The first case involves a large, international betting company operating in several countries and employing approximately 1400 people. The company is based in the UK and entered the Cyprus market 7 years ago. Immediately after its launching in the country, and when it realised the potential for growth in the Cyprus market, it decided to become committed to sponsoring sports in the country as the regional manager asserted. Therefore, in 2008 it became involved in sponsoring a football club operating in the first division. The following year the company decided to expand its sponsorship activity by sponsoring three different football clubs competing in the same championship and also by engaging in event sponsorship in basketball.
According to the regional manager of the company, the decision to become committed in local sponsorship agreements was based on purely commercial incentives leading to what were clearly business objectives such as building brand awareness, acquiring exposure through TV coverage and building mutually beneficial public affairs with the local market. More specifically, the regional manager admitted during the interview that one of the main drives for engaging in sponsorship agreements was to build good and trusted relationships with the local market in an effort to combat the introduction of new legislation restricting betting and gambling in Cyprus. As he noted: “because there is going to be legislation that is gonna be passed on on-line betting and gambling, so we thought it was, you know, a good idea to be part of the local championship”.
Interestingly, it seems that the sponsorship-related decisions of the company were not driven by any personal or altruistic motives. The prevalence of commercial motives is hardly surprising when considering that the literature review revealed that large companies were found to be more professional and
123 more systematic with regard to the sponsorship management actions and decisions they undertake (Thwaites & Carruthers, 1998). In addition, the evidence presented in the literature review suggesting that sponsors operating in more developed sponsorship contexts are inclined towards more rational, structured and professional sponsorship related activities (Burton et al., 1998), can also provide a logical argument on the fact that an international betting company that is based in the UK and is involved in sport sponsorship on a global basis appears to be directed by clearly business and marketing oriented motives. The prevalence of commercial motives in the case study can also be explained by the fact that football sponsorship may be connected to the prevalence of a more commercial orientation, as Thwaites’s (1995) study found.
The prevalence of rational and business motives is further substantiated by the fact that, the company had not established any personal relationships with sport officials – directors or board members of the clubs - at that time. In addition, the company was not aware of the local market, as the interviewee argued, something that led the company to the decision to hire an agency to help them in choosing appropriate sponsorship partners. What is interesting in this case is the nature of the power within the channel. Specifically, the agency appeared as having a central and extremely influential role, since the decision-making power or negotiation power, was mainly concentrated on the party acting as the intermediary, and not the sponsor. As the regional manager said in the interview:
The media agency was close let’s say to the president of the club…he knew that they were in search for a sponsor because it was… that year they had financial problems… and the change of the management team… so he dropped the idea and this is why it was the particular club.
The interviewee also added that the agency was mainly responsible for the sponsorship related decisions since “they have much bigger experience in that [sponsorship] and they were also aware of the Cypriot football clubs… the market”.
Therefore, in line with the commercial incentives mobilising their decision to invest in football sponsorship in Cyprus, the company seems to have adopted a
124 systematic, rational and strategic approach in selecting the sponsorship agreements, something that is primarily depicted in their decision to assign to an agency the task of recruiting the most appropriate sport property for sponsorship.
What is interesting in this case, however, is the fact that the agency did not seem to act on a highly and strictly rational basis, since its decision may have had been influenced by personal relationships with the club’s officials. Furthermore, in this case study, sponsorship acquisition was not supply-side driven as in most cases (Thwaites, 1994), but it seems that sponsorship opportunities were pursued by the sponsor in its efforts to enhance its competitive position in the market. It is also interesting to note that the company had chosen to invest in multiple sponsorship arrangements for sound and well supported reasons. Considering that the main stated reason for entering into a sponsorship arrangement was to become part of the local championship and to build constructive public affairs, the company had chosen to support three different clubs competing in the same championship but representing a large geographical area in Cyprus – specifically the clubs represent three different cities - and at the same time the sponsor was attempting to convey the message that an international company operating in Cyprus supports local clubs and subsequently supports the sport. This is clearly depicted in the interviewee’s statement:
I think the fact that we did [sponsor] three teams at the same time means that it was more the sport that we are interested in… as I said, we do not want to match or work with one team… we do not favour one team only.
This decision may be linked to the nature of the activity the company is dealing with, since betting depends on, and concerns, all clubs. Additionally, the reluctance of the company to support or favour one team can be explained by the broader social and cultural context in Cyprus. It is probably useful to mention that one of the locally specific aspects of sport in Cyprus and more specifically football is the huge level of ‘political interference’ in the development of the sport. The history of football in Cyprus had been greatly affected by the civil war in Greece in the late 1940s between Nationalists and Communists and its subsequent effect upon all domains of life on the island. As a result, the broader political situation in
125 Cyprus has given football political dimensions which have resulted in the separation of the football clubs into left and right, according to the political parties (Charalambous-Papamiltiades, 2011a). The politicisation of football is still evident today, with the two most successful clubs in Cyprus being associated with the left and right wings. As a consequence, there has been a traditional hostility between the fans of the two clubs which is vividly demonstrated inside and outside the stadium. Politicisation of football is regarded as one of the main sources of violence and hooliganism today (Peristianis, Kapardis, Loizou, Fakiolas, and Puloukas, 2002). It is therefore not surprising that sponsors can be very hesitant to associate themselves with one of the two clubs or with any other “right” or
“leftish” club in the country, since strong identification with such a club can have detrimental effects upon the image of the company and subsequently on product image and sales. Those reservations were clearly stated throughout the interview, as the manager of the company stated that “at that time we did not want to go to one of the two teams, for many reasons… because first of all there is always a rivalry”, and he added “if you connect yourself with one of the two teams then...
instantly the other team is an opponent… at least to the people’s eyes”.
Evidently, the international betting company employed sophisticated and rigorous selection processes as illustrated by the overall decision making processes presented by the interviewee, although it is important to take into account the fact that the agency was not acting on an entirely professional approach. A number of criteria were used to enable the company to arrive at the best possible decisions as to the sponsorship opportunities they could exploit. The criteria taken into consideration involved the performance of the clubs, geographical distribution, the cost of the sponsorship in relation to the budget the company could spend, the size of the club in terms of its fan base and the subsequent media coverage that the club was expected to receive. Moreover, and in line with the evidence presented earlier in the literature review indicating that more experienced sponsors tend to engage middle level managers in decision making processes (Burton et al., 1998; Shanklin & Kuzma, 1992; Walliser, 2003), the main persons
126 involved in sponsorship-related decisions in this particular case study were the regional manager and the marketing manager of the company. According to the respondent, although the budget available for marketing spending was decided at the top level management, all the sponsorship related decisions with regard to the selection of the sport properties to be sponsored were undertaken at the lower management level with a substantial involvement of the legal department of the company at the final stages of the sponsorship agreements.
The professional and systematic approach adopted by the company is further illustrated in the comprehensive contract including a large number of components and clauses that define in detail the relationship between the two parties. The interviewee stated that the contract was predetermined as the company is very experienced in sport sponsorship arrangements globally, but the final version of the contract was actually a result of an intensive negotiation between the two parties through the agency representing the sponsor. The contract included terms and conditions such as exclusivity, designation, logo placement, logo size and prominence, signage within the stadium, hospitality opportunities, tickets, right of first refusal, additional advertising, presence of players in PR activities and during social responsibility events organised by the company, and legal clauses regarding future legislation restrictions in the country that could immediately terminate the sponsorship agreement. This final component is interesting in that it is a way to engage partners to lobby for the company as well against the legislation.
It is also important to mention that, as a part of their social responsibility program, and considering the controversial nature of their product and the fact that betting and gambling refer to adult users, the betting company decided not to have their logo placed on the academies and youth sport teams affiliated to their sponsees, despite the fact that there are currently no legal restrictions about this in Cyprus.
As the regional manager of the company argued “we did not want to have the presence of a betting company on the junior’s team for example” and he added
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“we thought it would be better not to provoke”. This action is better explained when considering their main drive for sponsoring sport in Cyprus, which was closely connected to the objective of pursuing the development of good public relations. Therefore, as a part of a broader strategic effort, the company was trying to avoid any negative or detrimental debates around the issue of gambling and betting. According to the interviewee, “it is more about being proactive, so we would not like to get into a discussion or any problem”.
The aforementioned well-structured and systematic approach towards selecting the sponsorship arrangements demonstrated by the betting company was followed by a rational and well-defined objective setting, as well as by well clarified target audiences to be reached through sponsorship. As the regional manager noted, their sponsorship was directed towards external customers as well as towards the local community. As already mentioned, one of the priorities of the company was to use sponsorship as the platform for building good and mutually beneficial relationships with the local public in order to influence positively public opinion and thus to avoid the enactment of legislation that would be detrimental to on-line betting. Therefore, it is clear that sponsorship was regarded as a very successful means towards exercising positive public relations and lobbying with the local authorities and the fan base of the clubs, and thus to exercise pressure on politicians and decision-making bodies with regard to their decisions on passing legislation restricting their activities in Cyprus. As the regional manager commended:
At a time where legislation is about to pass and people… you know, they do not decide on their own, but obviously it’s better for us to be present more and more in the press or on the TV. It works because after all people are the ones that decide who is gonna vote for those laws so it’s good to have a good public opinion.
Interestingly, the literature review did not explicitly reveal that lobbying was one of the objectives mentioned by the sponsors, although lobbying is often a component of public relations. It is indeed the case, however, that there is
128 evidence suggesting that the uniqueness of some industries and the challenges that they are faced with, such as legislative restrictions, shape to a great extent the objectives pursued by sponsors. Lavack (2003) for example found that building political support was one of the main goals pursued by the tobacco industry. Moreover, and similarly to tobacco sponsorship objectives, increasing awareness through increased exposure emanating from media coverage was another highly appreciated objective set by the betting company examined in this case study. This is not surprising when one considers that increasing awareness objectives featured among the most highly pursued goals by sponsors, regardless of the industry they come from (Cornwell & Maignan, 1998; Davies & Tsiantas, 2008; Irwin & Asimakopoulos, 1992; Papadimitriou et al., 2008; Pope & Voges, 1994; Shanklin & Kuzma, 1992; Spence et al., 1997; Thwaites, 1993, 1994). In this particular case, awareness objectives become even more important when considering the legal restrictions on advertising that the betting and gambling industry is faced with. As the interviewee stated:
We are not allowed to have any advertisement on television, because of the nature of the business. I think it is better to do it in this way [through sponsorship]. For us it was the only way, but even if we could choose, even if we had the option to play spots [advertisements] on the TV we would also choose to have sponsorships.
Another important objective pursued by the company was to align with the local market in an effort to compete more effectively with local products. Glocalisation (Robertson, 1992, 1995) is a goal commonly pursued by international companies operating globally since the aim, in this case, is to provide a product that is distributed globally but in a way that fits the local market, culture, customs, beliefs and preferences. As the regional manager of the company admitted:
The other disadvantage that international companies have is that, people sometimes, and especially these days, tend to prefer local products. So, if you just have an international company, that you have it in your mind somewhere far away in London, in an office, and just English people there, dealing with English football… it is much different when you actually see that
129 these people are here to support the country, and that they do things for the local teams which then goes to the local community.
As is clearly depicted in the above statement, creating goodwill for the business was also an important objective for the international betting company since they strongly and repeatedly emphasised the need to create a positive image within the public in Cyprus through actions that are perceived as supporting the local community. Again this is logical when considering the controversial nature of betting and gambling industry, and this is further supported by evidence found in the literature review suggesting that creating goodwill is an essential goal of industries dealing with unhealthy products such as tobacco (Lavack, 2003). The intention of the company explored in this case study to sweeten their image through sponsorship is further illustrated in the following statement of the regional manager:
When you hear betting, you think about betting shops, obviously you also bring to mind some bad examples, bad guys carrying guns, and mafia. But yes, what we want people to understand is that it is something completely different.
Pursuing image objectives does not seem to align with sponsoring many different sport entities, especially in the particular case that the three clubs sponsored by the betting company have completely different and even contradictory image qualities. What it is useful to mention, however, is that the goal of the company as indicated by the interviewee was to align with the image of the sport of football, which is admittedly the most popular and highly valued sport in Cyprus (Charalambous-Papamitliades, 2013) and not the image of the particular sport properties they decided to sponsor.
In addition to the awareness, public affairs, goodwill, and image objectives, the interview revealed that the company was also focused towards customer recruitment and customer retention, with the latter goal being a much more highly important objective than recruiting new customers as the interviewee emphasised.
130 An important observation with regard to the objectives set is that, consistent with the evidence demonstrated in the literature review (Hartland et al., 2005, Thwaites, 1993, 1994; Thwaites et al., 1998, Witcher et al., 1991), there is an emphasis on corporate related objectives. In addition, it is also interesting to note that, although it is evident that the company appeared prioritising specific and predetermined goals, similarly to the majority of the sponsors as indicated in the literature review (Farrelly et. al., 1997; Papadimitriou et al., 2008; Thwaites, 1993, 1994), those objectives were not concise, clear and set in a quantifiable manner.
Despite the systematic objective-setting that the company seems to employ when managing its sport sponsorships, when it comes to other sponsorship management activities such as leveraging and activation strategies, it appears that those are very limited or non-existent. According to the regional manager, there were no personnel available to “organise activities and boost the sponsorship”. In fact, the only activities undertaken to support the sponsorship investments was the organisation of several contests on their internet site or the radio allowing their customers to win tickets for the games, and distributions of promotional merchandise within the stadiums, but those activities were not organised on a regular basis. It is indeed surprising that the company did not spend on any additional activities to leverage their investment. Obviously, sponsorship was approached as an isolated communication tool that is not integrated to the marketing communications mix of the company. This is hardly surprising when considering that there is much empirical evidence in the systematic review (e.g. Amis et al., 1999; Lamont & Dowell, 2008; Polonsky et al.,
Despite the systematic objective-setting that the company seems to employ when managing its sport sponsorships, when it comes to other sponsorship management activities such as leveraging and activation strategies, it appears that those are very limited or non-existent. According to the regional manager, there were no personnel available to “organise activities and boost the sponsorship”. In fact, the only activities undertaken to support the sponsorship investments was the organisation of several contests on their internet site or the radio allowing their customers to win tickets for the games, and distributions of promotional merchandise within the stadiums, but those activities were not organised on a regular basis. It is indeed surprising that the company did not spend on any additional activities to leverage their investment. Obviously, sponsorship was approached as an isolated communication tool that is not integrated to the marketing communications mix of the company. This is hardly surprising when considering that there is much empirical evidence in the systematic review (e.g. Amis et al., 1999; Lamont & Dowell, 2008; Polonsky et al.,