A. ASTURIAS

The sixth case study refers to a local cooperative credit society of a specific community in Cyprus and its long-lasting sponsorship arrangement with the local club of the community. The cooperative credit society was established almost a century ago by a group of farmers, residents of the local community. The vision of the organisation was to create a community free of oppression, usury and economic exploitation of the residents, and to set the foundations for the creation

184 of an organisation serving the wider society with dignity, humanity, mutual understanding and equal opportunities (Anonymous⁴, n.d., b). The main activity undertaken by the organisation was the provision of low-interest loans to the residents of the community, despite the fact that for the first 10 years of its operation the economic condition of the residents did not allow for any savings.

By the middle of the twentieth century the cooperative credit society started growing, and, apart from the financial services provided, today the organisation is also determined to contribute substantially to the sport and cultural development of the community. Therefore, it was probably not a surprise that, as a part of the organisation’s broader social offering, the organisation had been involved in a long-lasting sponsorship arrangement with the local club. In fact, the cooperative credit society has been the sponsor of the local club for almost two decades, and it supports financially, as the Secretary General stated, not only the football club, but also all the other sports offered under the umbrella of the local sports club of the specific community.

Congruent with the aforementioned vision of the organisation, the motivation to engage in sport sponsorship was primarily philanthropic, since social and community factors appeared as having a substantial impact upon the decision of the company. At the same time, commercial motives were also stated by the respondent, and it is indeed the case that those were more explicitly and heavily emphasised by the interviewee. For example, the Secretary General of the cooperative credit society initially indicated that “the motive is the return. We get what we give” and he added “the bank is a business, it is not a philanthropic organisation. So, it is a give and take. We got the exposure, we give the money”.

It could be the case that the organisation decided to shift from philanthropic to commercial motives, or that it used the cooperative nature of the organisation to achieve commercial purposes. The existence of commercial motives was also depicted in the following statement:

4 The source is not mentioned in an effort to protect confidentiality of the organisation examined in this case study.

185 What influenced us more was the TV… firstly the existence of many TV channels, secondly the live broadcasting of matches from LTV and My-vision mainly, and thirdly the increase of sport sections in newspapers in which the clubs are displayed, and thus we are getting directly or indirectly exposure and advertising.

Throughout the discussion, however, it became obvious that social and philanthropic motives were stronger driving forces for sponsoring the club. As the respondent indicated “we entered because it was something that belongs to us”.

Furthermore, when the respondent was asked whether the company would sponsor any other local club, if existing, the response was “it is given…yes”, whilst the response to the question whether the business would sponsor any other club outside their community, was the following:

We would never think of this because the second element is missing, which is the local… I mean, we enter because it is a local club… the self-evident [factor], and we enter because we have a return. In Nicosia, for example, we are going to have only the return, we will not have the local factor, so there is no reason to enter.

Evidently, the above statements strongly suggest that local and community reasons were actually prevailing. Interestingly, throughout the interview the interviewee admitted that:

We entered because we consider this as an obligation we have in terms of philanthropy, but, because of the return that philanthropy generated, we decided to continue. And, the amount we pay is clearly more than the return we generate, but, because of the fact that we entered primarily for philanthropic reasons, we believe that the extra amount that we pay… as philanthropy.

The emphasis on the local factor is, once again, hardly surprising when considering the broader culture in Cyprus as well as the central role that

“localism” has, and this is further supported by the fact that all the aforementioned case studies examining the actions of local sponsors identified the highly influential role of localisation upon sponsorship-related decisions. In this case study, however, local factor is probably assigned more importance when

186 considering that the specific community in which the cooperative credit society operates in an area in Cyprus which is relatively neglected, from an economic and developmental point of view, since central government is primarily concerned with the large cities in Cyprus in which the major infrastructure as well as developmental projects usually take place (Christophorou, 2010). Therefore, it is logical to assume that, in a small community like this, which depends more heavily on agriculture, the “local” factor is expected to have an even more prominent role in the decisions and actions of people and companies, including the sponsorship related decisions made by this particular organisation. The patronage nature of this sponsorship is further illustrated in the fact that, in a way similar to the previous case study, the cooperative credit society decided to withdraw their logo from the shirt of the first division football club whilst not decreasing the sponsorship amount they offered, so that the club could generate more money from an additional sponsor.

Although the dominance of altruistic and community motives demonstrated by the cooperative credit society, as well as by the previous case study of the cooperative savings bank, do not seem to coincide with evidence provided in the systematic review indicating that financial companies were more professional in their sponsorship approach and they did not seem to be guided by philanthropic factors as compared to other industries (Thwaites, 1994), it is probably the case that the cultural and social conditions described above, as well as the specific cooperative status of the two financial organisations, did have a role to play with regard to the prevalence of a philanthropic orientation.

Once again, the decision to become involved in sport sponsorship was taken at the board level, probably for the reasons mentioned in the previous case study, namely the bureaucratic and central decision-making authority characterising this kind of organisation, or due to the relatively immature market in which sponsorship took place since it is generally characterised by centralised sponsorship decision-making (Farrelly et al., 1997; Walliser, 2003). In addition,

187 the decision-making process that followed did not demonstrate any signs of professionalism. Specifically, the respondent indicated that their decision was not based on any kind of criteria since at the time of the commencement of their sponsorship involvement the situation was very different:

football was an amateur sport… players’ compensation was minimum… we mainly covered the expenses in term of the sports equipment and football kits… basically, our sponsorship during the initial stages involved the purchase of sport equipment (…). It was again disproportionate the amount we used to pay at that time - 70,000 to 80,000 pounds at that time - and the exposure we got back.

The amateur and patronage nature of this sponsorship arrangement was further depicted in the fact that, although at the original stages of the sponsorship there was a contract regulating the sponsorship relationship between the two parties, today the sponsor felt that there is no need for a contract since the relationship between the two “is defined by customary law… I mean… there is no reason to write them down. We know them very well” and he added “it is like the first contract is renewed… moreover, a contract is not for the benefit of the club. They will get less… because they always get something more”. Although the respondent was hesitant to reveal the real situation/condition, the financial dependence of the club upon the bank was clear – the bank had provided the club with a huge loan, whilst at the same time the bank was the main financier of the club – there was no need for an official agreement between the two parties since negotiation power in this dyadic relationship was clearly concentrated on the sponsor’s part, with the sponsor feeling powerful enough to define the parameters of this relationship.

Despite this power, the sponsor did not seem to intend to exploit this sponsorship to its full potential. Even at the time when a contract existed, there were no detailed provisions shaping the sponsorship arrangement. As the respondent indicated, “we simply had an agreement so that we could know approximately…

the agreement concerned basically what we [the sponsor] were going to provide them with”, and he added “with regard to what we were going to get back, it was

188 basically shirt advertising and advertising on the uniform of the support staff and coaching team”. As the Secretary General explained:

There were provisions [in the contract] and, they [the club] had terms securing the amount that we would pay [for the apparel and sport equipment].

It could not be less than 70,000 pounds. In the case that it was lower than 70,000 pounds, we had to pay the difference in cash. And we also had the right of first choice with regard to where the signage would be placed. We had to pay for the signage of course, but we had the right to choose the place for the signage before the rest of the sponsors.

Additionally, the respondent referred to the fact that the company secured exposure achieved through its logo presence on the correspondence of the club.

As illustrated once again, the sponsorship approach adopted in this case study was amateurish, coinciding fully with the supportive and philanthropic philosophical ground upon which it was decided and selected. The patronage nature of the sponsorship was further illustrated in the fact that the sponsor did not ask for exclusivity, but, as the interviewee emphasised, it exerted pressures upon the sponsee “to get additional sponsors as well… even a bank” in order to improve their revenues. These actions clearly suggest that altruistic aspects prevail over commercial ones, since the main concern of the sponsor was how the club could generate more revenues, even at the expense of the benefits offered to the sponsor. However this could also be regarded as a way to reduce their involvement in the future.

The philosophical grounds of this sponsorship arrangement are further illustrated in the objectives set by the sponsor. An emphasis was placed upon corporate citizenship and social responsibility objectives, since, when the respondent was asked to rank the objectives pursued according to their importance, he replied “I continue to believe that the number one is that we provide help to a certain effort”.

The dominance of social-related goals observed in this case study as well as in the previous case studies examining the actions of local sponsors is not unexpected, especially when considering that evidence cited in the systematic review of the literature provided very similar findings for similar cultural contexts.

189 Specifically, the study conducted by Apostolopoulou and Papadimitriou (2004) indicated that Greek sponsors investing in the Olympic Games also highlighted the importance of corporate citizenship as a goal to be pursued, and this tendency, as the authors argued, refers to the broader Greek context. It could be argued that, because of the relatively more collectivistic cultures that Greece (The Hofstede Centre, n.d.), and subsequently Cyprus have, there is a stronger emphasis on community and group goals as compared to more individualistic cultures that have a stronger sense of competition and personal interest. At the same time, it is worth noting that emphasis on group goals, team-spirit, solidarity and support are values that probably emanate from the long-term history and challenges that both, Greece and Cyprus, had been faced with, mainly due to the very small size of the country as well as due to the several wars they have had to deal with because of their strategic geographic location. In order to deal with such conditions, it might be argued, people had to develop a strong sense of team identity, communal sensitivity and cooperation, values that had deeply pervaded the culture of the country. In fact, solidarity, joint action for the common well-being, collaboration and mutual assistance are regarded as being deeply imprinted in people’s conscience and are in fact close to the defining values adopted by the cooperative movement (Co-Operative Societies’ Supervision and Development Authority, 2004). Thus it is perhaps not surprising that those values are still illustrated today in the activities undertaken by people and companies, such as the local sponsors of this multi-case study.

In addition to the social goals, the cooperative credit society also appeared to be concerned with image related goals, but it is interesting to observe that it appeared to be trying to avoid negative consequences of a possible withdrawal from the sponsorship at some point in the future. As the respondent indicated “the problem is that, if we quit sponsorship, this will have a very negative impact upon the image of the business, and thus we are obliged to stay in a theatre of the absurd which football today is”. In addition to image-related goals, another objective set by the company was exposure, both at a local as well as at a

190 nationwide level. Moreover, the respondent emphasised the importance of customer satisfaction as a goal to be attained through sponsorship, since he commented that “what I did gain is that my customers are satisfied by my [sponsorship] presence” and he added “they consider our support to the club as something extremely important”.

In line with the broader unsophisticated and non-systematic approach to sport sponsorship demonstrated by this particular sponsor, the objectives mentioned above were, according to the respondent, not pre-determined, nor specific or measurable. Rather, those goals were set in “more general” terms. Similarly, the target audiences to be reached through sponsorship were not defined by the company. When the respondent was asked, for example, about the groups that could be targeted through their sponsorship investment, he admitted that “we do not have… we do not deal with this….we have never been concerned with that”.

This response substantiates further the amateur approach to sponsorship demonstrated earlier.

It should be mentioned, however, that throughout the discussion, it did emerge that, the main target public was external customers, and more specifically young customers, but this particular public was actually targeted through various marketing efforts, not simply sponsorship. As the respondent indicated “the goal with regard to reaching young people is a general objective of the cooperative system. I mean, we have a problem in that area”, and he added that sponsorship is “part of the effort to reach the young people… one way to reach the young people… so that the young people are aware of the cooperative bank… such as the school savings program, so is sponsorship”. Those statements support further the evidence cited earlier which suggested that the relatively out-dated image of the cooperative system in Cyprus had created the need for approaching and attracting younger customers, thus it is not surprising that this particular segment formed the main target audience for both cooperative organisations explored in this study.

191 The primitive nature of this sponsorship arrangement is further depicted in the literally non-existent activation and leveraging practices of the cooperative credit society. Specifically, the company did not spend any additional money on managing the sponsorship, and the main activities undertaken such as events were organised solely by the club, and they were financed as part of the overall sponsorship amount provided to the club. As the respondent said, “The goal is to provide them with 120,000 euros per year. If this particular amount is not covered by the activities and events they organise [the club], then we provide them with cash [up to the agreed amount]”. As probably expected, the process concerning

“the flow of money devoted to sponsorship” was monitored and controlled by top-level management, but the role of the sponsor was confined to observing

“whether the money was devoted to the predetermined areas [events, several activities, equipment etc.]”.

In addition to the non-existent management and leveraging activities, the sponsor admitted that, since the beginning of its sponsorship involvement in 1995, it had not exerted any effort on evaluating sponsorship return. The Secretary General of the organisation said that “we haven’t done any research… we haven’t tried to measure the benefit we get”, and he added “the benefit we get is something that we can see here… in practice… I mean the recognition that we have”. It is very interesting however to mention that, the truth behind the decision not to evaluate sponsorship was the fact that, as the respondent disclosed “anyway… even in case that we do not have a benefit, there is no chance to quit sponsorship easily.

It is very difficult to unhook ourselves from this”. These arguments strongly suggest that, sponsorship in this case study was not regarded as an investment but rather, as an obligation to the community from which the company will find it very difficult to escape. In the words of the respondent, “I repeat that we entered into a jumble that… you understand given that you are involved in sports… But, we have a certain opinion about this. We believe that it is insane… I mean sport [sponsorship] involvement”.