Macro-level factors affecting sport sponsorship

decision-making process at Hungarian soccer clubs and

soccer sponsor companies

Ph.D. thesis

Péter Berkes

Semmelweis University
Educational and Sport Sciences

Supervisor: Dr. habil. Mihály Nyerges associate professor, CSc.

Official reviewers: Dr. Péter Szegedi associate professor, Ph.D.

Dr. Róbert Frenkl professor emeritus, DSc.

President of the final exam

committee: Dr. habil. János Gombocz professor, CSc.

Members of the final exam

committee: Dr. József Bognár associate professor, Ph.D.
Dr. Attila Borbély associate professor, Ph.D.
Dr. István Vingender associate professor, Ph.D.

Budapest
2008.
INTRODUCTION

Professional soccer is truly an international sport and it has been growing into a large
business, with an estimated market size of €12,6 billion. Over the last decades, worldwide
interest in soccer sponsorship has increased dramatically in terms of media coverage,
consumer interest, and corporate involvement. Most of the sport properties, mainly the soccer
clubs, and their business partners view sport sponsorship as a positive medium for achieving
marketing objectives. For sport properties there is increased pressure to seek corporate
sponsorship support to ensure ongoing organisational viability and survival. This is certainly
true in Hungarian soccer where, since the early 1990s, sponsorships have generated important
revenues for clubs at all levels.
Professional soccer clubs generate a high amount of revenue through sport
sponsorship. This is certainly true in Hungarian soccer where, since the late 1990s,
sponsorships have generated important revenues for clubs at all levels. Since the Football
League in Hungary was professionalised and became business-orientated in 1998, recently in
the first league 16 clubs are competing with each other and clubs have increasingly turned to
sponsorship as a means of generating revenue. Unfortunately, there are no secure sources
regarding the magnitude of the Hungarian Sponsorship market, but the Hungarian spending
on sponsorship programs climbed to US$200 million. All figures for the 2005/06 season have
been translated at 30 November 2006 exchange rates (1$=206 HUN forints and 1€=255 HUN
forints). The price tag on a soccer league-title sponsorship has risen to more than US$ 2
million per year. The sponsorship costs for a Hungarian soccer club runs as high as US$0.3
million.
The sponsorship industry is continuing to grow at an extraordinary rate. Global
sponsorship spending is forecast to hit an all time high US$33.8 billion in 2006, a 10.8%
increase on the $30.5 billion of 2005.
Soccer sponsorship has become one of the most dynamic forms of marketing, with
dual benefits for both the corporations and the sport property, because soccer clearly
possesses attributes, which are attractive to corporate sponsors. In addition, the image of
products, services, brands can be enhanced when a company aligns itself with the positive
characteristics of a soccer event or a successful soccer club. Professional soccer is truly an
international sport and it has been growing into a large business, with an estimated market
size of €11,6 billion. The ‘big five’ European Leagues – the top-tier leagues in England,
France, Germany, Italy and Spain - generated revenues of €6.7 billion in 2005/06, an

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impressive 8% growth on the previous year, with these five leagues accounting for 53% of the
€ 12,6 billion European soccer market.
There are large differences between the East-European sport system (observing the
principles of socialism) and Western-style businesses practice (focusing on profitability).
When Western-style corporations become involved in sponsoring Hungarian sport properties,
mainly soccer clubs, their capitalistic (i.e., economic profit motives) attitude conflict with
Hungarian’s distinct socialism (i.e., social profit motives), because Western corporations
traditionally have seen sponsorship as a marketing vehicle to differentiate brands or
organizations. Hungarian sport and mainly soccer previously featured a government-budget
orientation (i.e. all elite sport was government funded) and it will take time to transform the
driving force into a more cooperative model integrating marketing into sport. For a long time,
the industry-controlled environment, with a politically influenced climate, placed Hungarian
soccer clubs in non-profit positions requiring no marketing skills. While western capitalism in
Hungary might seek to focus on profits, the sponsorship in Hungary must generate social
gain. In fact, Hungarian soccer clubs currently are having difficulty finding new sponsors.
During Hungary’s economic reform, however, sport organizations were redesigned to
penetrate sport marketing and to play the roles of both non-profit organizations and business
entities.
When Hungary began a nationwide economic reform after the early 1990’s, sport
sponsorship created an appropriate way for the business community to explore new areas of
marketing and for sport properties to explore new sources of revenue. Thanks to these
reasons, some sport sponsorship arrangements probably are not compatible at the present
time. The relatively negative attitude of corporations (based on philanthropy expectations and
cost-ineffective experiences) offers two messages to soccer clubs. First, based on the ongoing
changes in the marketing environment, clubs should focus more on cooperative strategy.
Second, cost-effectiveness is a critical factor in influencing the sponsors’ decision-making
process. In addition, cost-ineffective implementation can ruin the cooperation between sport
organizations and commercial entities.

OBJECTIVES

This research work was indicated by an apparent lack of comprehensive investigation and
little empirical evidence emerged of the marketing orientation of sport sponsorship strategy of

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the Hungarian professional soccer clubs. The primary purpose of the empirical part of our
study was to evaluate the importance of certain factors that affect professional soccer
sponsorship decision-making in Hungary. Such factors are: the relationships between soccer
sponsorship objectives and measuring the effectiveness of soccer sponsorships. The secondary
purpose of this study was to conduct a gap analysis in order to develop successful sponsorship
strategies – strategies that will serve the development of sport sponsorship in Hungary.
A comprehensive overview of current sport sponsorship literature revealed that this
specific research theme has not been fully examined, little empirical evidence has emerged in
this field. In the literature review the arguments of a number of authors led to the conclusion
that the field of sport, especially soccer sponsorship is relatively young. These views and a
lack of research reports on Hungarian soccer sponsors’ objectives and measurement tools led
therefore to the assumption that relatively little on macro-aspects of sponsorship are known
locally about the issue. No literature references or research reports were found that provide
any evidence on how Hungarian professional soccer clubs’ sponsors make sponsorship
decisions and whether sponsorship involvement holds any measurable marketing and
communication outcomes in terms of profit, market share, sales volume, return on investment
and image enhancement.
As stated earlier, the Hungarian soccer and sponsorship market is a relatively new and
unexplored subject of research in the field of sports sponsorship in view of the fact that most
studies have focused on the major European soccer leagues so far. This paper focused on the
Hungarian soccer sponsorship market, which gives a variety of comparisons to other studies
on soccer sponsorship focusing on the major soccer markets. Based on the comparison, in the
future, it might be able to reveal differences in soccer sponsorship between East European and
Western soccer markets.

METHODS

Three research hypotheses were formulated:

¾ The marketing-orientated concept is used at the professional Hungarian soccer clubs

and the main elements of marketing and sponsorship strategy can be identified.

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 ¾ The marketing-orientated concept is used at the Hungarian soccer sponsor companies
and the macro-aspects of their sponsorship strategy (objectives, ROI indicators) can be
identified.

¾ There is a correlation between the importance of different categories of sponsorship

objectives and the importance of different categories of sponsorship measurement
tools (as indicated by Hungarian soccer clubs’ sponsors).

The scientific research is divided into three different stages, the exploratory, the descriptive,
and the explanatory stage. Our research is explanatory in nature and the method used in this
study was a quantitative survey method.
The study was directed at Hungarian professional soccer clubs and the Hungarian
corporations currently involved in professional soccer sponsorship.
Sampling frame: questionnaires were disrtibuted to the all Hungarian professional
soccer organisations (N=18) and their sponsors (N=103). There was no comprehensive list of
Hungarian soccer sponsors, so a purposive judgement sample was drawn from the official
website of the clubs. The sampling frame included companies that (a) soccer club’s sponsor in
Hungary, (b) reported a minimum combined sponsorship budget of $20.000, and (c) the last
selection criterion was that integrated marketing communication had to be used by sponsors.
Fifty-seven (N=57) sponsor companies met all three selection criteria and the research
questionnaires were administered to them. The respondents were corporate representatives of
organisations such as: vice presidents, marketing directors, marketing managers, marketing
research managers, advertising managers, pr managers and sponsorship managers. The
original survey was carried out in the period between May 10 and July 30, 2006. Follow-up
phone calls were made for 2 weeks following the original mail out. After 1 month, a second
copy of the survey was sent to those who had not yet responded. The designed questionnaire
was pilot tested by sport marketing and sport sponsorship specialists in various research
agencies to ensure expert and content validity. The pilot study made it possible to finalise the
survey questionnaire. As a result of the respondents’ wording recommendations a few
important modifications in the questionnaire were made.

Statistical analysis and procedures

The questionnaire tries to capture the opinions and perceptions of the respondents in
terms of the importance of specified sponsorship objectives and the importance and current

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level of applying of specified sport sponsorship evaluation tools. Using a Likert-type scale of
1 to 5 (1 = not important; 5 = very important; 1=always; 5=never), respondents were asked to
rate the importance of sponsorship objectives and the importance and using the evaluation
techniques. The questionnaire was subsequently divided into two sections. The two parts of
the questionnaire include the range of sponsorship objectives that fit into the five frequently
used categories of sport sponsorship (corporate, brand/product/service; sales, media coverage,
and guest hospitality), and measurement tools as proposed by a framework of Heerden (2001).
This framework was the most adequate for our research hypothesis, since it focuses on
sponsorship in particular, and summarises the most commonly suggested objectives by
various authors.
The direct relationships were tested by descriptive statistical analysis and Pearson’s
correlation analysis. The statistical analyses were executed by Statistics for Windows 6.0 Stat-
Soft Inc. (2001). A coefficient alpha (Cronbach’s alpha) test was run to ensure internal-
consistency reliability of response. The significant-level was (p<=0.05), the correlation-level
(r>=±0.61) and Cronbach alpha scores were between 0.796 and 0.610. The correlation
analysis will aim to determine whether corporations who sponsor Hungarian soccer clubs
indicate a link between sport sponsorship objective setting, and measurement of soccer
sponsorship effectiveness.

RESULTS

With a total sample size of 57, the average age of respondents was 42,6 years. Respondents
had an average of 19,2 years of working experience. A greater percentage of males (81,7%)
than females (18,3%) was surveyed. 30% of the survey respondents were sponsorship
managers, 25% marketing managers, 10% advertising managers, 8% pr managers, 7% vice
presidents, 4% marketing directors, 3% marketing research managers and the remaining 13%
of the respondents held other positions.
In the first phase of our research, the respondents were asked to rank, in order of
importance, the objectives for sponsoring the Hungarian soccer clubs. The average mean at
each of the categories indicate the sales objective category scored the highest value (x=3.88),
then the product/brand/service-related objective category (x=3.81), then broad corporate
objective category (x=3.76), media coverage (x=3.7) and last guest hospitality category
(x=3.36). See in Table 1.

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Table 1.

The range of sport sponsorship objectives regarded to be important by the respondents

Range of sport sponsorship objectives Importance mean SD
Sales objectives 3,88 0,8
Product/brand/service-related objectives 3,81 1,01
Broad corporate objectives 3,76 0,91
Media coverage 3,7 0,88
Guest hospitality 3,36 1,22

Due to the results of the average mean at each of the categories, it can be assumed that the
respondents view sales- and product/brand/service-related sport sponsorship objectives as
being very important.
The most important individual objectives were: promoting or enhancing corporate
image (x=4.53), building goodwill amongst opinion formers (x=4.43), then increasing brand
loyalty (x=4.42), then increasing target market awareness (x=4.27), gaining competitive
advantage through exclusivity (x=4.23), then increasing long-run sales (x=4.11), then
strengthening brand preference (x=4.11), then media coverage during the event (x=4.10), then
facilitating salesforce prospecting (x=4.09), then target specific corporate audiences (x=4.07),
then increasing brand awareness (x=4.00), and pre-event media coverage (x=4.00).
Consistent with past literature most companies in our sample seemed to be concerned
with image enhancement. Corporate image building is considered to be the most important
sport sponsorship objective among Hungarian soccer clubs’ sponsors. The image attributes
have high relevance in sponsorship decisions. In image sponsorship the sponsor company
transfers its positive image attributes to an event or a group.
According to the research results the media-related objectives had a high priority. In
case of soccer, the media value is often based on three factors, namely audience levels, total
exposure, cpt- cost per thousand. Media equivalent value is often determined using cost per
thousand (CPT), total exposure time, number of viewers. Brand exposure can be measured by
clarity of exposure, type of exposure (e.g., board, shirt), number of exposure, total exposure
time. Static boards around the pitch gave higher exposure opportunities to sponsors than
rotating boards, although the level varied depending upon the venue. It is apparent that the
venue does have some affect on exposure levels of boards. Sideline perimeter boards gave the
highest opportunity to see. Other sources, mostly off-pitch clothing, also gave added exposure
opportunities.

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 The second section of the questionnaire covered the range of sport sponsorship
evaluation tools that the respondents considered as important. In the theoretical part of this
article the main categories of evaluation were identified, but the evaluation methods were not
categorised on the questionnaire to eliminate response bias. The measurement tool categories
covered in the questionnaire were: behavioural measures; recognition, recall & awareness;
media audits; image and attitude; brand/service/product effects. These categories are
theoretically sound but to fit to Hungarian soccer sponsors to measure the desired effect they
had to be specified.
Table 2 illustrates those tools that achieved a mean score of >=4.0 (from importance
perspective) are demonstrated: measuring the sponsored requirements in the contract
(x=4.73), spectator figures (x=4.55), column centimetres in the press (x=4.20), sponsor’s
name, brand, product service recall (x=4.14), sponsor’s name, brand, product service
recognition (x=4.12), Return on Investment in Rand value (x=4.11), and finally successful
integration between sponsorship and other different sponsorships (x=4.10). Surprisingly, the
CPT-(cost per thousand of audience delivered) had relatively low importance (x=3.14).

Table 2.

Sport sponsorship measurement tools in ranking order of importance

(Mean score >=4.0)
Sport sponsorship measurement Importance
SD Use SD
tools (Mean>=4.0)
Measuring the requirements of the
4,73 0,58 V57 4,35 0,77
sponsorship contract
Spectator figures 4,55 0,65 V73 4,21 0,93
Column centimetres in the press 4,20 0,7 V65 3,67 1,25
Increase in sponsors’ name recall 4,14 0,66 V87 3,31 1,11
Increase in sponsors’ name
4,12 0,77 V89 3,29 1,28
recognition
Return on Investment in Rand
4,11 1,07 V105 3,85 1,21
value
Successful integration between
4,10 0,78 V109 3,56 1,13
different sponsorships

The implication of a high mean score relating to “use” is important. If a measurement tool
scored a high “use” mean score, it does not necessarily indicate that the particular tool is
effective in measuring sponsorship effectiveness. It might indicate that it is easier to use the
tool or the sponsor is more comfortable or more familiar with the particular tool. A low score
“use” may be an important indication of which tools are not often used, unfamiliar to most
sponsors, too difficult to use, too expensive to use, or in the past realised disappointing

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results, and need to be developed. The descriptive statistical analysis reported earlier in Table
1, 2 indicated that there are substantial differences between the importance and the utilisation
of certain measurement tools.
The direct association between all individual variables is included in the five
categories of sport sponsorship objectives and all the individual variables of sport sponsorship
measurement tools was tested by Pearson’s Correlation analysis. As reported earlier, the sport
sponsorship objectives were grouped into categories in the questionnaire. The mean score of
all variables of each of the five objective categories was correlated with the mean score
(importance perspective) of all sport sponsorship measurement tool variables. This analysis
was aimed to determine particular sponsorship objectives that could be associated with
particular evaluation methods used to measure the set objectives and the effectiveness of
sponsorship. We focused those associations (“strong” correlation) between objectives and
evaluation tools where (Pearson’s correlation coefficients of r>=±0.61 and significance of
p<=0.05). A significant positive empirical link was documented in the following aspects.

Table 3 illustrates correlation between individual measurement tools and individual broad
corporate sport sponsorship objectives. Image effect is considered to be one of the most
important objectives companies are seeking, image-related evaluation has received
considerably less attention in comparison to awareness effect. It’s essential important to
identify the attributes of the property that are part of it’s core essence and focus on them. To
have a positive impact on the sponsor’s brand equity, leverage those attributes of the property
that it relates to or want to be associated with.

Table 3.

Correlation between individual sport sponsorship measurement tools and individual

broad corporate sport sponsorship objectives
Broad corporate objectives – measurement tools Mean Std.Dv. r(X,Y) r2 T P
Sponsorship generates competitive advantage because
of reduced efficiency of traditional marketing 3,36 1,3618
channels
Measuring the requirements of the sponsorship
3,5455 1,4397 0,7048 0,4967 2,9805 0,0154
contract

Sponsorship costs compared to other promotion costs 3,5755 1,4397 0,7248 0,4867 2,8805 0,0154

Promoting or enhancing corporate image 4,6945 0,6876

Time-trend analyses of corporate image enhancement 3,7191 0,3015 0,7116 0,4523 2,7542 0,0161

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Increase public awareness of the company 4,5818 0,7508 0,6266 0,4081 2,6428 0,0316

Post-event attitude surveys towards the sponsor 3,3636 1,3618

p<=0.05; r>=±0.61; Cronbach's alpha = 0,796

Table 4 illustrates correlation between individual measurement tools and individual

product/brand/service sport sponsorship objectives. Sponsor companies are also using the
property to strategically link their brands with soccer. Many brands try to associate with
different properties (sports, events, celebrities, etc.) to accelerate the brand building process.
Through this association, the brand is able to capture or transfer some of the property’s values
and perceptions, sometimes in a more efficient way than through television advertising alone.
This process operates in that time when the soccer sponsorship was just one element of a
sponsors’ complete integrated marketing strategy. Sponsorship need to be really integrated to
the overall brand strategy.

Table 4.

Correlation between individual sport sponsorship measurement tools and individual

product/brand/service sport sponsorship objectives
Product/brand/service objectives – measurement
Mean Std.Dv. r(X,Y) R2 T P
tools

Launch new product/brand/service 3,8462 1,2142

Increase in sponsors’ name recognition 4,1538 0,8006 0,6264 0,3924 2,6653 0,0120

Increase brand loyalty 4,4222 1,3335

Post-event attitude surveys towards the sponsor 3,3654 0,7335 0,6155 0,3444 2,1234 0,0210
p<=0.05; r>=±0.61; Cronbach's alpha = 0,652

Table 5 illustrates correlation between individual measurement tools and individual media
objectives.

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Table 5.

Correlation between individual sport sponsorship measurement tools and individual

media coverage sport sponsorship objectives
Media coverage – measurement tools
Mean Std. Dv. r(X,Y) r2 t P

Media coverage during the event 4,2429 0,5345

Spectator figures 4,6714 0,6462 0,6563 0,4049 2,8571 0,0144
To get coverage in a diverse range of media 3,4857 0,9750
CPT – cost per thousand of audience delivered 3,3429 1,4601 0,6416 0,4510 3,1400 0,0085
p<=0.05; r>=±0.61; Cronbach's alpha = 0,610

CONCLUSIONS

The Hungarian soccer sponsorship market is a relatively new and unexplored subject of
research in the field of sports sponsorship in view of the fact that most studies have focused
on the major European soccer leagues so far. Investigating the sponsorship strategy of
professional Hungarian soccer clubs’ sponsors have received little academic attention and
have not been opened to academic scrutiny. This paper focused on the Hungarian soccer
sponsorship market, which gives a variety of comparisons to other studies on soccer
sponsorship focusing on the major soccer markets. Based on the comparison it might be able
to reveal differences in sponsorship between East European and Western soccer markets. The
respondents used in this study are representative of the broad Hungarian soccer clubs’ sponsor
population so that we could make generalisation of the results.
The main conclusion was that Western-style corporations become involved in sponsoring
Hungarian soccer clubs, but their capitalistic attitude (i.e., economic profit motives) conflict
with Hungarian’s distinct socialism (i.e., social profit motives). Western corporations
traditionally have seen sponsorship as a marketing vehicle to differentiate brands or
organizations.
In Hungary sponsors are looking for sport properties that can make a valuable and
quantifiable contribution to existing or planned brand communications. Hungarian sponsoring
corporations should find ways to fulfill the social-development needs of soccer clubs. On
international-level the movement from philantrophy to return on investment (ROI) has been
well documented in the literature. Using this research results we believe that in the future
more and more sport sponsorship will be based on partnership, not a philanthropic donation in
Hungary.

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 The results of this research have implications to the sports sponsorship industry,
Hungarian soccer clubs’ sponsors and the sport properties too. There is a need for
corporations to develop a deeper understanding of their sponsors' real objectives. This could
be achieved by setting clear objectives, which will enable a more positive evaluation of
sponsor investment. It also highlighted the fact that sponsor seekers need to target their efforts
towards organisations which have a potential strategic fit with their offered product.
Admittedly, today we know little about how stated objectives are linked to achieved results in
the context of sport sponsorship. Clear and measurable sponsorship objectives enable sport
marketers to select the appropriate post-event evaluation techniques to measure the return on
investment. The measurement tool categories covered in the questionnaire are theoretically
sound, but these methods fit to Hungarian sponsors’ frame of reference.
Many of the Hungarian sponsor companies have failed to assess sponsorship’s
effectiveness in meeting their objectives. Substantial differences, between the importance and
the utilisation of certain measurement tools, were assumed to be caused by the lack of access
to measurement procedures pertaining to the particular measurement tools listed in the
questionnaire. Broad corporate and product/brand/service-related objectives and media
measurement tools are favoured and tools to measure cross-impact are least used.
It is generally recommended that more discussion should be generated on alternative tools
or techniques that can be used to measure sponsorship performance. If a measurement tool is
often used it dos not necessarily indicate that the particular tool is effective in measuring
sponsorship effectiveness. It might merely indicate that it is easier to use that particular tool,
or the sponsor is more comfortable, or more familiar with the particular tool. Tools that are
not often used, might be unfamiliar to most sponsors; are too difficult to use; are too
expensive to use; have in the past realised disappointing results, and/or still need to be
developed. More research is particularly needed on exact measures to evaluate sport
sponsorship performance. The identified objective and mainly evaluation categories need to
be further developed theoretically and practically. We could gain more reliable perspective on
how sponsorship objectives are set and the evaluating methods are used to measure the
effectiveness of the sponsorship investment.
In the past there has always been unfair criticism of sponsorship's inability to be measured
in terms of results. In the future, this will become much clearer and individual sponsorship
programmes will deliver measurable results in terms of sales and revenue figures. Therefore it
can be concluded that the main objective of this research was achieved and we can accept the

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earlier set research hypothesis. Our research findings were consistent with past studies
conducted on soccer events.
It is our conclusion that a better understanding of sponsors’ objectives and measurement
tools can assist both companies and sport properties in the fulfilment of successful
partnership. Hopefully, our research can be utilized to bridge the gap between theory and
practice in soccer sponsorship in Hungary, where theorists and practitioners form a symbiotic
relationship where joint efforts are greater than the sum of the parts. It is envisaged that this
research work can stimulate more debate on developing sponsorship techniques. It’s obvious
that soccer sponsorship is a relevant topic that requires continuous research efforts. We hope
that this study also contributes significantly to existing knowledge about the soccer business
and sponsorship.

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