Getting More "Bang for Your Buck" - The Science of Sport Revenues

By Imago Group
Wednesday 7 March, 2007

In its latest educational offering, to be delivered in a one day course in Sydney on 12 April, Sport Knowledge Australia (SKA) is addressing the most challenging, vital, and rapidly evolving keys to financial wellbeing in sports – sponsorship and media rights issues.

SYDNEY – Valuing of sponsorships has matured into a sophisticated science over the last decade with corporate benefactors relying more and more upon the say so of a well resourced clique of experts.

Among those leading sponsorship analysts who scrutinise vast amounts of data in order to construct valuation summaries is SKA course presenter, James Finlayson of Sponsorship Information Services (SiS).

A global analyst organisation, SiS, owned in Australia by major market player Media Monitors, enjoys a fruitful working partnership with well-known publishers of the Sweeney Sports Report – Sweeney Research.

Access to quality up-to-the-minute information allows Finlayson and his colleagues to create in-depth analyses of sponsorship performance and to deliver independent advice on actual rather than estimated audience numbers, reach and demographic, right down to a sponsorship’s cut-through – such as brand perceptions, change in consumer habits and intention to purchase.

This type of analysis is the way of the future when it comes to major investments in sports, stadia, events and the arts, and rather than fearing the ‘sponsorship police’ as they investigate true-value and deliverables, Finlayson asserts that sport has much to gain by hopping on board the information express.

“It’s not just about signage space or filling a hole in your budget,” he says. “The majority of our clients in the past have been blue chip corporations but increasingly the bigger sports are taking a more sophisticated outlook and assessing their market value themselves in all areas. This gives them an edge in understanding their financial worth in the market place and in creating and assessing how they approach sponsorship packaging and sale of media rights.”

Among the benefits of analysis to sport is the ability to follow the lead of business and seek reward for successful delivery, says Finlayson, “Performance based payment with predetermined key performance indicators, is a growing trend in sponsorship contract content and this is an area that sport can embrace to its benefit.”

Co-presenter of the SKA course will be David Ferrarin, a Senior Manager at L.E.K. Consulting – a global strategy consulting firm with a sector speciality in Media, Sport and Entertainment. Consulting to professional sporting organisations is an important part of this sector and utilises L.E.K.’s global network of 17 offices, in particular the leading markets of Los Angeles, New York and London.

Ferrarin is a leader in L.E.K’s Australian Media, Sport and Entertainment practice which holds a key position in advising professional sports on their highest value issues. One of the highest value drivers for sport he says is media rights. In this area L.E.K. applies its traditional highly analytical strategy consulting approach to maximise the value of sports media rights for their owners.

“In the past, professional sports were at a disadvantage at the negotiation table with broadcasters when it came to understanding the value of their content,” says Ferrarin.

“These days, as sport becomes more and more professional, and the value of sport as an audience driver to broadcasters increases, sports need to be armed with a detailed understanding of the key levers of media rights value in order to be on a level-playing field at the negotiation table.”

At the SKA seminar, Ferrarin will address strategies for achieving a healthy balance between the broadcaster and the sport and detail how the value of media rights can be increased. “Fragmentation of audiences is a major trend impacting broadcasters and quality sport continues to be some of the most bankable content available. It consistently delivers attractive audiences to new and old media players. Internationally, the role and influence of sport continues to grow, and Australia is no different”.

The seminar will focus on how broadcasters extract value out of sport content and explore L.E.K. valuation techniques developed in various engagements with all of Australian leading sporting bodies.

SKA’s "Sport, Media & Sponsorship - The Science of Sport Revenues," takes place at Sydney Olympic Park on 12 April.

Please click here to download the seminar brochure.

ABOUT SKA: Launched in June 2005 with a Federal Government grant, SKA is jointly owned by the University of Sydney, University of Technology, Sydney and the Sydney Olympic Park Authority. SKA assists the continued global growth of the sports industry, helping more communities around the world to benefit from Australia’s strong sporting culture. Since its launch, SKA has delivered sport management programmes at the prestigious Indian School of Business in Hyderabad, run facility management courses in China and various seminars and courses in Australia on topics as diverse as player valuation strategies, genetic doping in sport, player welfare, executive sport management, elite sport coaching, major event management and facility management.

ATTENTION EDITORS AND PRODUCERS: James Finlayson is available for interview by contacting – The Imago Group – Liz Herbert
Mobile 0407 234 221 | Tel: +61 2 9331 7222