In an era where we are seeing financial companies having to reduce corporate hospitality due to IFS regulations, the principles of leveraging sponsorship for internal customers are becoming even more important. In the second of our Sport Business series, it is evident that yachting sponsorship can still be an effective internal marketing tool.
An article in the Chartered Institute of Marketing “The Marketer” magazine in 2004 was entirely dedicated to sports sponsorship. Almost without exception the content focused on engaging external audiences, product placement, endorsement and measurement. The words “internal motivation” do appear as a passing reference without any elaboration. Maybe this is a reflection of how the majority of sports sponsorships are activated and measured, which suggests only half the story.
When setting out in 2002 to research the subject of yachting sponsorship [for my MBA dissertation] and how sponsors achieve stakeholder value, I was firmly told by a leading London sponsorship agency that they would never recommend yachting for achieving internal objectives. An interesting view, which one can only assume is based on greater knowledge of other sports than yachting. Significantly, with the development of a number of ocean yacht racing properties since the early 1990’s, yachting sponsorship is developing a clear and distinct niche as an effective vehicle for internal integration, employee engagement and internal communications.
In the 1990s/early noughties The Volvo Ocean Race (formerly the Whitbread Round the World Race) saw many team sponsors with primary objectives focused on integrating large diverse or newly merged global corporations around one name, one brand and core business values. These include EF Language, Intrum Justitia, SEB, Assa Abloy, News Corp and Swedish Match.
The Global Challenge Race was an event set up by Sir Chay Blyth for amateurs and non-sailors to follow the route of his 1971 recording breaking “impossible voyage” the “wrong-way” around the world, against the winds and currents. It had a track record of attracting sponsors focused on internal leverage. Serco, Logica and BP used the race in 1996 and 2000, and the 2004 race included Barclays, BG-Group, BP and Pindar all with internal programmes. In France, major long term sponsors of yachting include Banque Populaire, Groupama, Sill and Cap Gemini using a variety of yachting properties. These include grand prix and specific yacht class circuits, Olympic teams and round the world record attempts, all with internal audiences as a primary target.
Why it works for internal audiences
The reason yachting sponsorship can benefit internal stakeholders is fundamentally linked to the relevance of internal branding.
Brands and brand values play an important role internally as well as externally, although this point is often overlooked, especially within a sponsorship. However, the concept of internal branding and integrated marketing is gaining increasing importance on the marketing agenda. The underlying principle is that everything a company does, or fails to do, communicates brand messages to stakeholders.
From a customer service perspective there are numerous examples where companies, through their product or services, have delivered a good or bad experience. A brand is far more than a logotype and corporate badge – although frequently mistaken as such. It is about what the company stands for and represents everything it does, for better or for worse! It is the “mental light-bulb” which goes off in the stakeholders’ mind which, depending on personal experience, might register perceptions such as “Harrods – exclusive, luxury” or “Harrods – over-priced, upper-class.”
External brand and product messages are promoted through marketing communications. If these messages are inconsistent with internal perceptions of what the firm delivers, this can create a disconnect. If employees’ interpretation of the brand, company culture and management behaviour are out-of-line with the claims made externally, this can lead to confusion, disengagement, de-motivation and negative attitudes.
Your people are important
Essentially, it is the organisations’ people who are responsible for delivering the “brand promise”, whether it is the salesman, receptionist, credit controller or CEO. Therefore, it is increasingly important, especially in rapidly growing and merging organisations, to enable employees to understand what the brand promise is and engage with it, to be able to deliver it.
For marketing and HR teams, engaging employees through conventional advertising or below-the-line marketing campaigns is difficult. However, sports sponsorship can provide a vehicle which can influence employees and help stimulate understanding of brand personality and increase a sense of belonging to one organisation.
The question is: why is yachting such a successful and powerful vehicle for internal delivery?
The consistently recurring reason that sponsors choose ocean racing is because of the sporting values and associations it creates.
Frank Chapman, BG Group CEO explains they chose the Global Challenge Race as a platform to show employees “who we are, what we do and what we stand for” because the mind-set and skills of ocean racing fitted with BG’s performance ethos. “The qualities needed to win an ocean race mirror the qualities BG needs to succeed in its business; teamwork, commitment, professionalism, pitting ourselves against the toughest competition in changing and sometimes very demanding conditions, and a the end of it all, coming out on top, winning.”
A trans-ocean or round the world yacht race is as much a personal quest and adventure against natures forces, intensified by the fact it is also a competitive sport and not a single expedition. This point was powerfully reinforced recently at the 2004 Global Challenge Race start. After the carnivals, parties, media interviews and farewells there was a public blessing of the fleet. The prayers for safety and the crews singing “For those in peril on the sea” from the decks of their sponsored yachts quite simply silenced the vast spectator crowds at Gunwharf Quays in Portsmouth. The reality of what the crews were about to go through had just hit home.
Unlike sports which require a track or pitch where the game is the same each time, a ball and two rackets or an athlete and a pair of running shoes, yachting is different. Athletic sports demonstrate human endeavour, fitness and focus. However, they do not include complex technology, and the track is always the same marked out length. Yacht racing is a sport which combines physical stamina, mental strength, intellectual and tactical skills and the ability to apply technology. The actual course sailed is never the same each time. Whilst some may argue this makes the sport confusing, it is the reason that yachting provides many powerful business analogies.
Bringing change management to fruition
Yachting sponsorship offers other opportunities less easy to achieve through other sports. Successful change management programmes creating changes in behaviour or attitudes take time. The same is true for brand owners seeking to create and or change images and reputations, both externally and internally. Round the world yacht races can take seven to ten months depending on the number of stop-overs. The pre-race build-up can run for a couple of years and the leverage period extends once teams arrive home. Further, the action is carrying on 24/7 rather than over in 90 minutes until the next match. This enables communications teams to run sustainable communications campaigns throughout the duration of the event.
Many sports sponsorship programmes are able to provide employees with reward opportunities, such as tickets to the rugby, football or tennis. These are good bonuses, although the experiences can be purchased off-the-shelf and are not unique. In addition, they are prone to occur in isolation or as a token gesture, rather than as part of a specific employee programme. It can be questionable whether providing employees with tickets to a match, with multiple sponsors’ branding present, will help them engage with their brand.
An extremely popular reason sponsors choose yachting is that it is possible to involve people in the sport, either sailing on the yachts or racing with the experts. Sailing lends itself to participation, whereas at the tennis guests are confined to the corporate box. You would be unlikely to be allowed to stand on centre court, let alone touch the top players rackets. The power of involving employees within the sport provides memorable and lasting experiences.
If brand owners believe that people are an important part of delivering shareholder and stakeholder value, employees need to be able to “live the brand”. Using yachting sponsorship as a platform to engage employees can provide many creative, global leverage opportunities.