Sponsorship is not a new medium for the B2B marketer, in fact it has long been considered one of the most effective ways for business brands to get their name recognised or their product message across to their target audience. But as with any medium it is evolving with the times and marketers are taking an ever more complex approach in the quest to maximise its potential to the full.
Large scale entertainment events have always been exploited by B2B companies in some sense; most traditionally as a means of cementing already existing relationships with customers or suppliers. In the past, sponsorship in this sector was driven almost solely by hospitality; it was about using your affiliation with an event to wine and dine in the corporate boxes, entertaining your key business contacts one-on-one. Increasingly though, B2B companies are thinking less one-dimensionally. Instead of concentrating on having a presence at an event and schmoozing customers with expensive food and champagne, they are thinking harder about how they can use an event to show off how the product or service they are selling actually works.
This, says David Farrow, MD of 141 Worldwide Sports & Entertainment, is the key shift in attitude towards sponsorship. “Brands are thinking more about how they can use an event to dramatise their product and to this end it’s important for them to create an environment where they are in control,” he says.
It makes sense that B2B brands should approach the medium in this way. Considering that most B2B brands are targeted at specific and often limited audiences, the hit-rate is bound to be higher if you have a presence at an event which you know will be attended by people predisposed to have an interest in your product. Rather than take a B2C approach to sponsorship – which relies largely on repetition and imagery to evoke emotional, impulsive buying – B2B marketers are realising they need to use the medium to encourage rational purchases based on business value. The B2B sponsorship model is becoming increasingly sophisticated, aligning itself with an overall trend that sees B2B marketing principals drift further away from B2C ones.
A change of tack
So when did this shift in perception occur? Ben Hart, CEO of digital communications agency Glass, thinks the past 12 to 18 months have been a key time for change. And the instigating factor that brought about this change? Hart says part of it was driven by a need to get more creative. “People were getting bored with seeing the same faces at the same (high profile) events and there became a resistance at senior level to going through the same hoops over and over again.”
Instead, B2B brands have started marrying sponsorship activity to the products they are promoting. “Companies that drill down into bespoke events are much more successful than those who have a big budget and are too keen to launch into sponsoring, say a Formula One team or a football event, just because it’s considered sexy,” explains Venessa Wilson, business development director at Planet.
“This seems to happen a lot in the IT sector; these companies have big budgets to spend so they sign up to big events, only address the brand awareness point of view and ignore the fact that they should be considering their business models over the next 12 months and how they can reach their ABC targets,” she says.
So rather than just addressing the issue of brand awareness (while keeping the champagne glasses of key contacts topped up) a clever brand will show an audience its product in action.
Inmarsat, a mobile satellite company with a purely corporate client base, demonstrated this approach to good effect in its sponsorship of the World Rally Championships. With the events typically held in remote locations, Inmarsat used its position as sponsor not only to advertise its brand name, but to actually use its technology to provide communications infrastructure for the teams taking part.
Meanwhile, it developed a range of marketing, public relations and corporate hospitality activities around the various rallys. This ensured it would draw in not only customers interested in the specific technology it was showcasing, but also customers interested in the wider brand concept through the forms of publicity it deployed to promote the fact that it was the sponsor. “It was a well-rounded sponsorship campaign that not only got it brand awareness, but showed people what they were about and what they could do,” says Farrow.
Preparation is key
Inmarsat drummed up a strong campaign by exploiting its sponsorship deal to maximise brand awareness, corporate relations and product capability all at once. Pulling off a deal like this takes a lot of groundwork so once a sponsorship has been put into place, the first step is to implement a strong communications strategy from the top down to the executives who will set the campaign wheels in motion.
Wilson believes that all too often, opportunities are missed because the whole package is not explained in depth to the marketing community within a company, which in turn means that the different facets of the sponsorship are not fully utilised. Communication, she says, allows correct usage of different tiers of sponsorship to the different levels of customers, partners or prospects. While a Formula One mug and cap would be inappropriate to send to C-level prospects, it could prove ideal to send to distributors who do not have access to such promotional items.
“All too often (the sponsor) ignores access to the merchandise that comes as part of the whole package,” she says. “It might not seem like the most crucial part of the deal, but using it is cost effective because it’s tied in. Too often this information gets lost because whoever cuts the sponsorship deal doesn’t communicate it to other parts of the organisation.”
This, she says, is when sponsoring companies can fall victim to non-affiliates who seek to gain ground by associating themselves with an event. Or in other words, this is where non-sponsoring brands can seize an opportunity to cash in. At the last football World Cup, Planet helped one of its clients, IT management company CA, to do exactly this, an activity Wilson terms ‘anti-sponsorship’.
By promoting CA as if it were associated with the event – and crucially, putting the campaign out to market before any of the official sponsors started to do the same – Planet helped it to piggyback off of the event for a fraction of the price that a multimillion pound official sponsorship deal would have cost them (the fifteen official partners each paid a reported 40 million euros for the privilege). CA held events at London’s ExCel centre, inviting its key contacts to watch the big matches, hired speakers from the infamous 1966 World Cup team and developed an online ‘shootout’ game – all of which gained the perception that they were involved with it and so heightened awareness and credibility of the brand.
Measuring up
With so many campaign elements contributing towards the overall sponsorship model – direct mail, PR and word-of-mouth marketing to promote the deal, and corporate hospitality, branding and product placement as the event happens – it can seem confusing for a B2B brand to know how to measure the overall success rate.
But according to Hart, for B2B brands it is actually quite simple. “The main measurable is the response you achieve from the follow-up sales process,” he says. “Because a lot of (B2B brands) sponsor smaller events, it’s much easier to see if the response rate has been low because of poor attendance or because the brand didn’t target the event in an effective enough way.” This is where research before the event is key; the smart B2B marketer should be able to generate a fairly accurate estimation of response rate by examining the habits of the key decision makers it will target at the event by looking at for example their loyalty to the sponsors and their ‘buying habits’. “In the case of the really big events it can be much harder to drill down into this type of information,” adds Hart.
For the brands involved in these bigger events, it is often their mix of B2B and B2C targets that provide them with their measurable response. When Philips became a World Cup sponsor, it recognised that the event would provide opportunity to encourage consumers to upgrade to its new generation of flat screen HDTVs. So it implemented a global incentive programme, inviting retailers to compete for limited tickets to the games, which it measured against their performance and year-on-year sales.
“It’s integrated, it’s measurable and it’s joined up,” comments Adam Wylie, managing partner at marketing communications agency 23 Red. “It’s a model that’s being adopted more broadly and it’s something we will see more of in the future. Why? Because it’s accountable and because it’s very hard to differentiate on a B2B level without an incentive or narrative platform such as this,” he says.
“For a lot of businesses there is a growing appreciation that although you might be implementing a B2B sponsorship, you need to think about your B2C mix too and see it as an extra string to your bow,” adds Shaun Whatling, a director at sponsorship consultancy Red Mandarin. This relationship works both ways, as demonstrated by the Philips sponsorship deal which Red Mandarin worked on. “Philips had to consider its B2B channels in order to reach its B2C audience,” he says.
At Red Mandarin, B2B sponsorship is considered as having one of two objectives; that is either to generate primary or secondary revenue. Whilst primary revenue gives some sort of guaranteed business from the property – and possibly its vendors or other sponsors – secondary revenue is the more risky approach which targets the sponsors customers and hopes that they will want to sign on your dotted line once the event is done and dusted.
Philips managed to score on both counts, with Red Mandarin striking an additional deal with FIFA to have Philips pay for the giant screens that the games were screened on. “If you have a relationship with a big sponsorship property like the World Cup or the Olympics, it opens up possibilities to create relationships with other suppliers and sponsors too, which in turn has the potential to generate even more revenue,” says Whatling.
For smaller B2B brands though, the underlying message is to keep it simple and to keep it niche. Research potential events thoroughly, be assured that the event you choose is going to be of a good quality and therefore (in theory) a success and look at ways of embedding your product within the sponsorship, whilst still remembering to entertain your audience with a good dose of corporate hospitality.
“Above all, remember that you have to be much more precise in B2B than when targeting a broad consumer audience,” concludes Farrow. “It’s normally wasteful for a company with a B2B audience to buy sponsorships that communicate to a mass audience.” Which means the sponsorship medium is evolving in tandem with a by now well known principle; that what works for B2C doesn’t necessarily work within the B2B sphere.
