It’s no secret. Given this economy, all of us, no matter what side of the table we sit at, will be challenged to generate more value with less marketing money.
Sponsorship marketing, my particular expertise, has not been immune to the economic downfall. Once talked about in terms of being recession proof, sponsorship marketing has taken its lumps this past year, like everything else. But while overall spending is down, sponsorship marketing remains a powerful promotional tool that allows marketers to tap into consumers’ passions, loyalties and lifestyle interests in unique and dynamic ways.
So what approaches to sponsorship marketing should marketers who want to do more with less consider? How can every possible efficiency be squeezed from budgets, and spending cuts implemented in ways least harmful to the brand? It’s easy to cut dollars for short-term gains, but harder to reduce spending in ways that won’t jeopardize long-term plans.
It all starts with questioning the strategic plan:
- Is the plan still valid?
- Does it address short-term business needs and long-term business health?
- Does it address the correct balance of building the brand vs. generating revenue?
- Does the portfolio still have the right balance of properties and effective activation models?
The development of new measurement analytics can help predict return on investment in various parts of the marketing mix, which can be extremely helpful when making these types of difficult decisions. Sponsorship research companies like Sponsorship Research International are now offering valuable new tools that help marketers better quantify and understand the value of their sponsorship programs.
For me, pop culture is very fluid: it’s music, it’s movies, it’s books, it’s art, it’s tech, it’s so many things — and as marketing and brand advocates, we should be able to take products and services and match them to what’s happening in pop culture.Bozoma Saint John
Once the plan is in place, opportunities to manipulate the current portfolio to generate more for less will become apparent. For example, there may be paid sponsorship assets that are not being leveraged, or that could be leveraged by added user groups. Sponsorship marketing has proven over the years that it can amplify brand messages, drive sales, open accounts, increase retention rates and resonate with consumers in an extremely cluttered marketplace. While most brands strive to integrate sponsorship assets throughout the company, many could do far better. Tough economic times may help break down internal barriers if proven value can be delivered.
Another consideration is using existing sponsorship assets to impact new audiences. For example, Toyota has created significant capital cost efficiencies by repurposing some of its successful NASCAR activation assets in support of its Supercross sponsorship. Appropriate re-theming has created a very transferrable and authentic experience for the unique Supercross target. Other brands have made similar decisions or, in some cases, even sold off certain assets that are no longer of use.
Possibly the most powerful option in this economy is to re-negotiate sponsorship agreements with properties regardless of size and budget. The pain is shared by all parties — and we’ve seen properties of all shapes and sizes show a willingness to reduce costs, add benefits, eliminate escalators and allow for flexible payment schedules in exchange for multi-year deals.
We’ve also seen properties show a much greater willingness to help brands measure the impact of their programs. While it is ultimately the brand’s responsibility to effectively measure ROI, now is the time to push properties to help with the financial burden of certain measurement programs, as well as to effectively valuate more of the brand assets that directly tie into the sponsorship’s return on investment.
And finally, now is the time to determine if certain properties in the portfolio should be eliminated if other properties in the portfolio address the same objectives or targets. While many properties may be nice to have, we’re now in a need-to-have budget environment.
Not to belabor the state of the economy, but at no time in recent memory has the job of marketing (including sponsorship marketing) been more critical. While today’s economy poses great challenges, it also opens doors to certain opportunities that we may never see again. With careful planning and aggressive action, there may never be a better time to do more with less.