PR, merchandising and hospitality are generally not available to broadcast sponsors. Similarly, there is a question mark surrounding why many brands pay so much for broadcast sponsorship if it is simply to achieve awareness. The likes of Ford, Carlsberg, MasterCard and even many smaller brands that use the medium, could hardly be described as lacking awareness.

The majority of brands, whether or not they use the medium to its full potential, are attempting to create an image transfer in the same manner as title sponsors. The argument that broadcast sponsorship cannot achieve this, or at least to the same degree as event sponsorship, is disproved in those cases where broadcast sponsorship has been used to the maximum of its potential. In such cases there is a good fit between the brand and the sport, the creative treatment has tapped into the essence of the viewing experience, produced strong branding and has not been intrusive. The research results in the Texaco case study at the end of this section demonstrate conclusively that brand image objectives can be delivered very successfully using the medium.

Background

The 2000/01 BT Global Challenge is arguably sailing's toughest race as the teams involved attempt to circumnavigate the World against currents and prevailing winds. The yachts, crewed by volunteers under the direction of a professional captain, have a greater number of technology sponsors than any other major sailing event, and BT is the title sponsor for the second time having judged the event a success in 1996/97. The company is keen to use the event as both a branding exercise and to demonstrate its systems and services to a global market. To achieve this, the company has created a series of technical features fitted to each boat to enhance communication.

Objectives

The key objectives for BT are to raise awareness and understanding of the company and its 'Family of Alliances' on a global scale. Global Challenge is BT's largest customer relationship marketing programme, and is being used to enter dialogue with customers, prospects, 'influencers' and the media. The race's technological input is central to that dialogue because it provides a practical demonstration of many of the issues being raised. Apart from the technology showcase, BT is also keen to explain the importance of communication with the strapline: 'better communications lead to better relationships which, in turn lead to better business and a better world.'

Technical features

Yacht tracking Using BT's C-Sat service with its in-built Global Positioning System (GPS) and BT's online tracking and messaging facility, each yacht's position can be pinpointed and tracked accurately and automatically. The data is sent via one of the Inmarsat geostationary satellites to Race HQ in Southampton where race officials process and verify positions using BT Race Control System software to produce the latest positions.

Remote video communication BT's B-Sat service is a digital satellite communications service providing video conferencing, email, internet access, telephone and data transfer from ship to shore. The high-speed frequency allows file transfer at 64kbps using ISDN compatible links. Each yacht is equipped with its own miniature outside broadcast unit that comprises six digital hand-held and fixed video cameras linked to a computer capable of on-board editing. The video footage can be stored, compressed and forwarded to the official race website (www.btchallenge.com) allowing site visitors to experience life on board.

Remote voice communication Boat crews are able to speak to friends, family and the media via Mobiq Marine, the shipborne variant of the world's most popular low-cost satellite phone.

Development of business relationships

BT has created a series of opportunities to develop business relationships throughout its commitment to the race.

Hospitality programme Prior to the race, BT ran a comprehensive hospitality programme for partners and 'influencers'. This included day sails and challenges featuring up to 22 yachts and 1,000 guests per week. During the race a similar programme is planned.

Seminars A series of seminars is aimed at creating debate on the implications of the 'electronic world'. A panel of experts from BT, local partners, academia and industry will form the creative catalyst for discussion with guests at ports of call. Businesses and IT professionals from around the world will be able to participate via the Internet.

Technology showcase Apart from the on-board technology, BT will also have a technology showcase run in conjunction with other sponsors at all ports of call. The company will exhibit applications that provide solutions in the 'virtual' world and sponsors will have their own dedicated areas.

Cyber café Cyber cafes will be used to provide relaxed areas for discussion where account managers and hosts can interact with delegates and guests. Computer terminals within this area will give guests access to the web sites to support discussion.

Research into 'virtual teams'

Because many of the factors needed to succeed in the Global Challenge are similar to those necessary for business success, BT is working with Inspiring Performance and Henley Management College, to conduct a study, Inspirational Intelligence Research Forum (IIRF), into leadership and the effects of different emotional intelligence styles. BT is also researching how modern technology enables leadership to be established and teams to be built using the Internet.

In the lead up to the race, team captains were provided with Internet enabled devices and collaborative software to communicate with team members, all of whom are geographically dispersed. The objective is to provide a direct analogy between the race and the emerging 'New World' of business. Opportunities for face-to-face meetings are rare prior to the event but the technology should provide a chance for team building before the race begins. BT and Inspiring Performance have been monitoring the captains since their selection to assess leadership style and to evaluate how collaborative software tools are being used to build teams and behaviour patterns in a virtual environment. It is expected that the race will provide visible results of the effects of different leadership and teambuilding styles.

These results will be turned into case studies that will be available to a number of sponsors including Microsoft, Compaq, Rank Group and NEC at IIRF forums. A book, summarising the findings is also planned.

Conclusion

BT expects a total of around 18,000 key business contacts from more than 60 countries to participate in the worldwide communications programme.

Beverly Robinson, head of marketing programmes for BT Global Challenge, points out why the sponsorship is about more than a simple branding opportunity:

"For us the BT Global Challenge is much more than a yacht race. This comprehensive marketing programme enables us to work in conjunction with our Family of Alliances and other sponsors to build better relationships with our customers and suppliers. We will also create partnerships with leading industry lights on both an international and local stage, all with a view to creating real business opportunities."

The estimated £7 million title sponsorship rights appear to have provided BT with an exceptional platform in terms of value for money. Obviously its leverage costs will be significant, but such expenditure would be necessary to meets it objectives regardless of any sponsorship. The Global Challenge creates the platform to make the relationship building programme more exciting and compelling while simultaneously creating an environment in which personal relationships can be developed. As an added bonus, BT will receive a branding opportunity on a global level.

Summary

To fully understand the potential, the strategies and the range of implementation of sponsorship, it is necessary to study case studies in depth. The chapter contains very detailed case studies of widely acclaimed sports sponsorship projects in Europe. They have been chosen to represent different sports, different industry sectors and, to a large extent, different objectives.

The case studies demonstrate, for example, how Schweppes used Formula One to create an image transfer and update its brand image to a younger, more international audience.

UPS used its Olympic association to underline its global presence, but also created a wide ranging internal communications programme to improve motivation and address specific issues that were important to its workforce. EF, similarly used sailing for internal purposes, but in this case it was to attract and retain the most highly qualified staff in its field.

MasterCard, Guinness and Mercedes-Benz all used their associations to aid their global marketing efforts, but in very different ways. An overview of BMW's sponsorship strategy is included to demonstrate its similarity to that of competitor, Mercedes-Benz, underling the fact that when a logical approach is taken to the subject, consistency is achieved.

The case studies also demonstrate factual accounts of the results of sponsorship investment and there are some startling figures, such as the equivalent media value that Schweppes and MasterCard produced from their investment, and the awareness rates that Guinness achieved as a Rugby World Cup sponsor.

The most important lesson from these studies, however, is how the sponsors have leveraged their rights. There are still far too many sponsors who acquire rights and do very little beyond the basic branding opportunities that are part of the package. These case studies demonstrate how sponsorship can be really made to work.

The Schweppes sponsorship of the West McLaren Mercedes Formula One Team is one of the most extensive and well-documented sponsorships for a single brand in a single property in Europe.

Background

The sponsorship was signed in November1997, at a time when rejuvenation of the brand image of Schweppes was becoming a priority around the world. Schweppes had an additional problem in that the brand personality differed internationally. In the UK, for example, it was seen as a sophisticated drink used mainly as a mixer and sold to an older audience. In Spain, on the other hand, it was popular with a younger audience and drunk in bars and clubs.

Objectives

The primary objective of the activity was, therefore, to help re-vitalise the brand image to make it more relevant to young adults. In order to support this, the sponsorship had to offer a flexible promotional platform to enable the company to leverage the consumer opportunities across varying flavours and markets, as well as to activate incentives and entertain at a bottler and trade level.

At the time, Schweppes was engaged in a significant effort to build the brand's global credentials, and had recognised the role that sponsorship could play in this. It was agreed that all marketing initiatives needed to cover all the major soft drink markets across the world.

"Schweppes came to us having recognised that advertising alone was not enough to meet its objectives, they realised that other communication mediums offered additional ways to help drive an image shift", says Ben Pincus, Managing Director of International Sponsorship Consultancy ICS.

"Sponsorship offered the ability to transcend language and cultural barriers and offered the right tool to gain a credible association with a lifestyle activity that could move the Schweppes brand image on." says Stephen Joy, Marketing Director at Cadbury Schweppes Africa India Middle East and Europe Beverages

Why Formula One?

"We looked at the opportunities in the targeted regions - they included football, basketball, tennis and a variety of other sports, but it kept coming back to Formula One."

The following table shows some of the other activities which were considered, and why they were ultimately discounted:

Table 5.1 Schweppes sponsorship options - pros and cons

Option	Pros	Cons
Basketball	Dynamic Growing	Very fragmented no strong regional structure. Very youth Limited promotional flexibility Sprite represented
Tennis	Popular Cost effective	Too old Diet Coke represented
Golf	Schweppes heritage	Fragmented Limited exposure Older audience
Art	Upmarket Stylish	Limited audience/ exposure Difficult to manage
Music	Flexible	Costly

Another factor was that Formula One events take place in 16 different soft drink markets around the globe, giving wide coverage, and a broad base for relevant promotional activity.

"The research was also telling us that Formula One provided a good fit to the brand's target audience," says Pincus. "The demographics, viewership figures and the seasons' timing and duration were ideal for the soft drinks business in general and Schweppes in particular."

"It soon became clear that the decision was what deal would most benefit the Schweppes brand objectives," says Joy. "The motivational benefits of a team deal rather than event - were clear. The McLaren Team was eventually chosen because it offered the right brand image - being, in many respects the most international team. Ferrari is definitely Italian and Williams a very English Team. McLaren, on the other hand, has long had an international image and its other sponsors - Mercedes, Tag Heuer and Hugo Boss - were exactly the kind of brands Schweppes was looking to sit alongside."

The sponsorship gave Schweppes a presence on the helmet visors, sleeve and bottles of the two team drivers, Mika Hakkinen and David Coulthard.

"Schweppes is about revitalising and refreshing people not cars", adds Joy.

The rights package

The deal, estimated at around £1 million per season, signed with McLaren, made Schweppes the West McLaren Mercedes Official Soft Drinks Partner in a contract for the 1998, 1999 and 2000 seasons. The agreement gave Schweppes the following entitlements:

• visibility on the drivers helmets and sleeves
• visibility on pit crew sleeves, pit signage, race transporters and McLaren printed material
• 2 driver appearances during the course of the season
• appearances by Ron Dennis, managing director of McLaren
• factory visits
• access to replica helmets, suits etc for promotional purposes
• two appearances of a replica car per season
• soft drink supply in the McLaren factory, pits and paddock
• 60 3-day hospitality tickets across the season
• use of hospitality at one Silverstone test day per year (20 people)
• advertising in Racing Line, the Team McLaren magazine
• 30 Team McLaren memberships

Schweppes also benefits from:

• access to potential business with other McLaren partners (sponsors)
• TV and press exposure from the contractual visibility is supported by additional unpaid-for visibility on the sleeves of the team's uniforms
• product placement and point-of-sale material in the McLaren VIP hospitality suite
• access to other rights such as circuit advertising and additional hospitality facilities
• access to McLaren's skill base; as part of its effort to continuously improve, Schweppes was keen to identify management best practice at McLaren and learn from it where possible

The financing

Schweppes, through ICS, knew at an early stage that full exploitation of the sponsorship could be achieved only through additional investment over the cost of the contract. Included in the funding needed to be an allocation for central activation - the creation of tools to help markets activate the sponsorship, so that Schweppes could hit the ground running.

"Formula One is a particularly flexible platform," says Pincus.

"It has many different characteristics, offering activation opportunity to varying brand image objectives - whether it be the more sophisticated glamour of Monaco or the adrenaline of the racing itself. These characteristics needed to be extracted and illustrated to markets to prevent confusion and aid speedy activation."

They covered the following areas:

• Internal communication/motivation
• PR material
• Branded merchandise and point of sale material
• Advertising
• Design and print
• Photography
• Hospitality management and co-ordination
• Research

The central activation budget (year one) was broken down as follows:

Table 5.2 Activation budget by percentage

Item	%
Design and print	7
Events	0.5
Photography	10
Merchandise/POS	4
Advertising	11
Research	6.5
PR and Media	9
ICS fees	35
ICS expenses	13
Product at races	4
Total	100

The total financial requirement, including the allocation for central activation, was apportioned to the various countries on the basis of a formula devised by Schweppes in-house. The formula was designed to reflect both the relative size and profitability of each country's Schweppes business, and the relative interest levels in Formula One by country. A broad consensus has been built to support this allocation methodology, which was felt to be fairer than any alternative method.

The total spend estimated at between £2-2½ million per year (including McLaren rights fee) represented less than 10% of the overall marketing budget, but replaced other activities, so was not incremental spend.

Implementation

In most cases, sponsors of Formula One treat the first year of a sponsorship as a learning curve in which marketing activity is passive as the sponsor develops a view on the best methods to exploit the property. Schweppes, however, with ICS, developed a complex marketing programme that ran across its AIMEE region within the four-month period of signing the contract with McLaren in November 1997 and the start of the Formula One season in March 1998.

The sponsorship formed the main element of the promotional platform for Schweppes within AIMEE in 1998. One of the key benefits was identified as its flexibility. The following examples demonstrate the variety of activities that can be used to leverage the bottom-line effect of the sponsorship. The examples represent the key marketing disciplines exploited during the first year of the sponsorship. The fact that virtually every AIMEE region ran activities in most of the disciplines discussed shows the range of activity associated with the sponsorship, as well as the importance of central activation and advice.

Consumer promotions

Formula One themed consumer promotions and/or on-pack activities were run in Finland, Portugal, France, Spain, Malta, Germany, Austria, Great Britain, Russia, Hungary, Macedonia, Japan, Argentina and Brazil.

In France, for example, an on-pack instant-win promotion offered the chance to win Grand Prix tickets and merchandise whereas in Spain consumers could redeem a Formula One T-shirt for buying 4 Schweppes packs. There were further offers of seven trips for two people to different Grands Prix and a competition to win a Mercedes Benz A-140.

Trade promotions and activities

Trade promotions and activities were run in Norway, France, Germany, Austria, Great Britain, Sweden and New Zealand.

In Sweden, for example, a promotion was run to the trade in which every 12 cases of Schweppes sold earned the retailer a lottery ticket. Both the owner of winning ticket and the regional seller received tickets for two to the Monza Grand Prix.

Joint promotions

Schweppes has run a series of joint promotions since signing the sponsorship deal. These have included promotions with fellow McLaren sponsors such as Finlandia in Scandinavia, Mobil in France, Mercedes in Belgium and Hugo Boss in several territories. Finlandia has been a particularly good partner because it has a natural fit with Schweppes, which is the market leader in the production of tonic water and Russchian, both popular mixers with vodka. Finlandia is also keen to 'internationalise' its brand and has run promotions on a split cost basis.

The company also used the relationship with Mobil and its European joint-venture partner BP, to explore the possibility of access to distribution in forecourt retail outlets. Schweppes France, for example, was able to use the relationship developed with BP to run joint promotions in BP outlets.

In the UK Schweppes has also run a Formula One themed joint promotion with supermarket group Tesco that helped get Schweppes a listing in the store and Tesco free access to a Formula One association.

Bottler incentives/hospitality

Incentives and/or hospitality for bottlers were run in: Sweden, Italy, Great Britain, Czech Republic, Turkey, Bulgaria, Morocco, Serbia Zimbabwe, Nigeria, Germany and Japan.

In Bulgaria, for example, the two top salesmen received a VIP trip to the Luxembourg Grand Prix whereas the 10 top performers in the Czech Republic won equivalent trips to the Belgian Grand Prix.

Media advertising and sponsorship

TV advertising, broadcast sponsorship, press advertising and poster advertising were used in Norway, Iceland, Spain, Italy, Germany, Austria, Great Britain, Hungary, Serbia, Slovenia, Russia, Macedonia, and Argentina.

In Iceland, for example, Schweppes is the programme sponsor of the ATL Formula One television broadcast watched by 20% of the population.

In Portugal, which does not have a Grand Prix, national and regional radio competitions have been run with the offer of tickets to the Monza Grand Prix.

Public relations

The use of the press in particular has been very successful in the sponsorship. Photography, arranged through an agency, has been made freely available to the media via a website so that controlled, high quality images have been placed in key media. Examples include trade and motor magazines that cannot afford to send photographers to every event but have a need for high quality photography.

The placement of stories in the media has also proved a fruitful part of the marketing effort, especially given he fact that most stories require photography.

"We have tried to create an active dialogue between the press and the Schweppes Team," says Pincus.

"This was done by providing them with lighter facts and trivia from behind the scenes, in an attempt to take F1 and Schweppes' involvement, as a stylish brand for young adults, to a non motor sport audience. Examples being management stories targeted at the business press, travel and style stories to the fashion press, etc."

The use of photo stories has also proved equally successful with, for example, features on David Coulthard's favourite bars in the world and Mika Hakkinen's favourite - just round the corner from where he lives - in both cases Schweppes was heavily featured.

Trade incentives/hospitality

Trade incentives and/or hospitality were used in Finland, Portugal, Italy, Germany, Austria, Great Britain, Australia, Argentina and Brazil.

Apart from the hospitality packages offered to key trade buyers, Schweppes has also run bar staff incentives. In the UK this was based on a collector mechanic in which an A3 poster map of a famous race circuit was given to bar staff. The circuit was sectioned into boxes and each time a Schweppes bottle was sold, staff could tick off a new box with bonus points gained at key corners and chicanes. All entries that reached the chequered flag were entered into a prize draw to win tickets for the British Grand Prix. Merchandise gifts were also made available to those who had reached targets.

Product and packaging

Schweppes was keen to build more credibility to its partnership with McLaren, as well to create more relevance through TV and press coverage. As a result Schweppes worked with McLaren to develop two products that met the specifications for the racing team's dietician that were packaged in dual branded bottles, featuring the car livery as a visual theme.

The products proved to be a great success with both the team and drivers, leading to significant additional media exposure. Coupled to this success, the packaging is to be adopted by various markets as a volume driving incentive.

Merchandise

To support the exploitation of the sponsorship at a local level, Schweppes developed a range of merchandise and point-of-sale items carrying the West McLaren Mercedes Official Partner logo and a stylised Schweppes Formula One logo. This has proved to be an indispensable tool for both promotional activity and corporate hospitality use. The merchandise has also included Schweppes branded items from fellow McLaren sponsors Tag Heuer and Hugo Boss, which has helped to develop relationships between the partners as well as to provide very high quality merchandise.

Internal motivation and communication

The sponsorship has provided Schweppes with a platform for employee communication and motivation. The success of McLaren has become a matter of common interest across the different countries and functions in the Schweppes AIMEE workforce.

Regular newsletters have been produced internally to update employees on the progress of the team and involve them in the brand activity. The replica car has been used at employee events to enable people to feel the reality of the Formula One world, and a travelling display has toured AIMEE locations to promote the sponsorship internally.

Schweppes has also created an interactive Formula One Fantasy game run on its Intranet site. For a small charge per player, Schweppes employees and agents can partake in the game in which they have to predict the results of the McLaren team. Those who make the most accurate predictions stand to win prizes and the game is being used to further enthuse and motivate staff to fulfil the potential of the sponsorship. So far around 1,500 staff have signed up for the game.

Internal organisation structures

Schweppes has built a team at product manager level labelled the 'Think F1Team', which aims to ensure maximum exploitation of the sponsorship through shared information and ideas. Two managers within AIMEE's Marketing Services department each devote 30%-40% of their time to the project and bear responsibility for it. The managers work in conjunction with ICS to ensure that communication and accountability are clear.

Resources

As the centrepiece to activation of the property, ICS has produced 'The Schweppes F1 Toolkit'- a manual illustrating to Schweppes' markets how they can leverage the sponsorship. Starting with a brief introduction to the sponsorship, and the rights available to Schweppes (with the rights being released progressively over the three years, helping to keep momentum and not bombard markets), it has details on how the tools at the disposal of the regional operations can be used to maximise the exploitation of the sponsorship. For example print advertisements have been produced that are in a template form and available on CD-ROM.

Regional offices can, therefore, use the template to adapt work to suit a particular need. This ensures that the print advertising maintains a specific standard and style across borders but there is control of the content regionally.

Photography is supplied via an agency appointed by ICS. The regional markets can order photography as required. The photography is also available to the media via a website free of charge. (see Public Relations - Chapter 8)

The Toolkit also includes information on the use of promotions, logos, approvals (artwork incorporating the car requires the approval from McLaren to ensure other sponsors rights are not infringed), hospitality, merchandise, photography and public relations.

This was backed up by quarterly "Think F1 Team" meetings and specific market visits where necessary. Throughout the year ICS maintained an active dialogue with markets, becoming a conduit for examples of best practice, "Markets learn better from each other, rather than from a corporate office," says Stephen Joy.

Evaluation

The original objectives set in 1998 were:

• to re-vitalise the brand image
• to provide a flexible promotional platform to build value through synergy and efficiency
• to lever the partnership with bottlers and trade by use of hospitality

It is important to bear in mind that increasing brand awareness per se was not an objective of the sponsorship, which explains why Schweppes opted for a deal that didn't entail high visibility such as the sponsorship of a car wing.

Consumer awareness of the brand is already high in all target markets. On the other hand, it is possible to achieve re-vitalisation of the brand through sponsorship only if consumers are aware of it, so a sufficient level of awareness has to be built-in. The chart below demonstrates the levels of exposure accorded to different branding opportunities in Formula One. Helmet branding is the least noticeable, but for Schweppes it offered a platform for leverage at an affordable price.

Chart 5.1 Branding exposure levels in Formula One by source

Source: Sports Marketing Surveys

Qualitative feedback

The feedback from Schweppes regional marketing departments has been very positive and has led to several instances in which annual sales negotiations have taken place at the circuit.

Media value - television

Television tracking was arranged for the five largest European markets; France, Spain, Italy, Germany and the UK. The tracking measured the number of seconds of complete, clear Schweppes brand exposure over a six-day period surrounding a weekend Grand Prix across all broadcasts. The results available are for the first five races of the 1998 season, three of which are not European. This tends to reduce television viewing figures in the five evaluated countries. The results identify a total media value of £190,000. Extrapolated across the entire season and all Schweppes markets, the estimated total value against the discounted cost of buying the airtime was £5.36 million, representing double the sponsorship investment.

Table 5.3 Media values by country

£ media value	Australia	Brazil	Argentina	San Marino	Spain	Total
France	3,482	4,419	393	13,077	6,928	28,298
Spain	0	606	0	1,848	20,233	22,686
Germany	10,118	6,724	5,729	2,143	12,419	37,133
UK	9,289	10,079	7,558	23,989	16,059	66,973
Italy	1,146	9,757	3,680	4,599	12,004	31,186
Total	24,034	31,585	17,359	45,655	67,643	186,276

Chart 5.2 shows that McLaren gained more exposure than other teams. Other key findings of the television research, carried out by SMS, include the value of highlights programmes in delivering viewers. Both live audience race figures and cumulative results demonstrate that Germany and Italy are the biggest Formula One television markets by some distance. Interest in these countries is significant, ironically because of the relative success of the Italian Ferrari team and its German driver Michael Schumacher. The UK, for example, actually has more coverage of Formula One than Italy, but has fewer live and cumulative viewers.

Chart 5.2 1998 Formula One television coverage by team

Source: Sports Marketing Surveys

Chart 5.3 Formula One branding exposure levels by country

Source: Sports Marketing Surveys

Chart 5.4 F1 cumulative television audience by country and programme type

Source: Sports Marketing Surveys

Chart 5.5 F1 live race audience by country - percentage

Source: Sports Marketing Surveys

Chart 5.6 F1 total television coverage by country - minutes

Source: Sports Marketing Surveys

Chart 5.7 F1 television audience/coverage shares by country

Source: Sports Marketing Surveys

Media value - press

Press tracking across the same five markets suggests that the value of press exposure is even greater than that of TV.

Table 5.4 Press value by country

£ media value	Total to end of May 1998
France	51,734
Spain	13,224
Germany	220,943
UK	40,748
Italy	33,532
Total	360,181

Given that Schweppes had not set an objective of generating large-scale brand awareness, the results were a bonus. Extrapolated over the season, discounted press exposure was estimated to be worth £6.5 million, again more than double the sponsorship investment. An added benefit was that Formula One can open doors to media opportunities. For example, Schweppes negotiated media space in The Times valued at £290,000, for just £90,000. This was through the use of a full page colour advertisement added to competitions to win a ride in a McLaren two seater racing car and to spend a day with the McLaren team.

Image transfer research

Image transfer research was conducted approximately one week after each Grand Prix among a representative sample of consumers. The research looked at specific measurements of:

• interest in Formula One
• spontaneous awareness of McLaren sponsors
• spontaneous awareness of Williams sponsors (as a check)
• prompted awareness of McLaren sponsors
• the difference in key brand image attributes between those aware of the sponsorship and those unaware

Chart 5.8 Total awareness of McLaren sponsors by percentage

Source: Ipsos-RSL

Chart 5.9 Schweppes image -potential and actual

Source: Ipsos-RSL

The results demonstrate that Schweppes has achieved relatively good awareness among McLaren sponsors especially given the fact that its involvement was recent. It is significant that total awareness of Schweppes rates behind only Mercedes-Benz, West and Bridgestone. It is around the same level as Mobil, which has branding on both the car and the helmet. Awareness is actually higher than Boss, British Aerospace, Samsung, Warsteiner, Sun Microsystems, Computer Associates and Tag Heuer all of whom (with the exception of Warsteiner) have had a longer association with McLaren, have branding on the car and who pay more for their partnerships.

The other significant result of the research is that those aware of the sponsorship have a much more favourable image of the brand i.e. they agree much more than those unaware, that Schweppes is refreshing, a brand for young adults, a brand worth considering and a good quality brand.

Table 5.5 Comparison of Schweppes image -aware/unaware of sponsorship

	Unaware	Aware
Refreshing drinks	36	69
Brand for young adults	21	34
Brand worth considering	16	26
Good quality brand	21	30
Distinctive brand	6	15
Stylish brand	5	8
Surprising brand	6	7
A brand for mixing with alcohol	7	23
Interesting brand	4	6
Brand for someone like me	2	7
None	7	1
Don’t know	7	0

Is the brand being revitalised?

Table 5.5 certainly suggests that those aware of the sponsorship have formed a more positive opinion of the brand. The media exposure has been demonstrated to be worth in the region of £12 million per year. So this would appear to be a cost-effective method of changing the image of the brand.

Does the sponsorship provide a flexible promotional platform that creates synergies?

Most markets have reported that the promotional activities carried out using the McLaren property was successful. Those activities varied depending on the country and target of the promotion, suggesting that the property did offer a flexible platform. Although specific results for promotions are, on the whole, not available, Schweppes Spain, for example, estimates that Formula One promotions delivered 9% more volume in 1998 than equivalent promotions in 1997.

Has hospitality been levered successfully?

Schweppes operates in a predominantly franchised industry. It is, therefore, important to be able to offer the trade and bottlers access to the sort of experience that would normally be expected of Coca-Cola and Pepsi. In fact these two giants of the soft drinks world have virtually no involvement in Formula One and cannot, therefore, compete to provide such hospitality.

From a point of view of hospitality it is interesting to note the differences in properties that, for example, Coca-Cola and Schweppes can offer in Europe.

Of the glamorous, high profile sporting events, Coca-Cola has, for example, rights to the World Cup, the European Championship, The Olympic Games and Wimbledon in Europe. Wimbledon apart, each of the other three take place only once every four years, and only the European Championships can be guaranteed to take place in Europe. In all the Coca-Cola sponsored events there are only a limited number of fixtures that are highly sought after e.g. Football and Wimbledon quarter-finals, semi-finals and finals and Olympic days when high profile personalities are competing for Gold medals.

Thus even a major sponsor like Coca-Cola, which benefits enormously from its sponsorships in many other ways, has a limited number of opportunities per year when it can invite guests to high profile events. It is, for example, unlikely that its allocation of Wimbledon Men's Final tickets can include large numbers of guests from the trade and bottling plants throughout Europe.

In Formula One, on the other hand, every race is seen as 'a final'. It is the pinnacle of the motor racing season in the country that is hosting the Grand Prix and to be invited as a corporate hospitality guest is a highly valued privilege.

Over the course of the season Schweppes was able to invite 750 VIP guests and an additional 350 grandstand seats were sourced for other guests. Anecdotal feedback on the hospitality programme has also been very positive.

Conclusion

Schweppes sponsorship of Formula One demonstrates real value for money. The company carefully researched an appropriate property to fulfil specific brand objectives. The cost of that property was not particularly high because Schweppes needed the official association with the sponsor rather than major TV exposure. With the marketing activity being spread across so many regions, the cost per country was relatively low and was mostly a re-use of existing budgets.

The real lesson for other sponsors is how Schweppes and ICS thought through all the opportunities and exploited them to the full. Many sponsors do virtually nothing in their first year of a sponsorship - its fair to say that Schweppes has done more in one year than most do in five years of a high profile association.

It will be interesting to see how this particular deal progresses. Certainly Schweppes has been fortunate in that its association with McLaren has come at a time when the fortunes of the team are at their highest for many years.

As was seen from the research, this makes an enormous difference to the TV exposure of the cars. Having said that Schweppes branding is not visible for the majority of the race. But clearly the association, whether viewed via TV, in the press, on packaging or through other marketing activity has been hugely beneficial to achieving the image shift the company was looking for.

It will be interesting to see if Schweppes decides to push its association with Formula One any further through, for example, a higher profile television exposure either on the car or through use of perimeter signage. Given the leverage it has achieved from the relatively low levels of exposure it has had, should the company consider it still needs to shift its image further in the direction of the younger, more sophisticated market, this could well be the direction taken.

Background

The Vittel brand operates in a very competitive market in France and in the mid-1990's it was identified that the image of the brand needed to be re-invigorated and market share had to grow.

The company looked at the possibility of using sports in the new marketing initiate and looked at research results of basic attitudes to sport in France.

Sports participation in France

The figures showed that the amount of time devoted to participation in sports as a percentage of leisure time activity had grown from 3.7% in 1977 to 4% in 1997.

A majority of the French population, 53% practiced a sporting activity in 1997 and, although there has been a growth in sporting activity among women, practice is still a more a male activity as men represent 58% of participants. The practice of individual sports remains preponderant, although it is reducing. The actual figures are:

• Swimming 13%
• Tennis 12%
• Cycling, Running each 10%
• Football 9%
• Skiing 1%

There is also strong growth in mountain biking, beach volleyball, snowboarding and roller-skating.

The research also showed that France is ranked as one of Europe's leading nations in terms of sports participation. There are more than 14 million members of sports clubs/associations in the country, a ratio of one in four citizens, compared with 1/6 in the UK, 1/12 in Italy, 1/40 in Portugal. The figure for Holland, Germany and Denmark, however, is slightly higher at 1/3.

N.B If the number of duplicate cardholders is taken into consideration; the estimated actual number of regular club/association members is 10 million in a total of 140,000 clubs.

Broken down into the most popular federations, membership includes:

• Football 2,200,000
• Tennis 1,000,000
• Judo 550,000
• Basketball 470,000

The level of participation fluctuates according to both age and occupational group. 75% of participants are below 20 years old and 87% below 35 years old.

Looking at interest in terms of both media coverage and individual participation, the figures show 75% of the population is interested in sports, broken down to 88% men and 65% women.

The disciplines attracting the most media interest are correspondingly matched by TV coverage:

1. Football
2. Tennis
3. Cycling
4. Ice Skating
5. Formula 1
6. Rugby
7. Athletics

TV coverage in France totals over 1,700 hours per year across the TF1/France 2/ France 3/Canal+/M6 stations with football receiving by far the greatest coverage:

• Football 490 hours (27.5%)
• Vehicle Sports 180 hours (13%) - (Formula One is 45% of this figure)
• Tennis 165 hours (10%)
• Cycling 160 hours (9%)

Water consumption during sports activity

The research demonstrates, not surprisingly, that consumption varies according to discipline. The average budget spent per year in relation to the practice of a discipline fluctuates from £100 (football) to £1,000 (golf).

Although medical research has demonstrated the increased need for water consumption during sports activity, the market research found the actual amount difficult to quantify. It did, however, find that consumption per capita (especially during training periods) is more than four times greater than average.

The basic conclusions of the research, therefore, were that sport is a potentially strong medium for building product image and brand awareness. Because of the large number of participants and the consequent need for water, sport represents a large potential target market.

Le Club Vittel

Objectives

Vittel was, therefore, keen to identify a method of enhancing its image and creating and maintaining contact with customers. It was also keen to provide added value.

The company launched a loyalty scheme, Le Club Vittel, in July 1995 for track and field with the target group being the athletes.

The objectives were to reinforce the brand statement and to develop a motivation for purchase among club members.

Implementation

The method was to use the sports network system already in place. To encourage members to drink more it was decided that senior club staff would be the ideal conduit to encourage members to drink more. The club would recommend the product if it gained.

The actual mechanic involved club members collecting bar codes from bottle labels and returning them to the club. The club in turn sends them to Club Vittel where they are converted to Vittel Points.

Vittel Points can then be used in a catalogue redemption scheme to provide the club with:

• Equipment
• Technical materials
• Training courses
• Sports services

The idea of the scheme was to engender the thought: 'I like my club, so I drink Vittel'

To develop the concept Vittel undertook a series of promotional activities aimed at club members, these included:

• The sponsorship of numerous sporting events with invitations extended to members of clubs.
• A monthly magazine covering all aspects of sports club life.
• Organisation of a national club recruitment campaign.
• A PR campaign targeted at specialist sporting press.

Following the success of the scheme in track and field it was decided to roll the programme out into other disciplines. Initially Handball (January 1996) and Swimming (September 1996) were tested.

Convinced of the success of the programme, it was opened to Basketball, Tennis, Table Tennis, Volleyball and Football in 1997.

1998 Results

By 1998 the results demonstrated that the programme had penetrated over 25% of its target market.

Table 7.2 Le Club Vittel 1998 programme penetration

 

Number of sports	8
Potential number of clubs	46,500
Clubs registered to the scheme	10,000
Potential number of members	4.2 million
Members registered to the scheme	1.3 million

Le Club du Sport concept

The downside to this success was the rise in cost in administration, promotion and redemption, prompting Vittel to consider the direction in which the programme could evolve. The ambition was that the sports clubs would be able to get new benefits such as insurance cover, banking, additional sports equipment, sports health facilities and access to legal and financial services.

There was also a desire to provide new means of points collection and to widen the club to include all sports. The concept was to create Le Club du Sport, which had four main principles:

1. A loyalty scheme supported by the clubs.

The ethos was to create an environment similar to Le Club Vittel in which members would think:

'I like my club, I buy products recommended by - Le Club du Sport.'

This was achieved by:

• The club recommendation of the Club du Sport offers to members.
• A recruitment campaign aimed at members of the sports clubs.
• Posters to promote the campaign at clubs
• Direct marketing to club members through the clubs, which provides a high level of recommendation and legitimacy

Club du Sport; in effect becomes better placed to recommend partner products than the partners themselves.

2. A consumption system founded on the motivation of club members.

This relies on:

• The product delivering personal benefits to the members regardless of whether that member benefits from the loyalty scheme.
• The consumption of partner products should increase interest in the scheme.
• Products and services offered must meet the expectations of the market.

3. An economically viable concept with true partners.

A two-tier partnership system was proposed in which there were four official partners and four official suppliers.

• Official partners to date: B.N.P, Go Sport, and Vittel.
• Official suppliers to date: Zurich Insurance, Quick, Budget

4. An attractive offer to both clubs and members

Club offers

A catalogue was produced that included a wide range of products and services where partners in the scheme also had the chance to communicate the advantages of their offers. Some examples of the benefits include:

• Banking with facility management.
• Complementary tickets giving privileged access to sporting events.
• Discounted prices for sports equipment.
• Priority access to specific services such as: car rental, sports courses, insurance cover, computer installation and special offers on accommodation.

Club member's offers

The club members also received special offers from each of the partners and their take up of the offers generated more points on their members' account.

The objective for Club du Sport is to grow the number of members to 4.5 million over a three-year period.

Table 7.3 Objectives for Club du Sport 1999-2001

 

	December 1999	December 2000	December 2001
Number of sports	14	23	25
Clubs –potential	65,000	72,000	75,000
Club members – potential	5.6 million	6.6 million	7 million
Clubs registered in Club du Sport	20,000	30,000	35,000
Club members registered Via Club du Sport	2.6 million	3.8 million	4.5 million

Conclusion

Vittel's scheme is one of the most innovative sports-based loyalty promotions yet seen in Europe. Through attracting a large number of local sports clubs to the scheme Vittel has ensured that it has a direct route of communication with the club members and has produced a strong incentive to purchase over a long period. Such a level of involvement has given the brand credibility among its audience.

Ultimately, however, Vittel could not afford to run such a scheme on its own, especially given the need to expand both the range and number of clubs to be involved. Many organisations might have left such changes longer or failed to attempt to expand the scheme. It is to Vittel's credit that it realised that the only way forward was to bring in new partners and generate a fresh approach.

The figures show that there is still some potential to grow the scheme further with another official partner and supplier yet to be found. Given the level of penetration already achieved through the scheme, finding the two new backers should not be too difficult. In the longer term, the scheme may have trouble retaining all of its suppliers and partners. For Vittel, a continuous role can be self liquidating, but other organisations involved may find the level of exploitation from the scheme difficult to maintain. A member can, for example, only open a bank account once, and although incentives could be put in place, the value to such organisations is bound to decrease.

The use of good photography in PR is particularly appropriate to sports sponsorships. Most national newspapers or major titles will either use their own photographers or those of an agency. It is difficult to influence exactly what these photographers shoot because they are working to a brief to get the best shots for their clients. The inclusion of a sponsor's logo is not in their brief. Obviously the placement of signage can make it more likely that a particular image will appear in shot.

The sponsor can have some influence with an event organiser to ensure that photographers are given all reasonable assistance, which helps to build a long-term relationship between the brand and the media. Placing restrictions on the media, however, is not generally recommended. There may, for example, be a temptation to restrict the areas that photographers are able to use to try to ensure that signage is in the background. This is a mistake because the photographers will understand the reason and will probably try to ensure that the signage is either out of focus or framed in such a way that the message is obscured.

The only restrictions placed on photographers should concern practical aspects such as safety, security, avoiding distraction of competitors and interference with the viewing experience of spectators at the event and on television.

Many publications do not have sufficient budgets to send their own photographers to an event and such publications often have to make do with sub-standard photography. However, if the sponsor provides professional quality photographs, they will almost certainly get used. In some cases the better picture is chosen above other photography even if the subject has less prominence in the story. For example, a report on a race won by car A might carry a picture of car B if the art editor finds it a more interesting shot.

It is important, however, to bear in mind the photographic styles of the target publications and to brief photographers accordingly. Some publications, for example, like grainy, moody black and white prints whereas others prefer full colour 'glossies'. It is pointless sending the wrong type of photograph to such publications, and choosing an appropriate style helps to cement the relationship between sponsor and publication.

The benefits of using a photographic agency

Many sponsors now use the same photographic agencies as the media to obtain sports photography. This provides sponsors with photographers who understand the nature of sports photography and ensures that the quality is both high and relevant to media publications.

Apart from the quality of photography, agencies are also geared up to distribute images according to sponsors' needs, as Mark Metcalfe of leading agency Allsport, points out: "A large factor in the global presence of Allsport, is that we are able to deliver quality pictures at incredible speed via computer. Our on-line digital archive and retrieval system means our collection of over five million images is easily accessible 24 hours a day, wherever the event may take place and wherever the end user may be. This is a key factor in our link up with the major corporate sponsors of sporting events and with the leading sports good manufacturers. "The sponsors department provides these corporations with a photographic record of their sponsorships and involvement with sports. The whole organisation is used to working to the requirements of commercial sports sponsors especially in the context of major sporting events. The main role of the Sponsors Department is to provide the end user with an efficient service that meets their photographic needs. If clients are after an existing image then we will locate it for them and provide it for their intended usage. Many of our clients now have access to our digital archive and can therefore search for specific pictures themselves from our extensive library using the Internet."

Photographic agencies also liase between clients and photographers to ensure that identified briefs and specific photographic requirements are met. The photographic medium, however, dictates that it is not always possible to meet clients' exact needs from live action.

Such a service obviously comes at a price, but for the sponsorship of major events, there is little alternative. Contracting freelance photographers adds to the administrative workload and does not guarantee quality or the archiving/distribution infrastructure of a major agency. Given the potential to communicate available through photography, many sponsors find that a good relationship with a photographic agency can be one of the most cost effective methods of increasing exposure and adding value to the sponsorship.

Case Study: Schweppes Formula One - Photography

Schweppes leverage of Formula One included a major public relations effort (see Major Case Studies - Chapter 5) in which photography played an important role. Because the sponsorship was being used to support marketing activity across its Europe, Middle East and Africa subsidiaries, the need to distribute photography to those markets became apparent. Local offices had varying requirements for photographs to supply to local media and for promotional purposes.

Schweppes sponsorship agency, ICS, created a strategy for the supply of photographs in conjunction with an international photographic agency. In 1998 the contract provided the following:

Provision of a photographer and wiring at the car launch.

• Photography in studio.
• Photographer and wiring at pre-season test sessions.
• Photographer and wiring at all Grands Prix.
• Library management.
• Electronic access to picture library.
• Rights status on images that covered use in PR/media activity and promotions (not advertising).

The agency also supplied 6 x 35mm branded slides x 25 sets, four times per year. Local offices were also able to contact ICS to request specific shot requirements that included:

• Hospitality photographs at the Grand Prix.
• Specific Grand Prix shots.
• Pictures of drivers.
• Behind the scenes pictures of the team.

For the 1999 season ICS added new benefits to improve access to images. This included the creation of an Internet site to allow viewing of four Schweppes branded images from each of the following:

• The car launch.
• Pre-season testing.
• All Grands Prix.

Local offices were therefore able to select images and download high-resolution images and the site was updated within three days of each Grand Prix. CD-ROMs containing 20 images were distributed four times per year. All images were indexed for easy reference. Requests for transparencies of any of the images available on either the website or the CD-ROM were processed within five working days.

The photographic policy effectively allowed regional offices to source relevant, high quality photographs quickly and easily. The use of electronic means of viewing and distribution also enabled Schweppes to keep the normally high cost of photography down to a minimum. The traditional alternative is to produce a large number of prints at high cost, and to distribute them with the consequent high degree of wastage. To hold stock photography at a central location, however, can prevent remote users from having a clear idea of what is available, as a consequence providing relevant material can be more time consuming which, when working to tight media deadlines, can result in opportunities being lost. Electronic management and distribution overcomes both of these problems.

Definition

To understand the problem of ambush marketing, it is necessary to explore its definition, because this is neither clear nor straightforward. How far does the equity of an event reach, and to what extent should marketers be validly justified in using sport for their own marketing ends if they have not bought official rights?

Michael Payne, the director of marketing at the International Olympic Committee raised the issue neatly:

"Are they thieves - knowingly stealing something that does not belong to them?"

Or are they

"Inspired marketers, neutralising competitive advantage?…….all is fair in the cut and thrust of the marketing field"

According to Catherine Bond, account director at sports sponsorship consultants, Atkinson Courage, there is belief that ambush marketing is both fair game, and that it is inevitable:

"Some suggest that ambush marketing merely represents market forces at work: - companies unwilling or unable to pay the 'excessive' prices of sponsorship, have turned to creative advertising.

"The problem with ambush marketing is that the event organisers, governing bodies and sponsors cannot agree amongst themselves what they think should be allowed. Or rather, no-one can quite agree what ambush marketing is and further even if they use the same definition, no-one can agree whether some 'ambushing', if it is to be seen as that, is right or not.

"The interesting point about ambush marketing is that it all depends on from whose perspective one is looking as to whether the material offends. Event owners shriek at the very words, some marketers say that it is all fair game whereas others, who pay huge rights fees for events, are horrified at others profiting from an event in which they have no investment."

Ambush marketing is seen as being the unauthorised use of an event without the permission of the event owner. It is, therefore, useful to break this statement down and examine its component parts:

• unauthorised use
• an event
• without permission of the event owner

Unauthorised use

If the first point is flipped on its head, what does authorised use mean? First, it is obviously the rights that are offered on licence to a sponsor. However, it appears that some people think that the ambit of rights that are attached to an event are extremely wide. Does this wide ambit mean that no brand can mention sport unless it has bought the rights? Why can't companies take advantage of sport generally as a marketing tool?

The main problem is that companies invest a huge amount of money in major sponsorships and feel that it is not fair that companies are associated with events when they have not bought any rights.

Research carried out on behalf of the I.O.C. some years ago not too surprisingly found that ambushing can be counter-productive in that most people thought the worse of companies who falsely claimed a connection with an event.

It was not too surprising given the formulation of the questions:

"If I see a company that is not a sponsor trying to pretend that it is supporting the Games, my opinion of that company is lowered"

Responses were generally in agreement with between 59% and 88% of interviewees in most countries supporting the statement. The one exception was Spain in which only 40% agreed.

To the statement:

"I think it is wrong for companies to deliberately avoid paying for Olympic rights."

The majority of respondents across the nations surveyed were in agreement. Apart from Japan (38%) all other nationalities marked up agreement ratings of over 60%.

To the statement:

"I think companies who avoid paying for the right to use an Olympic message are clever."

Agreement ratings were below 30% with the exception of Spain which saw 67% of respondents approve of the statement. Clearly Spain seems to be the place to practice ambush marketing.

On a serious note, however, although the research provides a prima facia case against ambush tactics, it is unlikely that overwhelming results would be registered if the ambush campaign was seen by the public as done with humour to gently 'send up' a sponsor. The results are also, of course, completely meaningless in cases where the public is not aware of the fact that a brand is not a sponsor and is 'infringing' on a competitor that is.

Indeed there is evidence to suggest that ambushing does work. After the Lillehammer Winter Olympics most Americans when questioned in various surveys showed that between 52% and 66% thought that American Express was the Official Credit Card of the Lillehammer Games and therefore did not realise Amex was an ambusher to think the worse of. This result was achieved by a blanket TV advertising campaign by Amex using the phrase:

"If you're travelling to Norway this winter you'll need a passport but - you don't need a visa"

Chart 9.1 1994 Winter Olympic Sponsors - credit cards - US consumer perception

Source: Performance Research

This strap line had carried on from the 1992 Olympics where Visa spent $20 million on the rights to be the official credit card. TV advertisements showed the host communities, promoted Olympic fervour and nationalism and ended with the line: In Spain you won't need a Visa. American Express, while acknowledging the double-entendre, asserted that they simply meant to say that a visa was not required for that particular country. American Express justified its campaign as 'corrective advertising' saying that it was designed to dispel misconceptions created by Visa's Olympic advertising campaign that had implied that American Express was not accepted in Barcelona! This ad campaign did more than 'correct;' the credit card situation, as it affected Visa's market share considerably and diminished the value of the Olympic sponsorship. Even the IOC commented on this sponsorship, saying that American Express was creating the impression that it was an Olympic sponsor.

During Euro '96, Nike (not a Euro '96 sponsor) undertook a huge poster campaign involving a variety of football stars such as Eric Cantona and David Ginola. The frequency and size of the posters increased the nearer one got to the stadia where the matches were being held. This is one of the most effective ambushing tactics; however, it can fail if the sportsmen involved do not perform. By the second round of Euro '96 matches none of the players featured in the Nike ads were left in the competition and quite a few, such as Cantona and Ginola had not even made their national teams. This own goal did not prevent Nike from undertaking a similar campaign in the 1998 World Cup.

Significantly Euro 2000 rights agent ISL, created a three-kilometre exclusion zone around stadia used for the event by buying all outdoor media sites in the proximity of the stadia. The sites were then offered to official sponsors.

Another interesting point on that Nike Euro '96 poster, was that Cantona was wearing a red football shirt, clearly trying to indicate that he was wearing his club team's (Manchester United) shirt. Whilst there is no breach of trademark, there is the question of whether Nike should try to pass the shirt off as a Manchester United shirt when Umbro had spent millions gaining those rights. In practice there is nothing to stop this from occurring.

Indeed the use of red shirts was successful in one recent campaign, which was based on a company using one team to trade on the reputation of another.

Red Card, a caffeine based energy drink, introduced a new marketing campaign with a poster featuring what they called the "New Force in British Football". Chelmsford City represented the 'New Force in British Football' despite being well over 100 places below Manchester United in the football league; the team that Red Card clearly hoped the public would assume was being depicted. Chelmsford City had, until the previous season played in a totally different colour but conveniently changed it to be like Manchester United and, the poster featured players with upturned collars to look like Cantona. Not content with this, a series of press ads also connected the product to a variety of footballers that have nothing to do with it.

Such 'unauthorised' use is, however, all legal. Much as the official sponsors may disapprove, from the point of view of the law, it is legal by the fact that there is nothing that can be done at the moment to stop it.

The issue of unauthorised use has caused a dispute between the British Olympic Association and the Institute of Sales Promotion (ISP) in the UK. The issue concerns whether the law - in this case, the Olympic Symbols etc (Protection) Act 1995, is made by Parliament or the BOA.

The act provides certain rights to the BOA that cover the Olympic Symbol, the Motto and certain words such as Olympiad, Olympic, Olympian. The act does, however, stipulate that the BOA does not have a monopoly on those words.

Section 4(7) of the Act states that the BOA's right is not infringed where use of one of those words fairly represents a connection with the Olympic Games, and the use is in accordance with honest practices in industrial or commercial matters.+

According to Philip Circus, head of legal affairs at the ISP, this means that use of the terms must not be misleading:

"To say 'my hotel is within five minutes walk of an Olympic venue' would be such a use. It fairly represents a legitimate connection and its use is honest and not misleading.

"So too would be an offer of tickets to the Games by a promoter, so long as there is no implication that the promoter is an official sponsor or licensee - unless it is true of course."

Despite the stance of the ISP, Duracell UK withdrew a spring 2000 promotion offering prizes to Sydney and tickets to the Olympics. This followed a request from the BOA asking the company not to use the words 'Olympic Games' on any promotional material as it would risk contravention of the Olympic Symbol (Protection) Act. Duracell had a strong case to say that it did not contravene the act but clearly thought that any challenge might create adverse publicity.

Theoretically the likes of Nike could, at least, try to go a step further than it has done to date. To say that Edgar Davids, for example, will be wearing Nike boots at Euro 2000 is a true statement and Nike could argue that this merely states that the company sponsors Davids, not the competition. The issue surrounds 'passing off' and whether the copy gives the impression that the advertiser is an event sponsor. Mentioning the name of the competition in advertising/promotional copy, it could be argued, is perfectly reasonable because that is where the player is performing, but it must not give the impression that the advertiser is a sponsor. It is, of course, possible to use a disclaimer in the copy to ensure that no such impression is created. To use the event logo, of course, would not be permitted. So far, however, Nike, has tended to avoid mentioning the major events it does not have rights to. It could be argued that the company is showing restraint, although a possible interpretation is that it does not wish to precipitate a law suit that would draw attention to the fact that it is not an official sponsor. With a high profile marketing campaign at the time of such events, there is, arguably, little need to include a reference to the event anyway - the public makes a natural association.