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Guest Article: Sports Sponsorship Deals Wise Investment, Even in Recession PDF Print E-mail
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Articles & Opinion
Written by John Rowady   
Tuesday, 03 March 2009 14:03

Citi Field

Is high-profile sponsorship spending by
by companies receiving TARP monies
irresponsible? One executive believes not.

The following is a guest article from John Rowady, president of rEvolution, a sports marketing and media agency.The views of Mr. Rowady are his, and may not reflect The Biz of Baseball, or the Business of Sports Network.

The outcry emanating from Washington and other bastions of economic responsibility might lead the taxpaying citizenry to think that sponsorship and event marketing is ineffective or even worse—wasteful. But as a fellow taxpayer, and as someone who has earned a living for his family consulting with companies on how to "drive their business through sport," I can assure you that sponsorship and event marketing are not approached recklessly. The fact is, when properly planned, executed and measured, these are two of the most effective tools a company can use to develop new business.

It goes without saying that if you are a company engaging in sponsorship or event marketing and you are not quantifying your spend by measuring its ROI then yes, you absolutely deserve all the criticism now headed your way. Nevertheless, the American people should know that the business planning associated with sports sponsorships is very detailed and focused on "how much revenue will we generate as a result of this event?" The people invited to attend the events are usually a mix of current and potential customers, along with some key trade partners (think investment companies and the network of independent financial consultants that sell their products.) The guest lists and activities are meticulously planned to provide the most memorable experience possible for the greatest number of guests that have either already accounted for significant portions of business or for those who are in the process of making a "buying decision." Engaging these people with an experience that elicits the pure passion that sports do is just good business.

If you buy into that line of thinking and still think luxury gifts, name entertainment, and VIP access to sports are over the top, consider this: Customers from different types of businesses need to be engaged in a way that will make a favorable impact. The basic premise goes something like this: If your potential customer is a private investor worth many millions of dollars, you shouldn't try to entertain him or her with seats in the rafters and a barbeque buffet. Please keep in mind that collectively, these guests can control potential revenue well into the hundreds of millions of dollars and beyond. It makes good sense for companies to pursue these relationships in good times and especially, in challenging times when many companies' competitors have fallen silent.

Our honorable elected officials have told us time and again how the federal government's goal for TARP funds and stimulus spending is designed to encourage growth at all levels of the economy. Why would they then, propose to restrict the use of some of the more effective ways to build revenue: sponsorship and event marketing? I am sure that most of our members of Congress appreciate how effective a well-planned event—designed to engage and influence its target audience—can be! These are legitimate business practices that, when planned and executed responsibly, deliver huge returns for the sponsoring companies. Why restrict their use? On top of that, restrictions on sponsorship and event marketing will decimate an industry that not only provides jobs for millions of Americans, but one that gives us all a reason to stand up and cheer passionately.

Let's keep sponsorship and event marketing expenditures in perspective. When properly planned, executed and measured both provide a clear path to generating new revenue. And, that's just good business.

John Rowady is the president of rEvolution a sports marketing and media agency based in Chicago, IL.



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