By: Adam Degrasse
There are opportunities aplenty across the entire property landscape when a brand considers where to put their sponsorship dollars. Traditionally, sport is the largest sponsorship category (dollar amount and number of deals), so sponsors have even more to think about when pursuing a sport sponsorship strategy. Focusing on professional sports as an example (the same rationale can also be applied to the amateur side), a sponsor essentially has three broad property categories to choose from: the league, a team (or teams) within the league or an athlete who plays in the league.
Each of these properties have strengths and weaknesses, so how does a sponsor pick? We’ll dive into what would typically be associated with a sponsorship in each of these property categories and if there is a greater benefit to one over the other. In order to simplify things we will consider the sponsoring of professional hockey and its corresponding properties.
The National Hockey League has seen a growth in its sponsorship portfolio over the last few seasons. A large reason for this revenue increase in part is related to the creation of new assets, most notably the NHL Stadium Series. So what can the NHL offer sponsors with its league wide deals? An NHL sponsor’s objectives may be centered around achieving general brand awareness with large audiences across vast landscape, leveraging the NHL marks on package or access to marquee events (i.e. Winter Classic or All-Star Game) for hosting and activation. The NHL is also somewhat unique compared to the other major sports leagues in North America with Canada-only corporate partners (Canadian Tire, Tim Horton’s) who can access the NHL rights specifically where they operate.
The 30 NHL teams represent individual properties that can negotiate their own sponsorship agreements with brands (however, certain rules apply, such as not being able to market or use team marks outside of a 80 km radius). A team deal will allow a sponsor to gain access on-site at games, which is an obvious attraction for brands looking at creating experiential campaigns or engaging game day activations. Entering into a team deal also makes sense for a local or regional brand that does not have a presence across North America. They are able to leverage a popular property in the market they operate in without paying a higher rights fee. A regional brand can enter into an agreement with multiple teams in the same area and expand their reach that way (e.g. an Alberta-based company partnering with both the Calgary Flames and Edmonton Oilers). Lastly, an NHL team may have more flexibility to customize a sponsorship package that will meet a company’s goals and objectives.
The final piece to this puzzle is pursuing an athlete sponsorship. The players are the face of the league and often they can be the most marketable. Athletes can be utilized in a variety of ways from advertisements, social media, internal meet and greets, etc. In today’s social media landscape, athletes can display their brand preferences at any time and be constant brand ambassadors. For an apparel company such as Reebok, sponsoring Sydney Crosby gives their products validity with consumers. However, athletes are a volatile market and capturing an athlete in their prime years can be difficult at times. Not to mention, athletes might not always act and say things that align with brand values, so damage control is a constant concern.
With all this being said, at the end of the day we need to consider results and ROI. So is one property better than the other? Just because a brand’s objectives aligns better with the league does not always mean that opportunity is available. Therefore, a sponsor may look at doing team deals to help promote their brand in key markets or signing a star player to use in a content play. If you ask the consumers what they value the most, the results may surprise you. The 2014 Most Valuable Property Study (a study of 1,000 Canadian consumers) identified the NHL as the most valuable property in the professional sports category, outpacing the Canadian NHL teams. In a study done by Navigate Research called The Social Media Scoreboard, they found that teams, followed by players then leagues mattered most when it comes to endorsement and impact of messaging. The study also found that fans are more likely to take action on social media via teams and athletes, as seen in the graph below.
Ultimately, a sponsor will consider its overall brand strategy and assess how their objectives can be met by entering into an agreement. The best approach might be pursuing a strategy that encompasses multiple properties (if the sponsor is able to shell out the dollars on rights fees). This will create maximal credibility with consumers as a brand attempts to showcase its passion for a sport such as hockey.