OBJETIVOS ESPECÍFICOS

Returning to decision-making and OBB literature, authors have noted the importance of the product characteristics in shaping decisions, which could be here equated with the sponsorship investment. March‟s discussion (1994) of bounded rationality focuses on

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the consequences decision-makers attribute to alternatives – the alternatives being here equated to the investment. In their review of OBB, Johnston and Lewin (1996) ranked purchase characteristics as a construct most frequently used to explain organisational buying. More recently, Lewin and Donthu (2005) determined that the “purchase situation was the more frequently examined antecedent construct” in empirical OBB literature (p.1382).

While we tend to talk about product characteristics in Marketing, in the context of CCI it is more appropriate to talk about the product as the investment. Here, when considering the investment characteristics, the relevant question is particularly how individuals in the DMU perceive this investment. While there will be specific features of the investment, the associated benefits, consequences and risks perceived may also be important.

In the context of an arts sponsorship, this investment may hold slightly different qualities in each situation. To provide some boundaries, an arts sponsorship, as an investment, might be considered as follows:

(1) Being worth a certain amount of money. The arts sponsorship decisions considered here each involved a financial outlay (not just in kind/contra).

(2) Holding promotional / image building opportunities. Based on earlier discussions of the importance of brand and image building in motivations for sponsorship and philanthropy, an assessment of related opportunities is likely to come into play in defining the investment.

(3) Containing value in terms of alignment with the company‟s frame of reference.

Based on earlier discussions there is likely to be some assessment of the value of this investment vis a vis the company. This may relate to promotional

opportunities, to a higher level strategy, or to the value placed on this opportunity by a key individual.

(4) Including the managers involved in the arts organisation as key communicators.

As this investment is likely to involve ongoing communication with the arts organisation, the managers involved – and specifically their ability to

communicate and respond in a manner desired by the company – are likely to be considered “part of the package”.

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With this description in mind, decision-making and OBB literature provides guidance to how the investments might be further characterised. These are summarised in Table 3.1.

Table 3.1 Investment Characteristics

Authors Risk & uncertainty Importance New / renew / buyclass Complexity Time Pressure Choice set Buyer Power Product Type

(Lewin & Donthu, 2005)

X X X X X

(Robinson, Faris, &

Wind, 1967)

X X X⁴ X

(Johnston & Lewin, 1996)

X⁵ X X X

(Bunn, 1994) X X X X

(Sheth, 1973) X X X

(Anderson, Chu, &

Weitz, 1987)

X X

Evident in Table 3.1, is that the level of risk (here associated with uncertainty), the importance of the product and the “new-ness” of the product are frequently noted as descriptors. Johnston and Lewin (1996) place risk at the core of their model, noting that

“much of the variation in organisational buying behaviour appears to be related to the levels of risk associated with a given purchase situation” (p.8).

The importance, complexity and uncertainty of a purchase is likely to change with the type of purchase, which was given the term “buy-class” by Robinson, Farris and Wind (c.f. Anderson et al., 1987) in their buy-grid model which categorises the buying situation into a new task, modified rebuy or straight rebuy, based on the newness of the problem, the information requirements need to make a good decision, and the seriousness with which alternatives are considered. Anderson, Chu and Weitz (1987) tested this model and found support for the newness of the problem and the information

4 Robinson, Faris and Wind incorporated the importance, complexity and uncertainty into the buy-class categories.

5 Johnston and Lewin incorporated the importance, complexity, uncertainty and time pressure into their definition of risk associated with a given purchase situation.

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requirements as key factors; they also noted that the importance of the purchase was a missing factor. Bunn (1994), in developing a taxonomy of buying decision process, proposed the characteristics be referred to as “situational characteristics” which would include purchase importance and task uncertainty, as well as two more constructs external to the firm: extensiveness of choice set and perceived buyer power. More recently, Lewin and Donthu (2005) found that five constructs were frequently used to reflect purchase situation: buyclass, product type, purchase importance, purchase complexity and purchase uncertainty.

Obviously absent from the list above, but inherent in the product choice is that it will achieve the objectives the company desires. In an industrial purchase this would be the meeting of specifications, and would be a high priority characteristic. In terms of CCI this is restated as the investment‟s alignment with company objectives. Therefore, this element is added to the top of the list of investment characteristics which will shape and define the process, resulting in the following for inclusion in the study of arts

sponsorship decisions:

1. the investment‟s alignment with company objectives

2. the task uncertainty surrounding the investment, including the new or renewing status

3. the purchase importance of the investment 4. complexity of the investment, and

5. perceived buyer power.

The following will elaborate on the above list in the context of CCI, in each case exploring this element with reference to OBB/Decision-making and in comparison to what has been studied in CCI. In doing this it will become evident that this perspective has not been taken in terms of arts sponsorship decisions.

Investment’s Alignment with Objectives

Considering alignment with objectives as a component of the investment characteristics, the question is, to what extent do individuals in the DMU see this opportunity as

consistent with the company frame of reference and/or specific marketing objectives? In organisational buying, products will be assessed on their ability to meet specifications.

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However, in CCI the investment‟s alignment with company objectives may not be so evident.

Alignment is also related to decision-making discussions. Returning to March‟s logic of consequence (1994), the decision makers consider the alternatives, their associated consequences and the value of the consequences – essentially in this last stage, the alignment of what the alternatives offer to what they value. The logic of appropriateness is also an alignment strategy – aligning the situation with the

decision-maker/organisation (March, 1994).

In CCI, alignment is concerned with the objectives the company is wishing to achieve.

For example, a company would ask if the investment would meet the company‟s desire to gain awareness, promote the product, and/or be a good corporate citizen? Alignment is directly considered when managers are seeking out a positive fit between their brand and that of the arts organisation, which consumers will also perceive as logical and consistent (Becker-Olsen & Hill, 2006; Smith, 2004). Alignment may also be something less direct or obvious, and possibly something assessed at a more personal level.

Task Uncertainty Surrounding Investment

Task uncertainty incorporates a number of variables identified earlier, and is likely to be a result of perceived risk, information and the newness of the investment. A definition for task uncertainty is provided by Bunn (1993) in defining this as “the buyer‟s perceived lack of information relevant to a decision situation” (p.45). The task uncertainty therefore also relates to the buy-class in terms of the newness of the problem and the information required for a decision. A new task would be likely to hold more uncertainty given that the firm would not have experience with the product. Presumably, the introduction of reliable information would then reduce the level of task uncertainty. Task uncertainty also reflects an element of risk as noted by Johnston and Lewin (1996), with greater uncertainties correlating to greater perceived risks.

There is little evidence of literature in CCI which deals with task uncertainty surrounding these investments. Seitanidi and Ryan (2007) highlighted the potential limitations of these relationships, which could be equated to risk. Other authors have noted the importance of trust, and developing trust within the context of these relationships

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(Farrelly & Quester, 2003a; Farrelly et al., 2003b; Farrelly & Quester, 2003c; Seitanidi &

Ryan, 2007). Authors have also noted difficulties in measuring CCI. This literature suggests an element of risk and uncertainty, but does not deal with this directly.

Purchase Importance of Investment

Purchase importance has been noted by authors as a key construct and element of the product characteristics (Anderson et al., 1987; Bunn, 1993, 1994; Johnston & Lewin, 1996; Lewin & Donthu, 2005). Bunn (1993) defines this as “the buyer‟s perception of the significance of the buying decision in terms of the size of the purchase and/or the

potential impact of the purchase on the functioning of the firm” (p.45). In CCI it appears that the importance may be reflected in the financial commitment and/or potential public exposure (positive or negative) which may be realised during this relationship.

Complexity of the Investment

Complexity is likely to be in the eye of the beholder, but should be considered given that this will have an influence on the process. Lewin and Donthu (2005) suggest purchase complexity be associated with purchase importance, and it is arguable that these will be related, as will complexity be related to task uncertainty. However, some separate discussion of this is useful. Jennings and Plank (1995) offer an in-depth discussion on product complexity in light of purchases, proposing multiple dimensions of complexity (i.e. complex in terms of function, manufacturing, specifications, applications,

transactions and politics). Although Jennings and Plank study aerospace which has its obvious complexities (to me anyhow), their conclusions are applicable here. They find that as the complexity of the product increases (excluding functional complexity), the likelihood of controls also increases. For CCI, the area of complexity has not been investigated, however it is suggested that the DMU‟s perception of a request as complex would influence the process.

Perceived Buyer Power

A characteristic associated with factors external to the firm, but nonetheless part of the product characteristics is that of the perceived buyer power. A definition for perceived buyer power is provided by Bunn (1993) in defining this as “the buyer‟s perception of the firm‟s negotiating strength in a particular buying decision situation” (p.45). This is included in the discussion of investment characteristics given that each investment or relationship will carry with it a certain amount of power for the company. Power has

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been discussed in more depth concerning the role of the individual and therefore as part of the DMU, however it may also be associated with the investment itself, where one investment could provide the company with more power and control than another. This has not been directly investigated in CCI literature to date.

Thus, the perceived characteristics of the arts sponsorship – i.e. the investment characteristics – are likely to influence the decision process. The extent to which the sponsorship is aligned with objectives, holds “uncertainty”, is important, is complex and offers more or less power to the company are all potentially important aspects of the investment.