Ambush Marketing:
a consumer perspective
Lieve Kramer (5908574)Date: June 23th, 2016
MSc. in Business Administration – Marketing Track Amsterdam Business School, University of Amsterdam Supervisor: dr. K. Venetis
Statement of originality
This document is written by student Lieve Kramer who declares to take full responsibility for the contents of this document.
I declare that the text and the work presented in this document is original and that no sources other than those mentioned in the text and its references have been used in creating it.
The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the contents.
Abstract
In this research, the focus lies on the consumers’ attitude – purchase intentions, affect, and credibility – towards a brand when ambush marketing and the resulting negative consequences are revealed. The brand personality characteristics, sincerity, and excitement, could also moderate the effect of ambush marketing. The regressions on the main effect, attitude change in case of ambush marketing, led to significant results for credibility. A negative attitude change was reported for credibility with ambush marketing. For the other two regressions, ambush marketing had no significant effect on brand affect or purchase intentions. A moderating effect for two different brand personality traits – levels of sincerity and excitement – was predicted. Sincerity has a statistically significant positive moderating effect on the relationship between ambush marketing and credibility, meaning that the effect of ambush on credibility was more negative for people who scored high on levels of sincerity. Excitement had no moderating effect on the relationship between ambush marketing and credibility, affect, and purchase intentions.
Table of Contents
1. INTRODUCTION ___________________________________________________ 1
2. THEORY _________________________________________________________ 6
2.1. Theory part A: Sponsorship and Ambush Marketing ______________________________________ 6
2.1.1. Sponsorship the Figures _____________________________________________________________________ 6 2.1.3. Reasons for sponsorship growth ____________________________________________________________ 9 2.1.4. Definition of sponsorship ____________________________________________________________________ 9
2.2. Theory Part B: Ambush Marketing__________________________________________________________ 10
2.2.1. Emerge of ambush marketing _____________________________________________________________ 10 2.2.2. Definition of Ambush Marketing __________________________________________________________ 11 2.2.3. Strategies ____________________________________________________________________________________ 12 2.2.4. Counter Action ______________________________________________________________________________ 15 2.2.5. Ethics ________________________________________________________________________________________ 17
2.3. Theory Part C: Brand equity _________________________________________________________________ 19
2.3.1. What is a brand _____________________________________________________________________________ 19 2.3.2. CBBE _________________________________________________________________________________________ 20 2.3.3. Attitudes ____________________________________________________________________________________ 23 2.3.4. Building Brand Equity Through Sponsorship ____________________________________________ 25
2.4. Theory Part D: Responses to Sponsorship _________________________________________________ 26
2.4.1. Perception, learning and moderating factors ____________________________________________ 26 2.4.1. Effect of Ambush Marketing on Brand Equity ____________________________________________ 28
3. HYPOTHESES ____________________________________________________ 31
4. METHODOLOGY _________________________________________________ 34
4.1. Research model ________________________________________________________________________________ 34 4.2. Research method ______________________________________________________________________________ 35 4.3. Pre-test Research design _____________________________________________________________________ 36 4.4. Pre-test analysis _______________________________________________________________________________ 36 4.5. Main experiment data collection ____________________________________________________________ 37 4.6. Main experiment procedure _________________________________________________________________ 37 4.7. Variables ________________________________________________________________________________________ 37 4.8. Main experiment statistical analyses _______________________________________________________ 40
4.8.1. Descriptive statistics _______________________________________________________________________ 40 4.8.2. Inductive statistics _________________________________________________________________________ 41
4.9. Quality of the analysis ________________________________________________________________________ 41
5. RESULTS ________________________________________________________ 43
5.1. Results Pre-test ________________________________________________________________________________ 43 5.2. General characteristics of the Respondents _______________________________________________ 43 5.3. Reliability check _______________________________________________________________________________ 45 5.4. Correlations ____________________________________________________________________________________ 47 5.5. Checking assumptions of the statistical analysis _________________________________________ 48
5.5.1. Normality and linearity ____________________________________________________________________ 48 5.5.2. Homoscedasticity and independence _____________________________________________________ 49
5.6. Manipulation check ___________________________________________________________________________ 49 5.7. Condition similarity ___________________________________________________________________________ 50 5.8. Hypotheses testing ____________________________________________________________________________ 51
5.8.1. Regression result hypothesis 1a___________________________________________________________ 51 5.8.2. Regression result hypothesis 1b __________________________________________________________ 51 5.8.3. Regression result hypothesis 1c ___________________________________________________________ 52 5.8.4. Moderating result hypothesis 2a __________________________________________________________ 53 5.8.5. Moderating result hypothesis 2b __________________________________________________________ 54 5.8.6. Moderating result hypothesis 2c __________________________________________________________ 54 5.8.7. Moderating result hypothesis 3a __________________________________________________________ 55 5.8.8. Moderating result hypothesis 3b __________________________________________________________ 55 5.8.9. Moderating result hypothesis 3c __________________________________________________________ 56
6. DISCUSSION _____________________________________________________ 57
7. CONCLUSION ____________________________________________________ 60
8. RECOMMENDATIONS _____________________________________________ 61
9. REFERENCES _____________________________________________________ 63
10. APPENDICES ____________________________________________________ 72
Appendix A: Pre-test __________________________________________________________________________________ 72 Appendix B: Results Pretest Brand Personality ___________________________________________________ 79 Appendix C: Survey ____________________________________________________________________________________ 81 Appendix D: Presentation of the Four Survey Versions ___________________________________________ 86Appendix E: Flow chart of the data collection process ____________________________________________ 87 Appendix F: Normality and Linearity Check _______________________________________________________ 88 Appendix G: Scatter plots residuals ________________________________________________________________ 91 Appendix H: Condition Similarity ___________________________________________________________________ 92 Appendix I: One way ANOVA manipulation check _________________________________________________ 93 Appendix J: Multiple regression results ___________________________________________________________ 96
List of Tables
Table 1: General characteristics of study population. ... 44
Table 2: Reliability credibility, brand affect, purchase intentions. ... 45
Table 3: Reliability of Sincerity and Excitement. ... 46
Table 4: Descriptive statistics of new variables. ... 47
Table 5 :Pearsons’ correlation table. ... 48
Table 6 Different survey versions. ... 50
Table 7: Multiple regression results for prediction of the dependent variable credibility (n=213). ... 51
Table 8: Multiple regression results for prediction of the dependent variable credibility (n=213). ... 52
Table 9: Credibility Outcome Process Sincerity x Ambush. ... 53
Table 10: Moderator effect Sincerity x Ambush. ... 53
Table 11: Affect Outcome Process Sincerity x Ambush... 54
Table 12: Purchase Intentions Outcome Process Sincerity x Ambush . ... 54
Table 13: Credibility Outcome Process Excitement x Ambush. ... 55
Table 14: Brand Affect Outcome Process Excitement x Ambush. ... 55
Table 15: Purchase intentions Outcome Process Excitement x Ambush. ... 56
List of Figures Figure 1: ANOVA for Credibility and Ambush marketing. ... 49
1.
Introduction
Big sporting events nowadays are hard to imagine without sponsorship from corporations. Some events have many different sponsorship partners, like the Olympics or the World Cup. Some sponsored sporting events are solely organized by the brand that seeks out sponsorship opportunities. Red bull, an energy drink company, holds different events with their company name and logo incorporated into the name of the event, for example ‘the Red Bull Crashed Ice’. In return for the sponsorship, the sponsors receive access to the sporting event and have the opportunity of strategic promotion where they can leverage the spirit and values of the event towards their own brand. This allows the brand to utilize exclusive hospitality and marketing opportunities associated with the event.
In some cases, a corporation leverages the sporting event without engaging in a sponsorship agreement with the same event owners. In this case, a company attempts to associate itself with an event without buying the rights to do so (Meenaghan, 1994). This practice is called ambush marketing. Ambush marketing is relatively new, emerging in the 1980s as a marketing technique. Ambush marketing usually arises during big sporting events with a big exploitable commercial potential, where only limited brands are allowed to sponsor and where entrance fees are high. One of the best-known examples of ambush marketing happened during the Barcelona Summer Olympics in 1992. Visa Inc., being an official sponsor of the event, was ambushed by American Express Co. During the Summer Olympics, television ads of Amex with scenes of Barcelona were aired with a message that said, “You don’t need a visa to visit Spain”. Though Visa complained loudly, Amex stated that the commercials did not refer to the Olympics and were not an attempt to ambush Visa. This is only one example of ambush marketing; there are many more ambush strategies that a company can apply. During the 1980s, sponsoring a subcategory or sponsoring media coverage was mostly used. Currently, confusing and miscellaneous tactics are applied more often.
There are several explanations as to why ambush marketing emerged during the 1980s. The first reason can be found in the enormous growth in sponsorship. In the last 40 years, global sponsorship grew from USD 2 billion in 1986 to 48.7 billion in 2011 (Reuters.com, source IEG report). From the traditional marketing communications budget, sponsorship deals become a bigger portion of the total budget every year (Shani and Sandler, 1998; Close, Finney and Lacey, 2010; Roy and Cornwell, 2004). From all sponsoring spenders, 82-85% is spent on sport sponsoring (TWSM, 2010). However, not only did the sponsorship market grow, but sponsorship contracts also became more expensive. The owners of big sporting events have also evolved the sponsorship programs; category exclusiveness, for example, makes sponsoring a certain event only possible for a few brands. Due to the scarcity of sponsorship deals and high sponsor fees, companies have become more creative and choose ambush marketing strategies.
When unofficial sponsors are able to access the exploitable potential of the sporting event, the official sponsor pays for something that is free for their competitor. The value and quality of the sponsorship opportunity is then reduced. Different studies have proposed the idea of ambushing being unethical and unfair (Meenaghan, 1994, 1996; Murphy and O’Sullivan 1998; Payne 1998). Other studies have focused more on the prevention of ambush marketing. Sponsors should, for example, carefully choose their strategic long-term arrangements with events that help to build their brands, and they can also counterattack the ambushers by drawing attention to legitimacy issues (Farrelly et al, 1998). Legal systems that are available to prevent ambushing have also been examined (Townley et al, 1998).
Research about the consumer reactions towards ambush marketing is scarce. Consumers do not seem as involved in the fight against ambush marketing as event owners and official sponsors are. The perception of consumers is important, since it are these consumers that make an ambushing action successful or not. Research has focused mainly on describing and preventing ambush marketing, where the consumer perspective has
somewhat been neglected. Research did find that consumers have a knowledge gap about ambush marketing, consumers often recognize an official sponsor as an ambusher (Shani and Sandler, 1998; Kinney and McDaniel, 1998). Shani and Shandler show that 35% of their research population was not aware of the practice of ambush marketing. Considering that roughly one third of the sample did not know about the tactic, it does not seem strange that different ambush marketing tactics were recognized as legitimate marketing strategies. Consumers do however, believe that ambushers are ‘wrong’ when they try to pass themselves off as an official sponsor. On the other hand, consumers are not really ‘annoyed’ when companies associate themselves with the event without being an official sponsor. These studies have asked consumers about their opinion on ambush marketing. However, there has not - to the best of my knowledge - been an effect study where consumers evaluated ambushing brands. We do not know how ambush marketing impacts the perceptions of consumers towards the brand.
This paper focuses on the consumers´ attitude changes towards a brand as a result of ambush marketing and the associated negative consequences. The idea is that disclosure will negatively influence the attitudes towards the ambushing brand. Attitudes are widely used to assess the value of a brand in a consumer’s mind, the consumer based brand equity (Keller 1993). In this paper, three different components of brand attitudes are investigated – credibility, brand affect, and purchase intentions. The chosen attitudes and measurements are widely used for measuring brand attitudes consumers have and form about brand (Goldsmith and Newell, 2001; Baker and Churchill, 1977; Stafford, 1998; Chaudhuri and Holbrook, 2001).
In addition to the proposed idea above, levels of a brand personality trait moderates the effect of the disclosure of ambush marketing. A brand image can exist out of a set of human characteristics. These different human characteristics make up a brand’s personality (Aaker, 1997). Sincerity, one of these characteristic traits, draws heavily upon being honest
and fair. This is exactly the opposite of what ambush marketing, which is unethical and unfair. Disclosed ambush marketing is seen as a transgression. Consumers view this transgression differently for different brands. Sincere brands suffer when this transgression occurred (Aaker, 2008). A brand with a personality closer linked to excitement could encounter a very different consumer reaction after the disclosure of ambush marketing. An exciting brand is unique, non-conformist and daring (Aaker, 1997; Van den Berg, 2001). The expectation is that these exciting brands could be viewed in a new positive daylight after the ambush disclosure. This study is designed to test the idea of whether brands that stand for honesty and fairness suffer more in a setting where ambush marketing is disclosed, whereas brands that have excitement as an important value in their brand personality could actually benefit from this disclosure.
To investigate whether the goals of this study are reached, a cross-sectional (survey) design with an experimental manipulation was done. Four different surveys differed only with respect to the ambush marketing, the key independent variable, and the brand. With a regression analysis, the relationship between the ambush marketing and the dependent variables, credibility, brand affect, purchase intentions, is calculated.
The first step is to investigate this idea, followed by an introduction, and then definition of sponsorship. The same chapter discusses the ways in which people respond to sponsorship. This will also increase our understanding of the attitude change. This theoretical framework leads up to the final three hypotheses, presented in Chapter 3. The model that is designed to test the hypothesis is then presented in Chapter 4. Empirical results are outlined in Chapter 5. Lastly, a conclusion and discussion are presented in Chapters 6 and 7.
The key objective of this is research is to determine how ambush marketing impacts consumers’ brand attitudes and whether a brand’s personality trait moderates this effect. Scientific literature in this field has either focused on consumer knowledge about brands and
events as the moderating effect (Hoeffler et al, 2006: Cornwell and Roy 2004), has been either exploratory or qualitative (Meenaghan, 1998), or has been based upon measurement instruments that have not been validated (IOC, 1996). This research might be able to explain some of the inconsistent findings of consumer responses towards ambush marketing (Shani and Sandler, 1998). A linkage between ambush marketing and the effect of brand personality traits on brand attitudes was not found in literature. This research, therefore, will be an extension of the current literature.
Another contribution of this research will be an increased understanding of the consumer perspective on ambush marketing. This will help future sponsors and event owners protect their rights better. This research enhances the ability to act when a case of ambush marketing happens and enhances knowledge on factors that moderate the ambush effect. Legitimate sponsors, event owners, and legal systems, can then focus more effectively on preventing ambush marketing. With this research, event promoters are also supported when seeking to preserve the value of the event sponsorship.
2.
Theory
Before addressing the research question, the main elements of this thesis will be introduced and defined. The theory is divided into three parts. Theory part A discusses sponsorship and ambush marketing. Because an in-depth understanding of the practice of ambush marketing is the main aim of this thesis, this subject will be addressed from different angles, starting with a history of general sponsorship and its history in big events, followed by the emergence of ambush marketing. Theory part C discusses ambush marketing, where brand equity, the consumer perspective on brands, is discussed more thoroughly. In theory part D, responses to sponsorship will explain how consumers form attitudes about brands. This will also explain how consumers learn about brands through sponsorship. At the end of this chapter the latter is put into a framework that summarizes the effect that ambush marketing (in big sporting events) has on consumer based brand equity, with brand credibility, brand affect, and purchase intentions in particular.
2.1. Theory part A: Sponsorship and Ambush Marketing
In this chapter, an overview on sponsorship and ambush marketing is given.
2.1.1. Sponsorship the Figures
Since the 1980s, sponsorship and expenditures have been very well documented. During this period, the IEG, the leader in sponsorship intelligence, was founded. In 1982, the corporate event sponsorship reached $500 million. In 1997, the industry grew to $5.9 billion (Shani & Sandler, 1998, p. 368). In more recent years, the market has still been growing, with a growth of 5.1% being achieved in 2011, resulting in a global spenditure of $48.7 billion US dollars (TWSM, 2011). In 2011, the sponsorship market was dominated by sport “79 per cent of all sponsorship deals and 88 per cent of total value” (Sports Business Brand and Marketing Data, 2011). The European market represents 28% of the total global spending,
while the USA represents 37%, and the Asia-Pacific represents 23% (TWSM, 2011). This growth is not expected to stop anytime soon.
Sponsorship has become a major element in the marketing communication mix. From the sponsoring expenditure, 82-85% is spent on sport sponsoring (TWSM, 2010). Sponsorship however, is relatively new in the marketing communication mix. A brief history of sponsorship is found in the next paragraph.
2.1.2. History of sponsorship
This section gives an overview of the history of sponsors, with the most important events highlighted. During the 19th century, the first documented giving of companies took place. The reason for this giving could either be seen as a philanthropy act or as strategic promotion. The main difference between the two is found in the expected return a company expects. Giving from the philanthropic perspective has no marketing objectives, whereas a strategic promotion clearly does have marketing objectives. A strategic promotion involves a two-way process of exchange, where both the sponsor and the sponsored organization benefit. In the 20th century, sponsorship grew enormously. Only during the 1980s did sponsorship approach a more strategic matter. Before the 1980s, sponsorship was approached in an ad hoc manner. IEG, the leader in sponsorship intelligence, was founded only 30 years ago in 1984 (“IEG about”, 2013). Only during this time was academic research conducted on a larger scale.
Sponsorship of sports is the biggest sponsorship category; the Olympics are the world’s single biggest sporting event. With this being said, a brief history of sponsorship and the Olympics is now presented below.
The Olympics
number of media present is no longer applicable. The Beijing 2008 games had other statistics: 10.942 athletes from 159 countries participated, with 3 billion television viewers worldwide (“Athens 1896 summer Olympics”, n.d.). In 112 years, the Olympic Games had been transformed into the world’s single biggest sport event in the world. Reviewing its history provides a good understanding of the practice of (event) sponsorship.
The first Olympics were made possible by George Averoff, who contributed funds for the restoration of the Olympic stadium. In return for his gratitude, a statue of Averoff was erected in front of the stadium. In 1924, Paris advertising signage appeared within view from the Olympic Games venues for the first and only time in history. The games in 1952 (Helsinki) were the first to launch an international marketing program, and sponsorship rights were issued for the first time. Furthermore, broadcast rights were negotiated for the first time. Due to an enormous increase in sponsors over the years, the sponsorship program was divided into three categories during the 1984 Los Angeles games. All three categories enhance rights and product category exclusivity. In 1985, these categories were elaborated in the IOC’s worldwide sponsorship program of the Olympics, the Olympic Partners (TOP). With this program, the IOC bundled the exclusive worldwide marketing rights to both winter and summer games. Fifteen years later during the Sydney (2000) games, a new code for brand protection was prepared. Brand protection was done via education, legislation, and advertising controls (Webb, 2001).
Due to the TOP program the number of sponsors dropped, but the income from sponsors rose enormously from US $96 million in 1985-1988 Calgary/Seoul to US $866 million in 2005-2008 Torino/Beijing, resulting in a growth of roughly 900% from the mid 80’s till 2008 for Olympic sponsors. The TOP program is one of six revenue categories for the Olympics. The others are broadcasting, OGOC domestic sponsorship, ticketing, licensing, and NOC’s. The total revenue in 2005-2008 amounted to a startlingly high figure of US $5.5 billion (“Olympic Marketing fact file”, 2010).
2.1.3.
Reasons for sponsorship growth
The growth of sponsorship has been startling. There are different reasons for this growth. Advertising, a more traditional marketing communication strategy became very expensive, while on the other side, there was a decrease in advertising efficiency. Event holders were facing higher costs due to, for example, extensive regulations and the withdrawal of organizing volunteers in their organizations.
Consumers are now much more educated about advertising and the reasons behind advertising. Consumers see companies that advertise as “just trying to sell their product” (Meenaghan, 2001, p. 208), whereas a company who sponsors an event is considered to be “a good company”. There appears to be a “halo of goodwill” around sponsorship (Meenaghan, 2001). The use of sponsorship develops brand equity (Cornwell, Roy and Weeks 2005).
2.1.4. Definition of sponsorship
Sponsorship has potential for building brand value (Cornwell, Roy and Weeks 2005; Close, Finney and Lacey 2010). Building brand value through sponsorship is powerful because of the following three characteristics: first, sponsorship is successful cutting through the clutter and gets the attention of the consumer; second, with sponsorship, the message and the medium are closely linked together; finally, sponsorship can reach multiple audiences at the same time (Crowley, 1991). Different brands find different audiences important. Brands with consumer products find the consumers important; other audiences are the workforce, suppliers, local community, and shareholders (Crowley, p. 14).
Meenaghan (1991), is applied: “Sponsorship is an investment, in cash or kind, in an activity,
in return for access to the exploitable commercial potential associated with that activity” (p.
36).
2.2. Theory Part B: Ambush Marketing
Sponsorship became an important part of the marketing communication mix the last thirty years. With the growth of sponsorship marketing, ambush marketing concomitantly emerged. Where sponsorship is “an investment, in cash or kind, in an activity, in return for access to the exploitable commercial potential associated with that activity” (Meenaghan, 1991), ambush marketing is not an investment. Ambush marketing does access the exploitable commercial potential associated with the property, but does not include paying a fee for this access. In the following chapter, the emergence of ambush marketing, key definitions, and characteristics strategies are discussed, followed by legal en ethical issues surrounding ambush marketing.
2.2.1. Emerge of ambush marketing
The first well-known and documented case of ambush marketing was in 1984, during the Olympics. During the Los Angeles Olympics (1984), Fuji was an official sponsor. During the same games, Kodak, a fierce competitor of Fuji, sponsored the ABC broadcast of the Olympics. Far more people were exposed to the Kodak sponsorship than the Fuji sponsorship, while Kodak did not contribute to the event itself unlike Fuji.
Leading up to the 1984 Los Angeles Olympics, the IOC prepared sophisticated sponsorship packages. During the 1984 Olympics, the IOC generated distinct three categories. All three categories enhanced rights and product category exclusivity, eventually leading to the 1985 established worldwide sponsorship program TOP. This development of sponsorship packages goes hand in hand with an increase of attractiveness of sponsorship.
Sponsorship deals for the Olympics became scarce, on one side due to increased costs, or in the case of Kodak vs. Fuji, due to category exclusiveness. Sandler and Shani (1989) state that Kodak was confronted with the last mentioned barrier and failed to secure the sponsorship rights. In reaction, Kodak sponsored the ABC broadcasts during the Olympics.
Four years later, the first games were held with TOP (The Olympic Partners) for sponsorship deals. As part of the TOP program, the IOC bundled the exclusive worldwide marketing rights to both winter and summer games. In 1984, Kodak and Fuji were an exception, and in 1988 the official sponsor was ambushed in almost every category (Sandler and Shani, 1989).
During the Sydney Games (2000), a new code for brand protection was prepared. Brand protection, now a main goal, was done via education, legislation, and advertising controls (Sydney report brand protection). This report included two quotes (Sydney, 2000):
“… the IOC has gone to Sydney to protect is commercial partners…” – Daily Telegraph (United Kingdom)
“Ambush marketing is not clever marketing – it is cheating. And who wants to be a cheat?” – Michael Payne, IOC Marketing Director
2.2.2. Definition of Ambush Marketing
The most widely used definition of ambush marketing states that, “Ambush marketing is the practice whereby another company, often a competitor, intrudes upon public attention surrounding the event, thereby deflecting attention toward themselves and away from the sponsors”(Meenaghan, 1994).
This definition is well connected to the most widely used definition of sponsorship from 1999 by IEG. Sponsorship is “a cash and/or in-kind fee paid to a property (typically a sports, entertainment, non-profit event or organization) in return for access to the
exploitable commercial potential associated with that property.” (Roy, 2000, p. 19). This sponsorship definition and other ambush marketing definitions, however, do not include the consumer perspective. The answer to the question of whether ambush marketing negatively influences the opportunities of building customer based brand equity is the goal of this research.
2.2.3. Strategies
There are different ambush marketing strategies. Each strategy is explained with an example below. In the mentioned examples, there is a fine line between an ambush action that is simply prohibited by law and other actions that are more subtle (Townley, Harrington, Couchman, 1998). As prevention is hard or does not exist yet, some legislation rules are in place to prevent ambush actions.
Sponsoring media coverage of an event
Big sporting events draw a lot of visitors, but there are even more viewers in front of the television. The Beijing Olympics alone had 4,7 billion viewers between August 8 and August 24 (Nielsen, 2011). This is approximately 70% of the world’s population.
In 1984, Kodak understood that a large portion of the Olympic experience was taken place in front of the television. During the 1984 Olympics, Fuji was an official sponsor of the event. During the same Olympics, Kodak, a competitor of Fuji, sponsored the ABC broadcast of the Olympics. Consequently, far more people were exposed to the Kodak sponsorship than the Fuji sponsorship.
Sponsor a subcategory within the event and exploit this investment aggressively
Where Fuji was the official sponsor of the 1984 Olympics, the roles were reversed in 1988; Kodak now has a worldwide sponsorship deal for the Olympics. Fuji only obtained the sub-sponsoring rights of the U.S. swimming team. However, their sponsorship was marketed heavily. The IOC viewed the actions of Fuji as inappropriate and a breach of the arrangement the IOC had with Kodak. The question is whether Kodak was really surprised by the actions of Fuji, within the context of their own behavior in the 1984 Olympics.
In 2012, this practice was still evident. During the European Championship of 2012 in Ukraine & Poland, the Danish football player Niklas Bendtner, after scoring a goal, showed the waistband of his underwear by lowering his shorts. The waistband of his underwear clearly showed the name of an Irish bookmaker Paddy Power. Paddy power was not an official sponsor of the European Championship, but rather their business rival, Ladbrokers was. Although the penalty was higher then expected, €100.000,-Paddy Power was happy to pay that penalty for Bendtner (Visser, 2012).
Engage in advertising that coincides with the sponsored event
A themed advertising
B Use a traditional advertising strategy
In the summer of 2008, the marketing campaign of Nike made frequent use of the number 8. This is a symbol of luck and fortune in China, as well as a symbol for the Beijing Games. Nike was not a sponsor of the Beijing Games; therefore, Nike made use of associative ambushing. It used the imagery or terminology to create the illusion that an organization has links to a sporting event or property.
Also in 2008 during the European soccer championship, Puma included the slogan “June 2008: Together Everywhere.” In that month, the European championships were
played. The official sponsorships emphasized themes of unity and anti-racism. According to Puma, their marketing campaign was meant to be “a reflection of bringing football fans from all over the world together during a football tournament,” and also “[Puma] would be in remiss if it didn’t recognize such events” (Chadwick and Burton, 2010).
A third example in the summer of 2008 is found during the 2008 French Open tennis tournament in Paris. K-Swiss, a sports-shoe and apparel maker, made an appearance with a surprise street-style promotion. On a main road leading to the event, K-Swiss parked a car with a gigantic K-Swiss branded tennis ball. On the street around this parked car, they handed out gifts and marketing materials, highlighting the brand and its involvement with tennis.
Miscellaneous ambushing strategies
Besides the aforementioned ambush strategies there are more creative options that could suggest involvement with an event. During the European Soccer 1996 championship, Nike used such a strategy. During the championship, Nike appeared on highly publicized billboards with images of famous football players. With these ads, Nike achieved higher recall association rates than some official Euro ’96 sponsors.
During the Soccer World Championship in South Africa 2010, a group of women wearing orange Bavaria dresses during the game created uproar. To be more precise, the harsh reaction of FIFA prosecuting the women caused uproar. The women were paid to be there in behalf of Bavaria and only entered the stadium in Danish supporters’ outfits, an ambush action indeed. Bavaria, not an official sponsor of the World Championship 2010, received a lot of attention. From a marketing perspective, Bavaria had hit the jackpot. The official beer sponsor of the World Championships 2010, Budweiser was the victim.
2.2.4. Counter Action
Event organizations are confronted with the different ambush strategies mentioned above. The organizers of the ambushed event have different approaches to counter the ambush actions.
The aforementioned example of the Bavaria dresses worn during the World Championship 2010 was not only an example of an ambush marketing strategy, but also a good example how not to respond to an ambush action. Things would have been very different if the cameramen were instead told not to zoom in on the women during the game, the women cheering in the stadium were left alone instead of escorted out of the stadium, and the designers of the dresses were not arrested.
Instead, FIFA’s actions resulted in a storm of negative publicity. Newspapers wrote about the harsh actions, and even a twitter page was started to ‘Free The Babes’. Budweiser, the official sponsor, was still not being mentioned and lacked the attention it would have anticipated. The case FIFA versus Bavaria maybe explains us how not to react to an ambush, but what is an appropriate response?
Counter strategies
Ambush marketing is found to be a successful strategy for some companies. A good counter strategy could diminish the effect of the ambush. According to research, there are a high number of sponsorships failures (Farrelly et al, 2005). The first question that arises however, is did the official sponsor make mistakes? Mismanagement of sponsorship programs as a reason for the lagging has been researched, but no evidence was found that the companies in question underperform compared to ambush brands. (O’Sullivan & Murphy, 1998). A prevention strategy seems like a more viable strategy for the long run. Prevention of
ambush marketing can be done via a legal route, and also by developing a strategy to minimize the impact of ambush marketing.
Legal rules against ambush marketing
The event owners should develop “coherent and commercial rights protection program” strategies to prevent ambush marketing (Townley et al. 1998). The IOC, for example, has done so with its TOP (The Olympic Partners) program. In such a program, the following parts should be controlled: intellectual property, the event environment, and the event partners. For London, the UK statutory marketing rights (London Brand Protection, 2012) is a comprehensive document of 60 pages. In this document, it is stated that the word ‘Olympic’ is protected. Elaborating on the protection of the word Olympic is protected, but also protected is “the translation and anything so similar to them as to be likely to create an association with the Olympic Games or the Olympic Movement” (London Brand Protection, 2012). The IOC focuses on making ambush marketing unattractive for potential ambushers. The IOC tries to paint the ambush marketing practices as “unethical and deceptive” (Payne, 1998).
A prevention strategy
Next to push for developments in the legal system, sponsors should also adapt a proactive stance towards their sponsorship. According to Farrelly et al (2005), sponsors should look for a “proactive, comprehensive, approach to sponsorship planning and activation to insulate against ambush and to protect and grow their association with the property” (p. 346). This proactive approach also conducts a thorough analysis of the event and the company.
2.2.5. Ethics
According to Murphy and O’Sullivan, marketing rules are built upon three ideals, justice equality, and truth (1998, p. 359). Ambush marketing, on the other hand, harms this code of ethics (Meenaghan 1994; Payne 1998; Farrelley et al 2005). A more moderate perspective on ambush marketing can also be found. This perspective sees the event owner as an entity that overemphasizes generating funds, thus creating a clutter of too many sponsors for the same event (Shani & Sandler 1998). The event owner is then partly to blame for the ambush marketing it is now confronted with. There are also marketers that see nothing unethical about engaging in ambush marketing. Official sponsors should focus on the development of “creative ways to bring its partnerships to live”, instead of focusing on battling in courts (Andrews, 2012). The opposite point of view comes from marketing directors from the event owners, who state that ambush marketing devastates sponsorship value and can potentially cause the entire sports branch to lose its income (Payne, 1998).
Before reviewing the (un) ethical nature of ambush marketing, ethics and marketing will be briefly discussed. There are different possibilities for reviewing (marketing) ethics: utilitarianism, duty-based ethics, stakeholder analysis, and virtue ethics (Murphy & O’Sullivan, 1998). The act of ambush marketing fails these theories for ethics. The consequences of ambush marketing (utilitarianism), with the intention of deflecting attention (duty-based ethics), are both negative. From a stakeholder’s viewpoint, ambush marketing can harm different groups, the viewers are confused and possibly more skeptical, and the decrease of value of the sponsorship program hurts the event organizer and the sponsor.
When applying the virtue of ethics, a closer look into the organizations is done. The key is that organizations try to be the best they can be. Honesty is a key virtue. Virtue ethics is widely used in business. As Bhide and Stevenson (1990) indicate, “business men and women keep their word because they want to, not because honesty pays” (p.121). Virtue
ethics are broken by organizations executing an ambush marketing strategy. On the other hand, the money-grubbing of event organizers, and therefore the lack of virtue ethics, is also seen as a reason for the growth in ambush marketing (O’Sullivan & Murphy, 1998; Shani and Sandler, 1998).
An important organization for marketing professionals is the American Marketing Association (AMA). Members of the AMA are all committed to an ethical professional conduct (“Statement of ethics”, n.d.). This conduct focuses on the behavior of the marketers, “promoting the highest standard of professional ethical norms and values for its members” (“Statement of ethics”, n.d.). The AMA applies virtue ethics. There are many marketing associations that could be mentioned, but AMA is mentioned here because this organization, with 30.000 members, is one of the largest marketing associations in the world. The organization also publishes three academic journals found on the list of the Amsterdam Business School. Two A* journals, ‘Journal of Marketing’ and ‘Journal of Marketing Research,’ and a B journal, ‘Journal of International Marketing’.
What do consumers expect?
The consumers show a lack of knowledge regarding the practice of ambush marketing (Shani and Sandler, 1998). They often cannot distinguish between the official sponsor and the ambusher. Also about one third of people were not aware of the existence of ambush marketing (p. 377). This source, being fifteen years old, is probably a bit outdated. Since then, no new research has been done on consumer knowledge about ambush marketing. We have learned that consumers place more “importance on the social responsibility of firms” (Lutz, Wagner and Weitz, 2009, p. 77).
Though corporate social responsibility is not contrary to ambush marketing, it has some shared values. Social responsibility is about not breaking the law and trying to do better, whereas ambush marketing is about seeking that line, and sometimes crossing it. For
consumers, it is important that whatever statement the policy is made of, the company should follow up on their words (Lutz, Wagner and Weitz, 2009). Related to our case of ambush marketing, a company should never state they will never conduct a case of ambush marketing. If a case of ambush marketing happened, and was perceived badly amongst consumers, they only then should conduct damage control according to Lutz, Wagner, and Weitz.
2.3. Theory Part C: Brand equity
2.3.1. What is a brand
A brand can be defined from the perspective of the owner’s point of view. Technicalities are a focus in this point of view; logos and package design are then important, for example. Another perspective focuses more on the effect a brand has on consumers. In this research, the latter is adopted. An example of a brand perspective where the effect of a brand on consumers is taken into account is found in Kotlers’ (1991) definition; he states that a brand can be defined as “a name, term, sign, symbol, or design, or combination of them which is intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of competitors” (p. 442).
We also learn that a brand is intangible and exists in the mind of the consumer. However, not everything that exists in the mind of the consumer is a brand. A brand needs to be strategically managed with the goal of creating extra value. The creation of value does not have to mean that profits have to be generated.
Brands have a financial value. Coca Cola was number one in 2011, and had a brand equity of $71,861 million. The top riser in 2011 was Apple (+58%), with a brand equity of $33,492 million (Interbrand, 2011). Only three years later in 2014 we saw brands increasing their value, but also that values of brands can differ fast: Coca Cola is now worth $81,563
and Apple, the big riser is worth $118,863 (Interbrand, 2015).
2.3.2. CBBE
Customer based brand equity is the brand equity from a consumers perspective, with Aaker (1991) and Keller (1993) being the most significant contributors. “Customer-based-brand-equity is defined as the differential effect of brand knowledge on consumer response to the marketing of the brand” (Keller, 1993, p. 8). Three characteristics of this definition are further discussed below.
The differential effect
A brand does not exist if it does not represent something that makes a difference to a consumer.
Brand knowledge
To have customer based brand equity, the consumers must have knowledge of the brand. Not every consumer has the same knowledge of the brand, nor does every consumer have the same attribution towards a brand. Every individual has a different associative network about a brand. Consumer A can have different associations with, for example, Mercedes Benz, than consumer B can have. Mercedes Benz, can for one person be classic, elegant, and linked to the royal family. While consumer B can have associations as elegant, expensive, rude taxi-drivers, consumer A can find Mercedes Benz a classic elegant brand.
Consumer responses – perceptions, preferences, behavior
The consumer responses are the consumer perceptions, preferences, and behaviors (Keller, 1993, p.8). A consumer reacts to a marketing activity of a company. This can either be favorable or unfavorable. During the 2011 Super Bowl, the online coupon service, Groupon,
aired an insensitive commercial; the plight between Tibet and China was mentioned. Quickly after this information, a switch was made to selling of the products of Groupon. A lot of people had an unfavorable reaction towards the ad and Groupon. Though Groupon received 50,000 extra customers after the commercial, this did not justify the spenditures for the commercial costing 3 billion dollars (Caulfield, 2011).
CBBE Pyramid
The customer-based-brand-equity (CBBE) pyramid gives insight into how consumers respond to brands and brand marketing. The pyramid distinguishes four levels: awareness, image, attitudes, attachment, and activity. A lot of brands try to create a form of attachment & activity, the highest level in the pyramid. Before that is reached, the three lower levels have to be reached. These four constructs of consumer-based-brand-equity can be measured. Measuring CBBE can be done via an indirect and direct approach. The direct approach measures the outcome of the reaction a consumer had to the marketing actions of a firm (Keller, 1993). The indirect approach attempts to reveal the sources of CBBE, for example, brand image and brand attitudes. For this research, emphasis is put on the indirect approach. The knowledge of a consumer about a sponsorship engagement and an ambush action will be a part of the total brand equity.
Awareness
Brand awareness exists out of brand recall and brand recognition. Constructs that measure this are top-of-mind accessibility and also (un) aided recall. These constructs will be further explained in the next chapter of consumer learning.
Image
held in memory” (Keller, 1993, p.3). Focus of this research is the brand image components that derive from sponsorship and ambush marketing.
A brand image exists out of different associations. These associations differ for different brands. The brand image of Jeep is different than that for Mercedes Benz. Sometimes, the brand associations of the same brand are not the same for different customers. Consumer A can have different associations, for example, Mercedes Benz than consumer B. Mercedes Benz can for one be classic, elegant, and linked to the royal family. Consumer B can have associations as elegant, expensive, rude taxi-drivers, whereas consumer A can find Mercedes Benz a classic elegant brand. The mentioned associations can have different strengths and have favorable or unfavorable associations. Subsequently, the association with a brand can be unique or shared with other brands (Keller, 2001).
Besides an increased awareness, sponsorship can also enhance the brand image (Gwinner and Eaton, 1999). Roy, Week, and Cornwell (2005) even found that sponsorship can add unique strong associations to a brand. Brand associations are not built overnight. Brand associations response has a strong link with the past brand image (Romaniuk, Bogomolova and Riley, 2012).
Experience. More recent studies show that experience with a brand and the product
itself also plays an important role in brand value (Gentile, Spiller and Noci 2007; Sheng and Thompson 2012). The experience itself makes the brand to be seen in a more positive light. On top of that, familiarity also leads to higher levels of liking (Inman and Rindfleisch 1998). This is one of the most robust generalizations. Well known brands have a head start just by being well known. It is therefore logical that brands invest a lot of resources to get their names out there.
2.3.3. Attitudes
When a consumer is aware of a brand, and has formed a brand image, a consumer can also form attitudes. Attitudes are formed about the quality, credibility, and superiority, but also whether a brand is fun, exciting, and secure. Scholars generally distinguish three different components in attitudes: affective, cognitive, and behavioral (Keller, 1993; Fishbein & Ajzen, 1977; Breckler, 1984).
Cognitive component
A consumer can find a brand unique, having a good value, and could recommend the brand to others. These judgments about a brand are found on the left side of the pyramid where the cognitive side of the pyramid is explained. This component exists out of quality, credibility, consideration, and superiority.
The credibility of a brand consists out of perceived trust, care, and respect. These can be influenced by sponsorship. A consumer can respect the Rabobank brand because the bank has invested in their cycle racing team for a long period. Engaging in ambush marketing, on the other hand, could also lead to lower credibility levels, leading to decreasing levels of brand value. Ambush marketing is not ethical and is perceived as unfair (Meenaghan 1994; 1996; 1998, Payne 1998; O’Sullivan and Murphy 1998).
Affective component
The right side of the pyramid (Figure 7) describes the affective component of a brand. It focuses more on feelings, with attitudes, such as warmth, fun, excitement, security, social approval, and self-respect. According to Keller (1993; 2001), attitudes are formed from the knowledge and image consumers have about a brand. Brand feelings are one of the most important components of brand attitudes (Markus and Zajonc, 1982). Brand affect summarizes all these brand feelings. Brand affect is defined as “the positive emotional
feelings of consumers toward the brand” (Chaudhuri and Holbrook, 2001). Brand affect can also influence attitudes, even when a consumer did not have a brand image (Kim, Lim and Bhargava, 1998). This change is biggest when the advertisement is liked. This is particularly important in this research, because it investigated whether disclosed ambush marketing is condemned or not. Most of ambush tactics are “whimsical or fun” (Roy, Week and Cornwell, 2005). A company that executes ambush marketing has a great emphasis on affect in their marketing campaign. With this ‘affect’ they can build brand equity.
Behavioral component
The behavioral component of an attitude is not mentioned in the pyramid by Keller (2001). Research does, however, also state a behavioral component in brand attitudes (Baker and Churchill 1977; Grimm, 2005; Breckler, 1984). This behavioral component is mostly measured by purchase intentions. It shows us whether or not people are willing to buy the product or service. The scale used to measure the purchase intention is introduced by Baker and Churchill (1977). Though the scale is meant to measure an attitude towards an ad, the conative dimension of attitude towards the brand is measured.
Three components
Brands are evaluated among these attitudes. By some brands, the affective components weigh more heavily than with other brands. For example, with Rolex, the affective component will be more important than the cognitive component. Self-respect and social approval are important components. On the other hand, the attitudes towards Swatch, another watch company, will be placed more on the cognitive side of the pyramid. There will be more emphasizes placed on the credibility of the brand.
Different brand categories sometimes are more focused on certain attitudes than others. Financial institutions will draw more heavily on credibility, than soft drink companies
will, as for example Coca Cola. Coca Cola needs attitudes that are more focused on fun and excitement.
Attachment and Activity
The number one brand since 2011 (till 2014) that has reached a resonance among consumers is Apple. First of all, a lot of people are aware of the brand, and have formed attitudes about the brand and its products. On top of that, a lot of consumers find themselves attached to Apple. The brand was also the brand receiving the highest ‘brand love’ (Batra Ahuvia & Bagozzi, p. 35, 2012). Forbes, a business news and financial source, which produces a yearly list of most valuable brands of the world, considers the brand Apple worth twice as much as the runner up, Microsoft (Badenhauser, 2013).
This resonance can be characterized as the level of attachment consumers experience with the brand. But also by the way they act because they feel attached, starting up a community, sharing on social media, or designing graphics for the brand they like.
2.3.4. Building Brand Equity Through Sponsorship
Consumer behavior is defined as “the process involved when individuals or groups select, purchase, use, or dispose of products, services, ideas, or experiences tot satisfy needs and desires” (Solomon et al., 2012, p. 35). This process is dynamic and involves cognitive and a behavioral components and is also present when consumers are presented with sponsorship and advertisements. A change in their environment, in this case a sponsored event, changes the way we think about the event and their sponsors. Consumers gain knowledge and might form attitudes, but they also already might have an image and/or attitudes towards the event or the official sponsor; this could be changed due to the sponsorship and event.
Sponsorship and ambush marketing are used as strategic marketing tools because they can build brand equity. When associations of an event and brand are linked in the
consumer mind, the associations of the event will then also belong to the brand (Keller, 1993).
Different components of brand equity can be built through sponsorship. Awareness is one. Brand equity is also built by a sponsorship that has a good fit with the event. This subject will be discussed in theory part C more thoroughly. The perception of quality can be enlarged by the marketing communications of a company (Roy & Cornwell, 2004). Perception of quality is an attitude a consumer has about a brand. The affect and cognition about the brand we have makes us buy the product or not (Brown and Stayman, 1992). It could also be that a certain behavior, like buying a product, can make you develop certain ideas about the product and therefore, look different at the sponsorship, as you would have done before the buying. Research agrees that the elements affect, cognition, and conation are a part of the consumer brand equity.
2.4. Theory Part D: Responses to Sponsorship
2.4.1. Perception, learning and moderating factors
One of the most prominent researched topics in sponsorship is congruence. In sponsorship, perceived fit is essential for generating desirable consumer responses to sponsorship activities (Roy & Cornwell, 2004).
The idea of fit or congruence between sponsor and event is one of the most investigated concepts in sponsorship (Roy, Week and Cornwell, 2005; Johar and Pham 1999). Recall and brand recognition of a brand are highest in sponsorship deals when a match between event and brand seems obvious. Proper identification of (event) sponsors is perceived as a necessary condition in sponsorship communication. Consumers, however, prove to be highly confused when assigning event sponsorship. A respondent was asked, “Which delivery company sponsored the 1998 Winter Olympics in Nagano?” 50% of the
respondents correctly answered United Parcel Service (UPS). More alarming was the 40% that mistakenly identified Federal Express as an Olympic sponsor (Johar & Pham, 1999). Research on recall of sponsorship focuses on four key factors: “sponsor relatedness, sponsor prominence, corporate exposure of the brand to individuals at events, individual exposure to sponsors due to individual involvement or identification with the sport and team” (Becker-Olsen, Cornwell & Wakefield, 2007).
Consumers will be more likely to correctly identify sponsors when a logical connection is present between the brand and the event. Through a heuristic of relatedness consumers will look for overlap between both sponsor and event, for example, the extreme sport of going downhill on hockey ice-skates. A consumer would easily attribute this event to Red Bull. Red Bull invests heavily numerous extreme sport events. The link with downhill ice-skating is then easily made. When there is a higher degree of overlap the higher the likelihood the sponsor will be attributed to a sponsor (Johar & Pham, 1999).
Identification of sponsors also follows a heuristic of market prominence. This heuristic of market prominence is more prominent in confusing and cluttered environments (Johar & Pham, 1999). The highest rates of sponsorship recall were with category leaders (Turley & Shannon, 2000). Therefore, it is expected that the greater the sponsor’s prominence, the higher the sponsor recall will be. This gives the prominent brands an advantage for event sponsoring, even if the category leader is not the actual sponsor. Furthermore, the most prominent brand gets higher recall, even if less prominent brands are also retrievable from memory (Johar & Pham).
Corporate exposure of the brand and individual exposure to sponsors due to involvement of the consumer with the sport and team is also researched in recall of sponsorship. The more exposed a consumer is to the sponsorship message, the more likely we are to remember it and adjust positive attitudes towards it (Becker-Olsen, Cornwell & Wakefield, 1997).
2.4.1. Effect of Ambush Marketing on Brand Equity
Sponsorship can build brand equity. When associations of an event and brand are linked in the consumer mind, the associations of the event will then also belong to the brand (Keller, 1993). Ambush marketing can have the same effect.
Ambush marketing is found to be low on ethicality/not fare/legally not good ratings (Meenaghan 1994; 1996; 1998, Payne 1998; O’Sullivan and Murphy 1998; Farrelly et al 2005). Few consumers recognize a case of ambush marketing during a sport event (Shani and Shandler, 1998). This demonstrates that ambush marketing is a threat for event owners and sponsors.
Another reason to why ambush marketing is often successful for building brand equity is the moral hypocrisy consumers apply in the market space (Batson, Collins and Powell, 2006)
.
Consumers do want to apply their moral standards, but in practice, they often don’t. So even when they find out about a brand’s bad doing, they don’t apply their moral standards, and still buy the product or use the service.Brand personality
Ambush marketing is low on ethics, not fare, and infringing on legal grounds (Meenaghan 1994; 1996; 1998, Payne 1998; O’Sullivan and Murphy 1998). Though at first sight, no company would want to have these associations transferred to their brand, there are brands that do want that. Some brands even have a brand image that has a lot of congruence with these values. An example is Geenstijl.nl, a well-known Dutch blog, which has a rebellious image. Geenstijl.nl advertises itself as being “tendentious, unfounded and gratuitously offensive”. The consumers will not punish a company advertising with these standards very hard if they act somewhat unethical; they want to be viewed as unethical.
A brand image can exist out of associations as classic or expensive, but also out of a set of human characteristics. These different human characteristics make up a brand
personality. Aaker (1997) created the first and still used scale for brand personality. Brand personality is measured by 41 different personality characteristics. All belong to five different personality traits: sincerity, excitement, competence, sophistication, and ruggedness. Different brands have different brand personalities, for example, Toyota and Jeep in the figure. You buy a Toyota car when you want a reliable car you can trust. Consumers that put emphasis on a tough image and outdoor characteristics buy a Jeep. In the category of car manufactures, Lexus, another car manufacturer, has a brand personality that has a lot of characteristics pointing towards sophistication.
Characteristics can also be transferred from sponsorship (Gwinner and Eaton, 1999). By sponsoring an event, a brand can transfer for example some of the excitement of the event towards its own brand. Remember the success of the energy drink Red Bull with all the exciting events.
A lot of consumers do not recognize an ambush marketing strategy. When an ambush marketing strategy is disclosed, consumers learn a new thing about the brand. This new knowledge about the brand might result in different associations consumers have about the brand. These different associations then lead to favorable or unfavorable attitudes towards the brand. The consumers will not punish a company with a brand concept aligned with the practice of ambush marketing very harsh if they act somewhat unethical. Consumers expect that brand to act in this matter. The company wants to be viewed as unethical. Consumers, on the other, hand will punish a company focusing on a sincere brand personality harsher when they are disclosed as an ambusher.
As previously explained, ambush marketing is not perceived as sincere. In a situation where ambush marketing for a sincere brand happens, a gap between the brand concept the consumer has in its mind, and the actual brand concept the consumer experiences occurs. This brand inconsistency leads to skepticism towards the brand (Foreh and Grier, 2003). According to Wagner, Lutz, and Weitz (2009), the inconsistencies between
statements and business practices affects attitudes negatively and “can have dramatic effects on firm’s image and sales” (pp. 78). This is also supported by Aggarwal (2004), who states that the gap between expectations and actions leads to poorer evaluation of the brand. Skeptical consumers are also more likely to process negative information (Skarmeas and Leonidu, 2012).
In case of a transgression, the gap between expectations and actions is greater for a sincere brand. This same gap is smaller for exciting brands. This is supported by Aaker, Fournier, and Basel (2004); relationships between consumers and brands were particularly damaged with sincere brands when a transgression happened. Exciting brands showed contrary results in the case of a transgression, the relationship with the brand revived (Aaker, Fournier and Basel, 2004).
3.
Hypotheses
Based on the described argument, we can formulate at least three hypotheses. As previously stated, consumers often do not have a lot of knowledge about ambush marketing and seem to be indifferent to ambush marketing strategies. Consumers can form different attitudes towards an ambushing brand when they are informed about the consequences ambush marketing has for event owners and official sponsors. Ambush marketing increases the knowledge consumers have about a brand thus can influence the attitudes formed about a brand. Credibility, affect and, purchase intentions are the building blocks for the brand attitudes. Credibility refers to whether a consumer feels a company can be trusted and has the ability to perform to standards (Goldsmith and Newell, 2001). In the case of ambush marketing, legal boundaries are stretched and the practice is seen as unethical (Meenaghan, 1996). Consumers who are informed about the ambushing tactic and the consequences for the event owners and official sponsors generate negative feelings towards ambushers (Shani and Sandler 1998, Meenaghan 1996). Brand feelings are one of the most important components of brand attitudes (Markus and Zajonc, 1982). Brand affect encompasses all these brand feelings. Brand affect is defined as “the positive emotional feelings of consumers toward the brand” (Chaudhuri and Holbrook, 2001). An attitude change developed from confrontation with ambush marketing can also be found in the conative component of attitudes. This conative component is mostly measured by purchase intentions. It shows us whether or not people are willing to buy the product or service. The scale used to measure the purchase intention was introduced by Baker and Churchill (1977), and an adjusted scale from Stafford (1998) is used to measure the likelihood of a purchase. From this, the first hypothesis is formed.
H1: Ambush marketing negatively influences a consumer’s brand credibility, affect,
