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Alcohol Sponsorship in Sport Report
- 1. 1 Alcohol Sponsorship in sport -Is it a good thing, or a bad thing? Prepared by: Annika Kemp and Tom Jenkins
- 2. 2 CONTENTS Introduction 3 What is Sponsorship? 3 Positive Impacts of Alcohol Sponsorship in a Sporting Context 4 Negative Impacts of Alcohol Sponsorship in a Sporting Context 6 Alcohol Sponsorships Current Situation 8 Conclusion 8 References 9
- 3. 3 In Australia, alcohol sponsorship and sport go together like cricket and summer, football and winter, beaches and bikinis, meat pies and tomato sauce. One just would not be the same without the other. Australian sport has improved enormously in both quality and quantity in the past two decades. The great increase in all facets of sporting life could be attributed to the substantial increase and recognition of sport as a marketing tool. More and more companies are using all the emotions and exposure sport provides for many different reasons. By far the most popular and cost effective way of marketing through sport is sponsorship. Whereby brands or products use sport as a medium for promotion and exposure to the general consumer and/or their specific target market. What is Sponsorship? Sports sponsorship involves a reciprocal relationship where an organisation provides resources such as funding directly to a sporting event, team or athlete in exchange for associaiton with that party. Sports Sponsorship has roots dating back to 1BC where patronage was the main way of supporting sport. This method of sponsorship was to a large degree launched by tobacco and alcohol companies in order to overcome growing marketing constraints placed upon them by traditional advertisements. It was also undertaken to help sponsors build their reputation within the community, generate goodwill and reach their target audience. Sponsoring sporting teams, events or athletes; has undergone a number of changes over the years. Today putting your logo on a jersey is only the tip of the iceberg when looking at the total sponsorship package. Not only do the sponsors get exposure from the team, the team also gets exposure from the sponsors. The relationship is in most cases a win-win and both gain economic and social benefits.
- 4. 4 Positive Impacts of Alcohol Sponsorship in a Sporting Context Over the past years Australia as a sporting nation, has greatly benefited from Alcohol sponsorship in sport. Impacts for Sport Organisations, Teams and Athletes: Sponsors are the primary source of revenue Sponsors are the primary source of revenue for sport. Although the government does invest heavily in sport they simply cannot match the Big Alcohol Companies. For example Lion and SABMiller Beverages are the two biggest brewing houses in Australia. Together they make up 83.2% of the market (Anning, 2015). These two companies are also the two biggest sponsors of sport in Australia. Beer companies love sponsoring of sporting organisations, events and athletes for two reasons. Firstly, most beer drinkers are male, and most males like sport. Secondly, due to the fact that sports fans tend to look more favorably upon sponsors than they do straight advertisers. They look at sponsors as part of the team, as giving something back, and not just trying to separate someone from their money. Thus breaking through the barrier of being a plain advertiser. Big Alcohol Has The Money Alcohol sponsorship in Australia brings in nearly half a billion dollars to the industry (The Drum 2013). The male dominated sports industry is an almost perfect representation of most Alcohol (Beer) companies target market. Not only does sponsorship allow your name or brand to be exposed to the general sporting public but also with a number of team sponsorships come an allegiance to the brand. Because of the amount of money put into sport by big alcohol companies’ sport in Australia has evolved and gone further in player performance and fan experience allowing sports to keep growing. Growth in sport is not only measured by the number of spectators or players, but also by the affect it has on the community. Investment in sport has created 10,000 new jobs around the country (Gibson, 2010). With these investments come expansions into broader communities. For example the Gold Coast Suns AFL expansion generated around $100 million of economic benefit as well as the obvious social and societal benefits. The added money also boosts player salaries and allows clubs and codes to retain talent. Without money talented players may choose to seek out more lucrative deals abroad. Impacts for Alcohol Sponsors in Sport: Almost ‘Perfect’ target market The major draw card for most sponsors of sport is the opportunity to, by association, to communicate directly and intimately with their chosen target market. Sport is a very unique industry in the way it brings people together on mass fills them with irrational passion and facilitates their emotions. This is a prime moment for marketers to capture the almost ‘perfect’ target market’s attention and untimely their business. For example the combination of TV ratings, social media posts and attendance at Origin 2 this year was nearly 3 million people (Tv Tonight, 2015). With a heavy male skew this is around 80% male viewership. XXXX (Lion) and VB (SABMiller Beverages) had almost their whole target market watching at one time (Anning, 2015). This is a phenomenon you would rarely find in any other industry.
- 5. 5 Television – Mass Exposure Sports with significant television appeal are very attractive to firms seeking to promote their products through an association with sport. By sponsoring the team have your logo on the uniform you are being exposed for the whole game. Where as other companies who use ad breaks to send through their message can get lost in the clutter. For example in the 2014 NRL semi-final there was 30 minutes and 40 seconds of advertising. Estimated that is around 25 different brands in the space of 30 minutes. Sponsorship of the team or organization allows brand to have a highly visible presence for the entire duration of the game. Team Allegiance When sponsoring particular teams over the long term, brands can gain fan loyalty or allegiance. The most prevalent, successful and longest running team sponsorship in Australian sport is arguably the XXXX Queensland Maroons State of Origin team (Anning, 2015). XXXX (Lion) have been involved in this game of Rugby League since not long after its inception. The brand has been able to gain a cult following and is known as the unofficial beer of the State. This unwavering loyalty and patriotism to the beer is due to the massive impact XXXX has had on the community and in rugby league, through sponsorship. Universal Appeal Sport is an industry that is present in almost all geographic locations. From third world to the western world sport is a language of its own. This sports language allows marketers to break down complicated cultural and/or language borders in communication. This can aid in the effect communication to a broader audience and expansion into new locations. Numerous Sponsorship Strategies There are three unofficial methods of sponsorship. High profile events can be used of effectively gain new attention to a new product or brand however they can also aid the repositioning of an existing product or brand. These events are effective due to the amount of media and community attention the draw. Secondly a high profile athlete can be useful over the long term to create exposure and also a standard for you brand. For example Nike used Tiger Woods to cement their position in the golf market as an industry leader. This position as industry leader was aided by Tigers outstanding performance and high media appeal. Nike have had this stagey for quite a number of years as well as using it across most if not all of there key sports. Finally community based events can add to a companies or a brands Corporate Social Responsibility Strategy. Sponsoring these events allows the target market to see the product a comfortable environment. Further more these events allow the target market to gain a sense of good will and this shows the brand is giving back. These different strategies all relate back to the promotional mix and what benefit the company seeks.
- 6. 6 Negative Impacts of Alcohol Sponsorship in a Sporting Context Whilst the benefits of alcohol sponsorship on sport are substantial this relationship also has serve impacts. For instance: Damaging Health Messages Sport is intended to deliver positive messages in regard to health, physical activity and personal well- being. However, sports direct association with harmful alcoholic products undermines the promotion of a healthy lifestyle due to alcohols potential short-term and long-term health risks. According to the Australian Medical Association, ‘Alcohol remains the single biggest drug related problem in the country and it causes more deaths and harm to Australians than all other drugs together’ (Bainbridge, 2013). So, if sport truly believed in its values, how can they endorse a product that is known to be associated with such physical and social harm? Harmful Influence on Children In the sporting environment young people are exposed to an extensive array of alcohol sponsorship, which research indicates significantly influences their attitudes and behaviours towards drinking (Richards, 2015). This early and cumulative contact with alcohol marketing contributes to the earlier age of an individual’s first alcoholic beverage as well as to their heavy rate and frequency of drinking. It can also lead them to develop harmful patterns of alcohol consumption later in life because it is portrayed to children that when watching or after playing sport, kicking back and having an alcoholic beverage with mates is a commonplace. This ideal is clearly expressed in numerous of XXXX Gold’s commercials where they regularly display a group of ordinary Australian men deservingly consuming XXXX Gold beers after an intense game of social beach cricket. Moreover, research findings in both Australia and overseas suggest that youths’ attitudes and assumptions about drinking are not only shaped by the content of the advertisement but also by the person who delivers the message (Richards, 2015). For example when sporting stars such as former Test cricketer David Boon delivered an advertisement for Cascade, this advertisement had a ‘higher degree of appeal, attention, recall and purchase’ of Cascade’s products due to the popularity of the celebrity (Run, 2011). Children are particularly vulnerable to these alcohol sponsorship messages as they lack the knowledge and skills to examine the advertising claims. Instead children believe the information delivered by their sporting icons, thus many parents insist that children need to be protected from inappropriate alcohol marketing. Consequently, parents propose that sponsorship of sport by alcohol companies and brands should be phased out with sporting organisations seeking alternative funds from a socially responsible source (Richards, 2015). The World Health Organisation likewise supports this view as they state that, ‘all children and adolescents have the right to grow up in an environment protected from the promotion of alcoholic beverages’ (Dobson, 2012). In contrast to these views the alcohol industry denies their marketing campaigns specifically target children or teens’ (Dobson, 2012). However, alcohol sponsors use of memorable characters such as Bundaberg Rums, Bundy Bear, begs to differ whether they have deployed this marketing strategy to promote their products to children, in an attempt to increase brand awareness and gain future customers. Further empirical studies have shown young people are drawn to the music, story and humour of alcohol advertising (Australian National Preventive Health Agency, 2014). Children also find the quirky, playful and subversive elements of alcohol promotions appealing. Overall with so much emphasis today around ethically advertising to children, sporting organisations have begun to take proactive measures to reduce children’s exposure to alcohol imagery and branding. For example, the XXXX Gold and VB sponsorship logos have been removed from children’s State of
- 7. 7 Origin Guernsey’s. Further 16 national sporting organisations have began the initiative, pledging to ‘Be the Influence’ and tackle binge drinking by providing sporting environments, from national through to community level, that are alcohol-promotion free (Australian Government , 2015). As part of this campaign sport ambassadors from across an array of sports are coming together and using their power to promote responsible drinking to children. Toxic Influence on Players Not only does the alcohol industry’s sponsorship of sports have a harmful impact on children but it also has been directly linked to problem drinking by players. A study in the latest issue of the international journal, Addiction, found that players from teams sponsored by alcohol companies drank heavily (Patty & Magnay, 2008). This was because players received sponsorship that included free or discounted alcoholic drinks. Consequently, players drinking levels rose to dangerous heights with most consuming more than six drinks in one sitting (Patty & Magnay, 2008). However, players stated this was because they felt obliged to drink the sponsor’s product after training and games (Patty & Magnay, 2008). Further players binges of alcohol, facilitated by alcohol sponsors resulted in athletes engaging in more high-risk behaviours such as drink driving or unprotected sex. Alcohol Sponsors have the Power Since many sporting organizations are so heavily dependent on alcohol sponsors for revenue this makes them extremely vulnerable to the control of their sponsors. Thus, sporting organisations go to extreme lengths to keep their alcohol sponsors on board, for example the Queensland Maroons explicitly promote that the official beer of the team is XXXX Gold and so fans must only consume this brand if they want to show their support for the team. Furthermore, only alcohol brands that sponsor the sporting organisation are sold at the venue, this in turn increases the sales of sponsor’s products, giving them a competitive advantage over their rival alcohol companies. Moreover, alcohol companies have the power as they can select whether to sponsor a sport organization or not. In turn this negatively impacts the financial wellbeing of smaller sporting organizations as ‘alcohol sponsors will simply not spend such amounts of money without the committed support of major broadcasters to the event’. This makes it difficult for smaller sporting organsiations to attract funds, resources or services from alcohol sponsorship, causing them to struggle to survive. Unfavourable Brand Image Finally from this relationship the alcohol sponsor may also negatively be impacted because the achievements of teams or athletes they support cannot be controlled. Hence, a poorly performing team or athlete may unfavorably influence the perception the public holds of the alcohol sponsor. Yet, this negative brand image is only likely to be minor since alcohol industries are so large and sponsor an array of sports.
- 8. 8 Alcohol Sponsorships Current Situation Currently, the ethical issues surrounding alcohol sponsorship in Australia has led to a blanket ban being enforced on alcohol advertising in the evenings and on weekends before 8:30pm but there are exemptions for sporting events (Bainbridge, 2013). Nevertheless alcohol sponsors state all their advertisements must be independently verified before being allowed to screen. This rigorous process ensures that promotional material is appropriate for all age groups and is suitable to be shown during sporting events. Further, with so much public debate around alcohol sponsorship twelve leading sporting organisations supporting athletes in soccer, basketball, netball, swimming, cycling, hockey and others have proactively agreed to end all existing and future alcohol sponsorship contracts. Instead of gaining funds from alcohol sponsorship these sports will share $25 million provided by the government, with these replacement funds being taken from the new Alcopops tax revenues (Bainbridge, 2013). However, whilst many sports are on board to reduce promotion of alcohol in society, the nation's biggest sports organizations; AFL, NRL and Cricket Australia have not yet signed up to the new program. Conclusion Overall, society links alcohol and the enjoyment of sport so tightly together that it is almost impossible to break this sponsorship agreement. Besides why would you want to, if alcohol sponsorship means we can watch professional sport, fund innovation and create local career paths for athletes. Whilst, there is no denying that alcohol sponsorship through sport does impact on societies wellbeing, instead of prohibiting this source of revenue marketing regulations should be introduced. These regulations are needed particularly in relation to promoting alcohol to children and young people. With these minor changes sport and alcohol sponsorship can have a somewhat healthy and very prosperous relationship into the foreseeable future.