Sponsorship Between Brands and Sport Clubs: The Factors influencing the initiation and termination of Sport Sponsorship
Author: Baher Baroma Student ID: 12000914 Master’s Thesis Graduate School of Communication Master’s Programme Communication Science Supervised by: Prof. Marieke Fransen
Abstract
The aim of this study is to discover the factors that encourage brands and sport clubs to engage in sponsorship arrangements and to uncover the reasons of sponsorship change. A qualitative research was conducted by semi structured interviews with Dutch brands and sport clubs (N = 9). It was found that the relationship between the brands and sport clubs in a sponsorship is based on reciprocal benefits. The brands were found to seek sport clubs for having exposure and building connections with the other brands who sponsor the same club. The CSR activities and the performance of the club were also found to attract brands. In return, the sport clubs were shown to be interested in the financial and the logistical support which the sponsors offer. The study also found that Bankruptcy, scandals and disagreements between the sponsors and the sport clubs lead to the termination of the sponsorship.
Introduction
While watching sport events in real life, on television or online, audiences get confronted with several brands they see on, for example, the players shirts, billboards, posts, etc. achieving this exposure, brands seek to have sponsorships with sport clubs to assist them in reaching people. It’s interesting to know why these brands would sponsor these clubs and support them financially aside from exposure and what factors decide which sport club they want to sponsor. Sport sponsorship can be defined as a type of societal marketing program in which a firm subsidizes a particular sport, thus associating its products or services to a sports team, in order to build a relationship and connection with the team’s fans (Koronios et al., 2016). Sponsorship is becoming more popular and it has grown fast especially as a marketing tool (Spais & Filis, 2008). For brands it is interesting because it helps in attracting people to the brand. There are some factors that make sponsorship attractive for a brand such as the number of club’s followers, brand exposure and loyalty. For the club, the financial support is a factor when it comes to sport sponsorship.
Regarding sports sponsorship, the number of the sport clubs’ followers is the first factor for brands. European Sport clubs, especially football clubs, with passionate fans, are ideal for brands to sponsor because of the conveniences of reaching mass audience. (Biscaia et al., 2014). On social media, specifically, the collaboration of the club and the sponsor will lead to reciprocal benefits, given that they are able to feed on each other’s followers (Levin et al, 2004).
Via marketing themselves to the followers of the club, the brand increases their exposure as well, which is the second factor for the brand for choosing sport sponsorship. Campaign is considered as the most important procedure of this kind of collaboration, during which marketing communication plays an important role. It is the success of the clubs instead of the types (e.g. football, basketball, volleyball, etc.) that enhances their chance of being
contacted by a brand, which is the initiation of sponsorship, since the brand will benefit the most from this success (Szymanski, 1998).
Stronger brand loyalty is the third advantage that the brand can benefit from the sport sponsorship (Liu et al., 2015), for the reason that the highly-involving-fans’ endorsement toward their favorite team is expected to be turned into the favorable feelings toward the brand (Kunkel et al., 2013; Tsordia et al., 2018). Moreover, it is indicated that this kind of positive feelings might increase purchases and enhance brand commitment(Liu et al., 2015).
Sport clubs consider the financial support they get from the brands as the important factor when it comes to choosing a brand to act as a sponsor. In return of the sponsorship with the brand, clubs will get the financial support that helps with its improvement, including buying players and improving their equipment in order to be on the same level as their opponents (Szymanski, 1998). Previous research stated that the investment of sponsors in sport entity can be in cash or any kind (Smith et al., 2008).
This study will aim to investigate the factors from both the brand and the club perspectives that influence the brand’s/club’s management decision of starting or changing sponsorship. Moreover, the results and goals of these sponsorship agreements will be examined. To determine the factors that affect management’s decision on sponsorship, interviews will be carried out with the managerial group of sport clubs as well as brands that act as sponsors or have undergone sponsorship changes.
Concerning the scientific relevance of this study, existent research has already evidenced how sponsorship has an impact on consumers and how sponsorship developed over the years (Biscaia et al, 2013). This research will help researchers to better understand the key factors of starting or changing in sponsorship and the main reasons that lead to such a change or an agreement. Moreover, this study is societally relevant as it will help sponsors as well as sport clubs to make the right decisions when it comes to a sponsorship agreement and
choose the right sponsor or club that would be more beneficial for both sides. In addition, it will help to save/keep the sponsorship agreement between both sides and in the decision-making process regarding sponsorship change as well. This leads to our research question that will help in achieving these goals which is:
RQ: What are the factors that lead to an initiation/change in sponsorship from the perspective of both the sport clubs and the brands?
Theoretical Background
Marketing experts are interested in connecting with consumers via marketing tools like PR, advertising, and sponsorship (Mason, 2005). Sponsorship can be defined as the assistance in which the corporate provides either financially or by an activity to events, sports etc. to achieve their objectives (Sirgy et al., 2008). It’s also considered to be business to business between the sponsoring brand and the sponsored in which they have reciprocal benefits (Biscaia et al., 2013). Advertising nowadays can be very expensive and time waste, but sport
sponsorships are simple, less expensive, and as effective as advertising campaigns (Dees et
al., 2008). This research aims to discover the factors of both the sport clubs and brands that drive them to start or change sponsorship.
Sport sponsorship is when a corporate funds sport teams and relates their products with them in order to reach their fans (Koronios et al., 2016). It has been growing worldwide and became an important element in the marketing strategy that companies use now to have advantage by being a competitor in the marketplace (Biscaia et al., 2013). For example, a sponsorship deal between football club Juventus and Fiat included the right for Fiat to portray their brand’s trademark on all the shirts of the players and in return Fiat gave Juventus 33 million euros to help the club succeed (Spais & Filis, 2008). Given that sport sponsorship is the proper way to reach the audience thus achieve marketing objectives (Dees, Bennett &
Villegas, 2008), it is used by many corporations, taking account of 68% of the companies’ total spending (Mazodier and Merunka, 2012).
Based on the attribution theory (Dubinsky et al., 1989), on one hand, people seek to
analyze the reasons behind others’ behavior and react accordingly. In the case of advertising,
people usually find it more direct and have more difficulties accepting the massages,
compared with sponsorship activities (Dees et al., 2008). Specifically, sponsorship increases its chance of success when it comes to deliver the marketing messages (Messner & Reinhard, 2012). For example, in a study about NASCAR (The National Association for Stock Car Auto Racing) it was found that people recalled the brands on the cars more than when they watched TV ads for the same brands. This implies that the marketing messages on TV seem to be persuasive and therefore ineffective unlike sponsorships that seem more effective (Dees et al., 2008). This example can be explained by the attribution theory (Dubinsky et al., 1989): after analyzing the messages they were exposed to, consumers might be aware of the
persuasive attempt, causing more resistance which is also supported by the persuasion knowledge model (Friestad & Wright, 1994); while sponsorship has the benefits of being more like a hidden form of marketing messages. Sport is an ideal area for sponsorship and brands are keen on investing in sports to reach mass audience because the positive attitudes that transfers from that audience will also transfer to the sponsor (Koronios et al., 2016). It’s one of the marketing tools that is used to connect with the consumer and influence them to buy (Mason, K., 2005). On the other hand, compared with advertising, sponsorship enables more cognitive responses, more highly engaging the consumers, who would then more likely to respond emotionally (Mason, K., 2005).
Sponsorship fit can be defined as the perceived match of attributes between sponsoring firms and sponsored objects and was considered to be a determinant factor of sponsorship success (Woisetschläger et al., 2010). It is especially higher regarding sport
sponsorship, which can be explained by the following reasons. Given that sponsors are now able to collaborate with the sport entities, working together as partners, understanding and accepting each other’s requirements, sport sponsorship is considered to be relatively effective (Farrelly et al., 2006). Sport sponsorship has been proven effective several times also, for example, an American bank in California sponsored an NFL team and provided a themed checking accounts of that team and this resulted in an increase of new checking accounts and around four million dollars in deposits plus a 300% revenue on its investments (Mason, K., 2005).
Dees, Bennett & Villegas (2018) also discussed the effectiveness of sport
sponsorship: fans who associate themselves as strong and loyal supporters to a team or an event, feel more likely to purchase its sponsor’s products than fans who are not much
involved with their team/event. Highly involved fans try to seek strong connection with their team by making impulsive purchases of their licensed team products (Dees et al., 2008). For example, it was found that 71 percent of NASCAR fans purchase products of brands that sponsor it and 46 percent of them would pay even more to purchase these products (Levin et al., 2004). This shows how effective the sponsorship can be especially when it comes to sports. Sport sponsorship became a valuable source of income for the sport clubs (Biscaia et al., 2013) and a main part in corporate’s marketing plans (Levin et al., 2004).
Based on the literature, several factors seem important for the brand when it comes to sponsorship (i.e. brand exposure, brand loyalty and the number of followers), (Levin et al., 2004) which will be explained in the following paragraphs. For the club, on the other hand, their main source of the financial support comes from sponsorship (Oral, 2018).
Due to the important link between the sponsor and the fan (Trachsler et al., 2015), it is crucial for brands to apply sponsorship especially in large sport events, promoting their products and engaging the consumers, which will then increase purchases (Dees et al., 2008).
Another study supports that the exposure of a sponsorship results in positive outcomes on brand’s affect, trust, and loyalty (Mazodier & Merunka, 2012). It is believed that the positive attitude of the fans towards their team also transfer to the brand who sponsors that team (Levin et al., 2004) which makes exposure important for the brand to acquire when having a deal with a sport club. The involvement of a brand in a sport sponsorship gives it exposure and its products become accessible to the fans which gives the brand a chance to be close to
stakeholders (Biscaia et al., 2013). That is why Marketers should use any chance they get to
expose the messages they want to deliver. They can use sponsorship in a sport event filled with many consumers to increase their exposure and have a big impact (Mason, 2005). This impact can be bigger when brands keep doing that every year, so it strengthens the
impression of the products in the consumer’s memory (Biscaia et al., 2013).
Brand loyalty also was shown as one of the reasons the brand start or change a sponsorship. Many Managers became more interested to grow brand loyalty by sponsorship activities (Mazodier and Merunka, 2012). In a study on NASCAR, (The National Association for Stock Car Auto Racing) a sample of NASCAR fans was compared to a sample of non-NASCAR fans in terms of who have stronger brand loyalty on non-NASCAR sponsoring brands beer and it was found that NASCAR fans have stronger brand loyalty towards the beer than non-NASCAR fans. (Levin et al., 2004) In addition, NASCAR fans were more loyal to NASCAR sponsor’s beer than non-NASCAR fans towards their own favorite beer (Levin et al., 2004). In other words, the NASCAR fans were more loyal to the beer brand that is sponsoring their favorite event. This can be a reason for brands to go for sport sponsorships to form a connection with the audience of whoever the sport entity is and form loyalty
between them. That touches on the point that brand loyalty represents an important reason for sponsorship between the brand and the sport clubs.
The number of viewers or attractiveness of the sport can be a potential factor too for the brand to engage in a sponsorship. As a result of an increase in brand awareness by corporate sponsorship, it may provide the corporates with a better market share (Mason, K., 2005). That’s why companies look for sports that have many views in order to represent their brand. For example, companies became more interested in motorsports like NASCAR to associate themselves with it as it was one of the fastest growing sports in the United States especially NASCAR as it attracted a lot of TV viewers in 2002 (Levin et al., 2004). For the sport clubs, the loyal fans wouldn’t miss any chance to watch their club playing and this would be a good chance for a brand to represent itself. The fans who highly identify
themselves with their club are more willingly to use the club’s sponsor products (Levin et al., 2004). In line with this, a study also stated that the closer the fans to their club, the more they will have a positive perception of the sponsoring brands (Koronios et al., 2016).
Sport clubs were shown to have different reasons for either having or changing sponsorship. The main reason seems to be the financial support. Football club Juventus seek to fresh their business by looking for multinational brands to sponsor them and assist them financially to be successful like Manchester United(Spais & Filis, 2008). This implies that the financial support they get will help in improving the team which can lead them later to success. The better the club performs the more fans and sponsors are attracted to because of
its success which results in high income (Szymanski, 1998). As a result, the sport club will
gain more financial support because of the new sponsors they attracted thanks to their performance that led to success. A study suggested that when a sport club performs well, it creates positive feelings in their supporters, which makes fans notice the sponsoring brand (Koronios et al., 2016) and that’s why new sponsors get attracted to the sport clubs which in return helps the clubs financially.
Change in sponsorship can be as a result of negative outcomes that occur and lead to sponsorship termination. The sponsorship can go the wrong way because of corruption or illegal actions by athletes (Messner & Reinhard, 2012). Also the announcement of a
sponsorship between two entities can have different effects on the brand and sport club. For example, the announcement of the agreement between Juventus Football Club and Fiat had a bigger impact on Juventus than Fiat and it was a negative one because investors didn’t see it suitable with their agenda. In this case the entity that was affected badly which is Juventus may consider withdrawing from the agreement and change their sponsor who is Fiat (Spais & Filis, 2008). A brand can also cancel the contract if the sponsored was caught in a scandal because this will transfer the negative image of the sponsored to the brand which makes
canceling the contract or changing the sponsorship a good decision to make (Messner &
Reinhard, 2012). In such situations people prefer to see reactions from key constituents which is the sponsor in this case (Messner & Reinhard, 2012).
The current research aims to investigate whether the factors observed in the literature are also considered by the brand and clubs in practice and whether they report other factors that have an influence on the initiation and termination of a sponsorship.
Method
Managers and staff who work at a brand or a sport club were interviewed about the sport sponsorship’s importance and the reasons why they either start or change it (N=9). Five sport clubs and four brands were selected because the research question renders around them. Out of the five clubs, two were basketball clubs, two were football clubs and one volleyball club. Brands included transportation, logistical, web design companies and a bank. Purposive sampling was used to balance the sample and enhance its variety. It was based on an online search of sport clubs and brands that act as sponsors in the Netherlands as the research took
place there. Accessibility of both brands and sport clubs played a role too in selecting the sample.
The clubs sample included people who currently work as directors/staff in the
marketing and commercial departments and some of them were ex-athletes of the club. It also included brands with people who work in the same departments and one of the interviewees was the co-founder of a brand.
The interviews were conducted by the researcher. The interviewees’ recruitment was based on a search that was carried out through social media of different sport clubs as well as brands including those who sponsor some of these clubs and been contacted via email. The interviews took place online on Skype, over the phone and one interviewee answered the interview guide questionnaire by email due to the current circumstances of the pandemic. The interviews took around a month to be finished and lasted between 25-40 minutes.
Inform consent forms were sent to the interviewees asking for their signature to assure the protection of their personal data. The interview guides were developed by the researcher and used during the semi structured interviews (See appendix A). Semi structured interviews provide a space for more questions that result from the interviewee answers which supports the research by adding additional and enhancing its ecological validity. The two interview guides included the same questions but with the difference of whether it’s directed to the sport club or the brand. It started with the interviewees describing their daily activities at their workplace and the period of time they have been working there: “Can you describe how your day goes when you arrive at your working place?” and “How long have you been working there?”. It was followed then by points about how they define sponsorship from their perspectives and what benefits they gain from it: “From your perspective, how would you define sponsorship?” and “Are there reciprocal benefits between the sponsor and the club? If yes, what are they?”. The researcher went in depth with the interviewees to discover the
reasons and factors of having or changing a sponsorship. Topics such as the motivations for sponsorship and how important it is for them were discussed. Based on the interviewee’s answer, the researcher asked retrospective questions seeking more and reliable data. Interviewees were also asked about their own previous experience with sponsorship and if their brand or club went through a change before.
Following the guidelines of qualitative research and the interview’s transcription, we started by open coding. The researcher used the computer program ATLAS.ti to code each interview separately, and the coding was derived by research and data. Following the open coding, focused coding was applied by grouping the factors that interviewees mentioned about the change/start of sponsorship and the benefits they get from sponsorship looking for categorizations. After creating categories, each category’s coding was analyzed to create variables within each category. Two measures techniques were used to enhance both the reliability and validity of the research. The first technique used was member checking, the transcription of the interview has been sent to the interviewees in case they wanted to edit or correct something to enhance the research’s credibility. The second technique was peer debriefing. The researcher discussed the coding and categorizations with other fellow researchers to provide feedback and solidify the research’s validity.
Results
Interviewees from both brand and sport clubs reported that sport sponsorship is mainly based on reciprocal benefits. To explain that more and based on the information that the
interviewees provided, a concept indicator model has been developed to explicitly highlight the factors involved in maintaining or establishing the sponsorship (see model below). The factors that were mentioned by the interviewees have been categorized into three categories; the interests the brands seek, the benefits the clubs gain and the termination of sponsorship.
Figure 1
Conceptual Integrated Model of the Factors Influencing the Initiation and Termination of Sport Sponsorship
Brands Interests
Interviewees reported that the brands have interests that they want to achieve by having a deal with a sport club. Brands were found to seek exposure through the sport club in order to reach more people to show them their products, grow a connection with and increase
purchases. They are also interested in growing their network by building business connections with other sponsors thanks to sport clubs who connect them together.
Sustainability was found to play a role when it comes to brands sponsoring a sport club. They are interested in the club’s CSR activities and seek social involvement by benefiting the society. It was also shown that the performance of the sport club is one of the brand’s
Sport Sponsorship's Importance Brand Interests Brand Exposure Business Connections CSR Activities Performance of the Club Club Interests Financial Support Logistical Support Sponsorship Termination Bankruptcy Scandals Conflict of Interests
interests therefore if the sport club is performing well and winning, it will attract the brands and vice versa. Each of these factors will be explained in more details below.
Brand Exposure
Interviewees stated that brands seek exposure through sport clubs, as they believe they have high viewings. They want many people to see their brand so that they attract them. Having a sponsorship with a sport club was reported to be effective. Brands want to increase revenue by selling its products to many people and they believe that associating their products with clubs and exposing it to the people help them in reaching their target. They also want to present their brand to get the public to know and connect with them. Brands sponsor sport clubs because many people watch sport events, so they get exposure; “they go to a sports team because a lot of people watch it, and it's on TV like a marketing idea” (Sport Club, Head of Business Development). He referred to a popular club as an example and explained that everyone wants to have a sponsorship with them because hundreds of thousands of people watch it.
The brands were found to get the exposure online via social media and websites. Interviewees reported that they use different social media platforms such as Facebook, Instagram, Twitter and LinkedIn to announce the sponsorship agreement which gives the brand exposure. “What we usually do is we make a picture of the signing of the contract and with that picture we are posting it on our LinkedIn to show the world that we have a new sponsor and to give him a little bit of extra exposure telling what business it is with the link to their website, and we also add it in our email list throughout all the sponsors” (Sport club, Account Manager). It became apparent that brands also get exposure during the events that are organized by the clubs. Sport clubs put billboards of their sponsors logo in their stadiums, on their jerseys, and by inviting them to show their products to fans and people attending the event. An interviewee gave an example by saying, “For instance at the club we sponsor, we
got a big sign in the sports hall” (Brand, Co-Founder). (Sport Club, Sponsorship Department) mentioned that they provide five minutes in their matches for their sponsors to have an elevator speech and show their products. It was also reported that the exposure the clubs gave to the brands attracted their fans to it. (Sport Club, Account Manager) said that the exposure they gave for their gym sponsor saw an increase of memberships after they sponsored their club.
Business Connections
It was found that brands go for sponsorship with sport clubs targeting connections as they find the sport club a suitable place where they can meet other brands to do business together and help each other grow. Interviewees stated that small brands seek connections so, putting them with the other big sponsors will help them grow thanks to the sponsorship they have with the club. Sport clubs organize events where all the brands that are sponsoring them get together and meet. “The other things I do, I organize a lot of meetings for our sponsors. Every month, we have a business breakfast, a business lunch, or a get-together at the end of the afternoon, like a happy hour kind of thing. I'm just trying to get our sponsors together to get to know each other so they can start up a relationship with each other, so they think about each other when they hear something in their brunch. I see us more as a tool to get to know other people” (Sport Club, Account Manager). Sponsors attend matches where they meet each other on a business to business way which gives them the opportunity to build up a relationship and do business together. “Being a member of the business club and knowing a lot of people in the area by joining the business club is good. Word spreads more easily and faster” (Brand, Managing Director).
CSR Activities
The brands were also found to be attracted to corporate and social responsibility activities. It was found that club’s CSR activities such as helping charities, being eco-friendly and being
sustainable attract brands because they want to be associated with a good image in the society. Brands focus on sustainability and it is important for them that a club they are sponsoring fits this requirement. (Sport Club, Account Manager) said that their main sponsor requires many corporate and social responsibility for the neighborhood. They worked
together on a big CSR project and the club organized clinics in schools. (Brand, Marketing Department) said that they want to give their money to make the world a better place from their vision. They will give money if the club will build solar panels for example to save energy as long as it for the good of the society. “Now, we only provide the teams the money and they can do things with it as long as they are sustainable” (Brand, Marketing
Department) Interviewees reported that the brand creates a good image by being engaged in social activities and that’s why it’s important to sponsor a club that shares the same mindset. Performance of the Club
Brands are also interested in how the club is performing. It was found that if the club is winning and performing well, it will attract brands to be future sponsors as they want to associate themselves with success. (Sport Club, Head of Sales) pointed that if the club is performing well on the pitch, it will attract many sponsors because brands want to be with success. This confirms that brands are attracted to the performance of the clubs. (Brand, Co-Founder) pointed that they recently started a sponsorship with a volleyball club after they won the national league and they consider them their most important club: “Because last year they were national champion of Holland and they promoted to the Netherland-Belgium league, so they also are operating and playing in Belgium” Interviewees also reported that bad performance can make the brands lose interests. It was shown that some brands lost interest because the club they were sponsoring was not making good results so they stepped away. Performance of the club was found important for brands to whether start/continue sponsorship or not because the brands want to be with a club that is winning titles. Winning
results in the club being successful worldwide and therefore a good opportunity for brands to share that spotlight.
Clubs Interests
The second factor that was mentioned by the interviewees is that sport clubs also seek to have sponsors for their own interests. This implies that there are reciprocal benefits between the brands and the sport clubs thanks to sponsorship. It was found that sport clubs are interested in the financial support provided by the sponsor and considered to be an important reason for clubs to engage in a sponsorship with a brand. Interviewees also reported that logistical support is considered to be a source of interest for sport clubs.
Financial Support
It was shown that sport clubs survive on sponsorships as the money they get from the sponsors is necessary for them. (Sport Club, Commercial Director) when asked about the benefits they get from the sponsors, replied: “is always cash” and they consider their main sponsor is their most valuable asset because “they bring the most money in” Interviewees reported that the money helps the club to build facilities, improve their team by buying better players and also paying the salaries. The financial support the brands provide was found to be discounts as well. Interviewees stated that some sponsors provide discounts for the club members on the products the brands sell so they can buy it cheaper. They all agreed that the large amount of money the sponsors bring in is what makes them the most valuable for the sport club. (Sport Club, Head of Business Development) provided an example to show the importance of financial support: “for example, that's why xxx has been a very good club in the Netherlands. They have one big sponsor, so they have a lot of money that one big sponsor gives, but they have a huge number of small sponsors”.
Logistical Support
Interviewees pointed that sport clubs also seek sponsors in which their services can provide support. The sponsors provide the clubs with materials they can use, transportation during the games and moving the club equipment. (Brand, Quality Manager) explained that they
sponsor sport clubs by providing transportation services: “In most cases our company drives the sports teams to away matches and using signs on the busses with the name and logo of the sports clubs when driving them” Gyms were also found to sponsor sport clubs by allowing them to use their machines: “every team needs a gym sponsor” said (Sport Club, Head of Business Development) A brand sponsor sport clubs by providing logistical services for them as it’s the company’s specialization: “On occasion, they ask me to move training field
equipment, or supply some square meters in our warehouse for working on their basketball” said (Brand, Managing Director) Interviewees stated that sport clubs look for brands that also can provide them with their practical needs and they seek to obtain that in addition to the financial support.
Sponsorship Termination
Interviewees also reported that sponsorship termination can occur for several reasons. Bankruptcy of either the brand or the club was found to be a reason in the contract
termination. Neither of them has money when they go bankrupt which means that they cannot continue to support each other anymore and therefore the best solution is to cut the business. It was found that also scandals take part as both entities want to have a good image and when one of them faces a scandal, the other part is found more likely to step out. Another key role is the conflict of interest between the sponsor and the club. Interviewees said that conflict of interests happens when there is a disagreement or not sticking with contract objectives.
Bankruptcy
Interviewees reported that sport clubs go bankrupt when they run out of sponsors because most of club’s income is from sponsorship. (Sport Club, Head of Business Development) explained that if the club lost their main sponsor: “even though they give €1 million, you're going to be bankrupt” Interviewees explained that brands also go through bankruptcy and they withdraw from sponsorship because of financial problems. (Sport Club, Commercial Director) said that there is a brand leaving them at the end of this year because they have financial problems and no longer can support the club financially.
Scandals
It was found that brands and sport clubs withdraw from the sponsorship if there is a scandal because they don’t want to be associated with that. It was reported that brands and sport clubs care about their image and they don’t like to be associated with a scandal because it harms them. (Sport Club, Head of Sales) explained that when a company gets associated with a scandal or something like that: “then we don't want to be seen with that”. It was apparent that brands and sport clubs prioritize protecting their image and they would rather step out of a sponsorship agreement rather than being associated with a scandal.
Conflict of Interests
Conflict of interests between the brands and the sport clubs was also found to lead to
sponsorship termination. Interviewees reported that sport clubs end sponsorship with brands because they didn’t stick with its objectives. (Sport Club, Account Manager) when asked why their club terminated the contract with their previous main sponsor he explained, “There were two sponsors who paid with their service, but the service was not what we expected”. It was also found that brands ended the sponsorship because clubs didn’t stick with their agenda which caused a disagreement as it went against their interests. (Brand, Marketing
the club used the money to go on a trip to a formula one racing event: “We are a sustainable bank, so it's not fitting in our agenda. We don't want to be exposed as a sponsor at that non-sustainable event like a formula race”.
Discussion & Conclusion
This paper aimed at discovering the factors that encourage both brands and sport clubs to seek sponsorship and also the reasons of its change. The interviews showed that the
sponsorship between the brands and clubs are mainly based on reciprocal benefits in which they have their own interests. The findings showed that brands pursue exposure through sport clubs in order to represent themselves and their products to potential consumers. The CSR activities the sport clubs engage in and their performance in the competitions were found to be a source of attraction for the brands to start a sponsorship with a club. Also, the
opportunity to meet other brands who act as sponsors for the same club because it gives the brand an opportunity to do joint businesses which bring benefits. On the other hand, the sport clubs go for sponsorship seeking financial and logistical support. Clubs were found to benefit from the sponsor’s money by using it to improve themselves seeking success. The logistical support also helps the clubs in terms of saving money.
The findings indicated that brands seek to reach large number of consumers and they do that through the exposure they get from the sport club as part of the sponsorship deal. The previous research suggests that the fans’ positive feelings toward their club were transferred to the sponsor (Levin et al., 2004) during the exposure where the clubs present the brands’ products to their fans (Biscaia et al., 2013). Due to the similar reason, this study showed that brands see sport clubs with high viewings as the right place for them to show their products. This exposure helps the brands to sell their products and increase purchases. In alignment with previous literature on brand exposure, the brands use sponsorship to get exposure for
their products to make purchases (Dees et al., 2008). The study also describes the tools of exposure. The sport clubs use different social media platforms to give exposure to the brands by writing posts and/or creating content. In sport events as well, the sponsor is there on banners, club shirts, etc. In line with similar studies, it was shown that sport sponsorship may depend only on social media (Popp & Woratschek, 2016) and it is considered to play an important role in achieving the objectives of sponsorship (Abeza et al., 2014).
This study discovered a new finding in which that brands tend to have connections with others through sport sponsorship. It was shown that sport clubs have many sponsors which attracts the brand to be one of them in order to expand their business. Sport clubs were found to organize events for the sponsors to meet each other either weekly or monthly to connect them and they can also meet during the matches. During the assembly, the brands get to introduce themselves to each other and discuss possibilities to have business together. It was also found that it helps the brands especially the small ones to link up with the bigger ones in order for them to grow. As a result, building business connections through sport sponsorship for brands was perceived to be a factor for brands.
Another highlight of the study was that brands also like to sponsor sport clubs who are involved with CSR activities. Brands apply different marketing tools including
sponsorship to elevate their CSR activities (Manoli, 2015). Brands want to associate
themselves with a good image through being involved with the society and being sustainable. The CSR activities such as helping charities, saving energy etc. were shown to grab the attention of the brands towards the sport clubs who apply it. The study showed that as a result, brands are interested to have a deal with the clubs because they want to provide financial assistance in these CSR activities. A case study on the German football Bundesliga also showed that clubs engage in CSR projects to capture the attention of sponsors (Reiche,
2014). In sum, CSR activities perceived to be an important factor for the brand to go with the sponsorship.
In a study by Szymanski (1998), it was found that the good performance of the sport club attracts the sponsors because it mostly results in club’s success. This study confirms with Szymanski findings on the importance of the club’s performance. The findings showed that the outstanding performance of the clubs such as winning competitions attract brands because they want to associate themselves with success. The bad performance of the club was also found to play a role in an ongoing sponsorship. Brands turn to step up from the
agreement if the club is not making good results. As a result, the performance of the club may be another factor from the brands perspectives when it comes to starting or renewing
sponsorship.
The study also found that sport clubs seek sponsorships for the financial support they get from brands. It was shown that sport clubs use the money they get from sponsors to build facilities and buy better players to improve their performance and be successful. This finding echo responses to the case of Fiat and Juventus that was discussed earlier in the literature: Juventus was seeking sponsors to support them financially in order to improve and be successful (Spais & Filis, 2008). The clubs also use the money to pay their employee’s salaries. Discounts on brand’s products were also found to be a way of the financial support the club gets. The brands provide their products to the club members, but with a lower price than the market. The study showed that the success of the club is related to the financial support they get from the sponsors. If the club has a good amount of money support, they will improve which will lead them later to winning (Szymanski, 1998).
Logistical support was also found important for the sport clubs to acquire. This study describes the ways in which the sport clubs can benefit from the sponsors in terms of
them to the games. In addition, they also use the gym equipment in case their sponsor was a gym. Overall, the clubs don’t only benefit from the financial support, but they also use their sponsors services to satisfy their practical needs. In line with this, a study by Oral, (2018) stated that providing sport clubs with shoes, gear and equipment is an example of sport sponsorship.
Our study also dug into the reasons that leads to change and termination of a sponsorship agreement and found that bankruptcy is an important reason for change in
sponsorship. This study aligned with a study by Delia (2017) that financial problems is one of the reasons that end sponsorship as well. Brands and sport clubs appeared to end the
sponsorship if they ran out of money as they will not be able to provide the financial support the club needs in case it’s the brand who went bankrupt. In case it’s the club, then they will not be able to pay their employees which will get them out of the coemption as a result of losing all their sponsors.
The study also revealed that scandals of either the brand or the club leads to the termination of the contract. Brands or clubs were found to likely step up from the agreement because they want to protect their image and not getting affiliated with negative perceptions such as scandals. A study on sport scandals showed that the negative impressions are
transferable to the associated entities even if they don’t have a relationship with what caused it (Chien et al., 2016). That is why brands and clubs would prefer to terminate the
sponsorship instead of harming their image for scandals they weren’t involved in.
The findings shed light on the problems that occur between the sponsor and the club that end their relationship. Failing to achieve objectives of the contract was found to end sponsorships. Bad services which the sponsor gives result in the sport club terminating the sponsorship. Brands were shown to also break the agreement when their money goes into things that do not match their agenda. The club use the money to improve, but the brand may
have a condition that part of the money goes with whatever suits their agenda and if the club failed to do that, it was shown to result in the termination of the sponsorship.
During the study, the researcher has gone through some obstacles. One of the limitations of this study is the period of time it took place in. The pandemic of (COVID-19) was an obstacle as the study relied on qualitative research where interviews should have taken place face to face, but this wasn’t possible due to the circumstances. Instead, it took place online, but this resulted in drop outs of some interviewees which affected the sample size. Also, the study was limited only on the brands and sport clubs in the Netherlands so, by expanding the population to Europe for example would give reliable insights. In addition to the interviews, longitudinal studies can be used in future because it will give the researcher the chance to look at the changes that could happen over time which guarantee reliability.
Future research can focus on the benefits of brand-club partnerships by measuring brand exposure, revenue, number of followers and correlate them to financial gains which will be suitable in this case to do quantitative research and enhance the internal validity.
This study will help both brands and sport clubs to have a successful sponsorship and maintain ongoing agreements. The study showed what interests the brands for having a sponsorship with sport clubs. In return this will help the clubs to put these factors into practice in order to attract new sponsors and keep the current ones. Sport clubs can
participate into social activities, expose their sponsors to the fans by using social media, and organizing events for their sponsors to meet each other. On the other hand, brands can reach to an agreement with sport clubs by offering a proper financial support and increasing the ones they have with the current clubs to maintain it. They can also provide the clubs with the materials and the equipment they need. This study demonstrated the factors which both the brands and sport clubs seek while going through a change or an initiation of sponsorship. In sum, the brands want to get exposure with the help of sport clubs to increase their revenues
and associate themselves with a good image in return, they are willing to support the club financially and logistically to return the favor which touches on the reciprocal benefits of sport sponsorship. This study can help both entities to understand each other’s requirements for sponsorship and avoid the negative factors that can harm their relationship.
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Appendix A
Introduction: Hello, my name is Baher Baroma and I’m a master’s student at University of Amsterdam studying communication science specialized in persuasive communication. I’m meeting with you today regarding my master’s thesis and I’m wondering I if I can ask you some questions that would help in my research about the factors that may or have led to a start/change in sponsorship of your brand/club
Topic 1: Description of the interviewee. Goal:
Seeking general information of the person.
Intro: Before we start, I would like to know general information about you, so we begin by,
Initial question:
1. Can you describe how your day goes when you arrive at your working place and what activities do you do? 2. How long have you been working in
the brand/club?
3. If I may ask, what is your job title and your role/responsibilities at the brand/club?
Topic 1: Description of sponsorship and the importance of it.
Goals:
• Understanding and knowing the accurate definition of sponsorship from the clubs/brand perspective. • Gaining the knowledge of how and
in what way does sponsorship benefit the sport club.
• Knowing the necessity of having a sponsor for the club.
Intro: As we know, sponsorship now is quite spreading, but of course it plays different roles depending on which organizations, clubs or any other entity it sponsors. The requirements that these entities want from sponsors differentiate from one another. As of sport clubs/brands, the needs from sponsorship is unique which leads me to my first question.
Initial question:
1. From your perspective, how would you define sponsorship?
2. Are there reciprocal benefits
between the sponsor and the club? If yes, what are they?
3. How can the sponsor benefit the sport club and vice versa, in what ways specifically?
4. Is there a specific important sponsor/sport club for you? Why? 5. Do your sponsors/brand have
decisional roles over your/their team?
Topic 2: Reasons of Sponsorship
Goal:
• To understand if the sport club achievements attract sponsors to it. • Sensitizing Concept: (The image of
the Sport Club/brand).
Intro: As much as knowledge I have, the sport club does not stay with one sponsor forever same as the brand. Whether clubs do good or not, they change sponsors and the brands do the same which makes me ask, Initial question:
1. Why is it important for the club/brand to have sponsorship? And is it better if the club/brand has more than one sponsor/club?
2. Has your BRAND/CLUB’s
reputation ever affected negatively or positively your sponsorship agreements?
3. From your point of view, what makes a specific sports club ideal for a sponsor to sign a deal with?
4. What other circumstances that may lead to a change of the current sponsorship?
Topic 3: Motivations of Sponsorship of sport clubs/brands?
Intro: It’s interesting to know the
relationship between the fans of the clubs and the brands that are sponsoring them. Also, to know the way both sides announce
How does the brand/club announce the sponsorship?
Through what specific media channels does the brand/club announce their sponsorship? Who produces the marketing advertisement content?
Goal:
• To know if the club fans are likely to consume products of the brands sponsoring the team.
• Sensitizing Concept: (Marketing and Brand Loyalty in Sponsorship).
their agreement and if they are goals or targets behind that which makes me wonder, Initial question:
1. How does the brand/club present the sponsorship?
2. Through what specific media channels does the brand/club announce their sponsorship? 3. Who produces the marketing
advertisement content?
4. Are there goals the brand of the club wants to achieve through these announcement ads? If yes, what are they?
5. How do you see the role of the fan base size when it comes to signing a deal with a club?
6. Do you think the consumers of the brands who sponsor the club benefit it in some ways?
7. Did your data base got
increased/decreased when the club/brand signed with any
sponsor/club you have now? If yes, why?
8. Did it affect the brand/club’s profit? If yes, how?
Rounding up Interview: We now reached the end of our interview and I would like to thank you for the valuable information that you have provided and also giving me the time to meet you and if you would allow me I would send you the transcription of this interview in case you wanted to correct something or add an extra information that may help. Again, thank you so much for your time it and have a good day, goodbye.
