And the Brand Played On – Corporate
sponsorships a growing presence at American and Aussie
festivals
Author: Dave Brooks
Date: April 30,2008

Radiohead fans in Detroit were certainly sullen earlier this
month when the band announced it was not routing the DTE Energy
Music Theatre for its upcoming tour of the
U.S.          

           
Even more surprising was the reasoning behind the snub —
Radiohead said the venue was covered in too much corporate
sponsorship and didn’t fit with the integrity of the
group. 

           
“(Lead singer) Thom Yorke is a real stickler about
that,” a band representative told the Detroit Free Press.
“Two albums ago, he read a book or an article about corporate
sponsorship, and it just sent him crawling up the wall.
They’ve really drilled in to see who’s doing what in
terms of sponsor presence at venues.”

           
Those same standards don’t seem to apply to the band’s
festival routing this year as the British group headlines several
major U.S. outings including Lollapalooza, which has a presenting
sponsorship with phone company
AT&T.        

           
Across the country, more and more music festivals are linking up
with corporate sponsorships as a means of offsetting the costs of
hosting these mega-events. This year’s three new entries into
the market all have big backers making capital investments. Sony
and Virgin have gotten behind AEG’s All Points West Festival
on Liberty Island in New Jersey, while the independently produced
Outside Lands Festival in San Francisco’s Golden Gate Park
has joined with Visa. Ironically, Radiohead is headlining both of
these festivals as
well.         

           
Even AEG’s environmentally focused Rothbury festival has
picked up a litany of socially conscious companies from Authentic
clothing to Gibson
guitars.         

           
In total, North American festival sponsorships are worth an
estimated $1.04 billion dollars this year, according to a report
from the Chicago-based IEG Sponsorship Report.
    

           
“That’s a four percent increase over last year, but we
have found that growth is slowing. We’ve seen double-digit
increases in previous years,” said the report’s senior
editor William Chipps. “The change is due in part to a
slowing economy, but for the most part, festival sponsorship from
corporate groups remains very
healthy.”         

           
The Australian market is growing even faster for festival
sponsorships. The Big Day Out series, which hosted events in early
2008 for seven Aussie cities, nearly doubled its corporate
sponsorship base. New sponsors this year for the Big Day Out
festival series included Converse, Bacardi, Coca-Cola, Lipton and
Smirnoff.
          

           
Part of the appeal of the Big Day Out is its youth demographic,
said Adam Zammit, principal of Peer Group Media. He estimated that
55 percent of the crowd is aged between 18-24 and another 30
percent is aged 25-32, two key age demographics for corporate
sponsors. About 15 percent is aged
16-18.      

           
“It is at the beginning of the year so [attendees] return to
school and begin talking about the event and are generally seen as
opinion leaders by their peers,” Zammit said.
       

           
Cat Footwear is using this year’s Big Day Out to launch its
product into Australia. National Sales and Marketing Manager Sean
Chrisp said the Big Day Out is its main platform for the launch
because concert-goers are its prime market
segment.      

           
“The brand has been in Australia before, but it has
disappeared over the past five years. It has just resurfaced in the
past six months,” Chrisp says. 

           
Cat’s sponsorship involves naming rights to the Cat Essential
Stage as well as one of the sideshows-“the Catapult”,
where people are hurled 450 feet in the air (inside a bubble
attached to a bungee cord). There’s even a competition to win
backstage passes.

           
“We were also able to ask several hundred people along, so we
gave away tickets to people buying Cat shoes and we have had
competitions for people to win tickets on a website,” Chrisp
said.           

           
But a sponsorship such as Cat’s doesn’t come cheaply.
While Chrisp wouldn’t divulge specific details, Zammit said
marketers will pay anything from $50,000 to $500,000 for the
sponsorship alone.     

           
“They then tend to spend about two to three dollars on top of
every dollar of sponsorship, leveraging their association with the
event,” Zammit said. “A lot of these brands might
sacrifice two to three weeks of brand advertising. But we are
seeing advertisers spend more and more every year so it is
obviously working for them.”

           
Activations are a critical component of making sponsorships work,
said Tim Chaney of car company Kia, which recently signed on as the
auto sponsor for the Van’s Warped Tour. The car company will
sponsor the Kia lounge where it will host meet and greets for the
band, along with interactive displays of their cars and a contest
to win a free new car.     

           
Another example of brand activity at this year’s concert
comes from Levi’s, which had a giant water tank at Big Day
Out towering above the crowds so visitors could refresh themselves
and use it as a meeting point. Staff also walked around with
backpacks filled with water.     

           
Zammit said that although Levi’s as a brand has nothing to do
with water, it is the service they are offering to the crowds that
provides exposure for the brand. 

           
Optus had a “recharge” room at Big Day Out where
concert-goers could relax and charge their mobile phones; Jack
Daniels took photos of people that could then be collected free of
charge from the website following the event and the Motor Accident
Authority sponsored fan interviews of popular
bands.  

           
One marketer that has been heavily involved for the past three
years is spirit-maker Lion Nathan. Among other associated
promotions, this year it had an “Inflatable Wave Bar”
for its Tooheys Extra Dry brand, which incorporates the sport of
surfing. The tent comes complete with inflatable bar, bar stools,
lounges and a “wave” for people to sit on, all while
being refreshed by a special water mist and, of course, plenty of
the sponsor’s product.

           
The other trend on the market is to bundle companies into 360 deals
that cover all aspects of touring, including festivals. Live Nation
inked a deal in February with Citibank reportedly worth $100
million that ties in links to the Bamboozle Festival series in
Irvine, Calif., and East Rutherford, N.J., as well as the Billy
Joel concert series at Shea Stadium in New York.

           
“We’ve changed the model for music promotion,”
said Russell Wallach, Live Nation’s president of National
Alliances. “At one time, we were selling tour and venue
sponsorship. Now it’s the ability to get someone involved in
everything from ticket sales
forward.”          

           
Russell said that the decline of newspaper and music magazine
advertising has caused some marketers to look for new ways to reach
audiences.          

           
“Music festivals create a direct connection between the
brand, the band and the consumer,” he said. “But I tell
companies that they have to be ready to dedicate the appropriate
amount of resources to make their sponsorships work. It takes more
than just a few banners on a stage. You need people on the ground
connecting with your target demographic.”

           
The shift towards growing sponsorships couldn’t happen
without the approval of the artists — even Radiohead —
which many view as a means of recovering revenue lost by illegal
downloading. A decade ago, many artists would have shunned the idea
of working with a corporate sponsor, but “now there are very
few who would turn down a sponsorship opportunity if it fit,”
said Courtney Graber, director of sponsorships for C3 Presents in
Austin, which is promoting both Lollapooloza and Austin City
Limits. “It’s important that the sponsor does something
relevant. Just putting your name out there isn’t enough any
more.”

 

Interviewed for this story: William Chipps, (312) 944-1727; Adam
Zammit, 61 (2) 9552 6333; Sean Chrisp, (866) 699-7375; Tim
Chaney, (949) 468-4800; Russell Wallach, (310) 867-7100; Courtney
Graber, (512) 478-7211