1. 6-1 Chapter 6 Pre-event Evaluation: The Assessment of Sponsorship Opportunities Copyright © 2010 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin

2. 6-2 Pre-event Evaluation An Effort to Evaluate Sponsorship Opportunities with the Goal of Identifying the Best Opportunities for Investment While Rejecting Those that Are Unlikely to Produce an Adequate Return on the Sponsorship Investment Recall Earlier Premise that Sponsorship Motives Have Evolved to Focus on ROI

3. 6-3 Reasons for Increased Emphasis on Pre-event Evaluation Mass (Untargeted) Solicitations for Sponsors Increased Emphasis on ROI Increased Cost of Sponsorship Increased Number of Sponsorship Opportunities Increased Opportunities Beyond Sports Better Descriptions of Sponsor/Sponsee Target Markets

4. 6-4 Mass (Untargeted) Solicitations for Sponsors More Sponsees Using Less Selective Methods to Contact Prospective Sponsors No Real Effort to Match the Two Entities Risk –Rejecting a good opportunity out-of-hand –Investing in a poorly conceived opportunity

5. 6-5 Increased Emphasis on ROI Prospective Sponsors Will Weigh the Cost of Sponsorship Against the Benefits Specific Marketing Objectives Associated with the Sponsorship Investment Pre-event Evaluation Represents an Effort to Estimate the Value of the Anticipated Results before Investing in a Sponsorship

6. 6-6 Increased Cost of Sponsorship Rights Fees for Major Events Have Experience an Upward Trend World Cup of Soccer Sponsorship: $17.5 Million in 1994; $100 - $125 Million in 2010 Also Need to Consider Cost of Leveraging

7. 6-7 Increased Number of Sponsorship Opportunities Properties Increasing Their Number of Sponsors Properties Adding New Sponsorship Levels Properties Seeking Sponsors for First Time New Events Seeking Sponsors Sponsors Seeking International Opportunities

8. 6-8 Increased Number of Opportunities Beyond Sports Causes –McDonald’s & Muscular Dystrophy Association Entertainment, Tours & Attractions –American Express & the Eagles Concert Festivals, Fairs & Annual Events –J 2 O & the London Comedy Festival

9. 6-9 Increased Number of Opportunities Beyond Sports Arts –Boeing & the Seattle Art Museum Associations & Membership Organizations –J.D. Power and Associates & Detroit Chapter of the American Marketing Association

10. 6-10 Better Descriptions of Sponsee’s and Sponsor’s Target Markets More Information Available Better Defined Small Target Markets Better Targeting Available When Prospect Engages in Pre-event Evaluation

11. 6-11 When Are Pre-event Evaluations Needed? When Existing Contracts Expire When New Opportunities Emerge –Property Initiates Sponsorship Program –Existing Sponsors of Property Drop Out –Property Increases Number of Sponsors –New Property Emerges and Seeks Sponsors When a Marketer Decides to Seek Sponsorship Opportunity for First Time

12. 6-12 Evaluation by the Potential Sponsor Identify Corporate Marketing Objectives Delineate & Prioritize Specific Sponsorship-based Objectives Identify Set of Evaluation Criteria Assign Weight to Each Criterion in Model Rate Each Criterion (for Each Alternative) Select/Reject Opportunities Based on the Systematic Evaluation of Each Alternative

13. 6-13 Identify Corporate Marketing Objectives What Do We Want to Achieve with Our Marketing Strategy? Examples: –Increase Awareness –Enhanced Consumer Perception –Strengthen Brand Loyalty –Increase Sales –Attain Positive Public Relations & Publicity

14. 6-14 Delineate & Prioritize Specific Sponsorship Objectives What Do We Want to Achieve with Our Sponsorship Strategy? What Priorities? Possible Sponsorship Priorities –(3) Increase Awareness –(4) Enhanced Consumer Perception –(2) Strengthen Brand Loyalty –(1) Increase Sales –(5) Attain Positive Public Relations & Publicity

15. 6-15 Identify Set of Evaluation Criteria Identify A Broad Set of Evaluation Criteria Drop Box 6.2 in Here

16. 6-16 Identify Set of Evaluation Criteria Break Each Criterion Down into More Specific Evaluation Criteria; For Example: Budget Considerations –Affordability –Cost Effectiveness –Tax Benefits

17. 6-17 Assign Weight to Each Broad Criterion in Model Weights Should Reflect the Relative Level of Importance of All Criteria to Be Used in the Evaluation Process Common to Use 100 Point Basis for Allocation Purposes Other Basis Can Be Used if Desired

18. 6-18 Assign Weight to Each Broad Criterion in Model Consider the Following 3-Criteria Model Using a 100 Point Basis –Target Market Considerations (60) –Budget Considerations (30) –Event Management (10)

19. 6-19 Reallocate Weights to Each Specific Criterion in the Model For Each Broad Criterion, One or More Specific Criteria Will Be Used in the Evaluation Process Each Specific Criterion Will Be Assigned a Weight that Reflects Its Importance in the Assessment of the Broad Criterion in Which It Is Listed

20. 6-20 Reallocate Weights to Each Specific Criterion in Model Instead of a 100 Point Basis, the Basis Is the Number of Points Assigned to Each Broad Category In the Previous Hypothetical Model, the Points Were Allocated As Follows: –Target Market Considerations (60) –Budget Considerations (30) –Event Management (10)

21. 6-21 Reallocate Weights to Each Specific Criterion in Model In This Hypothetical Model, Assume that the 60 Points Allocated to Target Market Considerations Are Reallocated As Below: Target Market Considerations (60) –Geographic Media Coverage10 –International Coverage 2 –National Coverage 8 –Demographic Fit30 –Size (Reach)10

22. 6-22 Rate Each Criterion Using An Appropriate Measurement Scale, Each Criterion Is Rated on Its Merits Most Scales Use Between 5 and 9 Points in Order to Allow Adequate Discrimination Generally, a Negative Evaluation Is Assigned a Lower Number; a Positive Evaluation Is Assigned a Number at the High End of Scale

23. 6-23 Rate Each Criterion Consider a 9-Point Scale Where -4 Is a Poor Rating and +4 Is an Excellent Rating; the Scale Has a Midpoint of Zero. Each Criterion Can Now Be Rated on the 9-Point Scale

24. 6-24 Rate Each Criterion Consider an Example Where Coca-Cola Is Considering Renewal of Its Sponsorship with FIFA and the World Cup of Soccer Criterion Weight Rating Target Market Considerations (60) –Geographic Media Coverage 10 +4 –International Coverage 2 +4 –National Coverage 8 +1 –Demographic Fit 30 +3 –Size (Reach) 10 +4

25. 6-25 Complete the Ratings Process Multiply Each Rating by the Weight for the Corresponding Criterion Criterion Weight Rating W*R Target Market Considerations (60) –Geographic Media Coverage 10 +440 –International Coverage 2 +4 8 –National Coverage 8 +1 8 –Demographic Fit 30 +390 –Size (Reach) 10 +440

26. 6-26 Sum Results for All Criteria Result Will Be a Single Grand Total Maximum Possible Points for Any Model Equals the Aggregate Weight Total Times the Best Rating for Each Criterion In this Example: 100 * 4 = 400

27. 6-27 Applying the Results Use the Same Model to Compare Each Alternative Sponsorship Being Considered Can Compare the Results of One Alternative to Another Can Compare the Results to an Established Benchmark

28. 6-28 Applying the Results Drop in Table 6.4 Here

29. 6-29 Overview of the Process Drop in Figure 6.1 Here

30. 6-30 Sponsee Applications Allows the Sponsee to Evaluate Its Own Proposal from the Prospective Sponsor’s Perspective Understand Prospect’s Priorities Can Help Sponsee Decide Which Components to Offer in Its Proposal

31. 6-31 Closing Capsule Prospects Have Many Opportunities from Which They Can Choose The Increase in Opportunities and a Major Focus on ROI by Prospective Sponsors Have Led to Greater Emphasis on Pre- event Evaluation

32. 6-32 Closing Capsule Systematic Pre-event Evaluation Should Increase the Likelihood that the Sponsorship Will Achieve the Objectives Sought by the Sponsor More Independent Consultants that Can Help the Prospect with Pre-event Evaluation –Sponsorium - http://www.sponsor.com/home.jsfhttp://www.sponsor.com/home.jsf

33. 6-33 Closing Capsule Fewer Sponsorships Should Fail Fewer Failures = Higher Renewal Rates