Sponsorship, as we all know, is about marketing which is about business. And business is about numbers and delivering the best return on your shareholder’s investment. In this second of my two-part series, I take a look at how a tiny slice of your sports budget can make a massive impact in the arts world.
Why would any corporate spend millions to get their logo on the jersey of a sports team (a logo that might get noticed, but is considered by the consumer as adjacent to the experience, not integral to it) when they can spend a fraction of that to become part of creating an arts event, production or festival that speaks directly to the heart of the consumer?

Doesn’t add up

It doesn’t add up, which is why extravagant sport sponsorships are barely tolerated in today’s consumer-conscious media.

Part of the blame, it must be said, lies at the feet of the arts community itself. For years it has been battered into a position where it apologises for the sponsorship it seeks. And for the same period of time it has singularly failed to recognise why corporates sponsor anything – not to feel good about themselves (although the pictures do liven up an annual report) but rather to drive sales.

It’s that simple.

And too few of those who seek sponsorship for their arts projects are prepared to recognise that and partner with corporates to help them reach their objectives.

Artists sometimes act as if marketing is a dirty word that will somehow tarnish their credibility. By the same token, sponsors make a hash of it when they get on the wrong side of the experience. As an audience is enjoying a moment of magic, the last thing they want is an intrusion or interruption. But they will respond warmly to a sponsor who brands an event with integrity, saying “Enjoy that? We did too, and we’re glad we could make it possible.”

Secret sauce

That “being on the same side of the experience” is the secret sauce that makes the difference between an effective arts sponsorship and an intrusive one. Some SA corporates have gotten it right – witness Cell C’s inner city art projects, Old Mutual’s customised once-in-a-lifetime music events, and Exclusive Book’s Homebru.

Others, which I won’t go into here, have gotten it wrong, being the sponsorship world’s equivalent of your daughter’s brash boyfriend arriving drunk at a christening in a Bokke beanie. The difference is mature, intelligent activation that earns consumer respect, not disdain.

In part oneI established that the arts market is uncluttered and ripe for the sponsorship picking. If it weren’t already self-evident, let’s unpack the economics of the debate.

To put your company logo on the jersey of a top football club in South Africa will probably (conservatively) cost you R50 million over a couple of years. Then you need to activate the sponsorship and shout about it, which doubles the bill.

The question, then, is this. What could R100 million get you in the arts, and is it better than putting your logo on the jersey of a soccer team?

Own outright

The secret is that, for the cost of the hypothetical football team, you could own outright most, if not all, of the biggest arts events in South Africa, including the National Arts Festival in Grahamstown; KKNK in Oudtshoorn; Aardklop in Potchefstroom; Johannesburg’s Dance Umbrella and the Cape Town International Jazz Festival .

And you would still have some change.

Then, with some smart (not expensive) activation around the event, you could find ways of touching and engaging hundreds of thousands of consumers. All of that, or your logo on a soccer jersey or golf shirt which may or may not get noticed by the fans?

Given that equation, I’m surprised that more financial directors aren’t pushing their marketing directors out the door to brush up on the arts.

Before I get bullied in the playground next time I go to a marketing gathering, let me state clearly and unequivocally that there is a place for sports sponsorship in the marketing mix. Clever brands – such as Standard Bank – have known this for years.

Standard Bank realises that a well-rounded portfolio of sponsorships isn’t just about cutting across a multitude of sporting codes and getting its logo on television, but rather about finding opportunities to touch South Africans whatever their passion, be it cricket, soccer, jazz or theatre. That’s a mature mix, a powerful mix, and one that pays off for it in survey after survey and which puts it at the top of the leaderboard of iconic SA brands.

Magic thread

Another fine example of creating that magic thread between event and spectator is Vodacom’s inspired “official supporter of South African supporters” campaign. In an instant, with a single clever line, it achieves that sense of “we’re on the same side here”.

When you strike gold in the arts world, the rewards are exponentially huge relative to the cost. You become a stand-out brand in a focused, usually educated and probably affluent market. And, because it comes at a relatively lower cost, you can take a few more risks. You can spend on the “safe bets” – the big festivals and the big productions – and throw in a couple of gambles knowing that some of them will pay off – a production here, a tour there, wrapping your marketing spend up in a CSI cloak as you give a leg up to some of the hundreds of community groups who know how the arts can help them restore their dignity and pride, but don’t have the resources to make it happen.

You can do all of that and not come close to the cost of that single soccer jersey.

And because you’re spending carefully and astutely on something that virtually everyone agrees is vital to nation building and identity, chances are you’ll keep your CEO off the front page of the papers…

At a fraction of the price of sport, and with potentially the same (if not greater) ability to move the jaded, brand-exhausted consumer along a “purchase now” trajectory, sponsoring the arts has become the smart marketers’ godsend.

Ripe for the picking

Right now there are hundreds of arts projects ripe for the picking. They range from multi-discipline festivals (the big safe bets with considerable media muscle and public support) through to startup events with huge potential; theatre companies who perform 365 days a year in venues around the country; community theatre groups trying to make a go of it; individual productions that will help you dip a big toe into the arts space; and a multitude of music, jazz and other focused festivals that attract hundreds of thousands of your customers.

No SA brand serious about its future relevance can afford to leave the arts out of the mix. No SA brand serious about delivering shareholder value cannot seriously reconsider its spend on sport. And there are no excuses not to enter this, the most uncluttered of marketing spaces still available.

It is the most cost-effective marketing vehicle in tough economic times. It has the added benefit of not only being the most powerful weapon in a marketing toolbox, but of doing good at the same time. All compelling reasons to get on the bandwagon.

As the global economic meltdown gains pace, it seems that the once-sacrosanct realm of sports sponsorship is starting to feel the pinch. So why is sponsoring the arts right now the smartest thing a brand can do?
Recently insurance giant AIG announced that it was not going to be renewing its U$75 million sponsorship of one of the world’s most successful and lucrative sporting brands, Manchester United, when the current contract ends in 2010. Formula 1 is shedding sponsors and tennis player Andy Murray, longtime beneficiary of a sponsorship from troubled bank RBS, has offered to reduce his current deal with them.

Closer to home

Closer to home, South African Airways signed a deal with golfer Angel Cabrera worth US$3 million just after announcing a series of internal cost-cutting measures, resulting in headlines and woes for its subsequently suspended CEO, Khaya Ngqula.

As the downturn slides off the news headlines and onto corporate balance sheets, it is becoming harder and harder for companies to justify to their shareholders the massive costs of “owning” sports events. A massive industry is at stake.

How big? According to BMI on behalf of Business and Arts South Africa, the numbers are staggering. In 2006 South African corporates spent R2.6 billion on sports sponsorships. The Department of Trade and Industry (dti) thinks that figure has now crept up to R3.5 billion. A similar amount is spent on leveraging those sponsorships, so assume that the industry is worth somewhere around R7 billion a year.

Teams, sporting codes and individuals used to commanding massive endorsement deals, and media owners, who benefit from the leverage behind it, are having to adjust their expectations as CEOs and financial directors begin to ask tough questions about the value to their shareholders of that mammoth spend on sport sponsorships.

Still have a job to do

But brand marketers still have a job to do and, perhaps more than ever, are looking for ways to reach through the fog of gloom to their customers and reassure them that, no matter what the state of the global economy, their favourite brand is still there for them.

Which is why the arts, an uncluttered and the biggest untapped value for money market, is poised to take over from sport.

But many sponsorship directors and their highly paid consultants still have a notion that sponsorship is about putting your logo onto something moving, preferably in front of a TV camera. It’s not. And that’s why they’ll miss the boat. They’ll also think that the way to get value from a sponsorship is to throw money at something big and to name it after their brand.

That’s lazy, clumsy marketing and, frankly, both intrusive and forgettable. New marketers, however, get the essence – sponsorship is about engaging with your customers and potential customers in a space they feel passionately about. And it’s not just about piggy-backing on the passion, but rather about becoming integral to their experience of it.

Once sponsors have gotten that right, and only then, can they legitimately embed their product and message into that experience, and begin reaping the benefits.

Head start

It’s true that if you’re talking about passions in a South African sense, sport has a head start on the arts. At least it is true on the face of it. Delve a little deeper into the traditions and customs of South Africans and you’ll quickly see that while spectator sport is a diversion and a hobby about which people feel strongly, the arts is more fundamental to the fabric of who we are.

Story-telling, dance, poetry, and music is the way we have shared our experiences over the years, and the way millions of youngsters shape their identity and learn their heritage. It’s isn’t surprising that one of the fastest growing pasttimes in South Africa isn’t soccer, rugby or road-running. It is performance poetry – edgy, creative, bold and full of attitude, today’s poets are the leading voices of a generation who are taking control of their own destinies.

Creativity equals authenticity. The experience of being part of creative expression – as performer or audience or that joyous middle where the lines blur – provides an entry to the heart of South Africans that too few of our brands recognise. A staggering 43% of adult South Africans maintain that they feel more positively toward a company that sponsors the arts, according to BMI. That’s a significant amount of untapped goodwill in the marketplace.

At the world’s leading annual sponsorship conference hosted by IEG in Chicago, trends are detected a couple of years before they become apparent. In 2007, the conference repeated a mantra that is only now, in the context of the credit crunch, beginning to make sense. “The next big thing,” IEG said, “is a million little things.”

Fragment

In other words, as consumers fragment themselves into smaller and smaller communities, become more inward looking and respond only to those things that have a direct impact on their lives, marketers need to avoid the “one size fits all, big bang” sponsorship that shouts loudly but speaks to no-one. Instead of the shotgun, a carefully aimed rifle is needed.

Consumers have changed over the years. Today they cynically reject the notion that big brands are better simply because they are big brands. Seeing your logo plastered around a sports ground doesn’t make anyone rush out to try what you’re selling for the first time, and in a stadium environment there are few opportunities to engage and “close the deal”.

Advocates of the shotgun-style of wallpapering a stadium or team argue that it is about getting your brand out there. In the ’90s, when “brand awareness” was the buzzword that would have been a sensible strategy. Today, “brand awareness” doesn’t necessarily translate into “brand consumption” or even “goodwill toward brand”.

In fact, given the rising cynicism of consumers and the economic climate, a show-offy big bang approach to sponsorship is just as likely to backfire and cause resentment among consumers.

Want to belong

More than ever consumers want to belong (witness the rise of social media – Twitter, YouTube, Facebook – they’re all enablers of one-to-one communication and building micro communities), consumers want to care and think deeply about the world around them and relate to leaders who don’t patronise them (Barrack Obama). They crave authenticity, community and the human touch in a world where they are increasingly alienated from the economy, politicians and their neighbours.

And where are they more likely to find those authentic, genuine connections – as one of 70 000 people at Newlands, or in a quiet, darkened theatre experiencing an intimate, goose bump-inducing moment of magic?

In part two, I’ll take a look at how a tiny slice of your sports budget can make a massive impact in the arts world.

Whereas Coca-Cola and Cingular had created reasons for their existence, Ford had struggled to find a solid and justifiable role. What we learned was that if a brand is part of a story line, our brains will accept the role of the brand and remember its presence. However, if a brand and its role don’t support the story line, the opposite will happen: Our brains will simply erase it. That’s the way we survive and keep from ending up like zombies, considering the average of 2,000 brand messages we are exposed to every day.

What resonates for me is something which underscored a gathering of sponsors at the world’s biggest annual sponsorship conference in Chicago not too long ago – and that is that sponsors need to embed themselves into entertainment the consumer craves. Not as an add-on or afterthought, but as a genuine “value adder” to the entertainment. So when Motorola sponsored Robbie Williams’ recent trip to South Africa, and got a 30-second big screen ad before he came on stage, they got it wrong. They were tackily adding themselves to the experience, rather than become integral to it. That’s the generous assessment. The cynical one is that they did themselves harm by intruding on the consumer’s experience. There’s a delicious word for it – they “brandalized” the event.

Clever sponsors get the difference. They won’t just write out cheques and sit back to admire their name in lights. They actually engage with what they’re sponsoring, and look for ways of enhancing the consumer experience. They realise that, at times, it is better to be discrete and low-key; at other times they can go big and bold. It is a small, but important distinction and being able to tell the opportunities apart make the difference between a mature sponsor and an opportunistic one.

Examples of great sponsorships like that abound – 702′s Walk the Talk; Pick ‘n Pay/Argus Cycle Tour; V-Festival (when it, ahem, actually happens); Old Mutual Encounters; and of course, my personal favourite for obvious reasons, the Standard Bank Young Artist Awards. Those are all sponsors who add value through their involvement – they don’t just hijack the event for their own branding purposes. They act with integrity. We need more of that.