Will Short-term And Shared Deals Be The Death Of Sponsorship?
Posted: 1/3/2012 11:08:21 AM by
Jim Andrews | with 2 comments
In the beginning, stadium naming rights agreements were largely 20-year commitments, with a few 10-year exceptions. The bulk of NASCAR team sponsorships were for a full season, and marketers signed on to sponsor every stop of a concert tour.
Today, we have Snapdragon Stadium—a 10-day naming rights agreement—race teams selling car sponsorship in five-race increments, and sponsors cherry-picking concert markets.
There are many reasons, from financial to promotional, why this fragmentation would seem to make sense for both properties and sponsors. For sponsors, their cash commitment is lower and flexibility higher. If corporate partners are only interested in such piecemeal deals, then properties are forced to deliver them if they want any revenue at all.
But this short-term thinking on the part of sponsors threatens to damage the entire sponsorship industry. Marketers are missing the point entirely that sponsorship is not a get-in, get-out medium. Treating sponsorship investments like spot TV buys will not work.
From all of the sponsorship measurement work done by my IEG Consulting colleagues, I can tell you that I have yet to see any short-term or piecemeal sponsorship that has earned a real return on investment. Can they create a little buzz and earn some exposure? Maybe, but that typically doesn’t justify even a reduced sponsorship fee.
And even those shallow “results” will be harder to come by as such fragmentation creates monstrous clutter. Can we really expect even the most diehard NASCAR fan to remember—let alone be loyal to—eight, ten or a dozen primary sponsors on his or her favorite driver’s car each year? Let’s be real.
Unfortunately, a lot of activity that currently passes for sponsorship is a fool’s game. With many sponsors willing to accept meaningless measures of “success,” this sponsorship economy can continue for a while, but ultimately will not be sustainable. Consumers will check out and the lowest common denominator— awareness numbers—will shrink to zero.
It is disheartening that so many sponsors are ignoring the example set by companies that excel at sponsorship. (For examples, check out IEG’s brand strategy paper “Invest, Don’t Buy: A Smarter Way to Sponsor.”)
What will it take to get the majority of sponsors thinking and acting in a manner their shareholders would like to see—being responsible managers of their brands and budgets?
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Filed under: what is sponsorship, sponsorship measurement