Insights From the Kellogg Sports Business Conference, Part 1
Posted: 2/23/2010 9:05:26 AM by
Jim Andrews | with 0 comments
I had the pleasure of participating in a panel discussion at Northwestern University’s Kellogg School of Management this weekend. The occasion was the school’s inaugural sports business conference.
“The Business of Sports Sponsorships” panel—which featured Bank of America corporate sponsorship chief Ray Bednar, Cleveland Indians SVP of sales and marketing Vic Gregovits and IMG College SVP Lawton Logan in addition to me—covered a lot of ground in our 75 minutes.
Among the more interesting discussion points was the idea of variable compensation as it relates to sponsorship fees. Ray was adamant that a pay-for-performance model needs to become the standard in our business in order for sponsors to justify expenditures.
In addition to adjusting fees based on delivery of benefits and ROO and ROI benchmarks, he included on-field performance—winning teams should get paid more than losing franchises because Bank of America’s research shows that those partnerships perform better for the company.
The logic behind that approach makes senses, but if Bank of America and other corporate sponsors want this to be more than a negotiating ploy, they are going to have to share some of the specifics of what type of difference a winning record makes to a marketer.
Just as player union reps negotiating new CBAs want to see the books and not just take team owners’ word that they are losing tons of money, properties are within their rights to ask sponsors to prove the case for variable compensation related to victories and defeats.
I also sat in on the keynote presentation from NBA SVP of team marketing and business operations Chris Granger. I’ll share some of his insights in my next post.
Read more blog posts
Filed under: evaluation, negotiating, sponsorship measurement, sponsorship ROI, trends, valuation, contracts