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sponsorship withdrawal

By The Drum | Administrator

July 27, 2006 | 6 min read

Sponsorship in Scotland is, to use a cliche, “a funny old game”. Sport – the long-time darling of big brands – has even experienced its popularity wane, something that many thought would never happen.

However, it is the biggest sport in Scotland – football – that is taking the biggest kicking. This is the final season that the Bank of Scotland Premier League (SPL) will be known as such, having lost its sponsor of nine years. Having spent over £17million over that period, the SPL’s loss is one of the last things the sport needs at this time.

The Challenge Cup, formerly the Bell’s Challenge Cup, has been drawn without a sponsor this year due to a lack of interest and Morrisons has also announced that it plans to drop its sponsorship of the Scottish national team having inherited it during its takeover of Safeway.

And it doesn’t end there. Edinburgh’s legendary Hogmanay street party has been left high and dry just six months before its event by Royal Bank of Scotland, which has pulled sponsorship worth over £300,000 saying it had ‘reviewed its sponsorship commitments’. The capital was also dealt another blow when Orange pulled its sponsorship of Edinburgh’s International Book Festival and Edinburgh’s International Film Festival. So why have Scottish events lost favour with the big brands?

Greig Mailer, the SPL’s marketing and communications manager, is bullish when he talks about the loss of the Bank of Scotland. “We are very confident that we will have a new sponsor to step into the shoes of the Bank of Scotland when their nine season relationship comes to an end,” he says. “The way we structured the contract it gives us 14 or 15 months notice in terms of planning that transition period. The Bank of Scotland have had a great innings with us and been superb partners. We now have a considerable amount of time to attract a new sponsor.

“Sponsorship is obviously vital. It’s not just all about taking the cheque from the sponsor. We want partners who can work with us to help develop the game and certainly the Bank of Scotland has been able to do that with us over the past nine seasons. But we have to put it in context. We’ve signed our biggest ever TV deal recently for £54.5 million with Setanta, which takes us over the four years. There will be more SPL coverage than ever before. We’ve got a great overseas deal which has taken our games into over 100 countries across the world and our crowds are at the highest they have been since the fifties. All of these stack up.

“Many sponsorship deals have a natural life cycle and sponsors will have their clear objectives as to why they are involved within a sport, whether it’s launching product, whether it’s generating brand awareness or countless other reasons.”

Even though it is ending its association with the SPL, the Bank of Scotland has pledged to continue its commitment to the development of grassroots football, through a three year programme delivered by the SFA and the Scottish Schools Football Association, by donating £1.5 million to the programme.

Mark MacLean, who heads up Frameâ„¢, the sponsorship and events division of Frame, believes value for money is driving the current deals. “An opportunity has to be in a position where it has to sell itself and persuade sponsoring companies that it offers a more effective and value for money option than other marketing opportunities,“ he says. “Sponsorships will always run their course or reach a stage where the company has maximised their return and will gain more from fresh involvement in other areas. In the case of the SPL, it is more about value for money. Setanta offers fewer eyeballs than other broadcasters and if the price tag still remains at £1.5million – the price when terrestrial BBC coverage delivered excellent media value – then it is no surprise. The buy price for SPL title sponsorship in value terms is now far diminished.”

To go back to football, many brands are realising that gaining standout in football is just too tricky.

Lloyds TSB Scotland has sponsored Scottish Cricket for the last two years, extending the account until next year and has recently launched a sponsorship deal with Young Scot. Lisa Stephenson, marketing director for the bank, would not yet say whether its relationship with cricket in Scotland would continue beyond 2007. “At the moment it’s a little bit early for us to say, but it’s working well for us,” she said. “It’s working well for the brand, it’s delivering in terms of business metrics.”

“It’s about finding something that’s a bit different.” Stephenson explains when asked what makes a good sponsorship opportunity. “Sports sponsorship I believe, is a great way for any company to promote their brand if they work it effectively.

“Our sponsorship of Scottish Cricket has delivered great returns on investment. We tend to look at a return on investment which presents significant growth to the brand and to the product. The partnership we’ve had with The National Galleries over the years is very strong. We spend a lot of time before we enter into sponsorship evaluating what we want to do with it and looking at how it can fit and then we spend a long time making it work and really getting underneath the skin of it and looking at what the key performance indicators are and make sure we are tracking them. If something is not working as we planned, we take stock, review what our activity plan is and realign our priorities.”

It could also be that long-term sponsorship deals no longer offer stand out. Perrier’s announcement that, after 25 years, it would no longer sponsor its eponymous Edinburgh comedy award, pleased the comedy circuit. Although the brand had suffered for the actions of its parent, Nestle, the award remained synonymous with the festival. It remains to be seen if people still call it the Perrier award when new sponsor, Intelligent Finance, takes over.

Maclean is concerned that the problem for sponsors backing events in Scotland is that they could look elsewhere to make more impact: “Scotland has a relatively small sponsorship market and a relative lack of major event opportunities. In the main, events are only Scotland national and do not impact a UK audience. The largest companies based in Scotland look to make an impact on a UK audience.

“The future of Scotland’s sponsorship market is probably the same as in most countries in terms of opportunity – big ticket events or events with significant broadcast deals will continue to attract support, for example T in the Park, The Scottish Open and The Scottish Cup. Meanwhile, smaller, niche events will continue to struggle as they compete against an ever increasing number of cost effective marketing opposition, especially offered online or digitally.”

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