Not all sponsors want millions of eyeballs. This is good news for some sailors who ask, “how can I compete with sports like football?” One brand that is using sailing to make their brand more personal is Japanese watch manufacturer Seiko. Robert Wilson, Seiko’s Director of Marketing made a presentation to the International Sailing Summit (ISS) recently, in which he described why the brand is investing in the 49er and 29er classes. Title : Successful sports sponsorships : The Seiko perspective
Successful sports Sponsorships
For most companies, sport sponsorship is the most debated and least understood part of the marketing mix. Huge numbers of companies are involved but no two of them for the same reasons. And this makes it hard for any sport to position itself successfully to potential sponsors. That was the start point for this presentation, and I hope that, by sharing the Seiko perspective on this tricky issue, it might help shed light on what sponsor companies are looking for from a sport and how a sport, like sailing, might present itself to the sponsor community.
Sport is big business
First, let’s get one thing clear. Sports sponsorship is one of the growth areas in marketing and it has had a dazzling rise up the agenda of companies of all types, in all industries and in all countries. Investment in sport grew exponentially in the last decade, and is still growing. It has taken share from more traditional forms of marketing investment, growing at twice the rate of TV advertising, three times the rate of print and four times the rate of outdoor. The market today is estimated at some 30 billion dollars.
Olympic TV rights
And there is no sign of this easing off. The Summer Olympic TV rights have increased in value by nearly 4 times in the past 2 decades, with Europe now paying a higher proportion, and with Asia soon to pay more as well, the Olympic bandwagon rolls on! It is interesting to note that the current economic climate is not discouraging the really big deals. Just yesterday, I was reading that a UK travel company is to pump 10 million dollars into a deal with Chelsea Football Club, and the agreement does not even deliver them exposure on the shirt! What we all observe is that the top, prestige clubs, events and personalities are resilient enough as properties to continue to attract sponsors, while lower down the food chain, life is indeed getting harder. There are today two Premiership teams without shirt sponsor deals, and it will not surprise you to learn that these teams are at the foot of the table. Nevertheless, the overall trend in the sponsorship industry is strong.
The Diversity of sports involvements
Within this growing market, there is a remarkable range of different sports now supported by the world’s great brands. Here you see a slap-shot of the 10 top brands as defined by Interbrand and their main sports involvements. I bet that, in their mainstream media advertising all these brands use very similar media. In their sports sponsorship, however, what is striking is the diversity. Golf, tennis, Commonwealth Games, F1, soccer, the list is virtually endless.
The ever-changing face of sports sponsorships.
There are many examples of very long-lasting sponsorships. Coke leads the way with an Olympic involvement that goes back more than 50 years, but in the vast majority of cases, sponsorship deals are relatively short-lived and, for a sports event or sports team, sponsors must seem frustratingly fickle. So why is this? What causes this confusing mixture of steady growth in the sponsorship market but, at the same time, this bewildering diversity and rapidity of change?
The answer is that times change, brands change and needs change. Let me use the example of Seiko to explain what I mean. Seiko has been in sport since the 1964 Olympic Games in Tokyo, but we have been in many, many different sports at different times. In the 60’s, 70’s, 80’s and 90’s our focus was on timing major international events like the Tokyo and Barcelona Olympics, while today we are more focussed on our partnerships with the Honda F1 team and the 49er Association. This is quite a change, in scope, impact and image. We made this change because our needs and goals have evolved. How these needs have evolved may be instructive, as we have found that our journey through sport has been mirrored by that of many other sponsors.
Seiko : Our journey in sport
Our journey through sport has had three phases: The Promotion of our brand, the Positioning of our brand and the Personalisation of our brand. Whether our various sponsorships have been successful depends on how well each of them has fitted in with our needs at each stage of our journey. Let me explain each in turn.
Phase one: Promotion.
In this first phase, we wanted to announce Seiko to the world. We timed the 1964 and 1972 Olympics in Japan and then we went global with sponsorship of the FIFA World Cups in, 1978, 1982, 1986, and 1990. At the same time and for the same reasons, we sponsored the French, Australian and US Open Tennis Championships every year from 1980 to 1990. Our aim was global propagation of the name Seiko. We valued large sign boards, and lots of them, at major events. All we sought to do was to say that there was a brand called Seiko and it was a major, global player. We were a young brand, relatively unknown on the world stage and we sought the exposure and status that only sport could deliver quickly. These sponsorship deals did more than anything to establish Seiko as a world brand, and even today, if you ask consumers who sponsors Roland Garros and Flushing Meadow, a good percentage of respondents say Seiko, even if we stopped 15 years ago!
Phase two : Positioning- sports timing
In the second phase, we had a different objective. We now needed to position Seiko as a watch brand of quality. By the early 90’s people knew Seiko existed and many users liked our products, but our market was getting crowded with brands and we needed to differentiate Seiko from its imitators. So we stayed in sport, but changed our approach. We went into sports arenas where we could demonstrate Seiko’s excellence. We timed the Summer Olympic Games in Barcelona in 1992, and the Winter Games of 1994, 1998 & 2002. In 1985, We made a long term deal with the IAAF and we have timed every one of their World Championships from 1987 to today. Here in Europe, we served European Athletics from 1990 to 2007. And throughout the period, we timed the Commonwealth Games, Asian Games and many other world class events. We showed the world that, where split second timing and reliability were needed, Seiko was the choice of the top sports events. Our aim was to show that Seiko had the technical skills to time world class sport. And we did that by making enormous investments in the technical service that we delivered to timed events. At that time, t there was a direct link between the demonstration of our excellence through sports timing and the increase of our sales. The more sports we timed, the more we sold. It was a golden era!
Phase two : Positioning- sports advertising
Even in our advertising we promoted these involvements, and our focus was on precision. These advertisements were run all around the world in the lead-up to the 1992 Olympic Games, and featured licensed watches we built with the Olympic logo on the dial. It was a stunning success, and I rather think I may have to admit that we have never done anything as good as this since! We tapped into the zeitgeist with a truly Olympic precision!
Phase three: Personalisation :
But again, nothing in sponsorship lasts forever, and by the end of the 90’s we saw that the sponsorship model we had been using was wearing thin. People now sought more than precision from their watches, and sports timing was taken more for granted. So we shifted our focus again. We looked to humanise the brand with personalities and stories. In essence, we looked to make friends with our public by inviting them into a world of experiences where the reader or viewer could share the excitement.
So, today, we sponsor Honda F1 Team, and we use Jenson Button, their lead driver, as our ambassador.
And we look for stories with drama and adventure. For example,Richard Garriott.. He approached us with a story of his own. His father had been a Nasa astronaut and now he was going to space as a Space Tourist. Indeed, he was to become the first space tourist to make a Space Walk. So we built him a watch; the first watch ever designed to be used in space. And when he landed safely back last month, we were staggered by the interest it developed. And, in case you are curious, we offered this watch to the public, at the modest price of 25,000 Euro. From e moment we announced it, we were inundated with orders. But I might just be able to find one, if you are really keen…
Similarly, we joined the world of sailing. We not only did a deal with the 49er class, but we used the deal to create stories. As the 49er class develops a new, faster rig, we have issued a challenge to all the sailors to use it to break the speed record for the 49er and to win sailing gear for doing so. Our aim is no longer exposure, and no longer to demonstrate precision. Our aim today is to add individuality and character to the brand. Thus, the name Seiko does not appear on the Honda F1 car, but we do not care; what we value is the opportunity to give consumers a glimpse in to the world of Jenson.
The Seiko Sponsorship Model: Our events
As a result of this journey through the world of sport , we have evolved a model in which we balance exposure against prestige, and increasingly we are prepared to sacrifice exposure to gain more prestige.
Some events with which we have had experience deliver great brand name exposure to a mass audience, with soccer being the prime example. Others, like the global multi-sport events, the Commonwealth or Asian Games for example, have a certain stature, but reach smaller, less passionate audiences. And some, like tennis offer an interesting blend of both exposure and prestige. No two companies’ needs are the same in sport because every company will have a different view of its place on this map. And from this comes the diversity of the sponsorship market.
Our events. Our journey
But, when we, at Seiko, think about this trade off between exposure and prestige, we see it reflecting our journey in sport. By putting a time line on this same chart, you can see how we have been happy to sacrifice exposure to gain prestige. We started in our first phase with the visibility of our logo as our clear and single-minded aim and events like the FIFA world cup of soccer were perfect for this. In our positioning phase, sports timing was the key aim. And today, personalisation and prestige is the name of our game.
I have dwelt on this journey that we have taken in sport with the hope that it throw up a few insights into how companies like ours may think about sport, and I would like to stress that we are absolutely not alone in this. I could give you many examples, but I hope that just 2 examples will show that this kind of thinking is not unique to us. My examples are from the luxury segment and the mass market, as I seek to demonstrate that the trend I describe is one that is relevant to all products and market positions. I hope you will see that they both prove the same point.
Tag Heuer strategy
Let me look first at one off the leading brands in our industry at the moment. Tag Heuer is a sports brand. They, like us, have an honourable tradition of sports timing and they timed the Olympic Games in 1920.
Coca Cola and ‘Mean Joe Green’
But maybe, as is so often the case in advertising matters, the best example of all time is from Coca Cola. And as so often, they got there years ahead of many of us. You may know the commercial I am about to show, but if you do, I am sure you will not mind seeing it again, and if you have not seen it before, sit back and see great sport sponsorship at work. To understand the film, you need to know that the star in the film, Joe Green, was the best, hardest and most feared football player of his generation in America.
Coke sponsor the sport and the broadcasts of the game, but they were not, even in the early 80’s when that film was shot, content to rely on the simple exposure they gained from these activities. They humanised their sponsorship with a simple but hugely powerful story. You may think that this film is a million miles from the world of international sailing, but I assure you that if any race organiser or team owner can put together a sponsorship package that allows a brand to deliver messages of this power to whatever his audience may be, you will have a very happy sponsor.
The evolution of sports sponsorships
You will notice a theme emerging in this presentation. The global sponsorship industry was built on the basic notion that, via signage at sports events, brands could get inexpensive, global exposure of their names and this was a model that served the market well for 20 or 30 years. Today, however, the needs of companies have evolved beyond exposure and a sponsorship that offers brand name exposure alone is unlikely to succeed. Coming back to our industry for a moment, you might think that the timing of F 1 with the global coverage it brings would be fought over with vigour by the leading watch brands. In reality, no-one is interested, and I have genuinely lost count of the number of times that Seiko has given a polite refusal to the proposal to be the Official Timer to F1. So, no-one times F1 today, and yet, many watch brands sponsor drivers and teams. At the same time, only at the very highest level are truly global mega-deals done today. There are examples: The IAAF proudly announced a new 11 year deal with adidas last month, whose value is reputedly over € 100,000,000, but I would argue that deals like these are the exception, not the rule these days as companies seek targeted, tactical deals, rather than long-term strategic ones. . Brands have moved from wanting a one-size fits all package centred on exposure to wanting customised programmes that communicate values. The shift is from events to participants, from big TV audiences to higher quality of impact; from ‘broadcast’ brand promotion to ‘narrowcast ‘ sponsorships that support specific products. Most of all, sponsors are increasingly moving from long-term deals to shorter-term tactical sponsorships that deliver specific global results to specific audiences in specific places.
Brand exposure vs Brand Association
Many long established brands still value exposure. And the new generation of mega-brands brands craves it. Brands like Emirates and Vodaphone, are always in the news with hugely expensive new deals. But it is also true that many of the biggest events that attract the largest sponsor interest offer no brand name exposure, e.g. Olympic Games, Wimbledon ( Rolex excepted!) and the Ryder Cup. And it is worth noting that the sums some companies pay for no exposure is huge. London 2012 is on course to raise over 800 million from partnerships that offer precisely no visibility in the sports arenas or on TV. My point is that sports sponsorship is no longer cheap media, nor is it an opportunity for a marketing department to indulge a Chairman’s hobby. Sports sponsorship deals today are reflections of a complex mixture of needs and goals, each of which is specific to the individual sponsor.
Successful Sports sponsorships and Seiko.
At Seiko we approach sponsorship like this, and our recent entry into sailing is, I hope an instructive case . When we wanted to find a way to promote our new sailing watch collection, we spoke to many distinguished members of the sailing world, including my good friends Edward and Inga Leaske who are here today, and we thought hard about what we wanted. No “off the shelf” sponsorship deal fitted our needs and, in the end, we defined what we wanted and approached the Class that we liked the best. Happily for Seiko, we met very clever, charming and open- minded people in the 49er Class Association and they helped us to design a unique package, with which we are very happy. It took a while for them to see that what we sought were stories and prestige, rather than exposure at every event, but we worked it out together and it has been a big success. It was only after we had done it that I learned that we were the first ever company to sponsor an Olympic Class! And we are now extending the arrangement to include the 29erxx. We are not motivated by exposure for our brand. We value the opportunity to learn about sailors’ needs and hopes, and the opportunity to build watches that reflect them. We value the prestige of being the partner of the fastest Olympic Class, we value the chance to create great imagery that we use in our own ways, and we value the chance to put our clients side by side with the many great young sailors whose dedication and energy are such an inspiration.
Successful sports sponsorships
So, where does this analysis lead us?
The conclusions I draw are that, for a team or a sport or an event to attract the widest and deepest levels of sponsorship, the key is to tailor the offer to the needs of the sponsor, depending on where they may be on the exposure/prestige continuum and to personalise/humanise the offer to the greatest possible extent. To see Joe Green play American Football must have been a thrill, but to share a moment with him and the kid is what really moves people. And what moves people is what, today, generates sponsorship money. Sailing is wonderfully well positioned to do this, and I am certain that the sport has a glittering opportunity to win share of sponsors’ funds if it addresses the needs of the sponsor companies in the new, flexible manner I am proposing.
To event organisers, team leaders and all those who seek sponsorship, I would humbly submit the following ideas as rules of the road to creating happy sponsors.
- Create an opportunity that delivers to the sponsor’s target audience an emotionally-involving touch-point. While they might not all say so, many sponsors care less about numbers and exposure, and more about the quality of the experience.
- Use the stars of your sport, rather than huge logo’s to present the message of your sponsor.
- Offer your sponsor the chance to communicate prestige to a small audience, rather than a name to a mass audience. “Less is more” could be a useful rule.
- And most of all, design programmes that enable the sponsor to create stories about his brand. Remember Joe Green!
In closing, may I say that I personally, and Seiko as a company, have learned a lot from the world of sailing and most of what we have learned is very, very positive. We have found the sailing world friendly, sensible and fun to deal with. I can only hope that the thoughts I have shared today are helpful and go some way to re-pay the sailing community for its kindness and generosity.