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Better together: start-ups and sponsorship

Written by Adam Pescod on Wednesday, 02 April 2014. Posted in Branding, Sales & Marketing

Often regarded as the preserve of the big guns, sponsorship can also be an affordable and rewarding option for start-ups. It’s just a case of finding a suitable partner

Better together: start-ups and sponsorship

Chevrolet and Manchester United. EE and Wembley Stadium. Samsung and The Oscars. The megabucks deals struck between corporate giants are usually the first thing that springs to mind upon hearing the word sponsorship.

Of course, some would argue that’s just a symptom of the world we currently live in. “In recent years, certainly with a struggling economy, sponsorship has come under the spotlight because the press sometimes portrays it as the preserve of fat cat executives who are enjoying hospitality at Wimbledon,” says Jonathan McCallum, head of sport marketing at OgilvyPR.

Many start-ups may only ever dream of being able to throw that amount of money around – and enjoying the luxuries that come with it.

Nevertheless, by looking beyond the headlines, it is possible to discover ample opportunities for start-ups when it comes to sponsorship. And many of them won’t necessarily have too big an impact on the company coffers. “Particularly for small businesses, it is a way that they can really stand out from the competition for a comparatively small amount of money,” says Sophie Morris, founder of Millharbour Marketing.

Morris suggests that starting local can be a sensible strategy for start-ups. Sponsoring a nearby sports team, she argues, can provide a far deeper level of engagement with the intended audience than an advert in a local newspaper – and the financial risk is generally lower. “Compared to the cost of advertising in a paper, it is about ten or 20 times cheaper but actually what you are getting back is so much stronger and so much more powerful because you are engaging with the people,” she adds. “You are not just putting your logo or discount offer in front of them; you are becoming part of their community.”

There does indeed appear to be some logic in an assumption that people – when making a purchasing decision – may place significant weight on a firm’s sponsorship of something they also support. “You are getting involved in something that particular group of people are very passionate about,” says Morris. “If you can engage correctly with those people, you take on board a bit of that emotion. If you are supporting the thing that they support and you are seen to be helping to develop it, the likelihood is it that they will come straight to you before considering any other supplier.”

McCallum also champions the opportunities for brand-consumer dialogue that sponsorship can bring. “Advertising can be very static. It can get your message out there but it doesn’t necessarily allow you to have a direct one-to-one relationship with potential customers,” he explains. “There is more opportunity to say something about your brand by partnering with a more established property.”

The latter point is as relevant to a local sponsorship deal as it is to a national or global one. McCallum cites Doosan, the South Korean conglomerate, and its sponsorship of the British Open golf championship as an example of how such an arrangement can tell people more about a brand. “The reason Doosan does that is because it gives this sense of credibility and safety,” he says. “By them being aligned together, there is a natural fit whereby people say ‘if they are partnered with the British Open, it clearly says something about their brand. It must be secure, it must have tradition.’”



A shared set of values is undoubtedly the cornerstone of any sponsorship deal. The collaboration has to make sense to both parties. As far as the sponsor is concerned though, attention must also be given to what it expects to achieve from the arrangement.

“It has to make sense in terms of your marketing objectives,” says Morris. “If you are a local business wanting to attract local customers, a small sport, arts, music or church group – anything that targets the same demographic as you do – makes sense. If you want to get national coverage, that’s a bit harder but it might be that you sponsor more grassroots-level clubs but pick a few in the regions that you can resource.”

Despite the apparent cost benefits of sponsorship, start-ups won’t reap the full rewards unless they throw everything they’ve got at it. After all, a successful relationship hinges on a commitment from both sides. “It’s not just a cash investment, it is a resource investment,” Morris explains. “If you sponsor a local sports club and give them £500 and put your logo on their website, people will appreciate the support. But if you put the time in to engage with the people, that is really what it takes for them to engage back.”

When it comes to measuring those returns, Morris believes there is one sure-fire way of keeping up-to-speed. “The obvious way for tracking it is to give discounts where it is appropriate,” says Morris. “That way, small businesses can track what effect it’s had. They can say ‘we’ve had ten clients this month who said they’re from the local hockey team’. When it comes to the end of the year, they actually know what happened and whether it’s worth doing it again.”

So long as a start-up has confidence in its own values and can identify where there is a natural overlap with a partner, sponsorship can be a very useful brand-building tool. It’s a fairly fruitless endeavour otherwise. As Morris concludes, “To sponsor something for the sake of sponsoring it can do more damage than good. There is a difference between sponsoring a youth swimming team and an adult male pub darts team.”

When food met fashion

Propercorn



“We never really use the word sponsorship,” says Cassandra Stavrou, founder of Propercorn, the fast-growing popcorn start-up. “We much prefer to talk about it as collaboration and partnership.”

Stavrou has managed to forge such relationships with the British Fashion Council and London Fashion Week thus far. Not bad for a company that is only two years’ old. Nevertheless, identifying exactly what Propercorn stood for from the outset has undoubtedly contributed to its impressive early growth.

“Propercorn has always come from a starting point of wanting to champion creativity,” explains Stavrou. “Our packs are hand-illustrated and we see any opportunity with the brand as an opportunity to introduce another element of creativity; not to shove logos and slogans down people’s throats. Very early on we seemed to very naturally get a lot of interest from the fashion and creative industries.”

For Stavrou, sponsorship is not something that should be forced, but rather must be allowed to develop organically. “We didn’t just sit down and decide that sponsorship was a way of leveraging Propercorn,” she says. “It has to come from a very natural fit and traction rather than just identifying prominent brands and just trying to jump on the bandwagon.”


Start local, go global

Scurri


Scurri
, the online shipment management platform, has seen huge returns from its sponsorship of a well-known technology event in Dublin, where it is based.

“Pub Summits is a local networking event for the tech community that started in a small pub in Dublin two years ago and has now grown to over 100 cities around the world,” says Rory O’Connor, founder and CEO of Scurri.

“As a co-sponsor at this event, we were able to raise our local profile among inspirational people from all walks of life and areas of expertise. We were given access to a fantastic network of contacts that led to a slot on stage at the influential Web Summit event and inclusion in START 150 as one of the top disruptive start-ups in business today.

“As a result, we have secured further investment of over €1.2m to help expand our business into new markets, receiving attention from the likes of the Wall Street Journal in the process. At each stage along the way we gained some invaluable business experience and contacts, but this was really kick-started by sponsorship of a local up-and-coming event.”

About the Author

Adam Pescod

Adam Pescod

EB's former editor, Pescod was tasked with ensuring these hallowed pages are rich with excellent, engaging and error-free stories, all written with the entrepreneur in mind. Pescod previously plied his trade penning pieces about pubs and pints. He is also a sucker for alliteration. 

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