Play ball: Sports sponsorships require an evolving marketing plan

For major marketers, competing and winning in the sports arena means more than simply affiliating a product with the team that posts the most points or the athlete who stands out in the draft picks. Marketers like Coca-Cola have learned that when it comes to navigating the tide of sports, they can no longer assume that their brand and product will be a standout player. It's all about appealing to sports fans as consumers, and adapting to their changing demands. John Cordova, director of sports transaction management at Coca-Cola, knows that scoring points and continuing to hold a lead among soft-drink consumers at sports venues requires an evolving marketing playbook.

For major marketers, competing and winning in the sports arena means more than simply affiliating a product with the team that posts the most points or the athlete who stands out in the draft picks. Marketers like Coca-Cola have learned that when it comes to navigating the tide of sports, they can no longer assume that their brand and product will be a standout player. It's all about appealing to sports fans as consumers, and adapting to their changing demands.

John Cordova, director of sports transaction management at Coca-Cola, knows that scoring points and continuing to hold a lead among soft-drink consumers at sports venues requires an evolving marketing playbook. Cordova says a successful sports sponsorship starts with the basics: "You must be certain that something is going to happen."

The test came in 1994, he explains. Beginning in 1980, Coca-Cola had been spending an estimated $70 million annually on sponsorships in the major sports played in each market, with $40 million annually going to Major League Baseball. However, Major League Baseball threw Coca-Cola's advertising strategists a curve ball when players went on strike and forced the cancellation of the 1994 World Series games.

Growing consumer indifference and cynicism towards sports sponsorships, compounded by the disruption in Major League Baseball, forced Coca-Cola to retool its sports marketing plans. The company also had to rethink sponsorship strategies to reflect those attending sports events — a demographic that was narrowing because of spiraling ticket prices.

As if that wasn't enough, Coca-Cola needed to counteract the fact that soft drinks aren't an integral part of the stadium experience on either the collegiate or professional levels for many fans. Cordova, speaking at the annual meeting of the Sport Marketing Association hosted by the W. P. Carey MBA Sports Business Program, jokes, "Do you know of anybody who's ever heard of two guys talking about going to the game and having a Coke?"

Coca-Cola's new game plan led the company to change direction. Rather than focusing on brand acceptance and sponsorship awareness, the company is driving brand preference and purchase intent through sports sponsorships. And, Coca-Cola's definition of a standard high-profile venue expanded from stadiums and amphitheaters to include colossal sites like Disney World, which emerged as important factors in Coca-Cola's sports marketing vision.

"The Coca-Cola strategic plan isn't about throwing more dollars into sponsorships just to maintain or build brand awareness," states marketing professor Michael Mokwa, academic director of W. P. Carey MBA Sports Business. "Rather, Coca-Cola strongly recognizes the need to interact effectively with audiences to provide memorable connections with the fans leading to brand engagement and sales."

"Industry people call this proactive interaction among the consumer and property 'sponsorship activation.' Activation is getting significant things done through the sponsorship relationship so that fans and consumers will engage in memorable experiences that lead to more productive consumer relationships, sales increases and better bottom lines," he adds.

Grabbing the attention of sports fans and keeping them as committed consumers meant showcasing the brand name as more than just one more logo in the crowded field of arena billboards, Cordova says. For example, Coca-Cola makes its brand 3D by bringing out a giant inflatable Coke bottle that, in Cordova's words, "speaks refreshment."

And, the company is promoting Coca-Cola as an interactive experience at sporting events as well as the soft drink of choice. At Turner Field — home turf of the Atlanta Braves in Coca-Cola's home city — Coca-Cola has a section where fans can play interactive games, enjoy soft drinks and celebrate after a win.

Cordova says that the turn to interactive marketing has paid off in bigger volume and profit gains for the company. Still, he adds, companies like Coca-Cola continue to struggle with the value crunch created by the explosion of new venues. Sponsors now have a vast array of media choices, but there are also a lot more advertising players on the field.

Presented with a plethora of marketing tools to reach consumers, Cordova says, Coca-Cola tore a page from "the beer guys," who, he adds, "got it." Spend on the things you think work best, Cordova says, and invest in what follows the parameters of your strategy. With that in mind, Cordova says the company began to view its sports marketing investments differently. Sports has become a component part of the Coca-Cola marketing portfolio, rather than the portfolio itself, beginning at the national level and driving down to local sponsorships such as tie-ins with radio stations or grocery stores that feature the Coke name prominently.

Maintaining trademark ubiquity — manifested in common strategy and signage throughout the U.S. — and making certain that ice-cold Cokes are always within arm's reach, are at the core of Coca-Cola's sponsorship approach. This strategy has taken sales of Dr. John Smith Pemberton's soda concoction from nine Coca-Colas per day in 1886 to 1.3 billion drinks per day today. Somewhere, Pemberton must be having a Coke and a smile.