Production for Live Events and Television University of the Arts London - Dissertation Example

Sponsorship for Television Ya-shu Audrey Chang Production for Live Events and Television of the Arts London London College of Communication Name of the Professor Date of Submission Introduction Mass media operates within an integrated realm of communication, economic policies, marketing principles, and use of technology (Markhan, 2007, p 1) However, the lifeblood of mass media is basically based on rigorous marketing through advertisements and on sponsorship. Sponsorship is defined as a highly cost effective method aimed at increasing purposively the levels of brand of a product and to generate public awareness (Busby & Digby, 2002, p. 1). In the last 25 years, the market in Europe has matured and thus, companies believed that undertaking sponsorship will improved their images to its product consumers or customers (Amis, Slack, & Berrett, 1999, p. 250). Albeit the decreasing number of television audience, companies have used and optimized popular television programs where they could sponsor, as ways to leverage and gain competitive advantage (Busby et.al., 2002, p. 1). To succeed in the sponsorship strategies, the company owners have to provide meaningful added value experience as a marketing strategy. They approach this in an experiential experience by dazzling the customers’ heart and appeal to their senses, hence, harness customer emotions by creating a noise in a cluttered marketplace (Busby et.al., 2002, p. 1; Batty & Dean, 2005 pp. 1-17). Sands (2013) defined TV sponsorship as funding provided to television program or network to support pay for the airtime or is offered in return to commercial advertisement. In another situation, television sponsorship is used to support public broadcasting programs pertaining to arts or educational programs without necessarily airing an actual television program (Sands, 2013, p. 1; Bednall, Walker, Curl, & David, 2003, p. 172). A television company can generate funding from various sources like companies and charitable institutions (Sands, 2013, p.1). They can in fact, strategies the airing of these companies to programs to specific age or in programs where there is high rate of viewers (Bennett, 1998, p. 485; Sands, 2013, p. 1). For example, a TV sponsorship of sports apparel can be paired to sports shows or events to entice sports-minded viewers to purchase their type of products (Bennett, 1999, pp. 291; Bennett, 2003, p. 41; Bennett & Gabriel, 1999, p. 41) . In Great Britain, some of the current sponsors on UK television program are BB for Live, Virgin Media for British Got Talent, Harveys for Coronation St., TalkTalk for The X Factor, and Bet365Bingo for Emmerdale (Bloxham, 1998, pp. 89 Burridge, 1989, p. 6). Purpose This paper aims to explore the reasons and causes about TV sponsorship and how this contribute to the marketing production of a television company and how this supports the marketing strategies of the company for competitive advantage. This researcher hope to find answers to these questions by examining the history and processes how sponsorship works in UK television; investigate the details about who are engaged in this process, why they opted this instead of advertisement, and how this is undertaken. The researcher will likewise endeavour to document and examine the influence of sponsors in the editorial reportage. It will also examine the effectiveness, influence, and impact of sponsorship for viewers Research Questions and Hypotheses In undertaking this research study, this researcher aims to answer the following questions: (a) Investigate the reasons why television uses sponsorship? (b) How sponsorship works for television? (c) What is the effectiveness and impact of sponsorship in television? (d) What is the distinction between sponsorship and product placement? The researcher further hypothesized that, a. Sponsorship, as a marketing niche, increases the company’s visibility in television shows, thus, supports scaling up its products prominence in the marketplace or among consumers. b. Sponsorship is a strategic method of competitive leveraging in marketing a company’s product. c. Sponsorship contributes in resource generation for a specific television program and adds to the economic stability of a television company. Significance of the Study This study will provide substantial literature and findings about sponsorship, the processes on how this is undertaken, and the benefits or pitfalls in engaging this system. This will likewise explore how sponsorship on TV deliver mutual benefits earmarked by the TV stations and the companies indulged in sponsorship. Limitations of the study This study is limited on the sponsorship that is transpiring in television companies in Great Britain. The researcher is limited to the responses of the respondents in a survey conducted and on their perception on the subject. Chapter 2 Methodology This is a mixed qualitative and quantitative study that aims to determine the effectiveness of sponsorship in television and to analyse the public’s knowledge on current sponsored programs and their respective sponsors in UK (Bloom, Hoeffler, Keller, & Meza, 2006, p 8). Creswell (2007) defined mixed method of research that combines approach to inquiry or associates both qualitative and quantitative forms to resolve a philosophical assumption by collecting and analysing information and data qualitatively and quantitatively (p. 4). Qualitatively speaking, the research will explore and understand the meaning and behaviour of respondents about sponsorship program in British TV program by using survey instrument and data or information analysis inductively based on themes of the study to simplify a complex situation (Creswell, 2007, p. 4). Quantitatively, the research will test the objectives and hypotheses by using the relationship of variables which will be statistically analysed. Researcher will be indulged in deductive explication to test theories but building in protections against bias, controlling alternative, and generalizing to replicate findings (Creswell, 2007, p 4). The strategies of inquiry will be sequential, concurrent and transformative (Creswell, 2007, p 12; Creswell, Clark, Gutmann, & Hanson, 2003, p. 209). Researcher use survey instrument to attain quantitative or numeric description of trends, attitudes, or opinions of a population by purposively selected samples of respondents (Creswell, 2007, p 12; Creswell & Clark, 2007, p.8). This cover cross-sectional and longitudinal studies using questionnaires or structured interviews for data collection, with the intent of generalizing from a sample to a population (Creswell, 2007, p 12). Information sources, observations and interviews will be combined with traditional surveys to converge with necessary data and other findings. Researcher will further seek to elaborate or expand the findings for exploratory purposes using survey method from chosen respondents in order to make some generalization (Creswell, 2007, p 12). Figure 1. Mixed Methodology (Creswell, 2007, p. 15 & Onwuegbuzie & Teddlie, 2003, p. 351). The respondents of these studies are television producers, representatives of agency for sponsors, managers of advertising agencies, and those directly engaged in dealing with companies who seek to sponsors a TV program. They will be the direct sources of primary information. Researcher will also make use of information sourced from secondary data generated from journals, books, online database and peer-reviewed studies. The succeeding chapter will discuss about the methodology of the research. Chapter 3 Related Literature Sponsorship is a transactional relationship between a fund or resource provider and the individual or an event organizer (Busby & Digby, 2002, p. 13) where the provider is accorded with rights and association with the individual, event or venue in return for the finance, goods or services (Chadwick & Thwaites, 2004, p. 39; Chong, 2003, p. 151). Sponsorship is not a modern strategy of business leveraging because in 65BC Caesar ‘hosted’ a gladiatorial show and enjoyed recognition out of its publicity (Busby & Digby, 2002, p. 13). Michelangelo, Columbus and Mozart also enjoyed sponsorship through ‘patronage’ (Busby & Digby, 2002, p. 13; Christensen, 2006, p 3). In Britain, Code Section Nine (Television) on Sponsorship and Code Section Ten (Television) on Commercial References was improved last February 28, 2011 to regulate sponsorship well under Commercial References in Television Programming (Ofcom, 2013, p. 1; Clark, Cornwell, & Pruitt, 2002, p. 16). Legislators wanted to ensure that suitable sponsorship of programmes on television that is based on transparent; to ensure that messages are separate from programmes and distinction between advertising and sponsorship is maintained; to ascertain that broadcaster maintains editorial control over sponsored content and that programmes are not distorted for commercial purposes; and to ascertain that sponsored program will be able to promote its name, trademark, image, activities, services under direct or indirect interest (Ofcom, 2013, p. 1; Cliffe & Motion, 2005, p. 8; Cobb, 2002, p. 125). However, each of the television companies have also separate corporate policies pertaining to sponsorship (BBC, 2013, p. 1). For IEG consultancy agency for sponsorship, this process of promoting a product is effective against recession and is perceived as the only marketing tool that benefits the greater good as consumer confidence continues to slide (Busby & Digby, 2002, p. 13). A combined spending of sponsorship from North America, Europe, Pacific, Central and South America and other regions showed that there are $24.4 bn (Busby & Digby, 2002, p. 13). The system is integrated in marketing communications to capitalize on its possible values. Sponsorship works on print and TV to build relations with consumers or target audience. Pre-event and benchmarking are essential in this system to have a defined goal and meet expectations (Busby & Digby, 2002, p. 14). Goals of sponsors should have measurable result and must be supported by research to ascertain success and to justify budget. Thus, the company who will seek to support a TV program thru sponsorship must have define objectives, clear market analysis, define target market, examine lifestyle or demographic profiles, competitive review, strategic development, budgetary allocation, concept review and testing, program selection, development of marketing support activities, implementation, and post-event evaluation and research (Busby & Digby, 2002, p. 14). Purposes of Sponsorship Any sponsor may aim for incentivising customers, database building, nurture customer loyalty, enhance community relations, revitalize brand or corporate image, and refine business leverage (Collins, 1993, p. 46; Cornwell, Pruitt, & Clark, 2005, p. 9; Cornwell & Coote, 2005, p. 6). To make the goals measureable, a sponsor may count to increase its sale, get new sales lead, customer retention, staff recruitment, improve community perception, or increase trade distribution (Cornwell, Weeks.& Roy, 2005, p. 8; Busby & Digby, 2002, p. 14). They must also deal with issues on product attributes; benchmarking for evaluations; balance between company image development, relations and shot-term sales; key internal targets; corporate hospitality (Busby & Digby, 2002, p. 15). Experts contend that sponsorship gain marketing benefits from sales promotions, sampling, trade or staff incentives. The return of investment in indeed difficult to measure but companies indulged in sponsorship must measure the consumer’s regard on a brand by its return of investment (ROI) (Busby & Digby, 2002, p. 39; Cornwell, Clark, & Pruitt, 2002, p. 6; D’astous & Bitz, 1995p. 6; Daneshvary & Schwer, 2000, p. 203). Measure must only on what is easily identifiable but also those that are critical, such as those matters considered as critical for the company (Busby & Digby, 2002, p. 39; Davies, Veloutsou, & Costa, 2006, p. 31). The company must be interested to determine how the property performs or how it increases the shareholder value viz the amount paid for this sponsorship. Recently, the measurement scheme are devised to help sponsor measure perceived quality based on total research, return of investment (ROI) in the case of Coca-Cola and Sprint, incremental profits (in the case of Colgate Palmolive) and maximising and quantifying sponsorship value (in the case of Gillette sponsorship) (Busby & Digby, 2002, p. 39; Dean, 1999, p 7; Dolphin, 2003, p. 172; Easton & Mackie, 1998, p. 98; Thwaites & Aguilar-Manjarrez, 1995, p. 149; Thwaites, Aguilar-Manjarrez, & Kidd, 1998, p. 29; Lembo, 2000, p. 8; Lodziak, 1986, p. 12 ). Measuring by Survey ROI and incremental profit can be measured by the accounting and finance department of the companies but the consumers’ perception and the increase of corporate image can only be measured through a survey to monitor the effectiveness of sponsorship (Busby & Digby, 2002, p. 42). It’s said that if sponsorship do not perform out of expectations, the contract can be renegotiated but the impact of this is apparently not good, hence event sponsors change fast thus, impacting on consumers reactions. ‘Superleague’ of sponsorship opportunities was established with lesser sponsorships being relegated a long way behind in terms of their desirability and market value (Busby & Digby, 2002, p. 42). Thorough research has become more focused to evaluate sponsorship performance and to answer the specific needs of the sponsoring company (Busby & Digby, 2002, p. 42). Business experts opined that if sponsorship is to be successful in the 21st century it must be integrated with multimedia to communicate products for maximum efficacy (Busby & Digby, 2002, p. 42). (Busby & Digby, 2002, pp. 45-46). In Europe, brands on sponsorship are Mars, Coca-cola, Phillips, Pepsi, Natwest, Heineken, Stella Artois, Whitbread, Lombard, and Stones Bitter. Impact of their sponsorships are measured by “determining the spontaneous awareness of sponsorship, brand-prompted sponsorship awareness; event-prompted sponsorship awareness; brand-promoted advertising awareness; and favourability to brands according to a five point bi-polar scale (very favourable, fairly favourable, neither, fairly unfavourable, very unfavourable)(Busby & Digby, 2002, p 48).” For products that are related sports or Olympics, popularity of the brand or product are measured by participation, spectatorship and claims TV viewing (Busby & Digby, 2002, p 49). Media owners further this by acquiring rights or cash and at times by bartering advertising pages to bundle them up with print or radio advertising or radio in a package. Research for the success of sponsorship is based on budget, target market, seasonability or timing, communication needs, competitor activity, project or event management, product relevance, and by positioning or imaging (Busby & Digby, 2002, p 51). On TV, the sponsoring companies will be concern too of the hours of commercial transmission; audience sizes, TV ratings, and audience profiles. Studies pointed that the association with sponsorship have improved the company’s corporate awareness with immediate effect and sponsorship appears to have a greater image than product advertising on awareness (Busby & Digby, 2002, p 67). It has also increase consumers brand preference and it takes longer time for sponsorship to make its impact on brand (Busby & Digby, 2002, p 67). Some researchers pointed that sponsors in Europe fail to exploit their sponsorship with sufficient financial support compared to how US agencies manage sponsorship to deliver consumer entertainment, sales incentives, media and retail extension (Busby & Digby, 2002, p 68). Sponsors should also go beyond its structural relation with consumers to a more emotional relation to be successful. Thinkbox (2013) explicated that sponsorship has been booming with the market gaining about £190m in 2007 (p. 1). The growth sustained as sponsorship increased amid demand for opportunities (Thinkbox, 2013, p. 1). The “stronger the viewer’s relationship is with a programme the more effective sponsorship is in driving positive emotions towards the brand (Thinkbox, 2013, p. 1).”   But the consumers’ intentions, favourability, and the increase of perception vary depending on the viewers, products, promotional scheme, and the strategies employed for sustainability. Figure 2. Thinkbox, 2013, p. 1. Sponsorship can also be done in cause- related marketing (CRM) as marketing strategy by transmitting emotional values (Busby & Digby, 2002, p 71). This is presupposed from Prudential’s Theory of Social Responsibility that considers consumer would opt to purchase a product where he could closely relate. This is perceived as an ethical edge that makes business sense (Busby & Digby, 2002, p 71). Benefits in this system include corporate reputation, press coverage, brand awareness, scaling customer loyalty and potential increase sales. What is easier for this is the fact that most companies have substantial budget allocation for CRM (Busby & Digby, 2002, p 75). Nowadays, multimedia and social media, including digital games and digital TV has become an open field for sponsorship experiments to reach home-based consumers and those people that have morphed online. Experts opined that this is an ideal vehicle for building interactive relationships with online customers. Chapter 4 Discussion Of the 50 respondents to an online survey conducted to selected respondents, 25 persons or 83.33% of them professed that they are aware of sponsorship of British television while 5 or 16.67% said they are not aware. Table 1. Respondent’s awareness on sponsorship in British television. However, of those who claimed awareness on sponsorship, 50% or 14 respondents pay attention to the commercials of the sponsors and the other 50% or 14 persons do not pay attention prior to the program broadcast as gleaned on Table 2. Two respondents did not answer to Question 2 (Q2). Table 2. Percentile distribution of respondents paying attention and not to the commercials of sponsors. On the question if these sponsorships influenced them to buy the products endorsed, 44.83% (or 13) of 29 respondents answered that the sponsorship has not influence them to buy or to even consider buying the indorsed products; 10.34% (or 3 persons) professed that they are swayed or persuaded to buy; while the other 44.83% (13 persons) professed to have considered buying the indorsed products of the sponsor but did not take further action. These findings are reflected in Table 3. Table 3. Percentile distribution of respondents, who are influenced, partly influenced and not influenced at all in the sponsorship advertisement in a tv program or show. In a comparative situation where both sponsored brands are offering the same similar service or product with other TV advertisers, 79.31% or 23 of 29 respondents replied that they are not influenced or emotively convinced to buy products from the sponsors of a British TV show while 20.69% replied ‘yes’—they are influenced. One respondent skipped or opted not to answer this question. This is reflected in Table 4. Table 4. Percentile distribution of respondents who are appealed or influenced to purchase products of the same brands offered in sponsorship and advertisements from two different TV stations. When asked if the sponsorship advertisements are enjoyable or annoying, seven (7) or 24.14% of British TV viewers/respondents professed that they enjoyed the sponsorship’s advertisements while 37.93% (or 11 respondents) replied it’s annoying; and another 37.93% (or 11 respondents) said they are not bothered or concern at all. Still one of the respondents skipped answering the question. Table 5. Percentile distribution of respondents who are enjoying, annoyed or not bothers at all to sponsored products viewed on a TV program. In exploring about the influence of the sponsorship to the consumers spending pattern, 3.45% or 1 of 30 respondents admitted that sponsorship advertisement affect his spending pattern, thus, likely persuaded to purchase products from a specific brand being promoted through sponsorship while 75. 86% or 22 respondents are apparently saying that sponsorship has not impacted to their spending patter, and another 20.69% or 6 professed that sponsorship on TV has indeed influenced and affected their spending behaviour or pattern. These findings are shown in Table 6. One respondent skipped answering Q5.. Table 6. Percentile distribution of responses on question pertaining to the influence or impact of sponsorship to consumers’spending pattern. Albeit differences of perception on the positive or negative impact of sponsorship on British television, still majority of the respondents or 60.71% (or 17 persons) are supportive of the ongoing movement of sponsorship while only 39.29% or 11 respondents are not. Two of the 30 respondents have not answered Q7. This is reflected in Table 7. Table 7. Percentile distribution of respondent who are supportive and not supportive to the ongoing movement of sponsorship on British TV. Moreover, only 24.14% (or 7 of the 30) of the respondents admitted that they have changed their perspectives toward a brand due to the company’s involvement in the sponsorship program on television while 75.86% or 22 respondents said that their perception are not changed toward the product or a brand whose company opted for sponsorship. One respondent prefer not to answer Question 8 (Q8). This is reflected in Table 8. Table 8. Percentile distribution of respondents about the impact of brand or product’s to their perception. When asked if sponsorship in British television will become a standard in the industry for marketing and advertisement, 72.41% or 21 respondents answered ‘yes’ while the remaining 27.59% or 8 respondents said ‘no’. One respondent have not answered Q9. Apparently, there reasons are not explicated or elucidate to justify their positions. Table 9 showed this. Table 9. Percentile distribution of respondents who perceived or not perceived that sponsorship will become a standard strategy for advertising and marketing of British TV station. Finally, when asked in Q10 if they will pay attention on the sponsorship program on British television, in case they were not conscious of this yet, 55.17% or 16 respondents replied ‘yes’ and the remaining 44.83% or 13 respondents replied ‘no’. Table 10. Percentile distribution of respondents who will pay attention or not on sponsorship program of TV shows. Conclusion The researcher affirm that sponsorship, as a marketing niche, increases the company’s visibility in television shows, thus, supports scaling up its products prominence in the marketplace or among consumers. It also affirms that indeed sponsorship is a strategic method of competitive leveraging in marketing a company’s product. While other empirical research affirm sponsorship’s contribution in resource generation for a specific television program and adds to the economic stability of a television company but this largely differ in countries and in the strategies adopted by both sponsoring companies and by the TV companies promoting a trade, brand or product. The survey affirmed, as showed in Q1 result, that majority of the respondents are aware of the sponsorship program within the British television industry and only an insignificant number are not. But notwithstanding this professed awareness, only 50% of these respondents pay attention to the commercials or products indorsed by the companies that are availing sponsorship as a strategy to leverage with other competitors in the market. Majority of the respondents, as television viewers, are not persuaded or may have considered buying but have not taken further action to buy products from a brand or company that used sponsorship to promote their goods. Few of them however, admitted that they are influenced to purchase products of this sponsoring company, but the number is insignificant to increase the sales or revenue of the company. The correlation of sponsorship to a company’s revenue generation however, requires further study or research. In cases where similar brand or product is introduced in two different TV stations, very few numbers of TV viewers are swayed or influenced to buy the products of company promoted through sponsorship. Respondents’ answers in Q5 depicted the variegation of their perspectives as consumers and TV viewers with almost 40% of them are either found the commercials of sponsors as annoying or insignificant at all. Apparently, the same percentage share the view that they are not bothered of the advertisement at all or it concern them the least. This is consistently reflected in Q5 where majority of the respondents professed those commercials of sponsors have not affected their spending pattern at all. Notwithstanding, most of the respondents are supportive of the sponsorship movement in television although Q8 depicted too that sponsorship has not changed their perception on a company, product or brand promoted in TV program. Interestingly, most of the respondents believed that sponsorship can become a standard in the industry for companys marketing strategy and for leveraging. 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