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Flashcards in Chapter 8 Deck (17):
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Corporate sponsorship

Corporate sponsorship is a form of advertising in which companies pay to be associated with certain events or organisations, which offer rights that may be used for commercial advantage in return for the sponsorship investment.

Sponsorship is not an isolated event; instead it forms part of an integrated marketing communications plan.

In most cases sponsorships are considered by top management as being part of the bigger corporate-social responsibility programme, especially where an organisation is involved in socio-cultural issues such as HIV/AIDS awareness, drug abuse, teenage pregnancy, crime, scholarship programmes and urban renewal projects.

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Why are organisations primarily involved in sponsorships?

Organisations are primarily involved in sponsorship to make the public aware of the brand, remind those that are already using the brand or have heard about the brand about the existence of the brand, and also to persuade people to continue using the brand.

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THE GROWTH AND IMPORTANCE OF SPONSORSHIP

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There are different types of sponsorship that will be covered in a later section on sports sponsorship. However, the following are two broad categories:

Sole sponsorship.

Co-sponsorship.

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Sole sponsorship.

This involves a situation where the sponsoring organisation is the only official sponsor of the event and no other organisation has any right to be associated with the event. The sponsoring organisation will have the licensing, broadcasting, naming and branding rights to the event.

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Co-sponsorship.


In this instance, the main sponsor reserves the naming right of the event, but other secondary sponsors could have an opportunity to be associated with the event. Apart from primary sponsorship, there are technical sponsors who are entitled to secondary sponsorship rights. Technical and secondary sponsors must not come as a surprise; instead they must be approved by primary sponsors, otherwise this opens the field to ambush marketing.

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In an article that discussed recent trends in sponsorship entitled “Why Sponsors Sponsor”, author Jim Karrh lists the four criteria that not-for-profit fundraisers expect to be used by most companies in assessing the request to become involved as a sponsor.

The four criteria are as follows:

Relevance.
The cause must be relevant to the company’s products or service.

Branding fit.
There must be a good fit with the overall company brand.

Mission alignment.
The partnership must align with a company’s mission.

Business result.
The company must believe it can achieve some measurable business
result through the partnership.

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The criteria should be developed from sponsorship objectives and will differ according to each company’s specific objectives.

So other general criteria for sponsorship selection include the following:

Target market coverage.
Event profile.
Timing.
Competitor activity.
Budget.
Hospitality opportunities.
Image.

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Target market coverage.

The sponsored event must reach the consumers with whom the marketer wishes to communicate, otherwise this will turn out to be a waste of money.

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Event profile.

The sponsorship manager must consider the extent to which the previous sponsor created a lasting bond with the event and whether the equity built on
the previous sponsor in the target market can be displayed.

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Timing.

Corporate marketing needs, product seasonality and other marketing communication needs must be considered. For instance, the event must not coincide with a major sporting event on the same day as it may be difficult to get enough media coverage.

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Competitor activity.


The company must avoid being engaged with the same events that a competitive company is involved in. If that happens, then the activity must be of higher profile to warrant the attention of the target market.

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Budget

The sponsorship must fall within the allocated budget and must also offer best value for money. A detailed calculation of sponsor exposure per hour, hours of broadcast, audience delivery and other costs of reaching the audience must be done. Sufficient funds must be available to cater for unforeseen circumstances.

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Hospitality opportunities.

The sponsorship manager must also consider the suitability of the event, the venue and the facilities for entertaining VIP guests.

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Image.

The event must fit the corporate and brand image and conform to the sponsorship policy of the company.

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8.5 THE IMPORTANCE OF SPORTS SPONSORSHIP IN SOUTH AFRICA TODAY

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Over and above the general benefits associated with sponsorship as outlined above, the following additional benefits cannot be ignored:

Sport serves as a melting pot for all cultures in South Africa.

It is a sign of unity among South Africans.

Sport creates a sense of belonging among South African citizens.

It is an important vehicle to reduce tension.
It provides an important foundation for breaking the racial barriers created by the system of apartheid.