Sports sponsorship in Malaysia seldom meets global best practices.
That is one of the major reasons why brands prefer not to sponsor Malaysian sports. This has resulted in the perception that Malaysian sports lack quality, or that there are not enough sponsorship benefits to justify the partnership.
The lack of the right sponsorship knowledge, on both sides of the sponsor and sponsee, has resulted in the low sponsorship ringgit inflow into our sports. It is, therefore, heartening to experience and observe how national oil and gas company Petronas leveraged its sponsorship with the Badminton Association of Malaysia (BAM), evident during the recently concluded Malaysia Open.
The sponsorship
On the sponsors’ side, global best practices ensure companies achieve their Return On Objectives (ROO) from three main areas – brand exposure, sales, and corporate responsibility (CR). A company’s CR, in today’s investment and financial world, can also be reflected in its Environment, Social and Governance (ESG) applications. Many other sub-objectives relate back to those three main areas.
As the rights holder, the sponsee must also be in a position to consolidate and prepare its assets and resources to deliver a world-class product. When sports assets like the Malaysia Open are branded and marketed heavily, it engages and ignites the interest of the fans. These fans are why companies sponsor a sporting asset; it is their target market.
Sponsorship is never about the platform. It is about the target market.
Sports marketing
When we have an astute sponsor and a dynamic sponsee where the fans of the sporting asset match the target market of the sponsor, the next key aspect is leveraging.
A sponsor needs to activate their sponsorship by leveraging strategically on the sponsorship to maximise their ROO. Additional budget has to be set aside for this.
Aside from the clever marketing done by Petronas for the Malaysia Open, their merchandise strategy was also spot on. In driving up interest in the event, the fans will buy the merchandise and other related services. Petronas will also now have an army of willing walking billboards, who paid to promote the brand.
The magic
It is good to see BAM, the sponsee, and Petronas, working together to achieve their respective objectives and, more importantly, treating the Malaysia Open like a product. Once the sport is treated like a product, which is branded and marketed well, magic happens.
The Malaysia Open saw Petronas leveraging on their sponsorship with BAM in a strategic manner. It was a homecoming of sorts for Petronas – as Malaysia’s only Fortune 500 company – to associate its brand with one of the most popular sports in the country.
Leveraging strategically will generate a powerful fan engagement, which will, in turn, generate more interest and a sense of belonging. More people will follow the event, buy more tickets, and increase sales of all supporting services and products. Ultimately, this increases the value of the product, in the form of the Malaysia Open.
Through basic observation, the recent edition of the Malaysia Open would have generated at least RM20 million in transactions.
It is derived from various aspects like event management, overlay, stadium rental, ticketing income, merchandise sales, parking fees, e-hailing income, public transportation, petrol costs, accommodation and food for the athletes and officials, logistics, air travel, BAM’s organising costs, prize money, merchandising, integrated marketing, other leveraging costs by the sponsors, broadcast rights sold, production costs for broadcasting, etc.
In short, this augurs well for the sports industry due to the symbiotic and synergistic relationship that exists among the key stakeholders.
Nur Jasni Mohamed is the founder and group managing editor of sports consultancy outfit Sportswork Group Sdn Bhd. This is the personal opinion of the writer and does not necessarily represent the views of Twentytwo13.
