Little Guys Join Ranks of Sponsors

Area teams offer a variety of packages as companies large and small ride the bandwagon.

Kansas City Star, September 4, 2006 | By Ruth Baum Bigus

 

David Sloan admits he has never been a big Chiefs fan.

But this year, the president of Li'L Guy Foods® has high hopes and more riding on the city's National Football League team.

Sloan has agreed to pay about $180,000 a year for Kansas City based Li'L Guy Foods to be an official Chiefs sponsor for the next five years. Not only are the company's tortilla chips and salsa being sold at Arrowhead Stadium, but the Chiefs logo will be an integral part of Li'L Guy's retail packaging.

Just months into the sponsorship, the company's red and yellow "Kansas City Chips" are scoring.

"We started getting responses (from people) immediately after the (first preseason) game ... and people have really been positive, with sales going well," Sloan said in late August. "It's helped our relationship with our retailers, and we've seen sales go up there as well."

Hitching a ride on the sports bandwagon is a popular move. Based on data from Chicago research firm IEG, eMarketer estimates $9.9 billion will be spent on sports sponsorships this year, an increase of about 12 percent from 2006.

Sprint, Pepsi, Toyota. The names are plastered everywhere - on the sides of NASCAR cars, on the Kansas City Explorers tennis web page, on the outfield signs at Kauffman Stadium and even on the front of soccer uniforms.

But professional sports sponsorships are not just for the big guys. Smaller businesses - like Li'L Guy - are getting into the game in hopes of becoming a bigger player.

"If a brand is associated with another brand, the familiarity of the smaller brand should grow," said Tim Bengston, associate professor of strategic communications at the University of Kansas in Lawrence.

And yes, indeed, Bengston calls that a "win-win" situation.

Teamwork

In Kansa City, packages very quite a bit among the area's professional teams, although most include standards such as signage, game tickets and special events.

Tammy Fruits, Chiefs vice president of sales and marketing, said Chiefs sponsorships generally start around $7,500 and go into seven figures. The team has about 100 sponsors, about 75 percent of which are national companies. Many pay a premium to be official or exclusive.

"When it says 'official,' we don't let any other company use that line, but that doesn't mean we wouldn't partner with another company in the same industry," Fruits said. Exclusivity gives a company the sole sponsorship rights in its industry.

Assets range from a name and logo on pocket schedules to stadium signage and player appearances.

"We like to try to determine what a sponsor's marketing objectives are and build from there," Fruits said.

The Kansas City Wizards soccer team, which shares Arrowhead Stadium as home with the Chiefs, has about 45 sponsors, said James Buckman, the soccer team's director of corporate partnerships.

About $1,000 will buy a name and logo on a Wizards e-blast, and $5,000 will put a name on the home page, Buckman said. The average Wizards sponsor spends about $50,000, but this season several local companies came on board at lower levels.

Sponsorship opportunities are ramping up for the Kansas City Brigade as the Arena Football League team plans a move into the new Sprint Center next season. The team landed Dollar Rent-a-Car as a sponsor at its new General's Club level, which starts at $80,000.

"Having the opportunity to play in a state-of-the-art facility makes our product more appealing to sponsors both locally and at the national level," said Brigade’s Greg Rodden, director of game-day operations.

Meanwhile, the T-Bones minor league baseball team brings in sponsors for as little as $250. That's what it costs to have a display table in the concourse and pass out information during a T-Bones game at Community America Ballpark.

"You really have to work at it to increase sponsorships," said Rick Muntean, T-Bones general manager. "We've raised it a tiny bit each year, and I'm happy with that. The competition in this market is absolutely fierce."

Connecting With Customers

Sponsorships offer a unique marketing avenue.

"It's more effective than advertising because with advertising you’re interrupting what the customer is doing to send your message," said Joe Sciara, senior vice president of sponsorships and events for Barkley, a Kansas City marketing agency.

He said sponsorships allow businesses to connect with customers in a personal way.

"It tells a consumer about a company's beliefs and values, and it shows that a company has a common interest with its customers," Sciara said.

At Li'L Guy, the value of a Chiefs connection was clear in 2005, when the company introduced Kansa City Chips using the Chiefs colors accompanied by football-themed promotions and packaging. Sloan talked with the Chiefs at the time about sponsorship, but it was beyond the company's budget, he said.

When the Chiefs approached Li'L Guy in December 2006 about a sponsorship, Sloan jumped at the chance.

"I've wanted to expand, and this provided the perfect opportunity for us," he said.

This month Li'L Guy is introducing a line of flavored tortilla chips as well as re-closable bags for all products.

"To be able to partner up with possibly the strongest brand in Kansas City - the Chiefs - goes a long way with our (business) strategy," Sloan says. "It gives us a leg up on the competition."

Milwaukee-based M & I Bank, with 13 area locations, signed on as a sponsor of the Wizards this year to create "an experiential relationship with our current and future customers,” said Pam Berneking, regional president.

The bank declined to specify what it paid for the one-year package, but the deal includes stadium signage; mention during Metro Sports TV broadcasts; and reduced ticket pricing for customers and employees.

“Soccer and its interests are being driven by youth in this country,” Berneking said. “(Major League Soccer) and specifically the Wizards understand that dynamic and provide high-quality entertainment for the entire family, (and) that’s something that we want to support.”

Of course, things don’t always work out as planned when it comes to live events.
When it was announced that British soccer star David Beckham joined the LA Galaxy and would play in Kansas City against the Wizards in September, the bank added the event to its sponsorship package, with plans to participate in half-time activities. Beckham has since been injured and is not expected to play in the Kansas City game.

Proceed Cautiously

While the hoopla and passion of sports can be intoxicating, sponsorship commitments should be considered carefully.

Elisa Waldman, business consultant with the Kansas Small Business Development Center at Johnson County Community College, said that while sponsorships can provide visibility before a large number of people, “you must consider what you’re trying to promote or if it fills a need of the demographic.”

The trick, she said, is to reach the right population at the right price.

Sciara at Barkley said sports team scholarships can prove particularly effective because that audience is often a hard-to-reach segment, mainly men who don’t watch much TV.

“You need to use it to communicate what you’re about and give the fan access to the sport or enhance the sport through various (sponsorship) activities,” he said.

Waldman advises businesses to track results.

An IEG survey found that nearly half of sponsors in 2007 planned to spend less than 1 percent of a sponsorship’s total budget on research to determine impact. And nearly one in three would spend nothing.

“Make sure you find some way to measure your outcomes- with a coupon, a code, sales or something,” Waldman said. “Make sure you can pay off on the goods or services you offer through the sponsorship.”

In April, the Kansas franchise of Panera Bread stopped one of its sponsorship activities with the Royals – a Baker’s Dozen promotion in which fans could redeem their ticket stub for bagels if the Royals got 13 or more hits in a winning game. It was replaced with sponsoring the purchase of 5,000 tickets for disadvantaged youths and others to attend Royals games.

“We switched from one sponsorship item to another because it was more in line with our community relations approach and community giving spirit,” said Eric Cole, the franchise’s vice-president of operations.

At first, Panera took some heat from fans for the switch, but once the company explained its reasons “people were very understanding and supportive,” Cole said.

Experts say whether a team wins or loses doesn’t matter so much.

“The quality and size of the audience and their passion has more of an impact on a sponsorship’s success than the team’s record,” said Jeff Fromm, of Kansas City’s Link Marketing.

For some local sponsors, though, winning is quite important.

Chiefs wide receiver Eddie Kennison this year signed his company on as a Chiefs sponsor.

Kennison Brown Real Estate Co., Kennison’s venture with partners Shawn Brown and Damon Taurer, is the “official real estate company” for the Chiefs.

“(The deal) helps us in aggressively going after developments,” said Taurer, who declined to say how much the company paid for the sponsorship. “It helps us with credibility and puts us on the map. We can take advantage of the city and how it feels about the Chiefs.”

The company can put the Chiefs name and logo on its marketing materials – including T-shirts Kennison passed out to Chiefs players and personnel at the team’s training camp in River Falls, Wis. Kennison wore his shirt while HBO filmed the cable TV network’s “Hard Knocks” series.

Li’L Guy’s Sloan says he’s become a bigger Chiefs fan since joining the sponsor ranks.

“We hope to move up to No. 5 in chip sales (in our area) from our No. 9 position and do about $2 million in revenues off of this program out of a total of $5 million,” Sloan said.

And Sloan, like many fans, is hoping for a winning season as it gets under way this week.

“Definitely I want them to win,” Sloan said. “The longer the season, the longer the selling season for us.”

 

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