New Deals Reinforce the Four Rs of Sponsorship
Four distinct partnerships announced within a 24-hour span last Thursday and Friday stood out from the list of other sports business news items and press releases in the email inbox. None of the quartet would be considered a blockbuster and individually would not have received a second thought beyond, “Okay, seems like a good deal for both sides.”
But looked at side by side, the new agreements each portray a unique attribute of sports partnerships and represent what could be called the 4 Rs of sponsorship. These are by no means the only reasons companies sponsor, but they are among the pillars that form the foundation of the brand-property-fan value exchange.
Relatable. A U.S. subsidiary of Indian conglomerate Mahindra Group has signed as a primary sponsor of Stewart-Haas Racing’s No. 14 NASCAR Cup Series entry driven by 2021’s rookie driver of the year Chase Briscoe. Among many other businesses, Mahindra is the world’s largest farm tractor manufacturer and this multi-year deal is on behalf of its U.S. agricultural business.
With a target market that may be skeptical of a non-U.S. company, Mahindra is following in the footsteps of many “foreign” brands in partnering with a beloved local sport or team to bond with consumers over a now shared interest. From out-of-town financial services acquiring hometown banks to Asian electronics firms to import automakers, sponsorship is a tried-and-true method to communicate the message, “We may not be from here, but we understand what’s important to you.”
Reputable. Private investment firm 777 Partners has become the presenting sponsor of the Walter Camp All-America Team, the prestigious college football honor. Sports, media and entertainment is one of the six industries that 777 Partners invests in.
The sponsorship aligns a six-year-old company with a 132-year-old property. Consider this private equity meeting borrowed equity. Even as well capitalized as 777 Partners is, it competes with older and larger private equity players and operates in a field where reputation and credibility can be just as important as the value of its portfolio. Associating with an award named for “the father of American football” and aligned with the 130 voting FBS coaches and sports information directors provides the positive halo effect that 777 Partners wisely seeks.
Recognizable. Having marked its 20th year as title sponsor of the Western & Southern Open combined ATP & WTA Tour event in Cincinnati, the insurance and financial services firm signed on for another three years last week.
Even though it is a Fortune 500 company, chances are that unless you live in the Cincinnati area—where the company is headquartered— or you’re in the insurance business—you know of Western & Southern through its association with tennis. (Ad industry sources place the $8.1 billion company’s advertising spend at less than $100 million a year.)
Such brand identification is crucial in a business where the end-user is often presented with an array of choices by a broker. Western & Southern—like many other title and naming rights partners—has earned recognition in a cost-effective manner through sponsorship.
Relevant. Watchmaker Timex and UFC have unveiled a global licensing and sponsorship alliance. In addition to becoming the first-ever official timekeeper and official watch of UFC, the deal includes production of a wide-range of UFC-branded products including fitness-tracking watches.
Although Timex has taken multiple steps to keep its 167-year-old brand fresh, it does not have the cachet of many of its competitors, especially among younger consumers. Taking a page from its successful licensing partnership with Ironman in the late 1980s, this latest deal will put the brand on radar screens of new consumers and help establish its bona fides in the all-important fitness segment.
The common thread running through these four deals is the unique ability of sponsorship versus other forms of marketing to achieve the brands’ objectives.