The Shift in Sponsorship Assets

As a new year begins, major changes are happening within sponsorship deals and the teams who manage them. One of the most in-demand skills is product development—new assets and offerings are proving crucial to keeping existing deals afloat. As a result, we see many organizations taking a more modern approach toward executing their sponsorship deals.

Getting Creative

Sport sponsorships have long provided valuable engagement with audiences. But without fans inside stadiums or at events, brands and agencies are looking for new ways to maintain that engagement. The industry has been witnessing a slow decline of pre-made package deals for some time, but pandemic considerations rapidly accelerated it. More than ever before, rights holders are collaborating with individual sponsors to create deals that help brands connect in new and innovative ways.

Recently, the Serie A football club introduced new asset categories connected with VAR (virtual assistant referee) and goal line technologies. This has been seen as a lucrative untapped advertising opportunity for sponsors to take advantage of pauses caused by referee calls.  The NFL has also gotten creative, incorporating Nickelodeon’s iconic green slime dump into their end zone broadcasts, and adding googly-eyes to players as a promotion for SpongeBob, in effort to attract younger audiences. Partnerships like these are transcending how organizations are thinking about traditional sponsorship assets.

However, there is concern that some new assets could get in the way of the root of the event and passion of sport, leading to branding fatigue in fans. Consider the Hawk-Eye Live system, frequently used at many tennis tournaments and slams to automate line calls, and most recently utilized at the Australian Open. The creators have suggested that “out” and “fault” calls could be replaced with shouts of sponsors’ names but concede that it “might wind a few people up after a while.”

Understanding Outcomes

The push toward new assets offers brands an opportunity to rethink how they want to activate. The key is to look at exactly how they are using sponsorship deals to achieve their objectives—not just why.

Understanding where the value comes from is key in justifying the spend.

With big changes in which assets can be delivered and how, plenty of deals have been turned upside down or restructured. Brands are specifically seeking assets that improve their direct-to-consumer outreach. Some of those are even assets that already existed, but were undervalued or seen as mere add-ons, especially in the digital space. What was once an afterthought could now have much more value, such as branding on a fan-facing voting platform or the placement of logos in email newsletters.

While digital-based sponsorships will provide immense value in 2021, we don’t yet know what next year will look like. Depending on performance and results, brands may want to pull back or double down on this strategy. A contract might specify a social media post, but it doesn’t have to be exactly that—collaboration and flexibility will be vital to the long-term health of these partnerships.

KORE is the global leader in engagement marketing solutions, serving more than 200 professional teams and 850+ sports and entertainment properties worldwide, providing practical tools and services to harness customer data, facilitate sponsorship sales and activation, and create actionable insights.

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What Type of Report Will Have the Most Impact on Sponsorship Strategy in 2021?

Every strategist has a go-to way of evaluating the success of a deal – Both short term and long term. So, I wanted to unpack this a little.

In and amongst various conversations with some of our industry’s best, I ran a quick poll on LinkedIn – What type of report will have the most IMPACT on Sponsorship Strategy in 2021?

This can be totally subjective and the sample size wasn’t huge, however, there were four options to choose from:

  1. Live Deal Valuation
  2. Asset or Benefit Delivery
  3. Value Generated by Objective, and
  4. Digital Engagement

Each are extremely valuable to both rights holders and brands. One more so than others according to the results – with 66% of people said that Value Generated by Objective would have the most impact on sponsorship strategy.

But, it got me thinking.

Live Deal Valuation

A tough one, I know. So, let’s pivot the narrative and oversimply this, perhaps we call it Deal Scoring and break it down.

When considering objectives, deal scoring is a great way to visualise the real-time performance of your deals because we’re able to see all of our deals on a scatter-plot graph, sorted by a score out of 100 on one axis and your investment / revenue on another.

Here is a quick 30 second.

Deal scores on the Y-axis should be calculated via weighting and achievement of at least 2 objectives (Anything less and it starts to become super tricky). Then, we ideally want to have 2-3 key results that we can track to determine whether or not an objective has been met.

For example, an objective may be to increase online sign-ups. If we reverse engineer this, we need to first increase online engagement with a view to driving people to a specific page on the website that acts as an online sign-up form. At a basic level, our key results could be:

  1. Percentage increase of online engagement across the website,
  2. Percentage increase of click-through to sign-up page, and
  3. Percentage increase of people completing the online sign-up form.

Our X-axis then just becomes a range from our lowest spend to our highest spend – Find me anyone who does value this type of report and I’ll eat my hat!

Spend and Value Generated per Objective

A big sin in survey data, I’ve tweaked the question – I know. But stay with me.

It’s common to find objectives being applied or tagged at a deal-level, but some strategists and sponsorship professionals will also do this at an asset-level as well. By doing this, we’re then able to filter down to both the spend and the value attributed to the objective that was applied.

From a Spend perspective, by tracking our hard costs per asset we’re able to aggregate this to a total amount. We’re also able to build a comprehensive analysis around how we link assets to objectives, not just a few overarching ones that sound good.

Then there’s Value. If you paused momentarily and said something out aloud about ‘how do we find the value’, then we’re on the same page. How we measure the value of assets then subsequently becomes the hero or key component of this dashboard.

Asset or Benefit Delivery

For KORE clients, this is a bread and butter report. And to a certain degree I feel this needs a little more love that the poll results gave it.

Being able to easily see assets that have, and haven’t, been used to date can be an effective tool in helping shape strategy execution. On face value it’s a fairly simple report, but if I can put my strategy hat on, it’s helps me understand the money I’ve left or table or proverbially wasted. It also helps me talk to other internal teams about what can be used in a new product-launch campaign or to instill confidence that we’re delivering assets that help achieve specific objectives.

It’s not the most glamourous or complex report, but I can guarantee that asset delivery is important to both sides.

Digital Engagement

Now, admittedly, digital is not my foray. However, based on conversations with clients and understanding how digital and social media can play a role in achieving objectives – I see why it’s important.

But what level of impact does it have?

If we stay on the path of online sign-up forms. Being able to break down a Social Posts Tracker or perhaps a Branded Content Summary can be really effective in determining whether the messaging we’re using is working or not.

The Winner

The poll wins – Value Generated by Objective. We need to move on from the ROO vs ROI debates. Going into 2021 objectives need to lead sponsorship strategy and the reports or dashboards that can helps us quickly understand performance are going to have a huge impact.

KORE is the global leader in engagement marketing solutions, serving more than 200 professional teams and 850+ sports and entertainment properties worldwide, providing practical tools and services to harness customer data, facilitate sponsorship sales and activation, and create actionable insights.

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Unlocking Sponsorship Data And Beginning To Use It More

Heads up, I’ve stolen some key themes from KORE’s whitepaper, Data Warehousing and Analytics, that is largely geared towards rights holders. With so much planning and strategy reviews taking place, however, there really isn’t a better time to start unpacking how data could be sponsorship’s silver bullet in 2021.

When you think about all the exciting business intelligence or strategy topics out there, it is not hard to see how much this theme will come to the fore over the next 12-24 months. With advanced analytics, AI, predictive modelling, data visualisation, and broader sponsorship valuations, you start to get a sense that, when unpacking business intelligence, in relation to sponsorship, you may need to buckle in for a long haul.

Although, it doesn’t have to be that way. There are two things you can explore to help you quickly begin to unlock sponsorship data and use it more effectively.

UNLOCKING A DATA RICH LANDSCAPE

We live in a data-rich world, but it is both a blessing and curse. I say this because, although you can begin to harness and aggregate lots of data sources, how much is too much?

Where do we start and what data sources are relevant to us?

Do we look at structured or unstructured data?

Do we overlay general sponsorship insights with consumer data or perhaps something taken from more traditional marketing?

In Dentsu Aegis Network’s 2019 CMO Survey, 54% of CMOs believed data is more accessible than ever before but it’s become harder to extract actual insight. Interestingly, 49% of the same respondents suggested they did not have the capabilities (both people and tech) to maximise their data’s value.

There are lots of questions around how you unlock data, so it can be tough to know where to start. If you have the budget, I would either look to buy a data warehouse or look to employ a strategist or analyst.

If you can’t do either, at a minimum, take a look at every report that comes into the business that is relevant to sponsorship. From there, begin to align the reports with your marketing and sponsorship objectives because understanding what you are trying to achieve will help shape how you review data.

Absolute utopia is the ability to aggregate and centralise multiple data sources to form accurate real-time reporting that allows you to shape strategy and execution of your sponsorship deals. To be more specific, this would bring together media valuations, social media engagement rates & impressions, and employee survey results, and maybe even include various demographics metrics.

Visualisation not only makes understanding and decision making easier, but it helps you tell stories, to various stakeholders, about how your sponsorships are contributing to the marketing and business objectives.

To oversimply this, being able to collect and visualise your data, and subsequent reports or dashboards, is going to be a crucial skillset or capability going into 2021.

TURNING DATA INTO INSIGHT

This is all about what to do next. It is being able to say, “We are looking at X data and it’s telling us Y”, but then also being able to answer the next question which is always, “What does that mean?”.

One of the biggest challenges we find with data analytics is how we actually use the data we have to make decisions and tell stories. Again, leaning on Dentsu Aegis Network’s 2019 edition of the CMO Survey, 84% of CMOs surveyed say that insight driven by data collection, management, and analytics, will be important in the future. Only 50%, however, believe their organisations are delivering this today.

Once you have aggregated and centralised the relevant data for your sponsorship deals, you need to work out how to bring it all to life.

During a panel session at Leaders, Mike Vitti, VP of Data Analytics at PGA Tour, said that the data itself does not solve problems. Instead, he noted that it is the actionable information from the data and the final execution based on the data that actually solves problems.

What he is alluding to is the fact that having flashy data and sponsorship reports is not the final step. Instead, how we turn that information into insight that guides what we do next is the important step. I think sometimes that can be lost in the sea of data we have access to and the flashy reports that we can produce.

For rights holders, turning data into actual insight might look like in-depth category analysis, real-time cost vs value analysis of assets or rights, and perhaps even predictive modelling on the likely success of deals.

For brands, this might look like similar activities but overlayed with brand filters or linear correlations between spend and results.

Unlocking data and then turning it into actionable insights is not as simple as buying some software, employing a resource, or closing your eyes until problems go away; there is a lot of work and strategy that goes into it.

PGA Tour, HSBC, Tennis Australia, Gemba, Two Circles, and teams across the EPL, are all using data to guide what they do next. They are all great examples, from the rights holder, brands, and agencies worlds, of what data to collect, how to collect it, and then ultimately how to create deals off the back of it.

KORE is the global leader in engagement marketing solutions, serving more than 200 professional teams and 850+ sports and entertainment properties worldwide, providing practical tools and services to harness customer data, facilitate sponsorship sales and activation, and create actionable insights.

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3 Things That Will Provide Both Short and Long-term Benefits to Sponsorship Managers

We have had some fairly significant shifts in the way we manage sponsorship, operationally speaking.

We have had to answer progress and performance-related questions like never before. We have had to value deals like never before. And we’ve had to bring them to life like never before.

The mentality of ‘That’s how we’ve always done it’ just does not cut it anymore.

As a result, there has been some brilliant ideas and ways of getting things done. That is why I want to share three quick things that, whilst they may appear straight forward and a no-brainer, can save a lot of time and resources for everyone involved in the sponsorship.

1. Milestone Payments

We often talk about ‘Content is King, but CFOs will argue that, and particularly of late, that ‘Cash is King’, and any actions taken to protect and grow cash is of high importance.
This one is absolutely more brand focused, however, instead of paying fees upfront or through a generic payment schedule, milestone payments can somewhat breathe life into how we pay for sponsorship deals and, at the same time, appease the finance department.

In theory, milestone payments are indeed agreed instalments of the term’s sponsorship fee. They have, however, certain criteria attached to them to trigger payment. For example, criteria could be the delivery of specific assets or specific objectives being met.

For me, this not only speaks to the need for CFOs to de-risk sponsorship payments, whilst keeping an eye on cash-in-bank, but also allows marketing and sponsorship teams to ensure their deal is achieving what it set out to achieve.

If there are linked to objectives, and KPIs, it also provides milestones for the teams to engage with each other, on a formal basis, and have discussions about progress. This is opposed to a whole year running by without anyone really discussing the performance because everyone is too busy fulfilling the deliverables and getting on with it all. It gives gates for the teams to pass through and have discussions about what might need to be adjusted.

This will go a long way to avoiding the dreaded line, “This just doesn’t feel like it is working for us anymore”. No one wants that.

If we want to get super nerdy, we could even apply a base milestone payment with added incentives if certain outcomes are achieved.

Its important here, however, that any criteria outlined is mutually agreed; we’re not talking about being ridiculous and it being one sided. Remember, it is a partnership first and foremost.

2. Sponsor Manual

Do not worry, it’s not a big document.

Typically, we have seen this as a two-pager and brought to life by golf, tennis, and other major events. It is, however, effectively a high-level summary of the contracted assets, asset specs, agreed objectives, key dates, and appropriate contacts for different areas of the business.

With the sheer havoc COVID-19 has caused, with many being furloughed, let go, or placed on reduced hours, information sharing has become a very tenuis task and it presents an obvious fail point for what is an important agreement.

Having a central document, with all high-level details, is a quick hack if other people either need to be across those details or perhaps take them on as part of their role.

3. Tagging Assets

Whether it is in Excel, through KORE’s KONNECT module, or something else, tagging assets is a game changer.

It might sound like a lot of work but being able to quickly see asset-related information can help make the most informed decision about sponsorship delivery, financial forecasting, or even understanding what is event or campaign-related as opposed to one-offs.

The best, and most efficient, tags I have seen in the past months are:

  • Campaign-related: Which of our contracted assets can or are we using to deliver this campaign?
  • COVID-19 Impacted: What assets could we not deliver as a direct result of COVID-19? This helps tell the wider story of what impact the pandemic has had on the business (think about hard costs and values of assets here as well).
  • Deferred: What needs to be pushed into next year or later in the deal?
  • Swapped: What assets were swapped in and or out this year?

Even though, when executed well, sponsorships are essential to a brand’s marketing success, sponsorships are still under a lot of pressure right now. On the brand side, all spending is being scrutinised heavily and, if a sponsorship is maintained, the performance is being scrutinised more regularly and more closely.

As such, rights holders need to be tweaking their approaches to ensure they are doing everything they can to help their counterparts on the brand side to ensure they are well armed to communicate the position and success of the sponsorships.

As I said at the start, the mentality of ‘That’s how we’ve always done it’ just does not cut it anymore.

If you are not already executing the three things above then, if you do, interestingly, you will notice how they do not simply offer you benefits in their own silo. For example, milestone payments bring around focused conversations more often, which can be had around the sponsor manual, and the tagged assets can take centre stage as everyone discusses how best to execute the sponsorship for maximum results in an ever-changing environment.

Following on from that, as a rights holder, if you get these aspects right, as well as everything else, when rights holder’s budgets are being discussed, and multiple sponsorships are being considered, you’ll be remembered as a rights holder who made the brand team’s job easier and was committed to success and that will more than likely set you apart and help ensure renewal.

KORE is the global leader in engagement marketing solutions, serving more than 200 professional teams and 850+ sports and entertainment properties worldwide, providing practical tools and services to harness customer data, facilitate sponsorship sales and activation, and create actionable insights.

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Hacking Sponsorship: Part Three – Perceived Value and Audience Segmentation

So far in our Hacking Sponsorship series, we have unpacked, in part one, Strategy and Headcount, and in part two, Asset Management and Creative, and whilst each have an important role in sponsorship, none really come close to what we will unpack in our third and final piece.

To round out this series, we will lift the lid on Perceived Value an Audience Segmentation. I live in Melbourne, Australia, and am beginning to despise this phrase but, in our ‘new normal’, how we value sponsorship deals in line with the business‘ financial position and objectives is going to change.

Hacking Perceived Value

Commercial Value and Perceived Value are two very different things. We might see tonnes of great deals over the next 6-12 months, but how we perceive their impact and success to the business is absolutely changing.

The pressure from a CFO to justify marketing spend has genuinely never been more intense than it is right now. A great commercial value on a deal might include low hard costs, a decent comparison between asset costs and sponsorship fee, and perhaps even below market rate CPM or CPI on a digital campaign.

But are those things still important? And are they important right now?

If we cannot attend a game, is the bulk buying discount on ticketing effective anymore?

If attendance numbers are restricted, did we really need that concourse activation that we expected to get lots of foot traffic to?

Perceived Value requires both sides of the deal to ask, “What’s really important to me right now?’.

We have seen a lot of pivoting and shifting spend to other asset types or categories, and that is partly because those assets have genuinely been impacted. That exercise, however, has somewhat reshaped what is important to both the Rights Holder and Brand.

If the focus for a brand is to drive online retail sales because in-person sales have slowed down, the perceived value of their digital-based assets might be higher than its commercial value.

The best questions I have seen asked, to tackle this commercial value vs perceived value include:

  • What is my business trying to achieve, in the next 30-60-90-120 days, and how can our sponsorship directly impact those outcomes?
  • What cross-over exists between our sponsorships and other marketing activities?
  • What did the CFO ask for this morning?
  • How is my audience engaging and interacting with us?

That is as cheesy a segue if I’ve ever seen one but next up, we want to explore Audience Segmentation.

Hacking Audience Segmentation

We have looked at segmentation activities and best-practices in previous podcast episodes and blogs, but this time we need to understand the ‘why’ (don’t worry, I’m not about to Simon Sinek-you!).

The most powerful thing a rights holder can have, in the present day, is a single customer view of their entire audience including who are they, what are their behaviours, how engaged are they with us, what do they like or dislike, and even what their role is within our overall audience.

Moving into a COVID-effected marketing landscape, brands will need to be more targeted in their approach to engagement; meaning that the database of 50M people, or an EDM reach of 500,000, is just not up to scratch anymore. Targeting and re-targeting campaigns will bring success, but there needs to be some accurate data to back it up.

As such, from a rights holder point-of-view, sometimes the allure of brands and targeted marketing can help bring those unknown ‘fans’ to the surface and allow them to be included in nurture campaigns for membership (in sportsbiz we are all connected in the great circle of life).  

Most brands will know who their target audience is, and they might have pre-built avatars around who specifically buys certain products or services, how much they typically spend, and what that buying journey looks like. As such, there are two hacks here:

1. Work backwards from your avatars

X engages with us on Y channel and responds to Z. As such, we can create a campaign using specific Z-related assets on Y and we know, on average, X engages with us 10 times per week for 3-4 minutes per engagement.

2. Completely flip Number 1 and find the gap

Who isn’t buying your products or services? This will typically be accompanied by ‘new revenue stream’ lingo, but effectively works in exactly the same way.

Without sounding like my finger is stuck on the repeat button, understanding your audience is just so important right now.

Crystal Ball

As we are wrapping up the Hacking Sponsorship series, we turn to the mythical crystal ball. Everyone seems to have one, but they never quite work the same. What comes next for the sponsorship industry will ultimately be a culmination of what we have explored in this series.

Strategy, headcount, asset management, creative, valuations, and audience segmentation are all key components of what makes a good sponsorship deal.

So many areas of our industry have been severely impacted by this pandemic and it has been nothing short of devastating. As we start to climb out of it, there will be some amazing individuals and work being done.

KORE is the global leader in engagement marketing solutions, serving more than 200 professional teams and 850+ sports and entertainment properties worldwide, providing practical tools and services to harness customer data, facilitate sponsorship sales and activation, and create actionable insights.

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Hacking Sponsorship: Part Two – After the Chaos

Picking up where we left off with Part One – Planning for the Return, I wanted to continue taking a look at what some of the industry’s best are doing across various functions.

This month we are going to look at two areas that should work together but often don’t and that’s because one can take priority over another – Asset Management and Creative.

Hacking Asset Management

Here, I wanted to explore exactly how, as an industry, we begin to tackle the most challenging assets to create, deliver, and integrate into the broader marketing mix.

It does not matter where in the world you are reading this, there is a high chance you have been part of a sponsorship deal, in the past six months, that has been turned upside down. Whether it was the 200 tickets, VIP hospitality, or pre-game activations that cannot be used the same way, change has been the constant in 2020.

Of late, at KORE, we have seen new clients (not existing clients) refer to traditionally having a lack of visibility over what assets have been contracted, what’s still available, and how a portion of spend can be repurposed but then also reported on. That, however, has all come to be a huge pain point this year.

In my opinion, although some have been dealt a bad card with furloughs and redundancies, sponsorship or partner services managers have truly earned their money lately. Being able to manage expectations in line with inventory levels can be hard!

Interestingly, as part of a survey we ran recently in APAC, respondents called out Asset Management as the third most challenging aspect of sponsorship during COVID. That was behind 1. Measurement/Evaluation, and 2. Integration into Brand Strategy.

Based on commentary we have received, from both clients and non-clients, about asset management (all through KORE’s sponsorship delivery product, KONNECT), I would suggest considering the below to hack this space if you’re experiencing any of the previously mentioned challenges.

  • Stop working from the contract. This should go without saying but sometimes contracts were written years before and they might not be as up to date as you think. Drawing a line through a delivered asset or benefit will not allow you to track any hard costs, values, or tasks related to its actual delivery.
  • Make sure someone else knows what is in the contract. We often hear of both rights holders and brands where an individual in the organisation ‘owns’ the delivery space. This can be super counter-productive, especially in today’s environment. If the person who knows everything gets furloughed, or goes on leave, how do you know what goes where and how it’s used? It also leads to the attitude of “That’s how we’ve always done it” and that is not something anyone wants to hear when we are trying to work our way through challenging times and keep being told we need to pivot, be nimble, adjust, and find new ways of working and do it more efficiently!
  • Understand what’s in the toolbox. And by toolbox, I mean in your asset register or inventory (whatever you want to call it). I’m not referring to a need to know how to repurpose assets. Instead, I’m acknowledging an elephant in the room and that’s new and renewing deals. When you go to a car yard, you expect the salesperson to have a base knowledge of the cars and what’s available, right?

At a bare minimum, at least, be aware of the asset categories, but, if you can, confidently say you are aware of everything that is contracted and still available. That will allow you to stay on top of new assets that shape a new or renewing deal because, if I was a betting man, I’d say that there’s a BIG portion of deals that will look totally different in 2021.

Hacking Creative

Here I wanted to explore the impact COVID has had on the creative function in sponsorship and how it plays a pivotal role in bringing us closer to our audience and fans.

Since the pandemic began, it has caused utter chaos across almost everything industry and job function including advertising and sports marketing. Creative directors across the globe have been given arguably the hardest task in making sure our beloved brands stayed front of mind with relevant content.

Let’s take a second to let that sink in because THAT IS A HUGE CHALLENGE!

The array of budget cuts, headcount reductions, general restrictions, and a need to stay up-to-date with consumer attitudes and behaviours has been nothing short of extraordinary. Some would argue that it has forced our creative directors, and broader advertisers, back to the drawing board to help create timely and relevant content in an even shorter period of time.

Seeing creatives deliver and repurpose imagery and film footage around the globe has given me a new level of appreciation and admiration for what they do. If you need proof, have a look at NIKE’s latest commercial that was put together entirely from repurposed imagery and footage.

 

If I can again lean on WARC for its 2020 Content Strategy Report, there’s some really simple but effective hacks we can learn:

  • Content should aim to be part of culture. Consider different content formats to deliver a message. We have seen the production of love songs, feature films, and even podcast series win awards based on their effectiveness. “The beauty of content is that it doesn’t have to feel like an ad,” says James Tucker, Senior Strategist, Colenso BBDO.
  • Content can drive behaviour change. Content can build emotional connections with audiences that ultimately drives action through powerful messaging. If I can lean on a KORE favourite to explain, refer to ‘Distracted Goalkeeper’ by Tech and Soul (São Paulo).

 

  • Considering context benefits content strategies. A better understanding of the purpose of a sponsorship deal, in context to what we are trying to achieve, can play a big role in making a content strategy more effective. This can include a range of approaches but always requires an answer to the question “How to do we improve the interaction with fans or consumers?”

If you’re not fortunate enough to have creative directors, talk to your CMO or Head of Marketing. If you can’t do that, well, then try reverting back to some advice from our friends Tim Morris and Adam Hodge – talk to as many people in the organisation as you can. This will give you different perspectives on an issue or challenge and allow you to hack whatever it is you are trying to create.

What’s Next?

In our third and final piece of the Hacking Sponsorship Series we look at Hacking Perceived Value – how COVID has changed not only the commercial value of assets and deals but also how we value the intangibles.

We’ll also take a look at Hacking Segmentation – How we now need to dive even deeper in the trends, interests, and behaviours of consumers to drive meaningful content and relationships.

KORE is the global leader in engagement marketing solutions, serving more than 200 professional teams and 850+ sports and entertainment properties worldwide, providing practical tools and services to harness customer data, facilitate sponsorship sales and activation, and create actionable insights.

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Managing Changes to Corporate Partnership Data

Did you know that data loss costs small businesses about $75 billion per year in downtime?

We most often think of data loss in the form of an external data breach or cyber attack, however, you might be surprised to learn that malicious data breaches only account for about half of all data lost for most businesses. According to the 2020 Cost of a Data Breach Report, about 24% of business data loss can be attributed to human error, making it a significant cause of data loss in business. Data lost due to human error can take on many forms, but what it ultimately means is that one of the biggest threats to keeping business data safe comes from the employees within that business who are directly responsible for managing that data.

This can be especially true when we must adapt to unforeseen circumstances (i.e. a global pandemic) rather quickly. When the COVID-19 pandemic hit earlier this year, it brought up a lot of questions in the realm of Corporate Partnerships that needed to be answered. How much value is lost without fans? How do we determine the value lost for partnership assets yet to be activated? How do we continue to provide value for partners when most of our major assets can no longer be used? 

Finding solutions to those problems is challenging enough but once those questions have been answered, keeping track of all that has changed in a space where legal contracts are involved provides an additional set of challenges. 

Whether you are tracking these changes in a partnership software app like KORE Sponsorship & Partner Engagement or KORE KONNECT, in Excel spreadsheets, or even on sticky notes, here are a few things to consider when managing changes to partnership contracts impacted by COVID-19. 

Have you backed up your partnership data?

The first thing to consider before making changes to your partnership data is taking a backup. This can be as complex as taking a backup of the entire database where your partnership data is stored or saving a copy of your partnership revenue reports in an alternate secure location. Either way, the goal is to make sure that an original copy of your data that will never be overwritten is set aside. This is important for several reasons: 

  1. Mitigate Human Error
    Given that we are the biggest threats to our data, taking a backup protects you in case human error enters the equation while the changes are being made.
  2. Measure the Impact
    It will help isolate and detail the level of impact COVID-19 had on your partnership agreements by making it easier to highlight the assets that required adjusting.
  3. Secure Staging Data
    It also gives you an initial source of the truth, allowing you to make future copies of your data for purposes like creating new agreements or for running before-and-after comparisons on your asset revenue. This will ensure you maintain a clear picture of what your partnership deals looked like before any changes were made, which is critically important for Finance departments.

And, speaking of Finance… 

What does Finance need?

Oftentimes the needs of the Finance and Legal departments can differ from that of the Partnerships department. It is important to understand what Finance and/or Legal might need prior to editing partnership data because it will influence how to approach the editing process. For example, a Partnerships department is usually focused on tracking final total revenue numbers and delivering on the assets that make up that revenue for their partners. Finance must deliver for their partners as well and in addition to reporting to internal executives, their partners may also include external auditors. So, while details of the partnership agreement such as what assets were changed and why they were changed might exist in the heads of the activation team, that might not be enough to appease auditors when they are trying to understand exactly where your revenue is coming from at the end of the year. 

Keeping Finance’s needs in mind as you approach this process will help you understand if:

  1. Additional contract documentation, such as a letter of agreement or an amendment, is required.
  2. New reports need to be developed to track the change of one asset to another, illustrating the actual movement of revenue.
  3. The recognition of revenue for these assets related to your organization’s fiscal year will change based on when you will be able to deliver on them.

What is your organization willing to offer?

It probably seems obvious that you would want to know what your organization can offer partners before making changes to deals or engaging in discussions about potential changes. However, the idea here is to make sure that you are not determining the path forward for your partners while editing the data of record simultaneously. Doing so increases the risk of data loss. Remember, we are the biggest threat to our own data. 

If you can develop a plan before reaching the point of adjusting your partnership data to reflect your new-look agreements, it will reduce the risk that you may misrepresent your data in the process. It will also help you understand if other important data points, like credits, need to be tracked throughout the process if it is determined that a partner’s asset value cannot fully be recovered. After all, you have the data so you might as well use it! 

What else?

While these tips were written with COVID-19 in mind, they can be applied any time changes to partnership data is required. Corporate partnerships are ever-evolving and there may be a need to swap assets or adjust data in a season not impacted significantly by external factors. 

This is also just one piece of the puzzle. Once you’ve worked through each of these areas, other topics such as making changes to your data, tracking the activation for the new assets, and tracking canceled or voided assets will also need to be worked through. We have some tips on that too! Let’s talk!

KORE is the global leader in engagement marketing solutions, serving more than 200 professional teams and 850+ sports and entertainment properties worldwide, providing practical tools and services to harness customer data, facilitate sponsorship sales and activation, and create actionable insights.

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Hacking Sponsorship: Part One – Planning for the Return

We briefly touched on it in the last episode of the Inside Sponsorship podcast, however, there is going to come a point whereby strategy and planning needs to be allowed to pivot back to normal  – whatever that looks like these days! 

Rather than pivoting strategy around restrictions and repurposing assets or spend/revenue, some would suggest there is a wave of ‘returning to activate without restrictions’ coming. We might be standing on a proverbial beach, unsure of how quickly that wave is traveling, but we can see it coming. 

I am by no means a planning or strategy expert, so I am taking my cues from others, and in a three-part series, over the coming months, we’ll look at what some of the best in the industry are doing in both preparation and planning. 

Hacking Strategy

Tim Morris, Divisional Manager, Strategy at Gemba, recently wrote about this and, in my opinion, nailed it. In a post-COVID world there is an increasing need for us to have the capacity of rapid strategic problem solving. 

Source: thegembagroup.com

Gemba have a fantastic approach to this in unpacking problems and identifying a clear path to the solution. Adam Hodge, Head of Strategy at Octagon, and his team, also have a great methodology of tackling this type of scenario. What appears to be prevalent across the board is that the trick is to not over complicate things and cut through the clutter of mixed messages and opinions. There’s a couple of things that we can pick up from this:

1. Try to speak with a wider group of people in the organisation.

Whether you are a brand or a rights holder, understanding the needs, wants, and general requirements of different departments will give you a much deeper understanding of how the business can tackle a problem or work though a project.

2. Get access to clean, accurate, and relevant data.

There’s probably hundreds of blogs and articles on the importance of data in today’s landscape. But reality is that there is now also lots of different data sets and sources we can look at. The key here is to look at the end goal and having oversight of what it is you need to show that will guide you on which type of data and metrics to look at.

3. Stress test the data against ideas.

Some people are naturally good with data sets while others need to get their hands dirty. The happy medium here is to play around with the data and to not be afraid of thinking outside of what is considered ‘normal practice’

4. Set a time frame to keep everyone accountable.

The natural project managers will argue this is the most critical piece, and it is important. After all, what is the point in planning and setting strategy if we can’t execute it in a timely manner? 

Hacking Headcount

Undoubtedly, the most uncomfortable exercise we are seeing is the mass changes to headcount across rights holders, brands, and agencies. One of the hardest things to juggle right now is work vs resourcing to do the work … and that is not mentioning the resourcing and spend attributed to actually bringing in the work. 

According to results in WARC’s 2020 Future of Strategy Survey, many strategists suggested that a big risk bubbling in the background is that whilst reducing headcount offers a quick source of cost reduction, it stretches the team employed to do a specific function and creates another problem in itself. With sponsorship requiring varying degrees of account management, creative, planning, and overall strategy development, It begins to swallow up hours than we can collectively give it in an average day. 

During Gemba’s The Big Timeout webinar recently, FIFA’s Ross McCall, Head of Commercial Strategy & Planning, summed up the situation well by stating that “the resilience that sport prides itself on is being tested” and in saying that, highlighting the fact that people are losing jobs and headcount as we knew it is changing dramatically. 

From KORE’s perspective, we are seeing somewhat of a reset in terms of how sports rights holders across the globe structure their teams. Some are questioning whether the current org chart allows them to truly maximise their efforts in the modern day and perhaps this presents an opportunity to rehash roles and responsibilities. It is now the classic case of instead of throwing money and people at a job, perhaps we look at more effective and efficient ways of doing business? 

What Is Next? 

In Part Two of our Hacking Sponsorship series, we look at Hacking Creative – The impact COVID has had on the creative function and how it plays a pivotal role in bring us closer to our audience and fans. Then, we’ll follow that up with Hacking Asset Management – How we begin to tackle the most challenging assets to create, deliver, and integrate into the broader marketing mix.

KORE is the global leader in engagement marketing solutions, serving more than 200 professional teams and 850+ sports and entertainment properties worldwide, providing practical tools and services to harness customer data, facilitate sponsorship sales and activation, and create actionable insights.

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A Look At Current International Sponsorship Trends

As the world continues to come to grips with its new-normal, the sponsorship world is consequently experiencing side effects of new social norms, new engagement activities, and a new appreciation for just how much both sport, and brands in general, play a role in broader society. 

We are beginning to see certain reactions and responses gain traction and widespread adoption which, in turn, are forming an array of trends.

Although geographically separate, there is a growing number of trends that we are beginning to see mirror one another across APAC, North America, UK, and Europe. 

UK & Europe

1. Audience Analysis

The first major trend, being led from arguably the most competitive sponsorship landscape in the world, is the ever-increasing expectations from brands that rights holders have an accurate and genuine understanding of their own audience. 

Now, more than ever, brands need to drive business outcomes. It is no longer about coming to the table with a compelling sponsorship proposition or well-designed proposal. 

Big audience numbers are simply not that attractive anymore. What is expected is a deeper understanding of the audience, irrespective of size, and evidence to show that they will actively engage with brand messages and activations. 

For rights holders, this means understanding fan’s (or customer’s) age, location, interests, spending patterns, purchasing history, attendance history, and so much more.

2. New Job Titles

As somewhat of a by-product of understanding audiences, new titles such as Strategy Director and Digital Transformation Lead/Director have been emerging rapidly. 

We are seeing the solidifying of digital-first throughout North America and APAC as rights holder’s, across the UK and Europe, have begun to recognise the need to be more informed about their fans and customers.

Although already strong in the UK and Europe, the quality vs quantity debate will become more prevalent across the globe when reviewing the workforce against expected objectives or outcomes. Focussing time, energy, and budget on understanding the behaviours of their audience, that can then be used as commercial intelligence, is where we will see growth for the next few years. 

North America

3. Cause-Related Campaigns

A noticeable shift in the North American sponsorship landscape is the growth of cause-related marketing. A great, and terribly humbling, example of this is the response to global protests over the death of Georg Floyd and the Black Lives Matter movement. 

We saw this a few years ago with the WNBA’s Minnesota Lynx printing warm-up shirts printed with ‘Black Lives Matter’ and ‘Change Starts With Us’, and more recently NASCAR banning the use of the Confederate flag. 

We are now, however, seeing this go global.

We’ve seen Manchester City, Arsenal, and every other Premier League team, in their first match back, placing ‘Black Lives Matter’ over the nameplates on player’s shirts. This suggests that it will be nearly impossible for brands and rights holders to not address their position and how they are approaching the conversation. In fact, staying silent is being interpreted by the market as actively opting out of the cause. 

4. Push Towards Performance-Based Sponsorship Models Gaining Momentum

Whilst this is not a new concept, and we have talked about it in the past, we are starting to see it more and more. 

A recent example is Nike replacing New Balance as Liverpool’s official kit supplier which increases royalties, based on the sale of licensed merchandise, with further cash bonuses tied to on-field performance. 

With real dollars being attributed towards these types of outcomes, it is critical that both brands and rights holders alike have a very clear way of tracking success. While larger brands tend to have the resources to track and measure these incentives in a variety of different ways, what is a bit more unclear, is how smaller brands, looking to replicate some of these modules, will be able to do so. 

Clearly identifying the incentives, data associated with those deals, how they will be tracked & measured, and reported back to both parties, is something we’ve seen here at KORE as becoming more and more critical. 

APAC

5. Re-purposing Assets

With COVID-related restrictions forcing changes to various categories of assets, literally every property in sponsorship has resorted to re-purposing assets, creative, activation builds, and a whole lot more. 

Flexible strategy and adaptation of whatever was originally planned has been the cornerstone of thousands keeping their jobs and allowing branded messages to remain part of B2C efforts. 

The impending challenge for rights holders, brands, and agencies will be deciding on when to return to normal … or whether that even actually happens. 

In Australia and New Zealand, sport has resumed, and small crowds are even growing as restrictions continue to ease. At some point, in Australia, we will get back to capacity crowds (New Zealand already is), busy concourses, and fun-filled activations out the front of stadiums. However, that still takes time, effort, and resources to create and produce. The question we need to answer is, “When do we start planning for this?”

6. Lead times getting smaller

As something of a by-product of the workforce getting smaller and the greater need to respond to cultural and environmental trends, the lead time from creating an idea in a meeting room to execution, and seeing it come to life, is getting shorter. 

Brands and agencies are seeing amazing campaigns turned around is less than two weeks which speaks to the ability of brainstorming, collecting data, and producing quality work the first time around. 

The same expectation will soon be expected of rights holders as they welcome back staff. Inefficient WIP’s, copying-and-pasting the same activations, or basic campaigns will not cut it anymore. Like their counterparts, the need to develop ideas and execute the builds, quickly and efficiently, while still at a high standard, will be increasingly important for many rights holders. 

The Move Towards Better

While COVID-19 has been devastating for the sports industry, one positive is the effect it has had on the status quo. It has forced both brands and rights holders to rethink how they execute sponsorships. 

No longer can the industry just move from season to season, doing the same things, and shunning innovation and change. The current environment has forced creativity, and in many cases, stronger and closer relationships between brands and rights holders. There are many great examples of how approaches have changed, and the trends emerging, and hopefully those positive approaches will remain as we emerge from COVID-19 because it will make the sponsorship industry, in all markets, stronger.

KORE is the global leader in engagement marketing solutions, serving more than 200 professional teams and 850+ sports and entertainment properties worldwide, providing practical tools and services to harness customer data, facilitate sponsorship sales and activation, and create actionable insights.

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What to Consider When Returning to Sell Sponsorship

Over the past few days, we have started to see sponsorship deals happening again. Beşiktaş and Beko. Pringles and ESL. J-League and Meiji Yasuda Life Insurance. South Sydney Rabbitohs and Menulog. 

However, as the rest of the sponsorship world reads the media releases, there is a looming question: When, and how, do we start selling sponsorship again? 

Jordan Belfort fans will tell you to pick up the phone and start dialling … but I disagree. Instead, I would suggest your first steps are to understand:

  • Your cash position and how that will influence payment schedules
  • That there are going to be some brands who just can’t take on any new expenses. Perhaps this is where we test the term ‘partnership’ and you work out if there are any genuine budget relief items they can provide in the short-term
  • What you can and cannot deliver with COVID-related restrictions in place

Aside from these, which I am sure most of our industry is well and truly across, there are two essential things we need to consider before we start putting pressure on the sales team to do deals – Relevance and Analysis. 

Are You Relevant?

Why should a brand spend money with you instead of a TV or Digital campaign? 

Now, more than ever, brands are under immense pressure to not only justify their spend but also ensure their spend turns into actual business-related outcomes. Agencies, off the back of this, are also under pressure to justify their portion of the marketing spend on top of already trying to make meaningful impact on the overall strategy and execution. 

So why you? 

Well, because you are relevant. Relevant to their audience, relevant to their new budgets, and relevant to the way in which they want to market themselves. In essence, you are relevant because you can help solve business problems or challenges. To influence purchasing behaviours towards their own product or services, brands need to be relevant to a consumer (Yes, I am also now self-conscious of the amount of times I’ve said the word relevant!). 

We often talk about how sponsorship is all about delivering the right message at the right time on the right platform and it’s fair to say that this global pandemic has forced the bulk of the sporting world to rethink how they directly engage with their owned audience. 

As such, now is a really good time to survey and talk to your fans, members, season ticket holders, and anyone who is actively on your database. Asking questions about what is impacting them right now, what would they consider as their first big purchase after COVID, or perhaps even what they have not spent money on that they would have liked to. These are all questions that brands are trying to reverse engineer to solve business problems and also create insight for themselves. 

You should be focusing on aligning yourself to a cultural cause, promoting positive data about your engagement levels, and positioning yourself as THE relevant property to help reach and connect with a specific audience to deliver their message. 

Have You Conducted A Rate Card Analysis? 

There is a global agency, I won’t spoil the fun in naming them, who are running a very clever, yet simple exercise to help clients understand their position. It goes something like this …

  1. Divide the contracted assets into two categories – immune and non-immune from COVID.
  2. Then, calculate the value and hard costs associated with each to understand your position of risk and what is available to adapt to the current market.

Rights holders need to think about doing the same thing, if they haven’t already. 

The reason being is that it will allow you to communicate back to the business your exact position. Nobody wants to be left with $1M in assets that cannot be delivered. Nor do they want to be left with $1M of assets that actually costs them a lot to deliver. 

Rate card analysis is by no means an easy thing to do, and of course, KORE can absolutely help with that. It can be done, however, with or without us. 

To conduct a rate card analysis on your own:

  1. Start an unglamorous Excel Spreadsheet.
  2. List every asset that you sell, its hard cost to deliver, and the current commercial value or margin you apply to it in sales proposals.
  3. If you can, categorise each asset into a range of asset-types (this will help long-term).
  4. Run a column adjacent to these categories and list whether it’s an exposure or engagement-based asset.
  5. List whether each asset has a fixed cost or fluctuates based on demand.

What you should come to understand is that:

  • Assets that have fixed costs are reasonably safe – these can still be used at varying levels or even repurposed.
  • Assets that have fluctuating costs are at risk – these will be hard to deliver on and create cause for ‘reductions in value’.
  • Exposure-based assets are safe (to a certain degree, social and broadcast can and may become your best friend) – these can still provide a lot of value, perhaps albeit in a different way than originally planned.
  • Engagement-based assets are at risk – the delivery of these are guaranteed to change based on the current circumstances.

In a post-COVID world, this exercise will also help you navigate both new deals and renewals. It will also help guide how you price certain assets and how you communicate back to the business what your risk position is at any given point.

It’s also important to remember that literally every rights holder on the planet is awake at 11 PM trying to think of ways to reinvigorate their revenue. So, you are not alone.

Sport is returning, and there will be changes, but there is light at the end of the tunnel

KORE is the global leader in engagement marketing solutions, serving more than 200 professional teams and 850+ sports and entertainment properties worldwide, providing practical tools and services to harness customer data, facilitate sponsorship sales and activation, and create actionable insights.

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