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    Maximising the marketing potential ofsponsorship for global brands

    Sponsorship is not a new marketing communication

    tool, but has become much more popular over thelast two decades. During the 1990s global deals

    were estimated to have nearly quadrupled in value, a

    trend that was forecast to continue during the first

    five years of the new millennium. Traditionally, com-

    panies investing in sponsorship relationships as part

    of the corporate communication mix learnt from

    experience, over time, how to manage their sponsor-

    ship properties. But, as the size of sponsorship deals

    has grown and their strategic importance for market-

    ing communications increased, it has become more

    urgent for marketers to deliver value from these

    investments. Speeding the learning process is impor-tant, therefore, especially in an area where

    literature is scarce and, expert practitioners and the

    media report a relatively low level of capability.

    This paper aims to explore some of the issues

    companies commonly encounter when engaging in a

    sponsorship relat ionship. Following a summary of

    the main problem areas and theories of best practice,

    the paper describes how one organisation (the Anglo-

    Dutch oil group Shell) improved the use made of its

    Formula 1 sponsorship relationship with the Italian

    motor racing company Ferrari.

    Conclusions will be drawn that should improve

    practice in this marketing growth area.

    Dr Julie Verity, Lecturer in Strategic

    Management, Cranfield School of

    Management, Cranfield University

    Sponsorship is a major global industrySponsorship has been a steadily growing proportionof companies marketing budgets over the past 20years, a trend which shows no sign of slowing. In1990 global expenditure was estimated at $7.7 bn byFT Sport Marketing Survey (1999). Another surveyconducted by Sponsorclick in 2001 put worldwidespend in the same year at $29.3 bn and estimatedthat growth over the next four years would result inexpenditure of $45.2 bn by 2005. Even at these fig-ures, sponsorship still only accounted for 4% of thetotal, global advertising spend in 2000 but, the report

    argued, as advertising budgets were curtailed in theeconomic downturn early in the millennium, spon-sorship had become a more significant part of brandspromotional budgets. This was partly due to thelength of sponsorship contracts and the difficulty ofrelinquishing them at short notice, but also becauseof their growing popularity as a marketing communi-cation tool.

    Of the sponsorship areas, sport dominates mar-keters choice. In 2001 in the UK, 63% of allsponsorship expenditure went to sports teams andevents, the majority of this being spent on motor

    sport and football. Vodafone, the UK mobile phonegroup, provides the perfect example, spending $46mn to place its name on the shirts of ManchesterUnited players and $41 mn to place its name onworld motor racing champion Michael SchumachersFormula 1 Ferrari. Apart from the sponsorship fee(which as demand grows, will become more size-able), companies typically double or triple theexpenditure made to the project surrounding thesponsorship contract so that, increasingly, the spon-sorship is seen as driving the overall marketingcommunication programme.

    Commentators explain the growth in sponsorshipas due to:

    restrictive government policies on tobacco andalcohol advertising

    escalating costs of media advertising increased leisure activities and sporting events

    and interest in them greater media coverage of sponsored events

    European Business Journal 2002

    A ddress for correspondence: Dr Julie Verity, Cranfield School ofManagement, Cranfield University, Cranfield, Bedford MK430AL, UKE-mail: [email protected]

    The case study in this article was used in a shorter version as asubmission to the Marketing Society Awards 2001, when Shellwon in the Customer Insight category.

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    reduced efficiencies of traditional media adver-tising (e.g. clutter and zapping betweentelevision programmes, but also consumersincreasing sophistication and cynicism whenseeing traditional advertising).

    The globalisation of sporting events, teams and per-sonalities, and sports centrality to an emergingglobal culture generally, are cited as reasons whythis area of sponsorship specifically is a valuablecommunication tool for international and globalbrands. Indeed, some writers have argued thatsports sponsorship will become the optimal posi-tioning tool for international marketers seeking tocommunicate global messages.

    Sponsorship outside sport, in the arts, societyand community areas, is still relatively small, but isalso growing and this is explained by the increasing

    popularity of corporate social responsibility pro-grammes.Finding different ways to communicate brand and

    corporate credentials to target audiences, apart fromtraditional advertising, is therefore a significant trend.Sponsorship is a major part of that trend.

    Issues arising from sponsorship as amarketing communication tool

    Setting objectives and evaluation of effectiveness

    As the proportion of the total marketing budgetallotted to sponsorship has increased, managementattention to its worth has also risen. However, disci-plined processes of research, evaluation and businesscase justification have been slow to emerge becausethere has been no standard unit of measurement andevaluation. Specific research conducted by ResearchInternational, a specialist market research agency(August 1999), on behalf of Shell, for example,amongst companies using sports sponsorship on aninternational scale concluded that:

    Evaluation of sponsorship activity was seen as acomplex area for which no rigorous method cur-rently exists.

    Whilst textbooks quote the need for sponsorshipdeals to be evaluated in terms of meeting objectivesand delivering for the brand, in reality the sophisti-cation of monitoring has been relatively crude. Atbest, this has involved measurement of media cov-erage and name mentions/sightings (commonlyrecorded by a specialist monitoring agency), and

    converting this to a money figure of worth. Forexample, Volvos 2 mn sponsorship of tennisresulted in 1.4 bn impressions (number of mentionsor sightings times audience size), which was calcu-lated to be worth 12 mn in media advertising(Jobber, 2001).

    Another issue slowing the development of stan-dard methodologies for evaluation has been thewide range of objectives companies have for theirsponsorship investments, as noted by the ResearchInternational report:

    The relative value of sponsorship activity in theoverall marketing mix was seen to depend uponthe specific brand and business objectives: somecompanies valued image-building activity andexposure, whilst others valued opportunities forPR activity and providing hospitality to key

    clients.

    Both corporate-related objectives and product/brand-related objectives are within the poten tial ofsponsorship communication programmes. Thesemight include the following:

    Corporate

    Increase public awareness of the organisation. Enhance company image. Alter public perception. Increase community involvement.

    Build business/trade relations and goodwill. Enhance staff/employees relations and motiva-

    tion.

    Product/Brand

    Increase target market awareness. Build positive image dimensions. Brand preference and increased sales. Block the competition.

    Defining objectives for sponsorship deals has notalways been a well-executed first step inside organi-

    sations. Even where this has been thought throughin marketing departments, the message can get lostwithin large organisations. This was the situationShell found when they reviewed their sponsorshipdeal with Ferrari in 2000. Worldwide, many man-agers held the view that Formula 1 sponsorship onlyprovided an opportunity for corporate hospitality.Others saw the sport as irrelevant and often quotedtheir local customer base as being as uninterested inFormula 1 as they were themselves. Some found itdifficult to believe that the relationship could deliv-

    EUROPEAN BUSINESS JOURNAL 162

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    er tangible business results such as improved sales.These differing opinions reflected the different useof the sponsorship by Shells local marketing com-panies around the world. It was acknowledged thatno formal attempt was made to measure the value ofthe relationship to Shells businesses.

    Understanding how sponsorship marketing

    activity works

    There is often a lack of clarity in organisationsabout how sponsorship works as a marketing sup-port activity. The basic model for any sponsorshipeffect is, essentially, the same as that for all brandmarketing support activities:

    1. Build awareness, which leads to ...2. top of mind, positive brand image dimensions,

    which leads to ...

    3. brand preference, which leads to ...4. repeat purchase and loyalty.

    The use of sponsorship to drive this model involvestwo main differences from other forms of marketingsupport. Firstly, the brand seeks to gain additionalattention, via association with a property whichalready enjoys a high level of interest, involvementand credibility for the brands key target groups. InShells case the property was two-fold, Formula 1itself and the Ferrari brand. The emphasis is givento additional, since the sponsorship cannot be a

    substitute for a customer value proposition thatalready offers desirable benefits to target customers.

    Secondly, communication with the brands tar-get groups comes in two forms, active and passive.Although these two forms of communication arerelated, they are fundamentally different in the waythat they contribute to the brands objectives:

    Passive. General media coverage in the form ofTV broadcasts (and related press and PR cover-age) creates the opportunity for brand exposureand the building of basic awareness of the associ-

    ation. In Formula 1, the skill lies in sponsoring asuccessful and popular team and in ensuring thatthe brand identity is placed in visible, on-camerapositions. The audiences reached by this kind ofcoverage are those people who are interestedenough in Formula 1 to watch Grand Prix.

    Active. Marketing exploitation programmes donot suffer from the constraints of general mediacoverage. They can be targeted and carry specificbrand and product messages with incentives topurchase. Crucial for Shell was the understanding

    that active communication programmes need notbe limited by the variable interested in Formula1. For example, a mother repeatedly buying Shellfuel because her son wishes to collect a highlydesirable range of model Ferrari classic cars needhave no interest whatsoever in Formula 1 (andwill register amongst those not interested inFormula 1 research).

    Failure to appreciate the difference between thesetwo forms of sponsorship communication was,Shell learned from their own research, one of themost common problems in sports sponsorship gen-erally. Simply attaching a name to an event or alogo on a shirt does not result in the target con-sumer being any more aware of the sponsorship orthe value statement the sponsoring brand isattempting to make. The FT report (1999) con-

    firmed this finding by reporting that:

    McDonalds spends $50m currently on NBASponsor in the USA alone and comment: theimportant element is that McDonalds placed itssports identity directly on its products both tosell the products to customers and to reinforcethe promotional connection.

    And, in the same report, M. Reynolds, the CEO ofthe Institute of Sports Sponsorship, was quoted:

    Buying the rights to be a sponsor is only thestart. Brands need to exploit this. They spendanything between a further 100200% of thebudget supporting it.

    The weakness of many sponsorship associations isthe tenuous link between the sponsoring companyand the property it supports. Where consumers can-not make sense of the link, they believe thatsponsors are simply buying endorsements. Forexample, there were a record 15 major sponsorshipdeals agreed for the 2002 Football World Cup, each

    one costing somewhere between $20 mn and $28mn. When asked if these would return value formoney to the sponsoring companies, the chairmanof the advertising agency TBWA responded nega-tively: Sponsorship can work if you are a sportsbrand, or a brand with close associations with a par-ticular sport, but most of the time that is not thecase (reported in the Financial Times, 30 April2002). An example of this lack of close associationis the UK-based telecommunications companyVodafone and its football sponsorship, where no

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    genuine connection exists. By contrast Nike, theUS sportswear manufacturer, does have genuineconnectedness to sport to underpin its sponsorshipassociations. So too does Shell, as a producer ofautomotive-related products, in its relationship tomotor sports.

    An integrated approach to marketing

    communications

    Optimal communication effectiveness is gainedwhen sponsorship associations are used as part ofthe corporate communications mix, and the spon-sorship is used actively alongside and integratedwith other promotional initiatives. This meansmarketing communications that share commonthemes and visual properties and, where these alsoappear in promotions and sales activities, will havegreater consumer impact. When fully exploited in

    this way, theoretically the sum of all communica-tions is greater than its individual parts. Studieshave proven empirically that a sponsorship is moreeffective when supported by other communicationmix elements, reinforcing the fact that sponsorshipalone is less effective as a communication tool(Tripodi, 2001). However, there are few publishedexamples proving that an integrated approach candeliver such synergistic effects.

    The next section describes in detail the sponsor-ship relationship between Shell and Ferrari. It ispresented here to demonstrate how improved spon-

    sorship management, alongside an in itiative to taketighter control globally, can deliver measurablebusiness value.

    A n evolving sponsorship relationship

    Shell and Formula 1

    In 2000, the global brand management team atShell set themselves the task of reviewing theirFormula 1 sponsorship contract with Ferrari. Thesponsorship relationship had been in place since

    1995 (although Shell had a long history of associa-tion with the sport) and was due for extension,renegotiation or termination early in the millenni-um. Renewal of the contract with Ferrari providedan opportunity for Shell to challenge what theorganisation gained from the relationship and, ifvaluable, to search for ways to optimise its value.The self-imposed brief for the global brand teamwas to make a dispassionate, quantitative and qual-itative data-based evaluation of the case forcontinuing, or not, with the sponsorship.

    Shell and Ferrari have a long history of workingtogether. The relationship reached back as far as1947 to the very beginnings of the, by now, leg-endary Ferrari team. During the 1950s and 1960sthe bright red cars of Ferrari dominated motor rac-ing. During this period, the reputation of Shell andFerrari for technical excellence, innovation andsuccess were closely knit. The teams founder EnzoFerrari, in his trademark purple ink, wrote: Shell ...worked closely with us to help us resolve the numer-ous problems related to our use of fuel andlubricants. Shell has always acknowledged the para-mount importance of racing experience and this hasenabled it to achieve remarkable results.

    Enzos words reflect the essence of the relation-ship at that time, one of technical collaboration,striving for engine, lubricant and fuel performanceperfection. During the 1980s and early 1990s,

    Shell collaborated with and sponsored theMcLaren Formula 1 team. In 1995, the historicpartnership between the Pecten (the Latin nameof the shell that is used as the model for the redand yellow brand logo of Shell and how the organ-isation commonly refer to their brand) and thePrancing Horse (the famous Ferrari badge) wasrenewed. Again the motivation was to reap thepotential technical synergy between the two dedi-cated innovators, but it was also about buildingpositive brand associations. At the time of thereunion, Shells management recognised the prize

    that the Ferrari brand could bring. The benefits ofaligning Shell with the Ferrari values ofdynamism, success and passion were compelling.As the then , global brand manager said: We shareprofessionalism and expertise, but there are a lot ofemotional values associated with Ferrari that wewould like to have linked with Shell. Ferrari isabout Passion and Romance. The name is a dreamfor most people.

    When the reunion was made, Shell set theobjectives:

    to sustain Shells position as the technology andquality leader in performance fuels and lubri-cants;

    to enhance relationships with key stakeholders; to create awareness and image for Shell premium

    products; to encourage purchase and loyalty through

    media activity and retail promotions.

    It was against these objectives that the 2000 reviewwas made.

    EUROPEAN BUSINESS JOURNAL 164

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    Technology leadership, stakeholderrelationshipsMany sponsorship associations are ineffectivebecause consumers believe sponsors are simply buy-ing endorsements, but this was not the case withShell and Formula 1. By working exclusively with a

    Formula 1 team, Shell was perceived to be sponsor-ing an activity in which its credentials and expertisewere directly relevant (internal market research).Documented customer information proved theorganisations long established reputation for tech-nical excellence. Shell also gained technicalbenefits from exposing its products to the pressureof the Formula 1 track. Working at the extremes ofperformance with Ferrari had challenged some clas-sical technology theories which gave ShellResearch a number of valuable technical insightsthat could not have been found easily another way.

    Against the first objective, therefore, the brandteam could argue positively for the sponsorship, butcould not place a value on it.

    Also, significant but unquantifiable value wasgained from corporate hospitality and Ferrari fac-tory visits. When surveyed, many of Shells localcompanies acknowledged the positive value theygained from the association in these areas.

    A ssessing awareness, purchase

    behaviour and resultant valueAs no standard methodology existed in the indus-try for measuring sponsorship effectiveness againstthe objectives of raising awareness and encouragingpurchase loyalty, the brand team devised their own.Since 1996 they had been collecting data abouttheir customers in major markets around the world.A range of consistent brand image marketing met-rics were tested annually, providing trend dataabout customer perceptions of the products andservices offered (the database is called the GlobalBrand Tracker GBT). In 1999, customer opinion

    in more than 50 markets, accounting for about96% of the Groups retail business, had been col-lected for four years. This database includedcustomer responses to a series of questions directlyrelated to Shells Formula 1/Ferrari sponsorshipactivities.

    Method 1 awareness and preference

    Detailed analysis of the data in the GBT showedthat the association with Ferrari affected both cus-tomer attitudes and behaviour. Customers who

    were aware of the ShellFerrari relationship alsohad a h igher preference for Shell (Figure 1). Here,preference is defined as customers emotional pre-disposition toward the brand, i.e. all other thingsbeing equal, customers would choose Shell abovecompetitor products and services. This did notnecessarily mean that customers who preferredShell purchased from Shell; the data did not allowthis conclusion to be drawn unequivocally at thetime. However, the theoretical implication wasthat a preference for Shell was likely to lead totrial and be followed by positive changes in pur-chase behaviour. The preference measure wasused, therefore, as an indicator of brand health andpossible future market share gains.

    Reviewing the GBT database revealed that 17%of motorists were aware of the ShellFerrari rela-tionship and that this 17% had a 3.3 percentage

    point higher preference for Shell, which was equiv-alent to a 0.5 percentage point increase in globalpreference. The financial benefit likely to accruefrom this preference was quantifiable, which theteam found to be of major significance to Shellsfinancial performance.

    This significant finding led to further investiga-tions into the linkages between awareness of therelationship and a higher preference for Shell.Research International looked at the variables thatwere likely to influence this relationship and con-cluded that regardless of high or low usage of Shell,

    and high or low interest in Formula 1, awareness ofShells sponsorship of Ferrari had a significant posi-tive impact on preference for Shell.

    From this work, the team drew the conclusionthat where awareness of the ShellFerrari relation-ship was created effectively, there was a significantimpact on Shell brand preference (and thus onShells business performance).

    Method 2 awareness and purchase behaviour

    A second conclusion could be drawn from lookingat the GBT data in a different direction: that con-

    sumers who were aware of the ShellFerrarirelationship also had a higher propensity to pur-chase from Shell.

    The 17% of motorists who were aware had a 3.9percentage point higher purchase share than thosenot aware, which was equivalent to a 0.6 percentagepoint higher global market share. This was alsotranslated into an estimated financial return.

    Method 3 independent assessment

    Not wanting to rely on internal analysis alone, the

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    global brand team commissioned Brand Finance, anestablished consultancy in the field of brand valua-tion which advises on values of brands for balancesheet or royalty purposes, to evaluate the benefits ofthe ShellFerrari relationship. The conclusions

    from this analysis were also positive.The three methodologies provided different per-

    spectives of value. All were positive. Overall, it wasconcluded that the benefit of the sponsorship was inthe range of one and three times the cost of thesponsorship.

    Exploiting the value worldwideThe next step was to find out more about how wellthe organisation had exploited the relationship andwhat could be learnt from best practice around

    Shells many local marketing companies.Shell had a long history of working with a

    decentralised organisation. Marketing companiesmade local decisions about using the ShellFerrarirelationship in their brand communications.Despite the central endorsement of the relation-ship, plus the advertising and promotional ideasgenerated centrally (at a higher quality and lowercost than could be made in individual markets),local managers varied hugely in their opinion aboutthe value of presenting this to their customers. As a

    result, the property was used extensively in somecountries, not at all in others and sporadically else-where. Many marketing companies exploited therelationship but produced their own communica-tions materials, which they argued were tailored

    specifically for their markets.However, GBT data showed that high exploita-

    tion resulted in a higher preference for Shell evenamong customers who claimed to have no interestin Formula 1. On this basis there was litt le customerrationale for the low exploitation by some localmarketing managers. Data also showed consistentlyhigh levels of customer interest in Formula 1 acrosscountries, irrespective of whether a race was hostedlocally a commonly expressed reason for market-ing managers not to use the relationship in theirlocal communications. Centrally produced adver-

    tising, when tested across countries, also proved tobe equally effective and often recorded compara-tively greater consumer impact against locallyproduced executions.

    Being able to prove that customers across theworld were consistently interested in Formula 1,and that building awareness of Shells associationwith Ferrari could deliver better business results,was a major step forward (Figure 2). This customerinsight was, as one of the global brand team said, amajor contradiction and challenge to the internal

    EUROPEAN BUSINESS JOURNAL 166

    FIGURE 1: Preference for Shell and awareness of sponsorship: those aware of Shells Ferrari sponsorship

    have a h igher preference for the Shell brand.

    Source: Retail Global Brand Tracker 1998.

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    assumption that sponsorship is only about corporatehospitality or corporate imagery. This work linkedthe relationship with business performance. Later,when we talked to non-exploiters we could talkobjectively and take out the personal bias that wasin the decision-making in the past. Our findingshave been genuinely surprising to some people, weare changing mindsets.

    The loss to Shell from this under-exploitationwas estimated to be in the region of twice the cost ofthe sponsorship.

    Learning and changesThe conclusion of the 2000 review was that thesponsorship of Ferrari had delivered significant,quantified value, but that it had been under-exploited. A positive decision to renew the Ferraricontract was made, but under new terms which

    focused on a more explicit connection between theFerrari brand and Shells main fuel and lubricantproducts. This resulted in:

    a changed emphasis of centrally-producedadvertising from statements about the twoorganisations simply working together, to moreactive marketing exploitation promoting theassociation in terms of benefits to motorists;

    direct endorsements on product packs andpumps of differentiated fuels.

    Internally, the learning from the review led to sig-nificant changes in the way the sponsorship wasmanaged. These included:

    restatement and clarity of the sponsorship objec-tives across the organisation;

    greater internal belief about the benefit of andconsequently, greater use of global advertisingexecutions and turnkey promotion packagesworldwide. This resulted in:

    global advertising production cost savings in2000 estimated at $11.6 mn;

    consistent and high quality advertising aroundthe world;

    substantial savings on turnkey promotionpackages;

    specific recommendations about (and firstexamples of) using the relationship as a fullyintegrated part of the marketing mix, plus activemonitoring of exploitation;

    new research initiatives aimed at improvingongoing evaluation and understanding of con-sumer response to sponsorship initiatives.

    Communicating differentlyAdvertising in support of the association up to 2000was typically passive in its message or reinforcedtechnical aspects of Shell. Images of the Prancing

    MAXIMISING THE MARKETING POTENTIAL OF SPONSORSHIP 167

    FIGURE 2: Benefits of higher exploitation of sponsorship: higher exploiters of the Ferrari association have

    on average higher preference share premiums.

    Source: Retail Global Brand Tracker 1997 and 1998.

    )

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    Horse and the Pecten were shown with sounds ofFerrari cars on the soundtrack. An advertisementcalled Refuelling showed a beautiful Ferrari in thedesert and a refuelling plane flying in to refill it.The plane and the car linked through a refuellingpipe while the car was travelling and the plane stillin the air. When the refuelling was complete, theFerrari pulled away into the desert and the planeclimbed away showing a Shell logo on its tail fin.The communication message was about two world-class names with huge amounts of technical abilitydoing the impossible in the middle of a desert.

    Advertisements like Refuelling were known toresult in consistent improvements in consumer atti-tudes to Shell and its products in a wide range ofcountries (including Argentina, Australia, Brazil,Czech Republic, France, Germany, Hong Kong,Japan, Portugal, Saudi Arabia, Singapore, Spain,

    Thailand and the UK) (Figure 3). However, the keycomponents to these increased scores derived pri-marily from improved perceptions of Shellsrelatively high-level attributes such as technologi-cal leadership, overall quality (because Shellsproducts are used by experts) and professionalism. Itbecame obvious that more marketing value couldbe gained by shifting the focus to more explicit

    communication of the ShellFerrari relationship inthe context of consumer-relevant benefits. Newcreative ideas were designed by J W Thompson tomake target segments of motorists more aware ofthe benefits in Shells products derived from theGroups close relationship with Ferrari activelyusing the relationship.

    The earliest of the new advertisements DesertWave showed a Ferrari driving across a sun-bakedlandscape, trailing a huge wave behind. The cap-tion read And you thought all petrols were thesame (an example of a print execution is shown inFigure 4). Research in Spain and Portugal followinga campaign using the Desert Wave advertisementrecorded impressive customer impact and influence.As a result, Shell Portugal recorded increased salesof its unleaded gasoline products as well as a signifi-cant improvement in the product mix with more

    customers buying its higher octane, higher marginproduct (Table 1).Later, Traffic was developed to support Shells

    new premium high performance fuel, Shell V-power/Optimax, a product targeted at responsibleperformance seekers for whom their car is a prizedpossession. The advertisement (a computer-graphicstyle of film) was used as the launch commercial in

    EUROPEAN BUSINESS JOURNAL 168

    FIGURE 3: Refuelling, all countries: overall opinion of Shell products (mean ratings).

    Sources: Shell/Ferrari Ad Survey August 1997; Broadbent Associates.

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    TABLE 1: Waves tracking research: Spain and Portugal, Waves impact

    Shell top of mind 5% 19% (+4)Currently using Shell 17% 22% (+5)Preference 16% 18% (+2)Preference reasons:

    product performance 8% 23%product attributes 45% 68%total product-related reasons for preference 53% 91%

    Advertisement appeal was 20% higher than competitors (BP, Mobil, Galp)

    Impressions from advertisementcares about clients 43% 54%

    advanced technology 41% 57%quality products/services 36% 52%

    Source: Quaestio Research, Portugal.

    MAXIMISING THE MARKETING POTENTIAL OF SPONSORSHIP 169

    Argentina in 2000 and as follow-up advertisingwhere the fuel was already in the market. The adver-tisement tells the story of our hero fish facing the cutand thrust of todays traffic with the help of Shellsnew performance fuel. The voice-over asks us: What

    difference do you think a petrol developed withFerrari would make?, as we watch our hero dodgeand weave through the long vehicles and marlins onhis journey to reach his destination safely (anexample of a print execution is shown in Figure 5).

    FIGURE 4: Desert Waves advertisement.

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    When tested in six markets around the world,results proved the positive impact of the Ferrari link.Qualitative feedback was summarised: The mention

    of Ferrari adds veracity to performance product claimsin all markets. It appears to be part of the magic inthe potion. Quantitative testing in Argentina alsoshowed significant changes in consumers views aboutShell after watching Traffic (Table 2).

    A significant shift in use of centrally producedFerrari-based advertising occurred with the changein emphasis to more product-centred messages. Usearound Shell was not tracked consistently beforeDesert Wave, but in the memory of those in theglobal brand team, only a handful of marketing unitshad incorporated these early global advertisements

    into their communication strategies. In comparison,since Desert Wave, 64 countries had used the adver-tising, a change which Shell estimated had resultedin production savings of $11.6 mn (Table 3).

    Maximising value through anintegrated campaignShell Brazil used another advertisement from theglobal portfolio Seascope in conjunction witha Ferrari-linked promotion at the service station as

    part of their Shell Helix (lubricant) revitalisationcampaign an example of integrated marketing.

    The TV campaign ran during October and

    November 2000. Seascope is rich with images ofFerrari sports cars scorching around test tracks andthrough sea waves. Ferrari and Shell engineersmonitor the cars performance with sophisticatedequipment and the soundtrack tells how, with ShellHelix, the engine stays calm. The voice poses thequestion, If Shell can protect a Ferrari, who betterto protect your car?

    Understanding that although powerful, thisadvertising would not motivate Brazilian customersto have their oil levels checked by attendants atservice stations and, knowing from market research

    that 25% of these customers actually did need oil,Shell Brazil ran a point-of-sale promotion simulta-neously with the TV campaign. Customers agreeingto have their oil checked and topped-up where nec-essary, were given a dipstick which could turn awinning pink, or a losing white, when exposed. Theprize for a pink dipstick was an official Ferrari poloshirt. The promotion had a planned duration of onemonth (5 October to 1 November), which had tobe cut short at some sites due to its popularity; 750service stations supported the promotion and 1.6

    EUROPEAN BUSINESS JOURNAL 170

    FIGURE 5: Traffic advertisement.

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    TABLE 3: Global advertising production costs savings

    Cost ($ mn) No. of countries used

    Wave (fuels + Helix) 2.20 39Traffic (fuels) 0.75 9Seascope (Helix) 1.40 16

    Total 4.35 64

    Cost per country = $68 000Normal local cost per country = $250 000Saving = $182 000 per countryTotal saving = $11.6 mn

    million dipsticks were dipped, of which 1% werewinners.

    In the context of a highly competitive marketwith at least seven high-profile competitor lubri-cant brands, the results were dramatic. Shell Helixsales at promotional sites rose on average by 17%and fuel sales through the core network increasedby 1.17%. Market research highlighted other sig-nificant gains; for example, preference for ShellHelix increased from 3% to 9%, awareness

    increased from 23% to 30%, and consumer know-ledge and awareness about the association betweenShell and Ferrari also improved dramatically(Figures 6 and 7).

    ConclusionSponsorship accounts for a growing proportion ofcompanies marketing budgets and is increasingly astrategic part of the communication programme forbrands. Therefore, it is more important to max-

    imise the value in sponsorship relat ionships and todo so faster than has been the case in the past. Thispaper illustrates the basis for best practice in man-aging sponsorship programmes. Recommendationsinclude:

    Setting objectives and making them explicitthroughout the organisation. Without objec-tives it is impossible to monitor performance ofthe sponsorship relationship and harder to disci-

    pline its use in an international or globalorganisation.

    Making clear what constitutes performance foreach objective and finding methodologies forresearching how effective sponsorship commu-nications are with target audiences essentialfor proving the worth of the relationship andfinding ways to extract more value from theinvestment.

    In global organisations that have sponsorshipproperties with potential worldwide value, man-

    MAXIMISING THE MARKETING POTENTIAL OF SPONSORSHIP 171

    TABLE 2: Shell Traffic advertising survey: Argentina before and afterSignificant improvement post viewing

    Company attributes Produces the best petrol Produces petrol which improves the performance of my car

    Takes the lead in producing new fuels Has new ideas relevant to me A dynamic company A company whose products I like to buy

    Source: Broadbent Associates.

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    FIGURE 6: Consumer awareness: brand used by Ferrari (figures are 4 weekly moving averages). 1, Helix

    (Shell); 2, Dont know; 3, Havoline (Texaco), 4, F1 Master (Ipiranga); 5, Lubrax (BR).

    Source: MarketMind () Continuous Interactive Intelligence ().

    EUROPEAN BUSINESS JOURNAL 172

    FIGURE 7: Consumer awareness: brand more associated with F1 (figures are 4 weekly moving averages).

    1, Helix (Shell); 2, Dont know; 3, Havoline (Texaco), 4, F1 Master (Ipiranga); 5, Lubrax (BR); 6, GTX

    (Castro). (GRPs, gross rating points)

    Source: MarketMind () Continuous Interactive Intelligence ().

    4 Apr 30 May 25 Jul 19 Sep 14 Nov 23 Jan 2 Apr 23 Jul 17 Sep 12 Nov

    100

    90

    80

    70

    60

    50

    40

    30

    20

    10

    0

    500

    400

    300

    200

    100

    0

    GP F1 Brazil

    Dip & Win Promotion

    1 2 3 4 5

    4 Apr 30 May 25 Jul 19 Sep 14 Nov 23 Jan 2 Apr 23 Jul 17 Sep 12 Nov

    100

    90

    80

    70

    60

    50

    40

    30

    20

    10

    0

    500

    400

    300

    200

    100

    0

    GP F1 Brazil

    Dip & Win Promotion

    2 3 4 5 6 1

    %

    1999 2000

    1999 2000

    GRPs

    GRPs%

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    aging exploitation of the sponsorship acrosscountry markets can deliver significant cost sav-ings and raise the quality of advertisements andpromotion packages.

    Creating communications that actively use thesponsorship property to promote and reinforcethe customer value proposition of the sponsoringbrand or improve the perception of the corpo-rate brand. Simply putting the sponsoringbrands logo on the track-side of a sporting eventwill not influence consumers to feel differentlyabout the sponsoring brand.

    Understanding that the positive attributes of asponsorship property will not automaticallytransfer to a product or service brand that, toconsumers, have no apparent overlap. Such rela-tionships will appear to consumers as ones wheresponsoring companies are buying endorse-

    ments. There is a logic therefore in the globalsport shoe company Nike spending $155 mn in2002, 40% of its global marketing expenditure,on football endorsements. Plus, 300 mn to pro-vide Manchester United with its kit for the next13 years, a deal which out-sized any made todate. But, it is harder to make sense of aVodafone logo on the Nike branded shirts of theManchester United team.

    Integrating sponsorship communications intothe marketing mix to produce promotion pack-ages will ensure optimum value is returned to the

    investment. Getting this right is shown in theShell Brazil example to deliver not only con-sumer impact and awareness, but also significantimprovements in sales at promotional sites forthe target product, plus pull-through sales ofother products at the same sites.

    Whilst it is evident that sponsorship is more andmore popular among marketers as a communicationtool, there are some who predict it has reached itspeak of success. As more companies try to ride thepopular tide, both the cost and clutter grow, making

    it harder for brands to stand out. For example, asmany as 60 brands sought official sponsor status for

    the 2002 football World Cup, all proposing to buildcampaigns in the UK. It is difficult to believe thatconsumers were not bemused and confused by thesheer number and variety of brands that tried toclaim a share of the goodwill, excitement, hype andspirit of the event.

    However, sponsorship has a very different futurein the mind of the chief executive of MC SaatchiSponsorship who was quoted in The Guardian inJanuary 2002: The trend against above-the-lineadvertising means that both brands and TV compa-nies need to replace advertising with something.The article suggested that in the near future mar-keters would take an even bolder step by creatingtheir own media content, so creating their ownvehicle for advertising rather than having to spon-sor other properties. The Saatchi executivecontinued: Broadcasters are becoming more flexi-

    ble and taking sponsorship more seriously. It is nolonger thought of in the traditional way ghet-toised into sports or arts sponsorships. They arebeginning to embrace the idea of advertiser-fundedprogramming. Instead of broadcasters creating theirformats to drive ratings, companies can do it todrive their marketing. And broadcasters will grasp itwith open arms. The changeover to digital TV, hesuggested, would make this shift in content owner-ship even more inevitable. This would allowmarketing companies to own entertainment andtime around the programmes far beyond two-

    minute breaks or sponsorship bumpers.Given either scenario, the need for marketers togrow their competence in managing sponsorshipinvestments is clear. The guidelines suggested herewill help them to do this more effectively.

    ReferencesFT Report (1999)Maximising the Value of Sports Sponsorship.

    Jobber D (2001) Principles and Practice of Marketing.

    Maidenhead, Berks: McGraw-Hill.

    Tripodi JA (2001) Sponsorship a confirmed weapon in the

    promotional armoury. International Journal of SportsMarketing & Sponsorship March/April: 95115.

    MAXIMISING THE MARKETING POTENTIAL OF SPONSORSHIP 173

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