||Best Practices: Selling and Managing On-Site Sales
Product Integration and Multiple Sales Channels Are Critical to Success
What do sellers need to do to create successful partnerships that include on-site sales rights? How can they take existing relationships to the next level?
Below, sponsorship buyers and sellers share eight tips, tactics and trends on making the most out of deals that include on-site sales.
Manage expectations. Most companies -- particularly snack and food marketers -- do not liquidate rights fees from on-site sales. As a result, properties should manage the expectations of potential partners.
"We don't want companies to have the expectation that they'll sell a million dollars' worth of product because they can sell at AT&T Park. That's not the reality," said Jason Pearl, managing vice president of sponsorship and new business development with the MLB San Francisco Giants.
"The hope is to break even, which is a net gain because of the advertising exposure and affinity the partnership creates," said Josh Kritzler, founding partner of Property Consulting Group, a sponsorship sales agency.
Consider local companies. While national food and beverage brands will always have a presence at professional and amateur sports facilities, a growing number of properties are placing more focus on local companies.
"Our goal is to work with as many local brands as we can," said Pearl, pointing to the Giants' partnership with Ghirardelli Chocolate Co. as an example. The company sells hot chocolate, hot fudge sundaes and other confectionary treats in AT&T Park.
More recently, the Giants secured Berkeley, Calif.-based Peets Coffee & Tea, Inc. as a sponsor of the new @Cafe in AT&T Park. The social media café features flat screen TVs that monitor social media chatter on the Giants and other teams.
Be prepared to work with concessionaires. With the exception of alcohol, nearly every deal that affords on-site sales includes two contracts: one with the property, and the other with the venue’s concessionaire.
As such, properties need to work closely with concessionaires to make sure that products are a proper fit with the venue, team and fans.
"I have run into a few problems where food quality and sales are not there. It is important to work closely with your concessionaries to analyze the potential partner from both the sponsorship and concession sides," said Chris Previte, vice president of corporate partnerships with the MLS Columbus Crew.
The Crew this year secured new partnerships with Papa John's and White Castle, both of which receive on-site sales rights.
Balance sales and sampling rights. Sellers need to be careful when selling deals that include both sampling and sales rights. The challenge: making sure sampling programs do not cut into sales.
Wells Enterprises, Inc.'s new partnership with Little League Baseball affords sales and sampling rights for Bomb Pops frozen treats at the Little League World Series as well as the opportunity to sell and sample at local games.
The company balances those rights by sampling Bomb Pops in a smaller size than products sold at concession stands. It also samples the snack in a controlled environment rather than a free-for-all sampling blitz. Consumers must participate in an on-site activity to receive the free treat.
The interaction provides a longer engagement opportunity than a straight-up sampling campaign, said Lowell Cantor, chief operating officer with Blue Chip Marketing Worldwide, the sponsorship agency of record for Wells Enterprises.
Wells Enterprises also sponsors the MLB Chicago Cubs and Milwaukee Brewers on behalf of Blue Bunny ice cream.
Use digital menu boards. The NHL Seattle Seahawks have replaced static menu signage with digital menu boards that can be used to promote different menu options and pricing throughout the course of a game.
The team uses the menu boards to drive early attendance by offering discounts prior to games.
The need to drive early attendance has taken on increased importance following the NFL's recent policy that restricts the size of bags that consumers can take to games, said Eric Mastalir, chief commercial officer with the Seahawks and Sounders FC.
"With the new bag policy and the education required around the new procedures, a food and beverage promotion may result in our fans arriving to the building earlier, thereby helping everyone out as it relates to crowd control."
The teams also use the digital menus to drive sales of perishable items.
"What do you do with an extra 1,000 hot dogs? You can hope you go into overtime, or you can offer some dynamic pricing."
The Seahawks own the commercial rights to the menu boards, although the team works closely with Delaware North Companies -- its food and beverage partner -- to determine what products to promote.
The team this year signed a new partnership with Starbucks Corp., which sells coffee and related products in CenturyLink Field.
Engage all stakeholders. In addition to concessionaires, properties need to work with other stakeholders to make sure sponsors get as much recognition as possible.
For example, Wells Enterprises had to tell ice cream hawkers to mention Blue Bunny when selling the ice cream brand.
"It was a simple thing, but for us, it was important," said Cantor.
Integrate sponsors into in-game promotional offers. Sellers should try to integrate food and beverage items into in-game promotional offers. That could include offering a $1 discount on ice cream after the 7th inning stretch.
"There are a lot of issues on who funds the discount, and you need everyone -- the team, concession operator and sponsor -- to agree to it," said Cantor.
Provide multiple sales channels. Properties need to offer sales channels that extend beyond concession stands. That includes suites, tailgating events and other on-site events where food and beverage products are sold.
"It's a simple thing, but not enough properties do it," said Cantor.
Cantor points to the MLB Milwaukee Brewers as an example. The team sells Blue Bunny at concession stands and push carts in Miller Park, but it does not sell the ice cream at team-sanctioned tailgate events.
Rightsholders should also try to align food and beverage items with similar products. For example, Blue Bunny activated the MLB Minnesota Twins by providing ice cream for root beer floats sold in Target Field.
(Source: IEG Sponsorship Report, 07/01/13)
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