Thursday, April 06, 2006

Talkback: Strategy needed to make sponsorship pay

By John Boyd

Many in business get inundated with requests for sponsorship.

With each colourful, glossy, spiral-bound proposal promising a "fantastic" return on investment it can often be difficult to decide what to support and what not to support.

In the past many sponsorship decisions were based around the specific interests of the managing director (usually sport).

In many cases little was done to leverage the sponsorship - a bit like tipping a large bucket of money down a well.

The key is to put in place a sponsorship strategy that is aligned with the company's direction and helps to reinforce the brand attributes of the company.

And don't be blinded by the promises those seeking sponsorship will make at initial meetings.

There needs to be a very clear understanding of expectations by both parties.

Sponsorships involve a considerable investment - not just the money for the sponsorship but also the additional investment to leverage the sponsorship - so it is important to be able to measure effectiveness of the sponsorship.

This can be via a direct link to sales, through measuring media exposure or conducting research before and after to measure the impact of the sponsorship.

A company that has done this well is Mazda New Zealand. Mazda's sponsorships must fulfil two objectives: to align the brand with an event/organisation that encourages and promotes New Zealand art and culture, and to contribute to the future of young New Zealanders.

In some instances these objectives are fulfilled by supporting existing organisations or events such as the Auckland Philharmonia orchestra.

Another example is Mazda Artworks. This event promotes New Zealand art and artists and all funds raised through art sales are donated to charities which aim to help young New Zealanders.

Mazda has also found that creating its own events or sponsorship vehicles can be a very good use of resources, giving greater control and ability to leverage its investment.

Through its involvement in Mazda Artworks, Mazda saw the need to create a stand-alone event to promote up-and-coming artists, so it founded the Mazda Emerging Artist Award which provides cash prizes totalling $17,500 to fine art students.

In addition, earlier this year the Mazda Foundation was launched. It provides funds three times a year to people involved in projects and activities that have an environmental, cultural or educational focus.

Each of these sponsorships has been carefully chosen or established to achieve the sponsorship objectives. They have been successful in raising brand awareness at a corporate level, as well as at a community level through the involvement of each Mazda dealership.

It is important not to spread the sponsorship dollar too thinly. You cannot please everyone so it is vital that sponsorships are chosen not on a whim, but to fit your sponsorship strategy.

Companies have a role to support activities in the community - it goes with the territory - but they need to apply the same business rules to sponsorship as they do to other parts of their business.

* John Boyd is a director of Donovan Boyd Communications whose clients include Mazda.

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