A sporting chance

Photo credit: Michael Bradley Photography.

It’s the glamour end of the sponsorship wheel – corporate sponsorship of New Zealand’s top sports teams and athletes and it’s worth a great deal of money. It’s also an area where both parties seem to be pretty happy with the results. 

By Patricia Moore.  

Sponsorship is big business and while fees are rarely disclosed, according to an IMR Sports Marketing Sponsorship Today report, analysing 257 deals in New Zealand, sports sponsorship here was worth an estimated $182 million in 2013. This is a mere drop in the global bucket reckoned to be worth around US$45 billion a year. Not surprisingly, rugby is the winner with 63 percent of all New Zealand sponsorship spend.

But what’s in it for the sponsors and how important is a return on investment?

While spectators at events and in front of television are measureable, a McKinsey & Company report in 2014 indicated that for around one-third to half of US corporate sponsors surveyed, there were no comprehensive ROI measurement systems in place.

Nick Harvey, managing director of Auckland-based boutique sponsorship and brand experience agency SPUR, says some sponsors place a huge emphasis on measuring results, others don’t.

“Broadly speaking there’s a greater focus on accountability but our philosophy involves looking at return on objectives, not return on investment. A brand entering the market might pick up a sponsorship with the objective of building brand awareness. Another company may view sponsorship as a vehicle for growing its social media audience.”

ANZ NZ spends around $11 million annually on sponsorships and it expects to see a measurable return in terms of business and community outcomes, says Sue McGregor, head of sponsorship and corporate marketing.

“A sponsorship is part of our marketing mix; as such we go into it knowing what we want to achieve, why we’ve entered into the partnership in the first place.”

ANZ’s ‘Supporting New Zealanders to Achieve’ strategy is based on a reach, frequency and passion matrix; a large enough following, an organised competition structure or frequency and a passionate interest, says McGregor.

“We’re picking up sponsorships that are important to New Zealanders, and we leverage them right down to the grassroots.”

A sponsorship is a business partnership and needs to be about shared objectives, she says.

“We work hard to make sure this is detailed and that the understanding from both parties is there.

“From both brand and business viewpoints, what are those shared objectives and what do you want to achieve? There has to be alignment so you can make the asset you’re buying work for you as a brand and have an authentic role that demonstrates why you should be associated.”

AIG and the All Blacks
Global insurer AIG has been in New Zealand since 1970, but it was probably not until 2012 when it stepped on board as New Zealand Rugby and the All Blacks’ major global sponsor and official insurance partner that many Kiwis became aware of the company.

It was a significant coup for NZ Rugby and one which AIG Global head of sponsorship Daniel Glantz, describes as “our cornerstone and most valuable global sponsorship property, one we’re really proud to associate with”.

Glantz, a huge sports fan from New York, who had never really touched a rugby ball until he came here to negotiate the deal, is hugely enthusiastic about the benefits the partnership has wrought. “New Zealand Rugby, the organisation, the history, and an incredible legacy of tradition and success is really a phenomenal platform that showcases values AIG wants to associate with.”

But it’s a business deal. “And, there’s no question, just like any marketing initiative you certainly are going to want to measure results,” he says.

“Having broad-based market exposure with a logo on a jersey, or digital platforms where we’re able to track what many refer to as media-equivalency, is just one small element.”

Measurements include a significant number of KPIs, analysing engagement on all AIG and third party channels including platform channels from NZ Rugby, tracking anecdotal feedback based on interaction with key stakeholders and guests at events and, importantly, direct business generated through the sponsorship.
“Those are some of the things we’re tracking but I’ve often said, ‘how do you value an icebreaker?’ I think there’s something to be said for having NZ Rugby as a partner and being able to comfortably talk to our stakeholders in a meaningful way that’s not just your typical insurance jargon.”

Netball NZ and Foodstuffs
Sponsorship is the revenue stream that allows netball to be sustainable, says Kym Aust-Howlett, head of commercial and business development for Netball New Zealand.

“The key drivers are aligning to an iconic brand – the Silver Ferns, reaching the female market and having a positive influence for women in New Zealand. With a reinvigorated strategy, netball is becoming a major player in the sports sponsorship space.”

For Netball NZ, values, fit and commitment are as important as the financial aspect of a sponsorship. “We look for a genuine partnership where we work together to achieve the goals and objectives of both organisations.

“Success is about brand alignment. The two brands must have a synergy to make the most out of the partnership. We’re fortunate to have long-standing partners and broadcasters and we’re growing our sponsor portfolio to add new revenue that will enable us to grow netball at all levels, execute new initiatives that assist on-court results and participation numbers, and create strong pathways to elite netball, media exposure and reach into the market.”

For the past eight years New World has been the elite sponsor of the Silver Ferns and its commitment has been confirmed through till 2017, says Jules Lloyd-Jones, Foodstuffs New Zealand Group brand director.

“As New World is a 100 percent locally owned New Zealand supermarket brand, it makes sense to support a sport as ingrained in Kiwi’s DNA as netball. This year we’re planning extending our sponsorship to include grassroots netball.”

Lloyd-Jones says with 137 New World supermarkets throughout the country, often in smaller communities, the supermarket is at the heart of the community.
“We encourage our regional stores to help support local netball teams so that our partnership with the sport can make a real difference, not just to elite level players, but also the young players who dream of being a Silver Fern one day.”

Success has come through the “fantastic relationship” between Netball NZ and New World, says Lloyd-Jones. “We don’t want to be just a naming rights sponsor. We’re always looking to add value and it’s those aspects – involvement in the 2015 NZ Netball Awards, store visits by the Silver Ferns, involving Starship patients in starting one of the quarters at international games – that really generate the measureable success for us.”

Reflecting class and sophistication
Prestige events attract prestige sponsors, says Simon Wilson, executive director of the NZ Polo Open. “Iconic brands such as Heineken, NZME and Veuve Clicquot all enhance event activations for the Auckland Polo Club.”

Late last year the NZ Polo Open announced a new sponsorship with Land Rover which Wilson says “reflects the class and sophistication of our sporting event. Because we share similarly aligned goals it’s a perfect fit. Land Rover has a long-standing relationship with equestrian sports globally and understands our desire to build awareness of the sporting aspect of this fantastic game.”

“Their prestige has brought the additional horse-power the Open needs to keep relevant and ensure our event has the wow factor.”

So is this merely a branding exercise or is Land Rover looking for a return on their investment? “The honest answer is both,” says James McKee, Jaguar Land Rover marketing manager.

“Land Rover has been involved in sponsoring equestrian sport globally for more than 25 years and we continue to be the towing vehicle of choice, so we’re not only sponsors of tournaments, we are quite literally involved. Our legacy as a capable, luxury SUV, is priceless and continuing that conversation through sponsorship in New Zealand is incredibly important. As to an actual value, ask me again at the end of February.” (The Land Rover NZ Polo Open takes place in February.)

SPUR’s Harvey has been in the business since 2003 and says in that time there have been huge improvements in terms of the way New Zealand corporates approach sponsorship and what represents effective leverage.

He stresses the importance of strategic fit. “Is this the right sponsorship to help us achieve our mar-comm goals? Laying down solid objectives and KPIs from the outset is also vital and included in this should be an approach to measurement. The professionalism and attitude of the rights holder is also important.”

The right fit is absolutely important and it comes down to a combination of factors, says Nick Brown, New Zealand Rugby general manager, commercial. “We look for sponsors that reach a similar audience or a new group of fans; we also examine their strategic goals – are we both heading in the same direction? Most importantly, do we have common values? Shared values mean campaigns with the All Blacks are much more credible and therefore effective for the sponsor.”

Brown says they’re proud to have two of the most valuable rugby sponsorships in the world with long-standing principal partner adidas and major global sponsor, AIG. They also have other important relationships with global brands such as Air New Zealand and Bulgari and Brown sees scope for further significant partnerships.

“Ultimately having the support of global brands means we can invest in the game in this country – retain our best players and coaches, run exciting competitions, nurture young players and keep the community game strong.”

So is rugby in New Zealand beyond the means of local sponsors? “We don’t believe so. We’re flexible enough to be able to build attractive partnerships with a range of New Zealand companies, big and small, and that’s an important part of our marketing strategy – to stay connected to the New Zealand public and fans.

“Importantly, given the power of the All Blacks’ brand, we see a big opportunity for NZ exporters to partner with the All Blacks and New Zealand Rugby, to make an impact in common territories. It’s a combination that can help exporters leverage the All Blacks heritage of success and innovation to tell a powerful story.”

Access to athletes and rules around the use of IP are getting stricter. Rights holders are also becoming increasingly strategic around how and when they will provide access to ‘owned’ channels, including social media. Sponsors need to understand this, says Harvey.

“Sponsorship is no different to the broader marketing discipline. The explosion of digital has changed the game. Where it becomes particularly interesting for sponsorship is that rights holders can now provide their commercial partners with easy access to communities of passionately engaged fans through social media, email databases and so on.” 

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