Sport Sponsorship Strategy - Assignment Example

Sport Sponsorship Strategy Contents Contents 2 Sport Sponsorship Strategy 3 Executive Summary 3 Target Sponsor Brand 4 Value of the Sponsorship to Sponsor 5 Sponsorship Fit between Brands, Values and Culture 6 Values and Culture Transfer 7 The values of the team are transferred to the Airline. Any trait associated with Manchester United will also be part of Qatar Airways. The sponsor can benefit from the right values and characteristics that are a representation of this team. The success and team spirit of Manchester United will depict the good working policies of Qatar Airways and their efficiency in fulfilling customer needs (Coppetti, Wentzel, Tomczak, & Henkel, 2009). These traits will also show the success of the Airline in England as well as Europe. Attributes such as star players like Wayne Rooney and Robin Van Persie will be associated with the Airline making it look superior to other Airlines operating in the same area. Other values that will be transferred to the Airline in terms of attributes include the team colors. 7 How the Proposed Sponsorship Rights will be Exploited 8 Leveraging and Articulating the Sponsorship Rights 9 Sponsorship Risks 10 SWOT Analysis 11 Ranking the Alternative Strategies 13 Best Recommended Strategies 13 Forecast of Reach and Value 14 Conclusion 14 References 15 Sport Sponsorship Strategy Executive Summary The predicted fan loyalty metrics for Manchester United mean that the stadiums will always be full. The high number of fans in the stadiums is achievable if the fan loyalty strategies are well executed and will bring good business to existing sponsors. The big number of fans means increased revenues for the club and its sponsors, and is bound to attract other potential sponsors due to its economic viability. The achievement of these metrics depends on three key strategies, among which are having agent outlets, issuing bonus games and reducing the prices of tickets. The agency stores will increase ticket sales by reducing the amount of efforts that the fans have to put in getting match tickets. These officers will bring the tickets closer to the fan by being situated in areas with football fans. They will also market the club and its games to people. Thus, there will be peer pressure from other fans for those who do not go to stadiums to purchase the tickets and start doing so (Weeks & Roy, 2005). The bonus games are meant to attract people into buying season tickets. These tickets run for the whole season and have an extra game for the next season that has been paid for by the club. This offer will attract many fans, and more people will buy season tickets than before (Henseler, Wilson, & Vreede, 2009). As such, with a high number of season tickets sold, it is guaranteed that the stadiums in which Manchester United will be playing will always be packed to capacity in terms of Manchester United fans. The reduced ticket prices will also attract many fans into stadiums, creating a venue for marketing the sponsorship product (Papadimitriou, Apostolopoulou, & Dounis, 2008). Target Sponsor Brand The target sponsor is Qatar Airways, an airline that is owned by the government of Qatar. Being an airline from the Arabic region, it is a real competitor against the Emirates that sponsors Arsenal Football Club. This selection of sponsorship will create a healthy competition between the two airlines as the teams they sponsor try to show who the superior carrier is. There is a significant growth opportunity for this airline when it becomes Manchester United’s sponsor (Walraven, Koning, & van Bottenburg, 2012). This projected growth is evident in the high number of people travelling across England as they follow their team in their various games. Some of them fly to the cities hosting Manchester United’s games. Hence they require a reliable flight. With Qatar Airlines being the sponsor of this team, the fans would wish to associate themselves with the team by flying using this airline’s services. As such, there is an opportunity to grow and penetrate this market of football fans. Moreover, the team’s participation in the Uefa Champions League will mean that even the team itself will have to fly to several countries from which the teams they are playing against originate. This opportunity to have flights to other countries will open up new flight routes for the airline and expand their market (Amis, Slack, & Berrett, 1999). The increased number of fans attending games due to the increased ticket sales associated with the successful strategies of increasing the team’s fan base will result in increased customers for the airline. There are similarities and differences between the sponsor’s consumer market and that of Manchester United as shown in table1 below. Similarities Differences The two have frequent customers that travel on a regular basis Manchester Unite fans travel following a pattern that depends on game weeks unlike Qatar Airways customers Both consumer markets pay for the traveling services offered. Manchester United’s fans travel to similar destinations for the same purpose unlike Qatar Airways customers who travel with different purposes Table 1: Comparing Manchester Uniteds and Qatar Airways consumer markets Value of the Sponsorship to Sponsor Qatar Airways will benefit from the sponsorship in a number of ways. One of them is the increased sales. The team members, as well as the fans, will tend to use this airline for their travel around England and Europe (Apostolopoulou & Papadimitriou, 2004). They will have assured flights on all game weeks. The inclination towards this airline will be due to its association with the club. Another benefit is the increased awareness in England and Europe. The association of the airline with Manchester United will be a form of marketing for this airline brand. People will tend to identify with it because it will be substantially associated with this big English football club. Every fan of Manchester United will recognize Qatar Airways as the airline of choice by this club. Moreover, the airline will benefit from increased income coming from the sponsorship. This income will be generated from the increased number of fans in the stadiums as projected in the Fan Loyalty Plan (Cornwell, 2008). Similarly, the airline will build its image due to its association with a successful club that is full of football stars. Hence, the airline will be associated with success (Cornwell, Humphreys, Maguire, Weeks, & Tellegen, 2006). The benefit of outmaneuvering its competitors in the airline industry will also be realized. The Emirates has been a leading airline associated with the Arsenal Football Club. Bringing Qatar Airways to England will increase their possibility of beating Emirates in the acquisition of British and European customers (Fahy, Farrelly, & Quester, 2004). The two will now compete on fair grounds in England. Sponsorship Fit between Brands, Values and Culture Brands, values and culture are intertwined to create a fit that benefits both the sponsor and the team. Qatar Airways will benefit from the brand of Manchester United in that players will associate themselves with the airline because it is part of the team. The airline’s name will depict success due to the achievements of Manchester United. This airline will improve their brand image through their association with Manchester United. The values of the team are associated with this sponsorship name such that a great sponsor means a successful team. Therefore, the values associated with Manchester United can be viewed relative to Qatar Airways. Any positive value of the team will work in the favor of the Airline. This team has positive values based on success and victories in various tournaments. The culture of the sponsor and the club intertwine to give one team that has a strong influence on its fans (Verity, 2002). Manchester United fans have a culture of being loyal to their team and they accept any product endorsed by their club. Thus, this culture will favour the Airline in that, the fans will be loyal to it because it is associated with their club. Values and Culture Transfer The values of the team are transferred to the Airline. Any trait associated with Manchester United will also be part of Qatar Airways. The sponsor can benefit from the right values and characteristics that are a representation of this team. The success and team spirit of Manchester United will depict the good working policies of Qatar Airways and their efficiency in fulfilling customer needs (Coppetti, Wentzel, Tomczak, & Henkel, 2009). These traits will also show the success of the Airline in England as well as Europe. Attributes such as star players like Wayne Rooney and Robin Van Persie will be associated with the Airline making it look superior to other Airlines operating in the same area. Other values that will be transferred to the Airline in terms of attributes include the team colors. Many sponsors seek to develop their corporate culture (Gwinner & Bennett, 2008). Qatar Airways can achieve this by launching the affordable game tickets, as well as the bonus games. Qatar Airways can brand the proposed agent outlets that will be selling tickets to fans in their neighborhoods. As such, Qatar Airways will be associated with Manchester United, transferring the culture of the club to itself (Gwinner & Eaton, 1999). This Airline can also be at the forefront of signing new stars. They can fly the club’s scouts to areas where they are getting the new stars and can bring in the new signings in a way that will show their association with the club. This Airline can also host sales meetings for the team’s management as well as corporates owning shares of the team (Henseler, Wilson, Gotz, & Hautvast, 2007). How the Proposed Sponsorship Rights will be Exploited The proposed sponsorship between Manchester United and Qatar Airways will boost the club’s popularity and create a conducive atmosphere for fans in terms if football and additional travel promotions. These developments can be achieved by exploiting various sponsorship rights. Manchester United can enhance the identity of the fans by allowing the rebranding of stadium through logos and signage. The airline will be allowed to post signs and paint them all over the stadium, as well as show their logos in the stadium and game kits. The labelling of the seats with Qatar Airways logos will make the fans of both the sponsor and the team feel at home whenever they are in the stadium. The sponsorship can use the fame and popularity of the airline to boost the club’s popularity through the use of the word “official”. In their airline advertisements, they can associate themselves with the club by claiming that they are the official sponsors of the Manchester United Football Club. This official tag indicates that they are the main sponsors of the team. They get the right to advertise themselves as associated with this team and present themselves as part of the success of the team (Johnson-Morgan & Summers, 2005). Manchester United’s home turf is known as Old Trafford. Fans are highly linked to this club through its stadium and are always mentioning it in regards to their team (Wakefield & Bennett, 2010). The naming rights will change the name of the stadium to The Qatar Stadium, and will compete with the likes of the Emirates and the Etihad stadiums. This naming will boost the self-esteem of the fans for being associated with a top-ranking airline. The players of the club can use the sponsorship funds to support a worthy cause and promote the social development of their fans. One charitable event or objective of the airline can be supported by the club through the donation of some of the ticket revenues (Weeks, Cornwell, & Drennan, 2008). Manchester United fans have a liking for entertainment and are highly loyal to their team. The recent improvement in their performance has boosted their morale of purchasing tickets and going to live matches. As such, it is easier to reach out to them through the sponsorship. Leveraging and Articulating the Sponsorship Rights The sponsorship rights can be articulated through the creation of flights to and from England that are associated with the purchase of the season-long tickets. The tickets can be sold with an advantage of having a reduced price for a single flight either to or from England, depending on one’s preferences. The flights are on Qatar Airways and are sponsored by them as the sponsors of Manchester United. Thus, the fans will be inclined to buy the season tickets, as well as take advantage of the flight tickets with a reduced price (Farrelly, 2010). Qatar Airways can also articulate their sponsorship rights through the sale of branded t-shirts to Manchester United fans. The airways can have branded Qatar Airways t-shirts distributed to the proposed agent outlets, such that they can be issued to fans who purchase tickets to Manchester United games. As such, they will spread their brand to the fans and advertise their name throughout England. These t-shirts act as a form of advertising for the Qatar Airways brand. Qatar Airways can use the right to use the word “official” in its media advertisements. An example can be in television adverts in which Qatar Airways can include the fact that they are the official sponsors of Manchester United. They can identify themselves with the club as being their primary sponsor such that fans loyal to the team will be attracted to this airline. As such, they will have an increased number of customers as compared to when they were not sponsoring Manchester United. They will create a functional congruence between themselves and the club (Farrelly, Quester, & Burton, 2006). Sponsorship Risks There has been an increased popularity in the English Premier League, and many sponsors are showing interest in this field of sports. This influx of sponsors has led to a clutter that is characterized by a huge number of sponsors. They tend to be inclined towards the teams in this league, especially those with a huge fan base. Manchester United is one such team, and the number of players willing to buy exclusive sponsorship is big. The reason for this rush in getting the sponsorship rights are the high revenue returns that the sponsors get. This clutter might limit some clubs from getting the sponsorship rights they require. Qatar Airways might face the same challenge although it could be given priority in obtaining the sponsorship rights due to the funding and motivation it could bring to the team (Farrelly, Quester, & Greyser, 2005). Another sponsorship risk that may face the airline in its acquisition of sponsorship rights of Manchester United is the ambush marketing implemented by other firms. Some of these companies might fail to acquire the sponsorship rights of Manchester United due to the clutter of sponsors. As such, they might try to make spectators, fans and other consumers believe that they are associated with this football club. Such perceptions can be created in the formation of a Manchester United Fans fun fair that can be conducted in the Manchester region. This show can drive the fans of this team into thinking that the firm hosting it is associated with the club in terms of sponsorship. However, any company can legally hold such an event without requiring to spend cash on sponsorship. Another firm can decide to pay subway fares for people travelling to stadiums to watch Manchester United games, which can make them look like sponsors. The company pays for these transportation costs hoping to gain the attachment of the team’s fans and gaining their loyalty. They do this to avoid the amount that could be spent in securing a sponsorship (McKelvey & Grady, 2008). Qatar Airways should always be on the lookout for such risks in sponsorship. However, they should not be worried about them as long as they perform their sponsorship duties diligently and gain the loyalty of the team’s fans. They should push for long-term contracts and eventually gain the exclusive rights to most of the team’s functions and activities. SWOT Analysis The proposed sponsorship between Manchester United and Qatar Airways is a business strategy with advantages and challenges. Understanding the sponsorship from all angles is necessary in the development and growth of the sponsorship. It is characterized by strengths, weaknesses, opportunities and threats. The strengths in the sponsorship include the spread of Manchester United as a brand. This is achievable through the sponsoring of the Manchester United pre-season tour. The airline can fly the team and its management to countries within which the pre-season games are taking place. They can also use buses branded with their names and logos so as to sell themselves. The strength of this strategy is its ability to reach many people in the distant country in which the matches are scheduled to happen. Another strength is associated with the inclusion of a website page talking about Qatar Airways in Manchester United’s official website. This approach is robust in that it will get to everyone who visits this site regardless of their need to view stories of the airline. Having agent outlets through the sponsorship will also reach out to fans on a wider scope. The sponsorship has the weakness of some brief strategies that are short-lived, such as the pre-season tour. Such strategies have a small impact on strengthening the fan base. It also exposes the club to scrutiny from fans and other high-ranking clubs and sponsors since they expect exemplary performance from the football club. The fact that it is sponsored by a big name creates high expectations among the fans, and meeting these expectations can be tasking for the team. The sponsorship will create opportunities in the exploitation of the football fan base of Europe and other regions around the world. The fact that this airline is known all over the world creates opportunities for the club to reach out to international fans and spectators. These opportunities include the inclusion of flights from other parts of the world to Europe and back through the services of Qatar Airways. The airline can advertise the football club throughout the world by other means other than the usual media used by the club in its website (Meenaghan, 2013). The threats posed by this sponsorship include unhealthy competition within the sponsorship arena. Other firms may post advertisements in the club’s website, such that they will appear like sponsors to the fans. The fans might be misguided by these firms that use the name of the team to promote their economic activities and strategies. Another threat is the fact that other airlines might come in to compete with Qatar Airways. These airlines are worth a lot and can influence sponsorship decisions against the club and Qatar Airways. They can also sponsor other teams so as to compete with Manchester United and the Qatar Airways brand associated with them. Ranking the Alternative Strategies strategy ranking (1-low benefit 5- highest benefit) Pre-season tour sponsorship 3 Inclusion in official website 2 Having representatives in agent outlets 3 Filling the stadium with logos and banners 4 Table 2: Alternative strategies and their ranking Best Recommended Strategies The three highest ranking strategies are the pre-season tour sponsorships, having representatives in the agent outlets and filling the stadium with logos and banners. These three have the best revenue results for the sponsors in both the short-term and long-term periods. Apart from these alternative strategies, other recommendations include the launching of flights associated with the purchase of season-long tickets for Manchester United’s games. The reduced flight ticket prices for fans who buy a limited edition of Manchester United jerseys can also work to strengthen the brand of Qatar Airways relative to its sponsorship of the team. Forecast of Reach and Value The reach of this sponsorship and the rights issued to Qatar Airways is meant to be beyond England. It is predicted to reach audiences all over the world who watch football matches in the English Premier League and who are fans of Manchester United. In fact, the appropriate strategies should be implemented such that the airline can fly in supporters from various parts of the world to watch the matches first hand. The value of this sponsorship will be high and will keep on increasing based on the fact that the fan loyalty of Manchester United will increase. This increased commitment will be due to the improved performance of this team and the high chances that it will make it to the next Uefa Champions League. The value of this sponsorship can be replicated in the changes that will occur in the home stadium, including the rebranding and renaming of the stadium if the necessary rights are granted. Conclusion Sponsorships are important in that they help the teams involved in terms of their financial needs. In return, the sponsors benefit from an improved brand image and gain the loyalty of the team’s fans, increasing their revenue through ticket sales and their particular product sales. Sponsors should take advantage of the rights granted to them and utilize them in making income. They should also ensure that they fulfill their contractual duties appropriately. References Amis, J., Slack, T., & Berrett, T. (1999). Sport sponsorship as distinctive competence. European Journal of Marketing, Vol. 33, No. 4, pp. 250-72. 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Leveraging Sponsorships on the Internet: Activation, Congruence, and Articulation. Psychology and Marketing, 25(7), 637-654. Read More