Successful sponsorships are symbiotic not transactional
Updated: Nov 2, 2022
In light of Visit Victoria’s recent announcement that it will partner with the Australian Diamonds, we ask what does the data tell us about the relationship between a team known for taking an authentic stand on important issues and the outcomes for that team’s sponsors?
Before answering, let’s take a couple of steps back… over the past few weeks there has been significant discussion around the relationship between a sponsor and a team. The commercial realities for sporting teams have come head-to-head with the values alignment of the partnership. A fundamental principal for successful partnership is that the relationship is not purely transactional, to achieve success the relationship needs to be symbiotic – with each benefitting from the association with the other.
When the symbiotic relationship does not exist, or when the relationship does not sit well with everyone within the ecosystem it can lead, as is the case with the Hancock Prospecting Netball Australia failed partnership, to internal and external brand damage, with the long-term effects yet to be understood.
Commercial pressures are the reality for many sporting bodies, but it is still important to look beyond the dollars, to understand the alignment before taking the plunge. The more time and effort invested by both parties at the start of the partnership to ensure that values are aligned and throughout the partnership to enable effective activations, the higher the chances of success. We work with both rights holders and sponsors to do exactly this.
The partnership world is littered with all types of variants from this core principal – in the extremes there are still those who slap the logo on the dress, jersey, guernsey for the right to access a box at games, and at the opposite end there are partners who think deeply about how they can invest through the verticals of the sport from grassroots to the elite game to maximise the potential of the partnership. But ultimately if you want your partnership to be successful, step number one is do the research and find out where the alignment sits.
It is clear the benefit that the partner delivers to the rights holder, in its most transparent form it comes in $$$ form, ideally it also provides relevance to the broader ecosystem. Of particular interest to us, at True North, is evaluating the benefits that a sponsor derives from the partnership. This is something we measure through our BenchMark Sponsorship Evaluation Framework, a very transparent method of evaluating how current partnerships perform in the market and future partnerships' chances of success. The analysis provides very clear industry comparisons, KPIs for the future, where alignment exists and suggestions around how to activate (get in touch to learn more about it).
Supporting social or political causes
What piqued our interest was something within Hancock Prospecting’s recent statement:
“Hancock and its Executive Chairman Mrs Rinehart, consider that it is unnecessary for sports organisations to be used as the vehicle for social or political causes”
The irony is that when sports organisations do get involved in these issues, and are well known for it, their partners are the beneficiaries.
We looked at the results amongst supporters and fans who agree their team takes an authentic stand on important issues. Amongst those aware of the team's sponsors, this group is significantly more likely to have a positive reaction to the team’s sponsors versus supporters and fans who either do not agree or are unsure whether the team takes an authentic stand on important issues. From a sample of more than 53,000 sponsorship ratings we found that supporters and fans who feel their team takes an authentic stand on important issues are:
79% more likely to feel more positive towards the sponsor and/or its message,
68% more likely to use the sponsor’s products or services more frequently
88% more likely to trust the sponsor as a result of the partnership
...compared to supporters and fans who did not agree or were unsure whether their team took an authentic stand on important issues.
Effectively what these results demonstrate is that positive sentiment towards the team from taking a stand on important issues is being transferred to the sponsors of that team. It’s a short cut. Some call it virtue signaling, others having a moral compass, either way, a team that stands up for what it believes in delivers clear cut benefits for sponsors.
Whilst there is no doubt that the netball community will already feel positive towards the Victorian Government after stepping in to plug the $15 million hole, Donell Wallam’s stand hasn’t just led to the signing of a new partnership with Visit Victoria, it has significantly increased the chances of success for that partnership. Diamonds players have demonstrated that they are prepared to take an authentic stand on important issues and the positives of this stand will flow through not just to Visit Victoria, but all of the Diamond’s sponsors.
So where does this leave mining sponsorships?
It's an important distinction to make that the issue around the Hancock Prospecting Netball Australia partnership was not about mining companies per se, it was about an abhorrent statement by the founder of Hancock Prospecting, that the players believed had not been publicly rescinded, at least not enough.
There is in fact more irony to be found in the data. Our latest wave of BenchMark, just out of field this October, adds to the huge bank of insights we’ve collected since 2018 on sponsorship outcomes. We continue to see significant benefits for mining companies that partner with sport. Looking at sponsorship outcomes for over 50 different industries, mining companies rate in the top five industries for two sponsorship metrics: 'driving positive sentiment towards the sponsor' and 'building trust in the sponsor's brand'. It is therefore not surprising that sporting partnerships are sought by these companies. They provide a platform for them to communicate their message and give back. Some will describe this as greenwashing, but it is important to judge the contribution that they are making, particularly in instances where they are giving back to society in meaningful ways. This is currently recognized by many Australians and reflected in these results.
Interestingly, and it is an important distinction to make, there is a clear demarcation in how the Australian public react to mining partnerships versus how they react to alcohol and betting partnerships. For these same two metrics: positive sentiment and trust, both betting and alcohol industries rank in the bottom five performing industries. Of course, their objectives around sports partnerships are different, for them it is about driving usage, it is therefore not surprising to see these two industry sectors perform comparatively better for the sponsorship metric: use more frequently.
Time will tell if the fall out between Netball Australia and Hancock Prospecting will colour how other mining partnerships are viewed in the future; whether this is a watershed moment for sports sponsorships. However, cool heads, a clear demonstration of shared purpose and a thoughtful activation plan are required to counter misconceptions.
Our data is clear, taking an authentic stand is of benefit to sponsors. What is key to successful partnerships is understanding the alignment, how best to activate, where synergies exist. It is not to say that there is no place for different industries who partner with sports properties, it is more about being adept at understanding how to bring the partnership to life and how organisations can best work together to achieve the desired outcomes for all parties involved. As a sports insights company, who spend our time analysing these partnerships our simple advice is: do the research first!