2012 CANADIAN OPEN SEMINAR

JULY 10, 2012

CORPORATE SPONSORSHIP IN CHESS

Brian Fiedler July 2012

AGENDA

1. Chess sponsorship in Canada.2. Types of sponsorship support.3. Sources of sponsorship.4. What corporate sponsors are after.5. What chess has to offer.6. How to approach corporate sponsors – the pitch.7. Sponsorship benefits available.8. Pricing the opportunity.9. Targeting specific corporate sponsors.10. Closing the deal – sponsorship contracts.11. Evaluating the results – postmortem analysis.12. Q&A

1. Chess Sponsorship in Canada

• Less prevalent in North America than in Europe/Asia.

• Global corporate sponsors have included IBM, Intel, Corus, Gazprom, Lloyd’s, BNP Paribas, Deloitte etc.

• The public sector internationally (and some Canadian provinces) are also big

sponsors, especially for marquee events like the Olympics. • Wealthy patrons also a source of support (eg. van Oosteram (Melody Amber),

Dato Tam Nam, Andrei Filatov, Rex Sinquefield).

• In Canada, chess competes for sponsorship dollars with; hockey, baseball, football, basketball, tennis, golf, skating, curling, swimming, skiing and a host of individual Olympic-related sports.

• Yet in Canada, sponsorship has been obtained

Corporate Sponsors of Recent Canadian Opens:

Photos: Monroi

2. Types of Sponsorship Support

a) Direct financial contribution.

b) Sponsorship in kind;

• Discount on space (eg. tournament site rental, hotel room rates etc.)• Free / discounted services (eg. advertising rates, administrative/technical

support etc.)• Free / discounted goods (eg. logoed shirts, food & beverage etc.)• Prizes / trophies (eg. “comped” event tickets, free dining, chess sets/books,

golf clubs etc.) c) Financial Backstopping (underwriting financial risk of the event).

Note: Clearly distinguish sponsors (who provide tangible support) from organizations (eg. CFC, provincial association) that sanction the event. Make sure paying sponsors are given more exposure and credit!!

3. Sources of Sponsorship

• Personal contacts (relatives, friends, neighbours, co-workers). • Business contacts that “owe you a favour”. • Corporations approached professionally with a business

presentation. • Governments (federal, provincial and municipal) approached

through application process (eg. “Blockbuster” event application) or local MP.

• Cultural, Social and Special Interest groups.

4. What Corporate sponsors are after.

• Association of their product/service with chess to build brand equity. • Marketing of their product/service directly to participants in the

event. • Marketing of their product/service to spectators following the event. • Showcase for employee recruitment. • Demonstration that they are “good corporate citizens” supporting

their community.

But their real questions are:

1. Is chess a strategic fit with our sports sponsorship / charitable giving objectives?

2. How many “eyeballs” will be on the event (ie; impressions or GRP equivalent) – directly, via mainstream media, or via the Internet?

3. Does the value equation make sense relative to competing opportunities?

4. Is the ask within my signing authority or will I have to go “upstairs” for approval?

5. Is their sufficient room in my budget for this? Is it more “do-able” via sporting sponsorship or charitable donation?

6. Is there a legacy (residual benefit) from the association that can be leveraged in the future?

7. Will I “win any friends” (eg. CEO, Chairman or key customer interested in chess) by supporting?

5. What chess has to offer

• Public/consumer perception that chess is “smart” and “strategic”. • Financially accessible to the masses (eg. less costly than hockey, golf). • As global a demographic profile as soccer (FIDE membership second only

to FIFA, Olympic participation only surpassed since Beijing). • Association with technology (downloadable app and 24/7 availability,

analytical and teaching tools, players early adopters). • Strong link to fostering academic achievement and analytical & cognitive

skills in children. • Celebrity base (Lennox Lewis, Guy Ritchie, RZA of Wu Tang Clan).

6. Pitching to Corporate Sponsors (long form)

1. Objective (establishing basis of interest).

2. Executive Summary.

3. Background – Brief History of Chess (origins & historical development, landmark events (eg. Fischer/Spassky, Kasparov/Deep Blue), impact of technology, media & Hollywood coverage, celebrities etc.)

4. Chess Organization (international, national and local affiliations and their respective mandates)

5. Competition format (matches, round robins, swisses etc.)

6. Recent corporate sponsorships internationally and in Canada (specific names provided for previous 5 years).

7. History of the specific event (year commenced, locations, participation levels)

8. Venue details (rationale for specific venue and city, with pictures)

9. Event details (main tournament and side events, likely demographic profile of participants/spectators).

10. Marketing strategy (pre-event advertising, planned media coverage, website reach etc.)

11. Sponsorship fees (amount for Title sponsor and supporting sponsors – or could have platinum/gold/silver/bronze).

12. Sponsorship benefits.

Short form pitch (recipient au-fait with chess):

1. The event (location/date).

2. Number & demographic profile (age, sex, domicile, profession) of participant base.

3. The benefits.

4. The ask.

7. Sponsorship benefits you can offer

• Reference as (Title/Platinum/Gold/Silver/Bronze/Supporting) sponsor in all advertising materials, website, media interactions and speeches by organizer/TD during event.

• Company logos on all advertising flyers, site signage and backdrops for

interaction with media. • Company logos printed on tournament boards, score sheets, board

number markers, pairing sheets, cross tables. • Company booth at the event to interact with participants/spectators

and market their product/service.

• Access to mailing list of participants (subject to privacy laws).

• Opportunity to speak at opening or closing ceremonies/awards presentations.

• Naming rights for trophies or special prizes (eg. Mark’s best dressed, Lexus brilliancy prize) or event itself for title sponsor (eg. PwC Toronto Open, Pinnacle Canadian Open).

• Free tickets to closing awards dinner / GM simil. / lecture etc.

• Others as mutually agreed.

Very important: Ensure that benefits bestowed are commensurate with sponsorship levels!

Ensure fellow sponsors have good reputation.

Sure way to lose sponsors is to give others more that paid less (and they will find out!)

8. Pricing the Opportunity – The Determining Factors

• Number and profile of participants. • Event duration (weekend swiss vs. longer event) • Reach of websites (# hits) covering event. • Mainstream media exposure (that are willing to name

sponsors or provide exposure to logos). • Extent of local community involvement.

• Comparatives with similar reach for other vehicles (bridge, poker, backgammon etc.)

• Historical comparatives for prior years or other chess events.

• Sponsoring organization’s budget and current macro-economic environment.

• Negotiation! Overprice – no repeat sponsorship. Underprice – devalues chess as a sponsorship vehicle and makes life harder for future organizers!

9. Targeting specific corporate sponsors

• Branded consumables (Coca-Cola, Pepsico, Colgate-Palmolive, Unilever, P&G, Nestle etc.)

• Branded consumer durables (Toyota, Honda, Sony, Nike etc.)• Telcos (Bell, Rogers, Telus)• Retailers (Loblaws, Sobey’s, Bay, Costco, Mark’s, Future Shop etc.)• Restaurants (McDonald’s, Pizza Hut, Wendy’s etc.)• Financial Institutions (RBC, BMO, Manulife etc.) • Professional Services (PwC, Deloitte, E&Y etc.)• Technology (IBM, Apple, SAP, Samsung etc.)• Canadian Champions (Tim’s, Lululemon, McCains, Potash , Bombardier etc.) • Match event reach to corporate type.• International event – multinationals or Canadian champions seeking exposure.• National or regional event – local affiliates/dealerships or hometown businesses.• Ensure fellow sponsors have good reputations!

10. Closing the deal – sponsorship contracts

Key elements include;

• Tournament organizer responsibilities (provision of sponsorship benefits and protection of sponsor’s rights).

• Sponsorship benefits clearly defined.

• Sponsorship fee and payment terms.

• Term of agreement and notice period and circumstances for earlier termination.

• Assignment.

• Force Majeur.

• Covenants by both parties, including exclusivity clause.

• Limitations of liability (and insurance coverage) and reciprocal indemnifications.

• Confidentiality.

• Governing laws.

• Notices.

• Signatures.

11. Postmortem Analysis

• Report to sponsors on compliance with organizer’s responsibilities. • Quantify (to extent possible) media impressions, website hits etc. • Provide copies of magazine, newspaper, website articles on the tournament

(hopefully containing acknowledgement of the sponsor’s contributions). • Overall assessment of what the sponsor obtained for his/her money.

• Don’t forget sincere “Thank You” notes! A certificate of appreciation is also good – they hang them on the walls of the Corporate Affairs departments leading to further exposure for chess!

• Set the table for the future – a possible long term incumbency or tournament legacy (residual funding for the development of scholastic chess etc.).

QUESTIONS