Aidan Connolly Vice President Corporate Accounts Alltech
Catherine Keogh Chief Marketing Officer Alltech
Simon Bradley, Weekandoo Consulting
This paper examines Alltech’s sponsorship of the Alltech FEI World Equestrian Games™ 2014 in Normandy, France (the Games). As a multi-billion dollar global agribusiness, Alltech is the world’s leading nutrition company using all-natural technological solutions to generate better returns for its customers according to its ACE principle (Animal, Consumer and Environment). The authors’ description of the company’s history in experiential marketing, starting with sponsorship of the 2010 Alltech FEI World Equestrian Games which had 500 million viewers worldwide, exemplifies how a business can learn from and leverage a sponsorship strategy to achieve and develop new sources of sales revenue among target markets.
This paper examines Alltech’s sponsorship of the Alltech FEI World Equestrian Games™ 2014 in Normandy, France (the Games) and the company’s history in experiential marketing starting with the same event in Kentucky in 2010, as an example of how an agribusiness can learn from and use a sponsorship strategy to develop new sources of sales revenue and reach new customers. Alltech’s global sales strategy is to engage with the end users of their products directly, or go to the farm. This means reach out to those that are directly implicated in the production of food, engaging face-to-face with the farmer, the primary end-users of its nutritional solutions. Consequently, the company is building a brand presence in this core market of farmers worldwide through a number of initiatives all tied to its sponsorship of the Games in 2014. Normandy – the heart of both French equestrian and dairy industries – will be the backdrop for a celebration of the often unsung, but fundamental role of farmers in global agribusiness.
This insights for this paper was generated from in-depth interviews conducted between 2010 and 2013 with senior Alltech management who have been intimately involved in designing and implementing the company’s corporate growth strategy. These data were combined with the metrics from the 2010 Games and then evaluated against the AIDA framework. Combined with an overview of current sponsorship theory this provides a unique look at how sponsorship and branding can be brought together to increase customer involvement in a B2B company.
Our conclusions are that:
1. Event sponsorship is a credible and effective marketing tool for leading agribusinesses to raise brand awareness in new and existing markets.
2. Agribusinesses that understand the life-cycle approach to marketing can leverage event sponsorship toward delivering improved sales vis-a-vis a broader commercial strategy.
3. Crucial to a successful sponsorship are concepts of good-fit and shared values but also the emotional connection generated by a sense of participation and involvement in the event by the target audience.
This paper discusses the experiences of Alltech as a leading global agribusiness brand that has successfully developed its use of sports sponsorship since 2010 to achieve a succession of commercial goals from brand awareness to increased product sales. This process can be described using the AIDA communications model as a simple yet effective framework allowing the reader to assess the value of sponsorship as a tool to help achieve marketing goals.
According to the AIDA model (Russell, 1921) marketing communications tools can be used to create Awareness of a brand, Interest in the brand, Desire or Demand for the brand and ultimately Action as in purchasing units of the brand. Few if any marketing communications tools bring the target customer through a complete cycle of all four stages in AIDA, however. That is why businesses usually employ an integrated portfolio of tools such as advertising, sales promotions, public relations and sales personnel to do the job. Through its ongoing title sponsorship of the FEI World Equestrian Games, Alltech nevertheless, has successfully leveraged the association over time to drive brand awareness and latterly sales growth in key customer segments. Key to this has been its ability to apply its core competence of creating deep meaningful connections with its audiences through a variety of experiential marketing activities within the activation activity around the sponsorship of the games.
Globally, corporate sponsorship is a $51 billion dollar industry with a primary focus on sports properties and consumer brands, (IEG 2012). Research to date indicates a heightened level of sponsor awareness predicting a higher level of purchase intention (Ko, et al 2008), meaning that popular sporting events, which transcend cultural barriers, represent ideal platforms for consumer brands aiming to reach multinational customer bases.
The power of sponsorship to reposition a brand cannot be underestimated. For example, Gorse et al. (2010) described how Red Bull have demonstrated the long-term impact of sponsorship in transforming a company’s position and market place performance. Red Bull has shifted from being an energy drinks manufacturer to an extreme sports sponsor, creating the exciting events that align the values of the brand closely with the aspirations of its target audience: energy, adventure, a life less ordinary.
In general, there is a gap in the literature examining how agribusiness companies can leverage similar partnerships to achieve sales growth. Similarly, while the primary form of brand communication in business-to-business (B2B) markets is via the sales force, (Lynch and de Chernatony, 2007) successful B2B companies incorporate brand values that appeal to the emotional and rational concerns of buyers (Lynch and de Chernatony, 2007). Even less is known about the role of customer experience and sense of participation in helping to consolidate the emotional connection that is important to brand-based purchasing decisions in agribusiness markets.
But as Meenaghan et al (1999) point out, in the case of sponsorship the media and the message are inextricably linked and the sponsor’s association with the particular events generates the brand image impact. In that vein, Alltech’s use of its title sponsorship of the Games to reposition its brand with famers, getting closer to the customer than ever before is an opportunity to examine this under-researched area.
Agribusinesses are facing a daunting set of challenges such as food safety, traceability in the food chain, water shortages, changing consumer expectations and the need to feed an additional 3 billion people within the next 30 years. In addition is the ‘disconnect’ from nature as the majority of the world’s population becomes urbanized. Experiential marketing tied into sponsorship activities afford agribusinesses an opportunity to engage with direct and indirect customers. It affords them the opportunity to demonstrate what their business is doing to address these challenges, and encourage customers to become involved in the process themselves.
The benefits of sponsorship for brand-building are relatively clear: typically the exposure has a positive impact on brand effect, brand trust and brand loyalty (Mazodier and Merunka 2011). Leveraging positive associations with sponsored properties (generally sporting, cultural or entertainment events) presents companies with a marketing tool for connecting with customers on an emotional level. This emotional connection depends however, on notions such as consumer goodwill, the process of image transf