Legal rights involved in sponsorship
What are the legal rights involved in sponsorship?
What can I sponsor?
How do I secure maximum television exposure?
What will I get for my money?
What are the pitfalls as a marketing tool?
How do I maximise my return?
What are the legal rights involved in sponsorship?
Traditionally, sponsorship is a “below the line” activity, involving an investment in the right to be associated with a sports event or activity, which is often called a “property”. Strictly, there is no intellectual property right in a sports event but, it is likely that the event title will be a trade mark e.g. World Cup or Ryder Cup. The right of association is therefore the right to use your brand name in association with the event name, and for the event organisers to use your name in association with theirs. Careful thought should be given to the territories in which the sponsorship will be promoted and whether appropriate trade mark protection is in place for both the event brand and the sponsor’s brand.
What can I sponsor?
Primary or event or title sponsorship – you may acquire exclusive rights, or at least rights to be the main sponsor of the event, usually including your name in the title such as the Littlewoods (FA) Cup.
Secondary sponsorship – this will be non-exclusive and may be conferred as “partner” status, joint sponsorship or sponsorship of an element of the event such as an individual race at a National Hunt race meeting.
Official supplier status – another non-exclusive arrangement as far as the event goes, but it could be exclusive to the aspect of the event such as Slazenger – the official ball of the Wimbledon Championships or Tag Heuer – the official time-keeper of Formula One.
How do I secure maximum television exposure?
Plainly, exclusive title sponsorship will give effective television exposure, if appropriate arrangements are in place for televising the event. It is also possible to negotiate separate sponsorship of the event television broadcast, particularly where the event (for instance the Olympics) is taking place in another territory and the television transmission is sold to the UK. There is an ITC code of programming sponsorship which limits acceptable advertising and branding to events with a bona fide non-television status; and imposes various restrictions on references to sponsors, advertising, signage and branding at events and in their programming. You should also bear in mind that tobacco involvement is heavily restricted under the voluntary agreement with the Tobacco Manufacturers Association.
What will I get for my money?
There should be a formal sponsorship agreement or contract and it should spell out in detail the sponsor’s rights, which will fall into these areas:
- title or branding – the use of your name in the event title and event publicity in all of its forms.
- advertising and branding rights – the ability to use your brand on advertising hoardings, flags, scoreboards and other signage, as well as a logo on team uniforms and equipment.
- marketing rights – your right to associate your brand with the event on your products, marketing literature and in below the line and advertising campaigns.
- prize and presentation rights – you will be able to create and present a trophy and arrange personal appearances of the winners at the ceremony, and for photo calls.
- corporate hospitality rights – the number of tickets and the extent of event hospitality will need to be negotiated.
other opportunities – beyond these fundamentals, each event lends itself to other opportunities and the marketing professional should be creative about these; as the event organiser controls the event and its television rights, all sponsor’s rights need to be incorporated in the contract.
What are the pitfalls as a marketing tool?
From the point of view of legal rights, you may be subject to “ambush marketing”. Contracts need to be very carefully vetted and negotiated to avoid these situations:
As an event sponsor or partner, you may find that advertising or sponsorship of the television programming conflicts with your own product, and likewise advertising in official programmes and publications could also conflict.
If your product can be supplied in connection with the event, for instance food or drink, you need to ensure that a competitor does not secure the rights to supply similar goods, or secures advertising in the television programme and it conflicts with your product and brand.
You will also want to secure a “clean venue” so that no long-term signage or advertising in the venue conflicts with your brand.
How do I maximise my return?
Inevitably, television coverage of the event will be the key, the negotiation of the sponsorship agreement should focus on the extent to which the event organiser can commit to levels, frequency and territorial distribution of television programming of the event. A long term commitment seems like a risk. Short term contracts are clearly less risky, but it takes time to develop the connection between the brand and the sporting event and get into the mind of the public. It may be possible to secure a short term commitment, but with rights to negotiate a renewal, but most valuable properties or events are in demand and you may have to negotiate on their terms.
A more radical approach is to take a closer interest in the event, creating partnerships or joint ventures which allow the sponsor a long term relationship and a greater degree of influence. British American Tobacco are pushing that boundary even further with their involvement in Formula One, by establishing their own team, British American Racing, giving them total control of the huge investment that sport demands.
