Sponsorships Uncategorized

It’s time for global corporate sponsors to lead

Will sponsors change the strategy of leading from behind?

(AP Photo/Koji Sasahara)
(AP Photo/Koji Sasahara)

Much has been made lately about the concept of leading from behind, a purposeful strategy to shape behavior and yield results by making followers believe they are leading. While typically associated with politics, it increasingly applies to corporate sponsors of sporting events, regardless of their size and scope.

Case in point: Brazil’s recently completed World Cup. Steeped in controversy before, during, and after the event, corporate angst (forget outrage) was tepid. Tepid because sponsors, including Sony, Adidas, Coca-Cola, Visa, Hyundai and Budweiser, among others, hoped to market their goods and services without getting in the way of their own messages. They did not want to unnecessarily rock the largest marketing boat on the planet by featuring the collective shortcomings of sports business.

Issues ranging from concern over FIFA’s site selection process and related undue external influences and overall governance, to regional issues such as Brazil’s public debate about the country’s lavish spending at a time when many of its citizens remain in dire financial straits, presented an opportunity for leadership from those sponsoring the latest World Cup.

It marked an opportunity – not a threat – for corporate leadership; leadership on display on the largest possible world stage. At a time when seizing the high road in an effort to affect meaningful change was at hand, sponsors chose to protect their immediate investments. Routinely allocating well in excess of $100 million to market, promote and activate around their World Cup sponsorships, companies were understandably leery about undercutting their own strategies.

However, shouldn’t it be argued that shareholders, consumers and sports fans would ultimately benefit from sponsors holding sports’ major governing bodies feet to the fire? Wouldn’t doing so lead to even greater global opportunities over time and, by extension, increase corporate brand and shareholder value?

Fans often talk a big game about what is wrong with sports, whether it be the price of attendance or athlete behavior, yet they continue to consume. Their consumption of sports seems limitless given new media platforms, and their appetite remains insatiable despite their hollow calls for change. They tune in to watch, they register for fantasy sports leagues, they don their favorite player’s jersey, and they continue to spend.

Sponsors understand this. They measure the return on investment associated by employing the strategy of leading from behind. Most do so because they are only minimally interested in change, but want others to believe they are committed to change, most notably governing bodies and advocacy groups.

Sponsors don’t feel a groundswell of support (outrage?) to actually affect change. So while they are better poised than most to ensure the sports industry continues to grow, and does so in a responsible manner, once again those in and around the industry realize that when it comes to the business of sports, goals are seldom aligned.

As major events slated for Rio de Janeiro, Russia, Tokyo and Qatar draw closer, don’t be surprised if, ultimately and despite myriad controversies, these Olympics and World Cups bring with them just enough change to protect cash flow.

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David Carter is the Executive Director of the USC Sports Business Institute and is an associate professor of sports business at USC’s Marshall School of Business. Bio

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