Turning Lemons into Lemonade Part II
Jan 26, 2009
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That's what Steve Seyferth, the president of SSG Marketing, is saying, too. Seyferth - whose 25-year career has included top strategic posts at Young & Rubicam, America Online, Sports Illustrated and Bayer Bess Vanderwarker - believes that it's all about metrics in today's marketplace.
His Ann Arbor, Mich.-based company, whose current work includes agency-of-record duties for AT&T's Corporate Hospitality and Event Groups as well as projects for Ford's Customer Service Division, attacks problems using Six Sigma, a business management strategy first developed by Motorola that aims to identify and then weed out the causes of weaknesses or defects in manufacturing and business models.
Seyferth strongly recommends that clients in sports related marketing partnerships do not, under any circumstances, accept vague answers about the performance of their sponsorships.
"We're a strong metrics company," he says. "We believe that sponsorships need to be measured and can be measured. And we believe that once you've adequately made those measurements that sponsorships typically need to be modified. That's how people maximize their investments." Unsurprisingly, the unofficial slogan of SSG Marketing is "Measure. Modify. Maximize."
"I think that everyone nowadays will be looking at every dollar they spend," Seyferth continues. "And they will be looking for clear and precise valuation information not only on their return on investment but their return on objectives as well. It's a much more disciplined approach.
"As we move forward [through the year] there's going to be companies that look at the line in their budgets that is for sponsorships, and some companies are going to just cut that line. But I would suggest that there's a smarter way to do it than to just slash something that could, if handled in the right way, be a great investment."
Measuring and modifying works on many levels -not just financial. When London-based telecommunications giant Sony Ericsson signed on in January 2005 to become the title sponsor of the Women's Tennis Association, its primary objective was to burnish its brand image around the globe. Four years later, the six-year, $88-million deal has done that and more for Sony Ericsson.
The Sony Ericsson WTA Tour combines 50 tournaments and four Grand Slam events that take place annually in more than 30 countries. The WTA also, not incidentally, includes about 2,200 incredible athletes, many of whom match their on-court brilliance with off court brand-building initiatives.
But that was then. This is now.
"When we entered the WTA deal, the original aim was to increase brand awareness and create traction for the brand with a wider audience, particularly with women and youths both female and male," explains Aldo Liguori, Sony Ericsson's global head of communications and one of the top executives overseeing the sponsorship of the Sony Ericsson WTA Tour. "What has happened now, though, is that the sponsorship has evolved and we are, as much as possible, trying to link it to our business objectives, which is to sell phones."
Liguori goes on to say that Sony Ericsson, which in September of last year became an event sponsor for the 2010 FIFA World Cup, most likely will not enter into any major new sponsorships in 2009. Instead, he adds, Sony Ericsson will be looking to "achieve more in terms of ROI and better leverage the opportunities" the company currently holds.
"The initial objectives are no longer relevant. We've already achieved them," he says. "So, as a title sponsor, we have had to evolve to the next level. I'm of the opinion that even if we didn't have the added challenge of the current economic conditions, we would have had to do that anyway. But now I think it's become even more important."
That sense of urgency also is being felt by Alli, the Alliance of Action Sports. Alli stages a wide range of events in sports such as motocross, BMX bike riding, skateboarding and snowboarding. Alli's bread-and-butter events are not as mass-market as the Sony Ericsson WTA Tour. But that's apparently more than OK with Wade Martin, Alli's president. Extreme sports, he contends, attract extreme fans. And that's extremely good for those who partner with Alli.
"It'll be interesting to see how things play out," he says, "whether this recession hurts the bigger, top-tier sports properties or the niche properties like ours, which tend to have more passionate fans. Everyone's going to be under tremendous pressure for the next year or so. And I think this is going to weed out some of those in this industry, and that the strongest properties won't necessarily grow but they will survive."
For its part, Alli, which is co-owned by NBC Sports and MTV Networks, takes a good amount of momentum into 2009. Last year, the organization formed partnerships to create two new events: The Maloof Money Cup, which offers the largest single event purse in professional skateboarding, and The China Invitational, which debuted in April in Beijing.
"We started working on these partnerships well before the whole economic mess started unfolding," Martin says. "But now that it has, I'm sure glad we got those deals done. We're as well-positioned as we can be because we have strong owners and good partners." And that, with all the uncertainty that lies ahead, is about all you can hope for. But while 2009 could indeed be a year to forget, it may also be a period that produces a new set of best practices for operating in less-than-favorable conditions. It could even produce, according to some, an improved paradigm for transforming business relationships into long-lasting business partnerships.
"The economic environment is going to test us all," says GMR's Greg Busch. "But that's not going to be all bad either. People are going to have to work leaner and smarter. And I think that when the country finally comes out of this we're going to see a better, higher-level of deal become commonplace in the sports marketplace."
For more Sports Marketing coverage:
Turning Lemons into Lemonade Part I
Turning Lemons into Lemonade Part II
Sony Ericsson WTA Tour
Turner Sports
