Marketing Matters Featured

9:57am EDT July 22, 2002

The money companies are paying to associate with big-time sports is enough to drop your jaw. It costs a cool six figures to have your company logo sewn onto the jumpsuit of a top NASCAR racer. Naming rights for big-league ballparks are in the neighborhood of $20 million. And the price of admission into the inner Olympics circle is $50 million — which gets you the right to use the famed entwined rings symbol, and that’s about it.

So why do the Quaker States, PNC Banks and Coca-Colas of the world — companies driven by profit and shareholder return — spend phenomenal amounts of money on sponsorships? Because they work.

Used as an integral part of an organization’s overall strategic marketing mix, sponsorships can help deliver qualified, highly motivated customers who share a particular common interest. In other words, sponsorships offer exposure to a super niche market that’s already been cultivated and developed.

When thought of like that, it’s no wonder Coca-Cola spends well over $100 million every year on national, regional and local sponsorships. It’s less expensive than trying to create avenues to new customers.

Sponsorships help define who you are as a company, your image and your values. They also have been proven to:

  • Strengthen brand name recall;

  • Contribute to brand loyalty;

  • Reinforce corporate image;

  • Transfer positive attributes of the sponsored event (or organization) to the sponsoring organization and its products/services; and

  • Drive traffic (to retail, Web site, etc.)

A common cause

While big-time sports sponsorships command large cash outlays, you don’t have to spend megabucks to play and win the sponsorship game. Sponsorships are not limited to sports. There are tremendous opportunities in a variety of settings, including business, academia, the arts and sciences, and charities. The key is to understand what your customers passionately care about — what motivates them. Then, get involved.

Some ties may seem natural. Dog lovers would clearly see and appreciate pet supply stores that help underwrite Humane Society events. An information services firm that offers academic scholarships at local universities helps increase its visibility among high-achieving students it wants to recruit. An electronic components manufacturer is viewed among customers as an R&D leader by sponsoring a lecture series at a major electronics trade show. In each case, the sponsor is gaining valuable, positive image-building exposure in a third-party setting important to its customers.

How to succeed

Sponsorship involvement comes in a number of forms. You could sponsor a local PBS-TV cooking show or underwrite an exclusive reception at a trade show. You could sponsor a live, high-profile chat in cyberspace, or contribute your time, energy and supplies to Habitat for Humanity.

In addition to altruistic motivations and the valuable goodwill generated through your sponsorships, you will find measurable levels of visibility for your company. These include varying degrees of name and logo recognition, advertising and signage space, product sampling/demonstrations, publicity recognition and hospitality. You can increase your marketing mileage by highlighting your sponsorship programs in your own marketing and advertising efforts.

Whatever forum you choose, try to leverage your promotional dollars to maximize exposure. But avoid the temptation to sponsor too many things, watering down the impact of your sponsorship dollars. Concentrate on a single cause, where you have the chance to be the big fish in a small pond.

Jeff Krakoff is president of Krakoff Communications, a Pittsburgh-based marketing communications firm. Questions can be sent via e-mail to Reach him by phone at (412) 434-7718.