Sponsorship of an Event
What is meant by corporate sponsorship?
Corporate sponsorship is a commercial arrangement whereby a sponsor will pay a sponsorship fee and in return receives certain exclusive rights. As is often the case, in addition to the payment of the fee, the sponsor also supplies the sponsored party with their products or services.
For example, Sony is a corporate sponsor for the Football World Cup meaning that they pay a sponsorship fee to be recognised and associated with the event. They will also supply their equipment to be used by FIFA and the Local Organising Committee during the operation of the event.
What do sponsors get in return for this sponsorship fee?
The corporate sponsors who pay the sponsorship fee will expect in return to have exclusivity in the use of the official marks, logo’s and other designations and be given unique advertising and promotional opportunities, certain on site concessions, certain franchise and product sales together with the right to describe themselves as the official sponsors of the event in their marketing and promotional campaigns.
What is meant by Ambush Marketing?
Ambush marketing is a practice that is often associated with many events, not just sporting. It is an activity whereby companies who are not official corporate sponsors and who have not paid a sponsorship fee try to associate themselves with the event and try to create the impression to consumers that they are official sponsors of the event. It is often referred to as parasitic marketing which shows the contempt that it is held in by companies who pay for associations with events.
It can be achieved in a number of ways, with two of the main being through advertising and through on site promotions.
Advertising can be anything leading up to the event such as television advertising – prior to this summer’s World Cup for example, many companies will base their advertising around the tournament with some even going as far as running promotional campaigns whereby tickets can be won. On site promotions can range from anything from strategically placed posters either near the venue or on the way to the venue, i.e. at the train station many of the spectators will be using, to handing out products for the spectators to carry into the stadium.
The advertising pre-event will often be undertaken by any company simply trying to boost their sales through an association with an event which has the British public talking whereas on site promotions will often be run by companies in direct opposition to the corporate sponsors of the event.
What is the problem with ambush marketing?
If other companies are able to freely associate themselves with an event it will dramatically decrease the value of the rights and therefore the exclusivity which the official sponsors have paid so much money for through their sponsorship agreements.
Examples of ambush marketing
For the 1984 Olympic Games which were held in Los Angeles Converse was an official sponsor. During the event a competitor of theirs, Nike built large scale murals near the Los Angeles Coliseum. These murals displayed the Nike Logo and several of the athletes competing in the games wearing Nike attire.
For the 1996 Olympic Games which were held in Atlanta Reebok was an official sponsor. During the games at a press conference British 100 metre runner Linford Christie was seen wearing blue contact lenses with the extremely well recognised Puma Logo in white in the centre of each lens. This meant that the logo received huge worldwide coverage and was seen on the front page of most newspapers around the world.
This shows that associating your company with a high profile sporting event where you are not an official sponsor is big business as often companies who sponsor certain athletes will request these athletes taking part in the competition to be part of the ambush marketing campaign.
What legal protection is there to prevent ambush marketing?
Currently in UK law there is no one single blanket provision which protects events from ambush marketing practices meaning that event organisers will have to rely on already existing legal doctrines to protect their exclusivity of the event.
Most commonly events will be protected by Intellectual Property Rights such as trademarks and copyright. For example for the coming football World Cup in South Africa, the official logo and the official designation (how the event is termed) will be protected by trademark. This means that only the official sponsors will be able to refer to the event in its official terms in conjunction with the official logo showing only their product to be official.
One of the best ways of protecting an event is through the ticketing terms and conditions which all ticket holders will be subject to. Contained within these terms and conditions will be a prohibition on transferring your ticket to another person except in certain circumstances such as ill health. This means that it is illegal for companies to get tickets from certain sources and then run a promotion offering them to prize winners.
Often there will be an explicit statement on the back of the ticket stating that it is illegal for the ticket to be used in a commercial promotion or a prize draw. This right will only be provided to official sponsors meaning that prior to this summer’s World Cup there will be official competitions to win tickets operated by the official sponsors.
Another provision that will be contained within the ticketing terms and provisions relates to a prohibition on certain promotional material being taken into the stadium. If companies try and associate themselves with the event by providing this to the spectators then it will be removed upon entry. If this were not removed and this promotional material were seen on television then it would be extremely detrimental to the official sponsors.
The event organisers will often work with local trading standards to ensure that this is prevented in and around the stadiums on the days of the event.
The fact that event organisers have to rely on existing laws such as the above and that ambush marketing is not prohibited per se means that many activities such as the above examples cannot be prevented.