Sports Sponsorship Understanding sponsorship and how to exploit it Copenhagen Business School, Cand.merc. Brand & Communications Management Master Thesis Student: Dennis Faurbye Supervisor: Troels Troelsen Handed in June 1st 2016 Characters/pages: 108.198/54 Abstract Based on the worldwide growth of sponsorship, and its increasing importance in the world of sports, this thesis explores how sponsorship in general, and sports sponsorship in particular, can be of benefit companies in reaching communication objectives. It is explained what a sponsorship is, and this can be used as a communicational tool for companies to improve awareness, attitude, sales and image. Several definitions of sponsorship is provided, the most broad of which identifies sponsorship as a mutually beneficial arrangement that consists of the provision of resources of funds, goods and/or services by an individual or body to an individual or body in return for a set of rights that can be used in communications activity, for the achievement of objectives for commercial gain. Aspects of sponsorship theory such as Rights, Activation, and Fan Involvement is presented and used to answer the question of how sponsorship can be beneficial. The key to this is to understand the limitations of sponsorship, and that it should be followed by a well-founded activation strategy that aims to make the consumer understand the correlation between the sponsorship and the sponsored activity. If the consumer fails to recognize the relation between sponsor and activity, the message of the sponsorship is lost, and no goodwill will be created toward the sponsor. However if the message is delivered with success, the goodwill that is created has to power to a bond between brand and consumer, that cannot be established through advertising. Dennis Faurbye Table of content 1. Introduction ............................................................................................................................ 3 Table 1 .................................................................................................................................... 3 Table 2 .................................................................................................................................... 3 1.2 Motivation ........................................................................................................................ 5 1.3 Research Question ............................................................................................................ 5 1.4 Delimitation ...................................................................................................................... 6 1.5. Professional cycling ........................................................................................................ 6 1.5.1. The history of professional cycling and its financial structure .................................... 6 Table 3 .................................................................................................................................... 7 2. Methodology ........................................................................................................................ 10 2.1. Research Philosophy ..................................................................................................... 10 2.1.1. Philosophical paradigm .............................................................................................. 10 2.1.2. Social Constructivism ................................................................................................ 11 2.1.3. Ontology & Epistemology ......................................................................................... 11 2.2 Research Method ............................................................................................................ 12 2.4 Quality of research ......................................................................................................... 12 2.4 Data Collection ............................................................................................................... 13 2.4.1 Quantitative data ......................................................................................................... 13 2.4.1. Semi-structured in-depth interview form ................................................................... 14 2.4.2. Data collection process ............................................................................................... 14 2.4.3. Steen Leth Jørgensen .................................................................................................. 15 2.4.4. Ole Egeblad ................................................................................................................ 16 2.4.5. Transcript of interviews ............................................................................................. 16 2.5. Summary of methodology ............................................................................................. 16 3. Theory .................................................................................................................................. 18 3.1. Literature review ........................................................................................................... 18 3.2. Sponsorship Theory ....................................................................................................... 19 3.3. Marketing Mix & Marketing Planning .......................................................................... 19 3.3.1. Marketing Plan ........................................................................................................... 20 Table 4 .................................................................................................................................. 21 3.4. Sponsorship in marketing literature .............................................................................. 22 3.4.1. Sponsorship history and current state ......................................................................... 23 3.4.2. Definition of sponsorship ........................................................................................... 24 3.4.3. Sponsorship Rights ..................................................................................................... 25 P. 1/94 Dennis Faurbye 3.4.4. Sponsorship activation ............................................................................................... 26 3.4.5. Sponsorship and fan involvement .............................................................................. 28 Table 5 .................................................................................................................................. 28 3.4.6. Sponsorship and advertising ....................................................................................... 29 Table 6 .................................................................................................................................. 30 3.5. Ambush Marketing ........................................................................................................ 31 3.5.1. Negative perceived values .......................................................................................... 34 3.6. Modelling Sponsorship Effects ..................................................................................... 34 Table 7 .................................................................................................................................. 35 Table 8 .................................................................................................................................. 36 3.7. Sponsorship evaluation ................................................................................................. 37 4. Case description – CSC ........................................................................................................ 38 5. Analysis based on data and findings .................................................................................... 40 5.2. What defines a sponsorship, and what does it offer compared to other marketing tools? .............................................................................................................................................. 40 5.3. What are the threats and disadvantages a sponsor must be aware of when engaging into a sport sponsorship? ............................................................................................................. 42 5.4. What is important when evaluating sponsorship? ......................................................... 44 5.5. Where will sport sponsorship go in the future? ............................................................. 45 6. Conclusion ............................................................................................................................ 47 7. Perspectives .......................................................................................................................... 49 7.1. Employee Branding ....................................................................................................... 49 7.2. Social Media .................................................................................................................. 49 7.3. Structural changes in the future of cycling .................................................................... 50 8. References ............................................................................................................................ 52 9. Appendix .............................................................................................................................