Unlocking Success: Insights from PepsiCo, Vodafone, and British Gas on Crafting Impactful Sports Collaborations

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Sports sponsorship can be expensive, but partnering with sports institutions offers brands the chance to see both short-term and long-term benefits. The upcoming UEFA Euro 2024 and Paris Olympics are set to provide a great opportunity for brand exposure. However, it can be challenging to prove the return on investment from sports sponsorship.

Adam Warner, head of global sports and partnerships at PepsiCo, mentioned that there is a lot to monitor with the various sponsorships for Pepsi and Lays brands, such as the men's and women's Champions Leagues. Partnerships are aimed at increasing penetration, but the approach can vary depending on the brand.

Warner emphasized the importance of serving the brand when setting up partnerships. He highlighted the need for PepsiCo brands to be represented in a brand-centric manner. According to Warner, it is crucial for brands to stand out when sponsoring sports.

Investing heavily in sponsorship can have a significant impact on other areas of the business. According to Lisa Walker, head of media and sponsorship at Vodafone, there is no separate budget for sponsorship. It is not an additional expense but rather a part of the overall marketing spend. As she explained, if more money is allocated to sponsorship, then less will be available for advertising.

At Vodafone, sponsorship is considered to be on the same level as advertising. The goal is to achieve comparable results from both, such as brand tracking.

Vodafone used to be a major sports sponsor in the 1990s and early 2000s. However, they had to reduce their involvement in sports sponsorship because the competition was changing and they had less money to spend. As a result, they ended their sponsorship deal with Manchester United two years early in 2005, even though the deal was worth £36m.

According to Warner, Vodafone had to end their partnerships with sports teams even though they didn't want to. This decision created a gap in their marketing strategy. Research shows that sponsorship plays a significant role in shaping a brand's identity and giving it emotional value and personality. Over the past 10-15 years, sponsorship has been proven to be highly effective in defining a brand.

Justifying investment

Warner realized that Vodafone had lost the emotional value and personality of its brand without sponsorship. He waited until the financial aspect made sense before making the investment.

British Gas paused their sponsorship activities for a decade until 2021. Andy Freeman, the marketing director at the energy company, mentioned that everyone is very aware of the recent energy and consumer crises.

With a brand legacy spanning 200 years, Freeman is exploring ways for British Gas to stand out in a competitive industry. He previously worked at Santander, where sponsorship was a common practice. When he joined British Gas in 2019, continuing sponsorship was something he was eager to pursue.

British Gas partnered with Team GB ahead of the 2024 Paris Olympics in a five-year deal in late 2023. According to Freeman, the focus was on finding the right timing and properties in sports, particularly with national institutions. He emphasized that British Gas preferred not to limit itself to one regional team, highlighting the trust and reputation of Team GB and Paralympic Team GB that they aim to utilize for enhancing their brand impact.

At PepsiCo, sports sponsorship is deeply ingrained in the business, as Warner pointed out. The company's strategy revolves around relevance, tapping into passion points, and achieving reach and returns - known as the "three Rs".

"We invest heavily in sponsorship for three main reasons, and we are committed to continuing this practice as long as we stay disciplined," he explained.

Warner's advice for marketers and brands looking to incorporate sponsorship into their marketing strategies is simple: "You need to have a clear strategy in place."

Marketers are advised not to rush into partnerships, as they are meant to be long-term. It is important to have strategic clarity and make the right long-term investments to avoid winding up the partnership prematurely.

Editor's P/S:

The article highlights the complexities and importance of sports sponsorship in modern marketing. While it can offer significant benefits in terms of brand exposure and emotional impact, justifying the return on investment remains a challenge. Brands like PepsiCo and Vodafone emphasize the need for a clear strategy and a long-term commitment to maximize the potential of sponsorship.

Despite the financial constraints and competitive market, companies like British Gas recognize the value of sponsorship in shaping brand identity and resonating with consumers. By aligning with prestigious national institutions like Team GB, brands can tap into a shared sense of pride and patriotism, enhancing their brand impact. However, it is crucial for marketers to approach sponsorship strategically, focusing on relevance, passion points, and achieving measurable results to ensure that their investments yield a positive return.