cprs edmonton luncheon presentation january 18 2013

January 18, 2013

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INDUSTRY OVERVIEW TRENDING AND IMPACT ON PR AND

COMMUNICATIONS

CPRS EDMONTON

Mobile Devices

Staying connected in the session

Twitter: #partnershipgrp

#sponsorship@partnershipgrp

BRENT BAROOTES President and CEO

Phone: 403-255-5074

Fax: 888-486-3407

Toll Free: 888-588-9550

Email: [email protected]

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The plan for this session

Discuss recent trends and updates in the industry

Discuss national sponsorship surveys and the

analysis of that information

How all these affect the PR and communications

world

Canadian Sponsorship Landscape Study 2012

Thanks to:

Norm O’Reilly and Benoit Seguin

University of Ottawa

Sponsorship Marketing Council of Canada

TrojanOne

Canadian Sponsorship Forum

IMI International

Since the CSLS was undertaken in 2006 the industry has grown 43%

Again the industry grew by over 2% since last year – now $1.59 billion

Brands were investing almost 75% of their sponsorship investment dollars within Canada

Almost 22% of spends are on local sponsorships

About 35% of that spend was with “for profit properties” and 65% with “non profits and charities”

Canadian Sponsorship Landscape Study (CSLS) 2012


Diversity in sponsorship mix – on average over 100 properties per sponsor (In a range of 0 to 1100!)

Decrease in spending on activation – now at $0.57 / dollar) (2011 was $0.62/dollar and at 75 cents per dollar in 2010)

Both Professional Sport and Fairs/Festivals and Events had the greatest number of largest sponsorship rights fees in the 2012 study (25% each)

Naming rights accounted for only 6% of the sponsorships in Canada last year


30% of brands marketing budgets last year were spent in sponsorship and experiential marketing – up by almost 1/3 over the 2011 study and up over 75% over the last 7 years

Cause marketing and professional and amateur sport sponsorships have seen a declining trend over the past several years

Greatest continuous growth has been with fairs, festivals and annual events

Entertainment-Tours – Attractions and the Arts have also continued to see growth trending


For in-kind sponsorships, about 18% are in-kind product and 13% are in-kind services and 69% cash

Average sponsorship rights fee investment in Canada for 2012 was $4M (ranged from $0 to $25M for total brand investments)

Sponsors when evaluating ROI the top three areas to measure were:

1. Brand perception

2. Brand value

3. Brand Knowledge / profile

Revenue ranked 6th


The 2012 report showed clearly that properties still are failing to provide resources for activation programs and this is a major issue for sponsors

The report also showed that sponsors are not receiving a comprehensive wrap up report and this is critical for them

Also sponsors noted that properties need to be better at providing sponsor recall statistics as well as audience loyalty statistics


Almost 55% of properties have operating budgets of less than $1M

The average property had 25 sponsors

On average properties received about $740,000 in sponsorship revenue

It is important to note that 72% of properties receive less than $100,000 in sponsorship revenue and 92% receive less than $1M


20% of property sponsorship revenues come from financial institutions and 15% from crown corporations

Food and Beverage sponsors account for 12.5% and oil and gas accounts for 9.5%

Provincial lotteries account for about 8%

The balance (35%) comes from auto, professionals organizations like law firms, communications, retail, travel, agriculture


Sponsorship Investment Allocation:

1. Professional sport 19%

2. Amateur sport 19%

3. Cause Marketing 5%

4. Fairs, Festivals and Annual Events 24%

5. Arts 12%

6. Education 8%

7. Attractions, Entertainment, Tours 8%

8. Other 5%


40% of organizations that used an agency to assist them in sponsorship used specifically a sponsorship agency

There continues to be a six year downward slide on post evaluation of sponsorships – now only 2.3% of total sponsorship budgets are spent on evaluation of outcomes

41% of sponsors invested in pre-sponsorship evaluation


The biggest growth areas for activation in the 2012 study are:

Ancillary events

Internal marketing (employees)

Social media

The biggest “losers” in activation dollars were:

Product sampling

Trade allowances – distribution incentives

Advertising


The brands that epitomized sponsorship passion from an industry perspective were:

Tim Horton’s

Loto Quebec (1/3 of study responses from Quebec)

Kraft

CIBC

TELUS


The industries that best epitomize sponsorship as selected by industry people are:

Financial Institutions

Restaurants

Consumer Packaged Goods

Sports Apparel

Alcohol / Lotteries


Most influential consumer trends were (almost 75% of areas of influential trends)

Technology

Consumers shift to healthier lifestyles and the environment

Cause based marketing issues

The top areas of concern for sponsors and properties going forward are:

Showing ROI

Budget concerns

Activating

Consumer Sponsorship Rankings (CSR) 2012

Consumer Sponsorship Rankings 2012

This research was done by Enigma Research

1000 respondents in the 2012 study, all telephone conversations from random Canadians

On average 12-15 minutes with each interview (French and English)

Cross section from every region of Canada

The 2012 study also has four detailed supplementary studies available for subscription purchase on the financial industry, the telecoms, sport and charities


1. Soft drink companies 2. Restaurants and fast food 3. Banks and financial

institutions 4. Telecommunication

companies 5. Breweries

Canada’s Most Supportive Industry Categories

6. Media companies 7. Auto Manufacturers 8. Large Retail 9. High Tech companies 10.Lottery corporations

CONSUMER SPONSORSHIP RANKINGS 2012

1. McDonalds within the restaurant sector and highest scoring among all industries

2. Coca- Cola

3. Air Canada in airlines

4. Ford – Lincoln in auto category

5. Molson for brewery

Canada’s Most Supportive Sponsors by Industry Categories


6. TD/Canada Trust

7. Shell for energy or petroleum company

8. CN for railway

9. Apple for technology

10.WalMart for large retailer

Canada’s Most Supportive Sponsors by Industry Categories

38% of Quebec felt BMO was the most

supportive FI


1. Carnaval du Quebec – (Winter festival) 2. Stanley Cup Playoffs (Annual sport event) 3. Montreal Canadiens (Sports team) 4. Montreal Jazz Festival (Music festival) 5. Cancer (Health causes) 6. Terry Fox Run (Run, Walk or Bike) 7. CNE (Exhibition or fair) 8. Terry Fox Run (Fundraising)

Canada’s Most Important Annual Events / Properties

Getting in the Game… CSR 2012

1. Sport ranked #2

2. Cancer related causes rank highest amongst Canadians

3. Red Cross and Heart and Stroke seen also as very important fundraisers by Canadians

4. Hospital related causes are more important amongst higher income earners in Canada

Canada’s Most Important Annual Events / Properties


1. 92% of Canadians believe it is for people to see their brand name

2. Majority say it is to enhance their brand image as good corporate citizens

3. Canadians know it is to create brand loyalty

Others are: • Support causes, athletes • Sample product • Entertain clients • Obtain sales leads • Differentiate themselves

Why do brands get involved in sponsorship according to Canadian consumers?


• 69% of Canadians said they would prefer to do business with a brand who supports their favorite causes

• 53% said the same for arts / cultural events

• 45% said the influence is there for sport

Interesting CSR Insight: Higher income Canadians are more

likely to conduct business with sponsors of their favorite properties

Who influences brand loyalty?


35% of Canadians said they pay more for brands that supported their arts and cultural organization, 57% said the same when the sponsorship is related to a cause and only 32% would do so in regards to sports

Interesting CSR Insight: More than 2/3 of higher income Canadians would pay more if a favorite cause is supported

Arts and Cultural Sponsorship

Cause Sponsorship

Sports Sponsorship

Who influences brand loyalty?


• 2/3 of consumers felt donating prizes to a cause or sport was an appealing or very appealing approach

• Giving cash actually ranked second!

• Providing volunteers and staff was also important as was handing out samples and marketing of the event

Interesting CSR Insight: Signage at events ranked in bottom

of top ten and “naming of an event” ranked last overall!

Consumers thoughts on sponsorship methods


• 76% frequently or occasionally watched sports on TV

• Almost 50% of Canadians attended alive amateur sport event in the last year

• 36% participated in a walk or run

• 50% of Western Canadians attended fairs or agricultural events

How active are the consumers?

Trending and Impact

• Shift in percent of what sport “owns” – margin used to 50% of all revenues – it is falling • We are seeing other sectors get better at the game – inevitable • Municipalities are really growing and getting in the game

Trending and Impact

• Other major growth area according to

CSLS is entertainment – more an more trade shows, concerts and festivals are understanding sponsorship and beginning to do it right • Fairs and exhibitions and related festivals are growing – we are seeing Ag Societies / Fairs and Exhibitions

Trending and Impact

• Continued shift of corporate philanthropic dollars to corporate sponsorship • Ongoing shift and growth (as illustrated by the CSLS) of sponsorship marketing dollars in brand budgets from traditional marketing

Trending and Impact

Both IEG and The Sponsorium Report have shown a move towards integrating, internal employee relations, public relations and government relations into their sponsorship activation and investment programs

Trending and Impact

•Brands are starting (slowly) to making more demands on their partners (charities or not) and becoming accountable for their ROI • ROI has become a major factor for brands today

Trending and Impact

•The properties who will continue to grow in this sector are getting “the paradigm shift” • They understand the need to be creative in partnerships – and this does not just mean with ideas on activation, but how they can integrate the brand into their theirs and more

Trending and Impact

• Digital media and social media and assets continue to grow and become a focus •Sponsors are now questioning the value of the property social media offerings

Trending and Impact

•Properties are undertaking IAV work specifically for digital and social media for their sponsorship programs •This is a critical step into the future for properties and brands and must be undertaken

Trending and Impact

• Digital media and social media and assets continue to grow and become a focus •Both properties and brands looking to confirm values and understand how to measure success, activate and leverage • Shift to sponsorship agencies working in conjunction with digital agencies

Trending and Impact

IMAGINE Canada study shows 56% of

Canadian corporations switched

from philanthropy to corporate

sponsorship in the preceding year

41

Trending and Impact

Sponsorship is now a fully integrated marketing and communications vehicle

It integrates PR, GR, IR, marketing, advertising, digital and social media, HR and more

BP has invested hundreds of millions into tourism sponsorship in Florida and Louisiana as part of their PR recovery

How It Works

42

Industry happenings that should not have happened

KFC blundered in 2010 with their double down fat chicken burger at the same time as the breast cancer launch for pink buckets of chicken

In 2011 they did it again with Mega Jug of Pepsi for just $2.99 with $1 of that going to Juvenile Diabetes (800 calories and 56 spoonfuls of sugar)

How It Works

44

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QUESTIONS?

Please visit our website for more information

Thank You

http://www.partnershipgroup.ca/

cprs edmonton luncheon presentation january 18 2013

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