Thursday, September 4, 2008

Sponsorship "Jargon" Defined

Defined by IEG as the marketing activities a company conducts to promote its sponsorship. Money spent on activation is over and above the rights fee paid to the sponsored property. Also known as leverage.

Ambush Marketing
A promotional strategy whereby a non-sponsor attempts to capitalize on the popularity/prestige of a property by giving the false impression that it is a sponsor. Often employed by the competitors of a property’s official sponsors.

Arts Marketing
Promotional strategy linking a company to the visual or performing arts (sponsorship of a symphony concert series, museum exhibit, etc.). See: Sponsorship

Audio Mention
The verbal mention of a sponsor on-site or during a TV or radio broadcast or Web cast.

Brand Name
Name used to distinguish one product from its competitors. It can apply to a single product, an entire product line, or even a company.

Business-to-Business Sponsorship
Programs intended to influence corporate purchase/awareness, as opposed to individual consumers.

Category Exclusivity
The right of a sponsor to be the only company within its product or service category associated with the sponsored property.

Cause Marketing
Promotional strategy that links a company’s sales campaign directly to a nonprofit organization. Generally includes an offer by the sponsor to make a donation to the cause with purchase of its product or service. Unlike philanthropy, money spent on cause marketing is a business expense, not a donation, and is expected to show a return on investment. See: Sponsorship

The sharing of advertising costs between a manufacturer and distributor or dealer.

Core Sponsor
Concept developed by IEG to describe companies whose sponsorships are aligned with internal practices. Rather than using sponsorship as a marketing ploy, Core Sponsors gain loyal customers by living their values. What they sponsor reflects the DNA of their brand. Core Sponsors include Ben & Jerry’s, Harley-Davidson, Patagonia, Timberland, Vans, Virgin and Yoplait.

Core Sports
Term developed by Vans to refer to youth sports that feature individual, rather than team, competition, including: skateboarding, snowboarding, surfing, wakeboarding, BMX, supercross, and freestyle motocross.

Sponsors of the same property.

Cost/Benefit Ratio
This is the ratio that IEG has developed based on market pricing to determine the amount of value a sponsor expects for each dollar invested in rights fees.

Advertisers use CPM (cost per thousand impressions) and CPP (cost per rating point) to compare media costs.

A joint marketing effort conducted by two or more cosponsors using the sponsored property as the central theme.

Customer Loyalty
The new imperative of marketing. As the marketplace approaches a super-saturation of products–as the power in the marketing equation shifts from product to consumer–brand loyalty disappears. To survive, companies will have to create loyalty relationships with their customers, one customer at a time, according to IEG.

Dealer Tie-in
A manufacturer’s announcement that lists local dealers; not the same as “co-op.”

Demographic Information
Based on the age, gender, life-cycle stage and occupation of consumers, as defined by Amsterdam-based European Society for Opinion and Marketing Research.

Editorial Coverage
Exposure that is generated by media coverage of the sponsored property that includes mention of the sponsor.

A graphic symbol unique to a property. See: Mark

An annual percentage increase built into the sponsorship fee for multi-year contracts. Escalators are typically tied to inflation.

Event Marketing
Promotional strategy linking a company to an event (sponsorship of a sports competition, festival, etc.). Often used as a synonym for “sponsorship.” The latter term is preferable, however, because not all sponsorships involve an event, per se. See: Sponsorship

The delivery of benefits promised to the sponsor in the contract.

Gross Rating Point
One percentage point of a specified target audience. Total GRPs for a campaign can be calculated by the formula ‘Reach times average frequency’. This is a measure of the advertising weight delivered by a medium or media within a given time period. A given total of gross rating points may be arrived at by adding together ratings from many different spots. GRPs may, thus, sum to more than 100% of the total target audience.

Hosting key customers, clients, government officials, employees and other VIPs at an event. Usually involves tickets, parking, dining and other amenities, often in a specially designated area, and may include pro-am spots, backstage tours, etc. Synonym: Client Entertainment

Incremental Value Added
A measurement technique IEG uses with corporate clients which compares the return a company earns from sponsorship above and beyond what it would expect from equal investment in other media. For example, if a credit card company is going to conduct a direct mail campaign, its expectation might be to break even. So if the company spent $100,000 to buy lists and print the pieces and pay for the postage and the campaign brought in $100,000 worth of new accounts, the effort would have been considered a success. If it’s $100,000 sponsorship generated $150,000 in new accounts, IVA would be 50 percent. The sponsorship is thus adding incremental economic value.

In-Focus Coverage
Amount of time sponsor identification is visible to TV viewing audience during event broadcast.

In-Kind Sponsorship
Payment (full or partial) of sponsorship fee in goods or services rather than cash.

Licensed Merchandise
Goods produced by a manufacturer (the licensee) who has obtained a license to produce and distribute the official Marks on products such as clothing and souvenirs.

Manufacturer which has obtained a license to produce and distribute Licensed Merchandise.

Right to use a property’s logos and terminology on products for retail sale. Note: While a sponsor will typically receive the right to include a property’s marks on its packaging and advertising, sponsors are not automatically licensees.

Free time or space provided to advertisers to make up for a program’s lower than expected ratings or an advertisement insertion that has been missed or has been incorrectly printed or broadcast.

Any official visual representation of a property, including emblems and mascots.

Marketing Surplus
A theory developed by McKinsey’s David Court, which holds that success is determined not by market share, but by which one of the entities in any transaction–from raw-goods supplier through manufacturer, retailer, and consumer–holds the greatest amount of the surplus or profit made at each step of the process. As the market reaches saturation, marketing surplus moves to the consumer.

A graphic illustration of a character, usually a cartoon figure, used to promote the identity of a property.

Media Equivalencies

Measuring the exposure value of a sponsorship by adding up all the coverage it generated and calculating what it would have cost to buy a like amount of ad time or space in those outlets based on media rate cards.

Media Sponsor
Broadcast, online, print, out-of-home and outdoor media that provide either cash, or more frequently advertising time or space, to a property in exchange for official designation, according to IEG.

Minimum Guarantee
A sponsor agrees to pay a specific minimum sum, regardless of the actual result of the program. In cause-related marketing–which raises funds for nonprofits by donating a percent of each sale during the promotional period to the nonprofit–a minimum guarantee means if sales do not trigger the sum anticipated, the company makes up the difference. When the minimum guarantee is also the total sum that will be given to the nonprofit–even if sales would justify more–it should be explained as a “capped minimum guarantee,” according to IEG.

Municipal Marketing
Term coined by IEG to refer to promotional strategy linking a company to community services and activities (sponsorship of parks and recreation programs, libraries, etc.).

Option to Renew
Contractual right to renew a sponsorship on specified terms. See: Right of First Refusal

Pass-Through Rights
Benefits that the property allows a sponsor to transfer to another company. For example, a retail sponsor of a marathon could negotiate pass-through rights to involve vendors in pre-approved categories—e.g., ones that do not compete with marathon sponsors—in its marathon promotions and sponsorship even though the vendors are not sponsors of the marathon. Rights passed-through typically include sampling, hospitality and signage. Almost any sponsor will benefit from having pass-through rights. They can be used to incent on- and off-premise accounts, e.g., exchange sponsorship benefits for more shelf space and a bigger order. Pass-through rights can also be transferred from a sponsor to a property. For example, a media sponsor could allow a property to include advertising in its sponsorship package in pre-approved categories. IEG advises clients to carefully define the companies and categories to which the partner is able to give pass-through rights.

Perimeter Advertising
Stationary advertising around the perimeter of an arena or event site, often reserved for sponsors.

Support for a nonprofit property where no commercial advantage is expected. Synonym: Patronage

Souvenir merchandise, produced to promote a sponsor’s involvement with a property (customized with the names/logos of the sponsor and the property).

Presenting Sponsor
The sponsor that has its name presented just above or below that of the sponsored property, e.g., “The Kroger Senior Classic presented by Fifth Third Bank,” or “The Music of Andrew Lloyd Webber presented by Lexus” or “AT&T presents Cirque du Soleil.” In presenting arrangements, the Event name and the Sponsor name are not fully integrated since the word(s) “presents” or “presented by” always come between them.

Price Adjusters
Market factors identified by IEG that increase or decrease the value of a sponsorship. These can include the value of a sponsor’s promotional commitment, the number of saleable categories purchased and the length of the contract.

Primary Sponsor
Refers to sponsor paying the largest fee and receiving largest package of benefits when property has no title or presenting sponsor, according to IEG.

A unique, commercially exploitable entity, (typically in sports, arts, events, entertainment or causes). Synonyms: Property, Rightsholder, Seller

Quantified psychological profiles of individuals, based on their attitudes and behavior, as defined by the Amsterdam-based European Society for Opinion Marketing and Research.

Right of First Refusal
Contractual right granting a sponsor the right to match any offer the property receives during a specific period of time in the sponsor’s product category.

Sales Rights
When sponsor is granted preferred supplier right to sell its product or service to the property or its attendees or members.

Banners, billboards, electronic messages, decals, etc., displayed on-site and containing Sponsor ID.

Sole Sponsor
A company that has paid to be the only sponsor of a property.

A property available for sponsorship.

An entity that pays a property for the right to promote itself and its products or services in association with the property, according to IEG.

Sponsor ID
Visual and audio recognitions of sponsor, e.g., sponsor name/logo on participant clothing, equipment, etc.; in property’s publications and advertising; public-address and on-air broadcast mentions.


Defined by IEG in 1982 as: A cash and/or in-kind fee paid to a property (typically sports, entertainment, non-profit event or organization) in return for access to the exploitable
commercial potential associated with that property.

Sponsorship Agency
A firm which specializes in advising on, managing, brokering or organizing sponsored properties. The agency may be employed by either the sponsor or property.

Sponsorship Fee
Payment made by a sponsor to a property.

Sports Marketing
Promotional strategy linking a company to sports (sponsorship of competitions, teams, leagues, etc.). See: Sponsorship

Official provider of goods or services in exchange for designated recognition. This level is below official sponsor, and the benefits provided are limited accordingly.

Time Buy
When an event or event sponsor buys time from the broadcaster and is responsible for selling the advertising.

Title Sponsor
The sponsor that has its name incorporated into the name of the sponsored property, e.g., the Allstate Sugar Bowl.

Tribal Marketing
Term coined by First Matter to refer to the creation of affinity groups for commercial ends. Perhaps the most notable and successful contemporary example is Harley-Davidson, which has coupled the sale of motorcycles and peripherals to the creation of weekend motorcycle clubs and an entire way of life built around Harley-Davidson products. Tribal marketing works best when it is constantly reinforced with icons.

Venue Marketing
Promotional strategy linking a sponsor to a physical site (sponsorship of stadiums, arenas, auditoriums, amphitheaters, racetracks, fairgrounds, etc.).

Virtual Signage
The insertion of signage electronically during a TV broadcast that is not actually present at the event.

Web Sponsorship
The purchase (in cash or trade) of the right to exploit the commercial potential associated with a site on the World Wide Web, including integrated relationship building and branding.