352 CHAPTER 11 SPONSORSHIPCorporate hospitality is developing relationship marketing activities within the framework of a sponsorship pro-
gramme. It involves, for instance, inviting employees, customers, suppliers, etc., to cultural or sports events, or the
organisation of special events for these stakeholder groups at the occasion of sponsored activities. The selection of
VIP events is a delicate exercise. The selection of groups requires an investigation into their interest in, and empathy
towards, the sponsored event. If the managing director of one of the largest suppliers of the company is only inter-
ested in opera, and not in soccer, he or she should not be invited to a soccer game. Grouping VIPs is another crucial
decision. The result of the PR or relationship effort primarily depends upon the interaction between those invited.
If they do not have anything to say to each other or are even hostile to one another, they should not be in the same
group. Corporate hospitality can also lead to irritation, for instance if someone is invited to an event he or she does
not like, or if other stakeholder groups feel discriminated against by not being invited. Therefore, it is a good idea to
conduct VIP treatment at a safe distance from the event itself, away from visitors who have paid to participate in
the event. If the value of the VIP treatment is substantial, this can lead to ethical problems because the expectation
is raised that the ‘reward’ for being invited should also be significant.
Corporate hospitality can also generate negative publicity in the media. An influential sports journalist from a
Dutch TV channel was interviewed in a newspaper, and was very critical about VIP events organised by sports
sponsors: ‘A cyclist championship for 15 000 VIPs in a concrete bunker on a car racing circuit – who was the fool
who thought of that?’ and ‘During the final of the tennis tournament in Rotterdam, the VIP area was full of people
in nice suits, talking about nothing important, while outside the world’s numbers 1 and 2 were playing. No-one
I asked in the VIP area knew who they were.’ Needless to say, this kind of negative media publicity can destroy much
of the goodwill that was built up by the sponsorship programme, and should be avoided.^31BUSINESS INSIGHT
Corporate hospitalityOne of the most important motives in sponsorship is the leveraging eff ect of the media
coverage of the event. In some cases, as in tobacco or alcohol advertising, the ban on regular
advertising leads to a situation in which sponsorship is the only way to obtain mass media
exposure. But a lot of other sponsorship initiatives count on the ‘bullhorn eff ect’ of media
coverage too. Sponsorship is indeed becoming more and more broadcast-driven.
Although sponsorship is becoming increasingly professional, in many situations the
decision to sponsor is motivated by personal interest, or ‘management by hobby’ of senior
executives, or their husbands or wives. It goes without saying that many sports sponsorship
budgets could have been spent more effi ciently on other communications tools. Th ere are
many examples of sponsorships that end when the senior manager retires or gets another
job. For instance, the Spanish soft drink brand KAS ended its sponsorship of a cycling team
(with Sean Kelly as one of the top athletes) aft er its CEO retired. Th e sudden death in 1995 of
Mr Furlan, CEO of the clothing company MG, was the cause of great concern among Italian
professional cyclists, who feared that their successful team would cease to exist.Types of sponsorship
Sponsorship budgets can be directed towards diff erent types of projects. Figure 11.2 shows the
main sponsorship types. Four basic categories can be distinguished. Event-related sponsorship
is the best-known category. Companies may sponsor a soccer competition, a team, an athlete,
shirts or even a match ball, a golf tournament, skiing or a baseball game. Th ey can lend theirM11_PELS3221_05_SE_C11.indd 352M11_PELS3221_05_SE_C11.indd 352 3/6/13 4:07 PM3/6/13 4:07 PM