The Meaning of Sponsoring : A study on the motives behind sponsoring a sports team and the following effects on brand awareness.

(1)

The Meaning of Sponsoring

A study on the motives behind sponsoring a sports team and the following

effects on brand awareness.

Bachelor Thesis within Business Administration Authors: Salar Roshandel 841117

Fredrik Skovshoved 860110 Tutor: Börje Boers

Jönköping December, 2009

J

Ö N K Ö P I N G

I

N T E R N A T I O N A L

B

U S I N E S S

S

C H O O L

(2)

i | P a g e

Acknowledgements

We want to take the opportunity to express our sincere gratitude towards the people who have contributed to make this thesis possible:

Börje Boers - our tutor who has guided us in the right direction by constructive criticism. Our fellow students - have given us a lot of useful and interesting feedback during

seminars.

Per-Ola Wennefors, Linda von Essen-Sylvén, Dan Nilhammer, Mats Westinius - the

interviewees at the investigated organizations who have all contributed with necessary information.

The Respondents - we would also like to express our gratitude to the ones who have

taken their time and effort to answer our questionnaires.

___________________ ________________

Fredrik Skovshoved

Salar Roshandel

Jönköping International Business School. 2009-12-09.

(3)

ii | P a g e

Kandidatuppsats i Företagsekonomi

Titel

: Sponsoring - A study on why to sponsor a sports team.

Ämne/kurs:

Bachelor Thesis in Business Administration (JBTC17)

Författare:

Fredrik Skovshoved & Salar Roshandel

Handledare:

Börje Boers

Nyckelord:

Sponsring, Sport, Motiv, Effekt, Varumärke

Bakgrund:

Sponsring är ett ämne som alltid har varit närvarande, fast än i olika former. Nyligen har konceptet dock blivit mer populärt och företag idag investerar mindre förmögenheter på att bli sponsorer av olika händelser, individer och lag. Dock finns det ännu inte mycket forskning gjord inom området, varför vi finner det intressant att undersöka vidare.

Syfte:

Syftet med denna uppsats är att undersöka, utifrån ett strategiskt marknadsförings perspektiv, vad en sponsrande organisationen vill uppnå genom att sponsra ett idrottslag och hur det påverkar varumärkeskännedom.

Metod:

För att studera vårt syfte har vi genomfört en fallstudie av HV71 och fyra av dess sponsorer, med syfte att förstå varför de har valt att bli sponsorer, och även att testa om och hur denna sponsring påverkar varumärkeskännedomen bland tittarna. Denna information tillhandahölls genom att samla in kvalitativa data för att kunna förstå motiven bakom sponsring, liksom kvantitativa data där syftet var att testa varumärkeskännedom och dess effekter. Den kvalitativa datan har samlats in genom att utföra intervjuer med fyra olika sponsrande organisationer; Kinnarps, Säkra Försäkringar, Elmia och M-Clean Papertech, medan kvantitativa data samlats in med hjälp av frågeformulär som delats ut till åskådare vid tre olika tillfällen.

Slutsats:

Denna avhandling visar att det finns en gemensam nämnare bland sponsorerna för HV71 till att ägna sig åt sponsring inom idrott, nämligen behovet av medieexponering och möjligheten att få ut varumärket på marknaden. Genom att inneha olika sponsringsrättigheter, kan varierande resultat av varumärkesexponering och medvetenhet uppnås. Sponsring siktar, inom strategisk marknadsföring på en mer långsiktig plan att öka varumärkeskännedom.

(4)

iii | P a g e

Bachelor Thesis within Business Administration

Title

: The meaning of Sponsoring - A study on why to sponsor a sports team.

Course:

Bachelor Thesis in Business Administration (JBTC17)

Auothors:

Fredrik Skovshoved & Salar Roshandel

Tutor:

Börje Boers

Key words:

Sponsoring, Sport, Motives, Effects, Brand awareness

Background:

Sponsoring is a topic that has always been present but in different forms. Recently however, it has become even more popular and companies today invest small fortunes on becoming sponsors of different events, individuals and teams. However, there is still not much research done within this field, hence we find it interesting to investigate further.

Purpose:

The purpose of this thesis is to investigate, from a strategic marketing perspective, what a sponsoring organization wants to accomplish by sponsoring a sports team and how it affects brand awareness

.

Method:

In order to solve our purpose, we have conducted a case study concerning HV71 and four of their sponsors, to understand why they have become sponsors, and also to test whether this sponsorship affects brand awareness amongst viewers. This information was gathered by collecting qualitative data to be able to understand the motives behind sponsoring, as well as quantitative data where the aim was to test brand awareness and its affection. The qualitative data was gathered by conducting interviews with four different sponsoring organizations; Kinnarps, Säkra Försäkringar, Elmia and M-Clean Papertech, while the quantitative data was gathered by the use of questionnaires which were handed out to viewers at three different occasions.

Conclusion:

This thesis shows that there is a common denominator in why to engage in sponsorship within sports amongst the sponsors of HV71 namely, the need for media exposure and getting the brand name out in the market. By possessing various sponsorship rights, varying results of brand exposure and awareness can be achieved. In strategic marketing sponsoring aims at a more long term increase in Brand Awareness.

(5)

iv | P a g e

1. Background

This following section will act as the foundation of our work. The reader will be introduced to the chosen topic and able to understand why we believe that this specific field of research is interesting and necessary to investigate further.

1.1 Problem Background

Recently, Usain Bolt signed a sponsoring deal with the Chinese shoemaker Li Ning at an astonishing amount of about 700 million Swedish kronor for the coming five years. The sponsorship says that Bolt will only be able to wear shoes produced by the company when competing at different events (Wennerholm, 2009). Having these huge figures in mind, one can ask oneself if it really is plausible to believe that these contracts can be beneficial for the sponsoring organizations. To be able to answer such a question, one must first understand the concept of sponsorship, how it works and what benefits there is to gain.

Sponsoring is not a new phenomena, it can be traced back as long as to the roman emperors time where artists and famous philosophers received money and other royalties for creating new books and art. Famous people like Leonardo da Vinci and William Shakespeare would for instance not been able achieve their accomplishments without the sponsoring which they received. Although this kind of sponsoring differs a lot from what we see today, the fundamental factors behind it are still the same - invest and you shall receive something back (Skinner & Rukavina, 2003).

At a later stage, during 1910-1970 the art of sponsoring became revolutionized by organizations that started to sponsor motor and golf tournaments but also individual participants. In the beginning these sponsors where mainly tobacco, liqueur and motor companies seeking for new ways to earn money and reputation (Skinner & Rukavina, 2003).

As one can see, sponsoring is something that has always been present but in different forms. Recently however, it has become even more popular and companies today invest small fortunes

(9)

2 | P a g e

on becoming sponsors of different events, individuals and teams. A research done by Meenaghan (1991) describes five factors which helps to explain why sponsoring has become so popular;

The increasing prices of media advertising.

New opportunities derived from the increase in leisure activities. The proof of success stories concerning sponsorship.

Increase in media awareness of sponsored events. The infectivity of traditional marketing sources.

1.2 Problem Statement

As discussed above in section 1.1, sponsoring has become more important and nowadays attracts more and more investments, organizations today are viewing sponsoring as a major marketing tool, seeking their way from other marketing tools. Dolphin (2003) lists some benefits which the sponsoring organizations can receive;

1. Creating greater reputation. 2. Creating brand awareness. 3. Stimulate sales.

However, Dolphin (2003) also states that the benefits which organizations receive from sponsoring are very hard to know exactly. Olkkonen (1999) supports this statement by saying that although the greater importance and money spent on sponsoring agreements, it is still very hard to measure the effectiveness of its nature. It is for example very difficult to try to realize and decide how much money the increase in brand awareness, goodwill and PR that sponsoring can generate will be worth. It is also very difficult to evaluate how large proportion of the increase in sales that comes from the increase in sponsorship.

Because of these drawbacks, one can start to wonder why it still attract so huge amounts of money as mentioned in the case of Usain Bolt, section 1.1. The topic of sponsoring becomes even more problematic and complex when an organization has no correlation with the sponsored partner and what it deals with; such as a furniture selling company which supports an ice-hockey team. However, many researchers are confident, that if an organization manages sponsoring in

(10)

3 | P a g e

the right way, it can have significant results. Cliffe and Motion (2004) were two researchers which investigated Vodafone‟s success on the New Zeeland mobile telephone market. This research concluded that Vodafone was a company which mainly focused on sponsoring as their most important marketing tool, by doing so they had gone from selling 150 000 to 1.2 million mobile telephones in just five years (Cliffe & Motion, 2004). From this, one can see that sponsoring indeed can work great as a marketing tool to create awareness and increase sales. However, as the article mention, Vodafone does not only focus on sponsoring, they have other marketing tools as well, so whether or not the entire success of Vodafone depends solely on sponsoring cannot be answered.

Although this example shows that sponsoring, if managed properly can be crucial for a company‟s success, it also shows the flaws of such a strategy. The authors Cornwell and Amis sum up and describe the complexity of sponsoring by stating that although sponsoring has proved to become more and more important, the fundamental question as well as problem still exists; how to measure its effectiveness (Cornwell & Amis, 2005).

As one can see, there are many positive aspects and thoughts about sponsoring, and its importance is stated by many researchers. However, as has been discussed, the effects are hard to distinguish and measure. Because of its importance, potential benefits and the problems attached to it, we want to examine why companies incline in sponsorship agreements; the motives behind it, what the sponsoring organization wants or hopes to accomplish by it, but we also want to get to know how sponsoring is seen from the viewer side, whether the organizations motives and strategies are working.

These problems described, lead us to what we believe is the most interesting part of sponsoring, and this is also the reason for why we chose to conduct a research concerning this field; i.e. why certain actors chose to become sponsors and invest money on different teams when not knowing exactly what and how much to gain; what are their motives, but we chose to examine whether sponsoring a sports team affects brand awareness.

During recent years HV71, an ice-hockey team from Jönköping/Huskvarna, has positioned itself as a top club in the highest league of ice-hockey in Sweden (Elitserien). Which has allows for great opportunities of sponsoring for both the club and possible sponsoring organizations. The

(11)

4 | P a g e

fact that HV71 is a team with outstanding success during recent years and their ability to turn this success into sponsorship revenues became the reason for us to focus this thesis on investigating further into this matter. Specifically we want to focus on the motives behind sponsoring HV71 and what possible effects they might have on brand awareness. This leads us to the following purpose which will act as guidance for the rest of our thesis.

1.3 Purpose

The purpose of this thesis is to investigate, from a strategic marketing

perspective, what the sponsoring organizations want to accomplish by

sponsoring the sports team HV71 and how it affects brand awareness.

1.4 Delimitations

This thesis aims at investigating the concept of sponsoring; the motives and reasons for why organizations become sponsors, and how it affects brand awareness. It should however be mentioned that this investigation will be limited to HV71 and its sponsors, an ice hockey team playing in the highest division (Elitserien) in Sweden. Hence, this investigation will reflect a team/organization which receives a great amount of exposure in media. Therefore, the results, analysis and conclusion which this thesis derives at will ultimately reflect the named field of investigation.

It should also be mentioned that this thesis focuses on the concept of sponsoring as a marketing tool, having an organization as the sponsor and the sports team as the sponsored part. Hence, sponsoring should be seen as business relationship between the organization which has some gains which they want to receive, (in this thesis named motives) from this relationship, and the sports team which receives compensation from being in this relationship, usually as monetary compensation.

(12)

5 | P a g e

2. Theoretical Framework

In this part of the thesis, the reader will be presented to the theories which we find most suited for investigating our purpose and solving our research questions which are stated at the end of this section.

In the theory section of this thesis we start off by explaining what sponsoring is, giving a definition to guide as a base for the thesis. To incorporate sponsoring into a company‟s strategy we discuss strategic marketing. Following is the concept of sponsorship and the many aspects one tends to overlook, this is important in order to gain a full understanding of sponsoring. The next section involves the A-ERIC model to find what motives that can lie behind the choice of sponsoring. Later on the creation of Brand Awareness through sponsoring is explained, this gives the reader information about brand awareness and explains how the motives from the A-ERIC model can affect brand awareness. To help explain this, we use the model: Company motives and Effects on Brand, which was created for this thesis by us, the authors.

2.1 Sponsoring defined

It is easy to read about Usain Bolt‟s and Vodafone‟s sponsorship agreements and not relate to the statistics of the deals, to simply read about the figures and not correlate to the extensive research and planning that has to be taken into account before constructing such deals. The concept of sponsoring can be perceived as something obvious and something which is not in need for more discussion and analyzing. However, there is no certain definition which researchers have agreed upon; the definitions are widely spread among different authors who all contribute to the field with their own definition of the topic. Therefore, we believe that a clarification of the definition of sponsoring is needed, as a basis to guide our theoretical framework.

“Sponsorship is a mutually beneficial arrangement that consists of the provision of resources of funds, goods and or services by an individual or body (the sponsor) to an individual or body (rights owner) in return for a set of rights that can be used in communications activity, for the

(13)

6 | P a g e

As mentioned in the introduction, sponsorship is not a new phenomenon and has been used differently throughout time. Philanthropic and commercial sponsorship are the two types of sponsorship and Calderon-Martinez, Mas-Ruiz and Nicolau-Gonzalbez (2005) define philanthropic sponsorship as a tool for improving corporate image and social recognition in the context of the community. Commercial sponsorship is defined as something that is used to achieve business objectives such as increased awareness or sales. Masterman (2007) argues that unless a donation is made by an organization anonymously it has some kind of commercial gain, direct or indirect (sales, increased brand awareness, recognition and goodwill).

Thus only a two-dimensional cooperation with mutual benefit for the sponsor and sponsored should be considered as sponsorship. A sponsoring part can consist of anyone who can gain commercially; individuals, organizations and institutions, from sponsoring; events, individuals, organizations, authorities, buildings etc. As well as the benefits can consist of; money (sponsorship fees), equipment, resources (medical, legal, utilities, accommodation etc.) Various types of deals are made to fit the needs of involved parties, but there is one common element, the mutual benefit of the sponsorship.

By the use of their status, reputation and stardom athletes and teams put themselves in a position to claim resources from sponsors for the “rights” which they possess. These “rights” are what sponsors are aiming to use for endeavors affiliated to the sponsored. Entitling a sponsor to have the right to use the name of a team in their business marketing is basically what today‟s sponsoring is all about. A classic example would be Nike‟s sponsorship of Michael Jordan and their Air Jordan brand range (Masterman, 2007).

2.2 The role of Sponsoring within Strategic Marketing

Our purpose states that we are going to investigate the concept of sponsoring and the motives behind it; as for why it should be treated as a strategic marketing tool. We therefore need to discuss and explain for why we, as many other researchers believe that sponsoring is best seen as a part of an organizations marketing strategy and not an independent “fun” thing which they support with money from time to time.

(14)

7 | P a g e

Vignali (1997) as well as Roy and Cornwell (2003) states that even though sponsoring is the fastest growing tool for marketing and that the benefits can be many if managed correctly; there are still not much research conducted on how to implement sport sponsorship strategically as a part of the organization. Sport sponsoring strategies has mostly of the time been an effect of certain peoples “gut feeling” who has believed that by becoming a sponsor they will receive some benefits, without really knowing how much money to invest, what benefits they will receive and how sponsoring may affect the organization (Vignali, 1997). Vignali (1997) further states that sponsoring should be dealt with at a more strategic level, evaluating the sponsorship agreement, setting up objectives, motives and benefits as well as measuring them. This view of sponsoring has been further motivated by Grönkvist (1999) who states that sport sponsoring should be treated as a long term strategic approach, not as a standalone marketing tool as for boosting sales during a shorter period of time. Hence sport sponsoring is by Grönkvist (1999) believed to have a more strategic and long term role as a way of generating sales over a longer period of time in the future. The role of the sponsor then becomes to find sports teams and events which can be incorporated and go in line with the rest of the organizations corporate strategy. As a result of this, we believe that as sponsoring is one of the fastest growing tools for marketing which attracts more and more money (Appendix 1), more effort, and affects people‟s views of the organization, the need for seeing sponsoring as a marketing tool which should be evaluated before implementing is crucial. Hence it should be treated as a strategic marketing tool because of its complexities and it should be incorporated into the organization as part of their long term strategy. That the role of sponsoring has changed from being more of a charity kind to become an important strategic marketing tool is further supported by the following statement:

“Sponsorship today is a well-integrated part of companies marketing strategies and it is no longer a question of charity, but a case of give and take, in order to benefit both parties” (Jiffer

& Roos, 1999, p. 63).

This statement shows that the previous view if sponsoring; being more of the charity kind were the main goal is to support a part that are in need, usually with monetary support, has changed towards a view were organizations meet other sports organizations in order to come up with a solution which benefits both parties. The sports organization receives some specific benefits such

(15)

8 | P a g e

as monetary gains, while the sponsoring part benefits from the agreement by receiving exposure in different arrangements for instance. Hence, one can conclude that the concept of sponsoring has changed from being a “one man‟s job” which only benefits the sponsored part, to becoming a win-win solution and an integrated part of organizations strategies. However, the reasons for becoming sponsors will guide what strategic options organizations will or should take.

2.3 Sponsorship Rights

In order to understand the sponsorship market, benefits in assets and associations that rights owners can sell, (Masterman, 2007), explanations will be given about what deals and packages are usually used when it comes to sponsoring. Important factors to be included from the rights owners are of course, negotiations with the buying parts, but even more important might be to control that all the media exposure and coverage promised in the deals are corresponding to the deals negotiated. From the buying part, the most important aspects are matching the right package deals, sponsoring rights and program structure with the need for exposure and commercial value of their company, as well as matching their budget requirements.

2.3.1 Categories of Sponsorship Rights and Structures

Sponsors have through different packages and sizes of deals become more important to their partners and accordingly the titles have changed from a simple sponsor tag to the more exclusive titles such as “official partner”, pillars, hosts, friends, corporate champions and principal sponsors (Masterman, 2007). Even though there are many names and titles used today, five categories are generally considered for sale (Masterman, 2007):

Title rights – maximizes the sponsor‟s corporate, product or brand names as media

exposure through the use of logos, event titles and graphics (Coca-Cola Olympics 2008) Presenting rights – usually not included in graphics and are often presented next in line

considering titles and logs (The F.A Cup presented By E.ON)

Naming rights – association is generally made to physical structures e.g. arenas, galleries and stadiums. Usually long-term agreements are made (Emirates stadium in London and Kinnarps Arena in Jönköping)

(16)

9 | P a g e

Sector rights – nowadays seen as a standard in sponsoring, the sector rights allow for exclusiveness for a sponsor. Each trading sector of a market is represented by only one exclusive sponsor, which facilitates their mission accomplishments for the specific sponsorship (Gatorade exclusive Sports-drinks sponsor for NFL) Supplier rights – usually supplier rights are included in sponsorship deals, meaning

services, people and products are either a part of the sponsorship along with fees, or they are the sponsorship per se (Gatorade supplies NFL with drinks)

A rights owner must also care for not maximizing the number of sponsors in order to maximize revenue, however appealing it might seem. When using program structures while selling sponsorship rights, one can control both revenues and allow sponsors to keep some exclusivity (Masterman, 2007). The sponsorship programs usually consist of:

Solus sponsorship - one sponsor possessing all the rights.

Tiered structured sponsorship – hierarchical rights and exclusivity (Gold, Silver etc.). Flat structured sponsorship – several sponsors involved, exclusivity kept to a minimum.

2.4 The motives behind Sponsoring – A-Eric model

In order to understand sponsoring, why it can be as beneficial for different organizations as so many researchers as well as existing organizations seems to believe, it is vital to investigate the motives behind why so many organizations put effort in this certain field of marketing. The reasons for using sponsoring of course differ from case to case, organization to organization. However, although its complexities, there are some common motives and reasons for becoming a sponsor, whether you are a giant multinational company or a one man firm. Therefore we believe that it is necessary to get an understanding of the motives since this is the fundamental and basic reason for why this subject exists today.

Jiffer and Roos are two well known researchers within the field of sponsoring who have come up with a model called A-Eric. In this model, they outline what they believe are the four most important motives and also describes how the different choices of sponsoring tools and motives can be dealt with and how it can be used by organizations as a basis for a long term strategy.

(17)

10 | P a g e

Depending on the structure, the motives and why organizations sign sponsorship agreements, they are in need for structuring and focus on the most essential parts of their motives. This is what is described in the A-Eric model; it organizes and narrows the topic of sponsoring motives down to four different areas - Associations, Exposure, Relationships and Integrated communication (Jiffer & Roos, 1999). The purpose of the model is to assist the sponsor when organizing the sponsorship agreement, to be able to evaluate the effects which can come from sponsoring, having these four specific topics in mind - it is a way for the sponsor to evaluate how beneficial or negative the agreement will be as a tool for fulfilling the corresponding motives behind sponsoring.

Before signing a sponsorship agreement it is necessary to understand and investigate what effects and gains such an agreement may have. Although this model is great tool for companies to focus on each and every one of these four categories, Jiffer and Roos (1999) states that an organization should not think of these four categories as independent strategies, rather they should be seen as supplementary to each other and a sponsor must have all of them in mind when valuating this model.

(18)

11 | P a g e

Figure 1: A-Eric model (Edited by researchers)

Sponsoring Association Exposure Relationships Integrated

Communication Media Emotions. Values. TV. Magazines. Events. The event as a

meeting place. TV. _Radio. Internet. Printed media. Activities Positive correlation. Press conferences. Arena commercial. Logo typing. Opening ceremonies. Awards. Invitations. Participation. VIP areas. Advertising. Sales promotion. Sampling/Sales. PR-activities. “Point of sale” material. Motives & Effects with Sponsoring Change or increase image. Create loyalty. Brand exposure. Introduction of new products. Enhance product quality. Media coverage. Networking. Staff activities. New customers. Special meeting points - entertain. Enhance campaigns and deliver message. Image creation. Reaching new customers. New “non commercial “channel.

Source: Jiffer & Roos (1999, p, 36.)

2.4.1 Associations

According to Jiffer and Roos (1999), association is the most important aspect of sponsoring. To be seen and associated with a sports team can create a beneficial association with the positive effects and emotions which the team arises towards viewers. This is also supported by Grönkvist (2000) who states that association and image transferring is one of the main motives behind sponsoring. By being viewed and seen together with a part that attracts a lot of positive publicity in different circumstances, the sponsor will be able to take part of these positive effects. Sleight (1989) states that this is the main motive behind becoming a sponsor, his definition of sponsoring

(19)

12 | P a g e

states that a sponsor receives some specific rights such as tickets and VIP areas, but also the most important part which they pay for; positive association which can be used for commercial advantages. Kotler, Wong, Saunders & Armstrong (2005) discuss the role of image transferring as a communication tool for creating a positive feeling towards the organizations brand, the most important aspect of image transferring according to these researchers is the role of creating a positive brand awareness and brand recognition. Therefore, the sponsoring organization often strives to find a part which only attracts positive feelings, since the problem with image transferring and association is that all the feelings which the sponsored object attracts will reflect their feeling towards the sponsoring part, positive as well as negative effects.

However, Grönkvist (2000) argues for exposure as the single most important motive for organizations to become sponsors and not associations. Jiffer and Roos (1999) on the other hand argues that exposure indeed is a crucial part of sponsoring which has and should continue to have a great impact when deciding if to become a sponsor. But, even more important according to the researchers is associations, as it describes the how. Meaning that it describes how the exposure will be reflected by the viewers. Just stating that the organization needs to create more exposure is by their means not enough, the most important factor is how the exposure will reflect the message which they want to convey (Jiffer & Roos, 1999).

As a strategic marketing approach, sponsors will take on the risk of sponsoring a team whose popularity will depend on their results on the field; having the implication that the sponsor will sometimes not only gain by positive association but also negative association in bad times. Jiffer and Roos (1999) therefore argue that it is crucial for the sponsor to investigate in more detail what results the sports team are likely to manage in the coming future and not only for the existing season. Jiffer and Roos further stress the importance of being up to date and having a deeper collaboration with the sponsored part for gathering information on what direction they are going in; a positive or a negative trend. This is especially crucial when using sponsoring as a long term strategic marketing tool, to be able to evaluate what benefits and effects the agreement may generate (Jiffer & Roos, 1999).

(20)

13 | P a g e

2.4.2 Exposure

Exposure can be understood as raising attention (Kotler et al., 2005). In this case, it can be in the form of a logo on a team‟s shirt or anything which makes the organization visible together with the sports team and its surrounding.

For a long time, this has been the most common motive for companies to become a sponsor (Grönkvist, 2000). Meenhagan (1991) states that receiving exposure and publicity is the most basic motive behind sponsoring; whether organizations claim that the motives is to be seen as a good citizen, they are not able to do this without receiving some kind of exposure. Hence the fundamental motive behind sponsoring is exposure. Jiffer and Roos (1999) agrees that this topic is necessary and crucial for raising attention and to show that the brand exists, although, they claim that a strategy which only focus on exposure will most certainly not fulfill the underlying motives that the organizations wants to achieve since it must also convey a message. Therefore does Jiffer and Roos (1999) mention that the sponsor must also look at how this exposure will take place so that it conceives this message which they want to deliver.

As discussed by Grönkvist (2000), the amount of exposure may be measured in several different ways, although the exact amount will mostly never be estimated since it is impossible to know how many that sees the logo or how many that views the game. However, the impact of the exposure is instead very difficult to measure. This is something which Grönkvist (2000) find as very troublesome, but equally important as the amount of exposure a company receives.

2.4.3 Relationships

Jiffer and Roos (1999) concludes that sponsoring may be a great way of building and maintaining strong relationships as they let the sponsor meet customers outside “working hours”. By sponsoring a sports team many sponsors receives specific seats or VIP areas where they can invite and meet their customers. Ford (2003) argues that this strategy mainly works for business-to-business relationships. Jiffer and Roos (1999) however states that this kind of motive can act as a strategy for creating bonds with the viewers who are not necessary only business customers. The strategy can also be to maintain the internal relationships by giving out tickets to sponsored events to employees as bonuses.

(21)

14 | P a g e

According to Grönkvist (2000), this motive can be accomplished in two ways which will have different effects; indirect and direct effects. The indirect effects come from the relationship that exists with the crowd. By being exposed and seen in positive contexts, it can act as relationship building since customers will tend to be loyal and remember the organization as something positive. As mentioned, sponsoring is sometimes used for personal motives; the CEO who wants to be famous and stand side by side with different athletes. However, Grönkvist (2000) describes this as something which can have positive effects internally within the sponsoring organization. By sponsoring a team or an event, employees can feel proud over the company and for working there; hence it is a way for the organization to keep their employees motivated. The direct effects come from such things as sponsored events, where representatives from the sponsor meet and interact with other people and in such ways establish connections.

What relationships a sponsor want to establish or maintain from being part of sponsorship deal may differ from case to case and so the type of sponsoring and strategy may also differ. However, having these kinds of motives in mind, and seeing sponsoring as a relationship building tool, one can conclude that it from this point of view could be categorized as a relationship marketing tool. This has the implication that the sponsoring part must understand what shareholder they want to target, understand them and their needs and to deliver a message which they appreciates (Lagae, 2005).

One certain risk factor which Jiffer and Roos (1999) argue for is that the customers which are invited to these events should have some kind of interest within the field. Therefore, the task for the sponsor becomes to find and make sure that the segments which are their preferred customers do want to attend this event; otherwise it may attract negative effects. Hence, an organization should only sponsor a team if they are sure that it reaches out to the ones they are interested in affecting.

2.4.4 Integrated Communication

Sponsoring can be used as a part in a mix of different marketing strategies and campaigns to increase the value of the campaign and to create a coherent feeling though the entire campaign, as a part in a larger puzzle. This is how Jiffer and Roos (1999) describe the topic of integrated communication. By combining other types of marketing tools such as TV and radio commercial,

(22)

15 | P a g e

magazine and bulletin advertisement together with sponsoring, the sponsor will be able to deliver a coherent message to its target customers and raise greater awareness for the existing campaign (Jiffer & Roos, 1999). This strategy is especially effective when launching new products, penetrating new markets and raising awareness for specific campaigns/events (Gwinner, 1997). Hence, from this point of view and with these kinds of motives sponsoring should be treated as a short term strategy for raising awareness for the moment rather for the forthcoming future. Organizations can then ask themselves why putting money and effort into becoming a sponsor instead of just relying on other marketing tools? Roos & Algotsson (1996) states that while marketing tools such as TV commercial is highly avoided by the viewers if possible, sponsoring is something which can be seen as something positive instead and generate positive emotions. It also possesses the benefit that it reaches out to the viewers, it cannot be turned away by changing channel for instance, and hence the message will be delivered in a more effective way. As a result, sponsoring can be very useful as to generate positive feeling towards a campaign, and the positive effects from the sponsored event can be transferred over to the other advertisement and commercials which in turn creates appositive feeling towards the entire campaign (Jiffer & Roos, 1999). This kind of strategy with sponsoring does often include a more deep going relationship with the sponsored part as it demands something special, not just a logo on a sweater. However, it is mainly used for campaigns and is more correlated to sponsoring of events which can be seen as a short term strategy, rather than a strategic one.

2.4.5 Model discussion

From these aspects discussed in previous sections, one can find that these four aspects should not be seen as independent motives with different strategies, they should rather be seen as supplementary to each other as only focus on one of them will not generate the benefits which they would do when matching them together. As Jiffer and Roos (1999) discusses further, some of the aspects may not exist without the other. The strategy of associations will not be able to become fulfilled without some kind of exposure. We do not however agree with Jiffer and Roos (1999) when they state that associations are the single most important factor of sponsoring strategies. Instead we claim as many other researchers such as Meenaghan, (1995), Grönkvist (2000) and Gwinner (1997), who all state that exposure is the most crucial factor. This is because without some kind of exposure the other strategies will not be able to exist. Exposure must

(23)

16 | P a g e

therefore be seen as the most fundamental basis for strategy building when talking about sponsoring. Since, how do sponsors get associated with a sports team if they do not attract any attention which corresponds to the team? Therefore we argue that exposure should act as the building block when developing with sponsoring strategies, to first decide and figure out in what

way they will be presented with the team, and at a later stage decide on how they will be

presented. However, the point which Jiffer and Roos (1999) argue for in this model is very important to bear in mind for organizations when evaluating if to become a sponsor; that the concept of sponsoring cannot be answered just by focusing on a specific aspect. The topic is more complex than that and one must take all the different aspects into consideration when putting up a long term strategic goal.

2.4.6 Additional Motives

Although the A-Eric model is well renowned and used by many researchers, we do find it necessary to take use of other motives as we do not believe that this model captures and describes all the different motives which organizations can have. Therefore, we have chosen to include two other motives which are commonly used by researchers.

Good citizen and Social impact

The time when organizations could only look at their own interests and not care about their surroundings is long gone. Organizations today are trying to act, or at least to be seen as good citizens in the eyes of their shareholders. The pressure from the society in which the organizations works has increased, to act locally by supporting different local organizations and be seen as the “good guy” has become more important (Grönkvist, 2000). This is further supported by Carroll (1991) who discuss the topic of CSR (Corporate Social Responsibility); that today some organizations implements certain divisions of people whose only task is to make sure that the task performed by the other departments is seen as “good citizenship”. Hence, sponsoring is a way for organizations to be seen as supportive and of this comes benefit such as increasingly loyal customers. If the companies were only to look at their core business, and not act as role models they would risk losing their support and respect from the community. Therefore, sponsoring has become a useful tool and a way for organizations to prove their responsibility and support towards the community in which they act. However, Grönkvist (2000) mention that sometimes the pressure from the society makes companies react by sponsoring

(24)

17 | P a g e

events and other organizations which they would not do otherwise. This can result in negative effects for the sponsor since the events and organizations were not examined in detail.

Increase in Sales

This is probably the most common reason for encouraging sponsoring, since an increase in sales is what all companies want. However important and essential an increase in sales from sponsoring agreements may be, this is not a standalone motive for sponsoring, it should be seen as the long term effect of some of the other motives, and just looking at the increase in sales may lead to misdirected sponsoring (Jiffer & Roos, 1999). According to Grönkvist (2000), using sponsoring as a tool for boosting sales under a limited period is rarely seen as he believes that sponsoring concerns the long term strategies, rather than short term. Hence, the sponsor should therefore search for events and teams which they can support over a longer period of time in order to create an increase in sales in the future.

All these motives should not be seen as standalone motives for organizations to take part of sponsorship deals. These different motives are correlated with each other and organizations cannot, nor should they focus only on one single motive. Instead, they should focus on having all these motives in mind, in different order of priorities to be able to attract as much positive publicity as possible.

2.5 Creating Brand Awareness through Sponsoring and the

following effects

With the development of media types such as Television and Internet during the 21st century, the coverage of sporting events has increased heavily and allows for people all over the world to take part of sporting scenes from everywhere. Noticeable extensions have been made to the Television channel range and games, events and ceremonies can be viewed online on a 24 hour basis. This provides for a significant opportunity for companies to present their brands and product-lines to not only the spectators but also the viewers sitting in remote places watching. Keller states that “anything that causes the consumer to „experience‟ or be exposed to the brand has the potential to increase familiarity and awareness” (Keller, 1993, p.10), if we consider his words together with the fact that media coverage of sports has grown to today‟s level and is still

(25)

18 | P a g e

growing, it is clear that companies can profit from this situation by maximizing the exposure of their brand.

2.5.1 Brand Awareness

To be aware of a brand can be explained as being able to identify a brand within a category of products and eventually be drawn to it to the extent of a purchase. Brand awareness does not always imply the recognition of a brand name but can also be the response to a visual image connected to the brand. According to Rossiter and Percy (1992), two types of brand awareness are brand recognition and brand recall.

Brand recognition – the typical situation for brand recognition to occur would be in a shopping

mall or a retail store. For instance a consumer is out shopping for sweaters and does not have any specific brand in mind, that is, until he/she discovers a section of the store or mall containing sweaters of a specific brand which is immediately recognized and thus leads to a purchase.

Brand recall – on the other hand does not imply a walk around a store, but more a decision made

pre-hand. A situation involving brand recall could occur as follows; a consumer sets out to buy a sweater and through memory recalls which store and brand to visit for a purchase, without having to see the brand name or image in real life.

As described by the name, Brand Awareness, the success of this phenomenon lies with the presence of a brand in a target‟s mind (Aaker 1996). Stronger presence gives stronger awareness and since domination is sought for amongst other brands in order to succeed in having the leading brand, repetitive advertising is a key issue. Thus sponsoring a sports team will indeed lead to repeated “hits” on targeted consumers.

2.5.2 Sponsoring: Motives and effects on Brands

The following model has been developed from our own insights and knowledge that we have gained from writing this thesis so far. The aim with this model is to show the relationship between motives that companies may have for sponsoring within sports and the effects they actually have on both targeted and untargeted consumers‟ view of the brand. We base the accuracy of these effects on the research of well known marketing authors such as Aaker (2003, Cheverton (2006) and Chernatony (2006).

(26)

19 | P a g e

We will include the six motives mentioned in 2.4 as we feel that they will provide us with an excellent base for this model.

Effects 1: A well-known brand will create loyalty amongst consumers and thus a higher price

can be charged Cheverton (2006), motivated by Chernatony (2006) who claims that the consumers experience a lower risk and spend less time searching when buying a well-known and familiar brand. Furthermore a certain societal status or identity can be achieved, or at least perceived, through purchasing or using specific products or brands (Chernatony, 2006).

Example: Luis Vuitton, the French luxury brand, is a devoted sponsor of sailing and marine sports as well as the yachting industry, due to the luxurious and prestigious surrounding. Indeed this allows for extreme prices for their products and a certain essence around the Luis Vuitton brand. Consumers know already before a purchase is made that they have a high quality product with a top of the line brand name, which will help define their social status.

Effects 2: By establishing a wide base of customers and keeping emotional connections, loyalty

(27)

20 | P a g e

brand should be linked to the company‟s vision according to Mårtensson (2009) and thus social responsibility and good citizenship allows for a great opportunity to show a company‟s better side.

Example: Adidas “impossible is nothing” campaign started in 2004 and consists of their biggest athletes such as Muhammad Ali, Haile Gebrselassie and David Beckham. The various athletes show the width of Adidas sporting goods and their involvement around many regions of the world. This quote from Erich Stamminger, member of the Executive Board of adidas-Salomon AG, responsible for Global Marketing and President of adidas America, clarifies and perfectly exemplifies a sponsorship campaign matching given motives.

“Impossible is nothing” captures in one short phrase the essence of adidas as a brand and the attitude that is known and shared by all athletes around the world, “Impossible is nothing” is the concept behind our brand positioning “forever sport” that clearly and emotionally communicates our passion for sport.” He added, “As an athlete you always strive to go further, break new ground, and surpass your limits. So do we as a brand, to achieve our mission to be the leading sports brand in the world.” (Adidas, 2004)

Effects 3: A brand can be established as or find a specific niche such as, a class brand, high

profile, modern, norm breaking or inventive brand, amongst many other descriptions. Consumers tend to part a product from another by the name or brand instead of functions, which may or may not be very similar (Aaker 2003). This will usually lead to increased or at least maintained sales for these “front edge” brands. A brand name (immaterial) can often possess a larger economical value than the company‟s real material assets. Mårtensson (2009) points out strong brands as very beneficial for the pride and culture of the employees as it gives a confidence and pride boost, which will in turn lead to better results and a better image shown to the “outside world”. Riding the wave of success is easier then experiencing failure.

Example: Even though they might not be focusing on sponsorship within sports, Google exemplifies this effect explicitly. To start of one can mention that before Google entered the search engine market; there were numerous competitors in the market who were performing well. But with extensive marketing in movies, television show and ads, the phrases “Google it” and “to Google something” became synonym to searching for something on the Internet. Indeed

(28)

21 | P a g e

Google‟s strategy became a huge success and even though other search engines offer an equivalent service, nowadays people “Google” for information instead of searching for it. The brand Google stands for innovation, norm breaking and of course modernity. The success of the company transfers to the employees and their innovative ways of working and creating new products has kept the success at the highest level and the brand Google is nowadays considered as one of the most valuable in the world.

2.6 Research Questions

Having introduced and discussed the theories which we find most suited for this thesis; clarifying the concepts of sponsoring and strategic marketing, and how they are related to each other, describing the different kinds of sponsoring deals and their structure, the motives for sponsoring, the importance of brand awareness and how it is created, the A-Eric model, and combining the motives from a sponsors side, their strategies and the effects it has on costumers, we will now describe the research questions which we believe will help solving our purpose.

In the quest for finding both proper and efficient research questions, one must keep in mind that a research questions must identify the phenomenon that is studied, namely in this case, sponsoring the HV71 hockey team. Our first research question is:

What are the motives behind sponsoring a sports team such as HV71?

This question is related to the motives behind sponsoring HV71, as mentioned in theoretical framework, there are six major motives behind sponsorship, which we have included in our model: Sponsoring: Motives and effects on Brands, section 2.5.2. We also strive to answer the research question:

How will sponsoring HV71 affect brand awareness amongst supporters?

The question includes the base of our case study, sponsorship of HV71, as well as the main motive for sponsorship, the increase of brand awareness. Since we will conduct our questionnaire with the focus on supporters of HV71, we also included this aspect in the question. This is due to being able to receive a clear answer to our question and avoid biased answers from subjects who are not affected by neither HV71 nor their sponsors.

(29)

22 | P a g e

3. Method

In this chapter, different aspects and topics within the field of research methods is presented and discussed. Starting off by explaining what type of study we are making, followed by describing the different theories in which one can conduct a research and motivating our choice. Our choice of research techniques will also be motivated followed by describing how we will analyze the data and at the end we will explain how we have assured reliability and validity.

3.1 Qualitative vs. Quantitative

The collection of data is made either through a Quantitative or a Qualitative approach. Quantitative collection of data uses numbers and standardized data which are to be analyzed into trends or patterns (Saunders, Lewis & Thornhill, 2007). Preferably quantitative data should be collected in larger numbers suitable for the purpose of the project. On the other hand qualitative data is considered by Bryman (2002) to emphasize an individual‟s perception of a situation and information. The importance of large quantities is greatly reduced by the use of qualitative data, but also leads to a greater possibility of receiving biased data than with the use of quantitative data.

This thesis will include the use of both quantitative and qualitative data in order to match the purpose. By the use of qualitative data from interviews with sponsoring parts of HV71 we will try to get a deeper understanding of their motives to sponsor HV71 and what they aim to accomplish by doing so. Questionnaires will also be handed out to supporters of HV71 at a home game (before and after game) as well as at a pub where supporters have come to watch the game.

3.1.1 Qualitative

Interviews were conducted with people at high positions from chosen sponsors of HV71, the aim was to include categories of sponsors with diverse rights specifically; presenting rights and naming rights. The major purpose of the interviews was to investigate, accordingly with the purpose of the thesis, what the main aim of a sponsorship involving HV71 is for the sponsors. Whether a local connection and compassion for the regional sport clubs are enough or an underlying economical ambition of future increased e.g. sales, brand awareness, goodwill etc. is

(30)

23 | P a g e

present. Examples of questions are available in appendix 2. The collected information from the mentioned interviews is to be analyzed with the intention of answering our research questions, stated in 2.6.

3.1.2 Quantitative

A questionnaire was developed with the aim to investigate whether the intentions of the sponsors really reached their objects and whether sponsoring creates brand awareness. We aimed to include supporters of HV71 (present at the games and at local pubs) and residents of Jönköping who were not considered as fans of HV71 (consideration was not given to the fact that HV71 is a regional team and even though one might not be considered as a fan, ones sympathies might or might not lie with the mentioned club). Furthermore, demographics was considered but limited to diversify the subjects used for questionnaires by age and availability. No consideration was given to any extreme cases, being diehard fans or uninterested objects.

According to Johns and Lee-Ross (1998), quantitative data should never be accepted as the truth, the results simply depend on too many variables. For example; which organization that conducted the research, which sponsors were active, interpretation of the conclusions, the way the questions were posed as well as the reliability of chosen methods for measuring of the results.

3.2 Induction vs. Deduction

When considering what approach to use for the research of this thesis, one must first explore the differences between the two main types of approaches namely, Inductive and Deductive approach. Starting with the deductive approach, Saunders et al. (2007), mention the use of data in order to test existing theory. Usually a deductive approach is suitable when researching within an area where extensive research already has been done and theories are available to confirm. Accordingly an inductive approach includes the analysis of qualitative data in order to reach new conclusions and thus form new theories. We intend to confirm motives behind sponsoring HV71, by the use of shorter interviews with marketing managers from sponsoring companies, with help of the theories mentioned in theoretical findings. Our research questions, which are based on the presented theories, will be tested through a questionnaire given to supporters of HV71. Consequently we will strive for a deductive research approach for this thesis. Albeit performing

(31)

24 | P a g e

a case study on sponsorship of HV71, we do not strive for developing any new theories but testing whether existing theories can be applied to this case.

3.3 Case Study

When research is conducted involving a specific phenomenon and compared to a real case example through different methods, this is called a case study (Yin, 2003). The aim of a case study is to gain deepened information and knowledge about a smaller amount of “cases” or even a single “case”. Cases can be companies, co-operations, individuals or specific situations (Yin, 2003). Yin (1994) mentions two types of case studies, Holistic and Embedded, the latter implying, in a single case study situation, that multiple units of analysis should be included to find consistent patterns within a case. Furthermore Yin (1994) argues that collection of evidence can be made in six ways:

1) Documents (letters, agendas, progress reports)

2) Archival records (Service records, organizational charts, budgets etc.)

3) Interviews (typically open-ended, but also focused, structured & surveys are possible)

4) Direct observations (formal or casual)

5) Participant observation (getting an inside view of the events) 6) Physical artifacts

Since this thesis‟ purpose is to investigate what a sponsoring organization wants to accomplish by sponsoring a sports team (HV71), the case of this study will be the phenomenon; of

sponsoring HV71 and the motives behind it. The units of analysis will consist of Kinnarps, Säkra

Försäkringar, Elmia and M-Clean, who were interviewed in order to find their motives behind sponsoring HV71, that is, what they want to accomplish by the sponsorship. The reason for choosing these sponsors is that they represent varied types of sponsors, which means that they possess different sponsorship rights, acts in different markets and are of different sizes. Primary data have been collected from the interviews with marketing managers at these companies as well as secondary data through their web-pages and brochures. To test whether the goals of the mentioned sponsors are successful or not, we also collected data from supporters of HV71 with the intention of measuring the effects of their sponsorship.

(32)

25 | P a g e

In addition to the included sponsors of this section, we have had contact with a major sponsor of HV71, which name we chose not to include, who although being a sponsor of large scale and during a long period does not have any clear strategy at all. At least not to the point to be able to neither provide us with any helpful answers nor find the time to explain further. The reason stated from this company was that a structural change within the company has lead to an investigation whether sponsoring HV71 is of great importance or not and until this investigation is completed no further information was available. Thus our original intention of including two larger sponsors had to be replaced and we chose to focus on a variety of different sized sponsors.

3.4 Collection of Data

As our purpose is to investigate the concept of sponsoring from a sponsors point of view, the way in which we gathered data was by combining a qualitative as well as a quantitative approach, we believe that interviews was a great way to gain qualitative information, while surveys was handed out to gain quantitative information. However, to support the interviews and surveys, and get some background information as well as to fill the gaps where it was needed, we also needed to take use of secondary data in order to collect all the material and information needed.

3.4.1 Secondary data

For supporting this thesis and making it more credible, as well as to find other useful information which we could not gather by ourselves we took make use of secondary data where we found it necessary. Documentary secondary data (Saunders et al., 2007) was gathered in the following way:

Through different organizational websites in the form of written materials such as HV71s homepage to be able to find how they are organizing the different kind of sponsors.

Information folders retrieved from HV71, where information about prices, sponsoring deals and different exposure opportunities are stated.

The reasons for choosing secondary data are many. It is cost-effective since it lets the researchers focus more on interpreting and analyzing the material rather than gathering it (Saunders et al.,

(33)

26 | P a g e

2007). It can also increase the credibility of the researchers own studies since the founding‟s can be compared and conclusions drawn from, to check whether the results you have come up with are in line with previous studies. The third advantage is that it may not be able to find the information needed without using secondary data, a comparable research may not be able to be investigated as a specific event has already occurred.

However, a word of caution must be mentioned as the material gathered from these sources can be biased by the authors, hence the information needs to be examined and references checked properly to be able to use this information confidently. Another disadvantage with using secondary data is that the information gathered may have been collected and interpreted for a purpose which does not match our (Denscombe, 1998).

3.4.2 Primary data

Primary data collection can be divided into three groups; interviews, observations and surveys (Saunders et al., 2007). As this research is based on a mix between a qualitative approach as well as quantitative one, this research technique is best called mixed-methods (Tashakkori & Teddlie, 2003). They point out that only taking on a qualitative approach or a quantitative one does not generate a satisfying result since by combining them the researcher will get a deeper understanding and the researchers work will become more credible.

3.4.2.1 Data collection through interviews

The reason for why we have chosen to conduct interviews is because we want to be able to get a more deep-going and descriptive understanding about why organizations becomes sponsors, and to be able to get more descriptive answers and ask counter questions.

As this approach reflects the qualitative part of our thesis, we as well as King (2004), believe that interviews are the best way to go around when the purpose of the research is to explore and understand the reasons for why the respondents have taken some decisions and actions, in our case; signing a sponsorship agreement.

The questions which we used for the interviews are found in Appendix 2. As one can see, they are open-ended questions (Saunders et al., 2007) so that the interviewee was able to answer freely on the questions and give us better descriptive answers. These kinds of interviews are

The Meaning of Sponsoring : A study on the motives behind sponsoring a sports team and the following effects on brand awareness.