Building Brands through Event Sponsorships: Providing On-Site Audiences with a Vivid Brand Experience pdf

Building Brands through Event Sponsorships:
Providing On-Site Audiences with a Vivid Brand Experience

DISSERTATION
der Universität St. Gallen,
Hochschule für Wirtschafts-,
Rechts- und Sozialwissenschaften (HSG)
zur Erlangung der Würde
eines Doktors der Wirtschaftswissenschaften

vorgelegt von

Caspar F. Coppetti
von
Zürich und Mollis (Glarus)

Genehmigt auf Antrag der Herren

Prof. Dr. Torsten Tomczak
und
Prof. Dr. Thomas Bieger


Dissertation Nr. 2925
D-Druck Spescha Druck, St. Gallen, 2004

Die Universität St. Gallen, Hochschule für Wirtschafts-, Rechts- und
Sozialwissesnnschaften (HSG) gestattet hiermit die Drucklegung der vorliegenden
Dissertation, ohne damit zu den darin ausgesprochenen Anschauungen Stellung zu
nehmen.

St. Gallen, den 14. Juni 2004

Der Rektor:

Prof. Dr. Peter Gomez
To my family
Sarah, Monica, Peter, Marina
Thanks for your love.

Building Brands through Event Sponsorships – Providing On-Site Audiences with a Vivid Brand Experience i
Acknowledgements
Writing a dissertation has been likened to climbing a mountain, running an Ironman
triathlon, or giving birth to a child. Given my research topic, I would like to use a more
salient metaphor. The human mind has the ability to compress time when looking back
to things that happened in the past. I will therefore undoubtedly remember the writing
of this thesis as an important event in my life – a challenging, yet very exciting one.
Thank you for making it happen.
I am deeply grateful to my doctoral advisors Prof. Torsten Tomczak and Prof. Thomas
Bieger for accompanying me through the learning process that writing this thesis has
been for me. In retrospect, I admire Prof. Tomczak’s unmatched capability to steer my
thought process in the desired direction by leisurely asking questions that not only
touch the core of the issue at hand, but cut straight through it. On a more personal note,
I very fondly remember the relaxed, espresso-fuelled mid-morning sessions in Zurich.
Prof. Thomas Bieger has supported this thesis with considerably more time and
thought than his role of co-advisor would have obliged him to. His valuable comments
at the right moment greatly helped the progress of this thesis. Thank you, also, for the
impromptu mountain run in the Alpstein.
The classroom experiment conducted for this thesis benefited heavily from the input of
Prof. Michael Tuan Pham of Columbia University, New York, who generously shared
his experience in the field of empirical research on sponsorship with me. A warm

thank you also goes to Dr. Silke Mühlmeier for her valuable methodological support in
the analysis of the data.
This thesis is concerned with some very operational and practical aspects of
sponsorship. It therefore benefited heavily from the valuable discussions with
practitioners in the field – the people who not only write about sponsorship, but
actually make it happen. Some of the people who contributed to this thesis can
rightfully be considered to be leading resources on the subject. I would like to thank
Eugen Brunner, Jürg Capol, Thomas Fink, Erwin Flury, Dr. Martin Venetz, Catrin
Wetzel, and Philipp Wetzel for the very valuable and inspiring discussions we had.
I am grateful to David Allemann for a number of things that helped make this thesis
what is. First, for introducing me to the branding world altogether, second for being a
great sparring partner, always inspiring me to think deeper, and third for keeping me
on my toes all along the writing process by systematically challenging me in my job as
a brand strategist at Advico Young & Rubicam.
Two people deserve special mention as they have actually laid hand on the content of
this thesis. Pascal Baumann contributed the illustrations of the different sponsorship
scenarios used in the classroom experiment. Anyone who sees them will have no doubt
that he is an artist in his very own right. Stan Fineman was responsible for the
proofreading of the text – a task that he fulfilled not only swiftly, but also with a
careful eye to the readability of this thesis.
A number of institutions (and the people who shape them) generously supported this
thesis in a variety of ways: Advico Young & Rubicam (Edgar C. Britschgi, Felix
Kündig), McKinsey & Company (Philippe Blatter, Dr. Christian Casal, and Dr.
Andreas Thut), Nestlé (Sibylle Kamber and Dr. Sabine von Mannteufel), FIS Alpine
Ski World Championships St. Moritz (Gian Gilli and Jürg Capol), Leguan Productions
(Toni Krebs), Verein Street Parade (Martin Schorno), and the University of St. Gallen
(lecturers, staff, assistants, and fellow students).
A special thank you goes to my reliable friends who have helped with interviewing
spectators in St. Moritz and carrying out the classroom experiment: Andrea, Catherine,
Christoph, Daniela, Dominique, Marc, Matthias, Pascal, Rolf, Sabine, Serge, Simone,

Thomas, and Tschäff.
Thank you, Sarah, for all the support and understanding you have given me over the
last months: putting up with very early morning writing fits, standing in the cold at
countless events, listening to my incomprehensible, quasi-scientific rambling, and
living among paper stacks for weeks at a time. Thank you for walking this path with
me.

14. Juni 2004, Caspar Coppetti
Building Brands through Event Sponsorships – Providing On-Site Audiences with a Vivid Brand Experience iii
Overview of Contents

1 Introduction and Overview of Research 1
1.1

Introduction and Aim 1

1.2

Research Question 2

1.3

Scope of Research 3

1.4

Research Approach, Methodology and Structure of Thesis 4

2 Literature Review 8
2.1

Sponsorship 8

2.2

Events and Event Sponsorship 37

2.3

Brands and Brand Equity 43

2.4

Perception, Learning and Moderating Factors 47

2.5

How Does Event Sponsorship Affect Brand Equity? – A Summary of Current Research 59

3 Case Studies Freestyle.ch 66
3.1

Research Design and Methodology 66

3.2

Reason for Case Selection and Focus of Case Study 67

3.3

Freestyle.ch: Authenticity, Professionalism, Innovation 67

3.4

Case Rivella: Experiencing the Cool Side of a Traditional Brand 73

3.5

Case Chupa-Chups: Evoking Vivid Memories through Product Sampling 78

3.6

Results: Impact on Brand Equity 80

3.7

Discussion of Findings 82

3.8

Reliability and Limitations of the Research 83

3.9

Conclusions and Next Steps 84

4 Survey FIS Alpine World Ski Championships St. Moritz 85
4.1

Research Question and Hypotheses 85

4.2

Methodology and Operationalization of Variables 89

4.3

Data Collection and Demographics 92

4.4

Testing of Hypotheses 96

4.5

Regression Analysis 99

4.6

Discussion of Findings for Each Sponsor 100

4.7

Reliability and Limitations of the Research 109

4.8

Conclusions and Next Steps 110

5 Designing the On-Site Brand Experience 113

5.1

Overview of Design Techniques for Event Site Brand Presences 113

5.2

Congruence with Event 118

5.3

Relationship Forming 120

5.4

Audience Participation 122

5.5

Brand Display 125

5.6

Does a First-Best Sponsorship Execution Exist? 130

5.7

Cost implications 137

6 Influence of Selected Sponsorship Design Techniques on Brand Image
(Experiment) 141

6.1

Research Model and Hypotheses 142

6.2

Research Design and Methodology 153

6.3

Hypotheses Testing and Discussion 170

6.4

Modeling the Influence of Perceived Sponsor–Event Fit on Brand Image 180

6.5

Limitations of the Research 186

6.6

Conclusions 187

7 Overall Discussion and Conclusions 190
7.1

Overview and Discussion of Key Findings 190

7.2

Implications for Practitioners 192

7.3

Future Research Directions 200

References xii
Interviews xxviii
Appendices xviii
A. Interview Guide Expert Interviews xviii

B. Survey Instruments FIS Alpine Ski World Championships xix

C. Stimulus Material and Questionnaires Classroom Experiment xxiv

Building Brands through Event Sponsorships – Providing On-Site Audiences with a Vivid Brand Experience v
Extensive Table of Contents
1 Introduction and Overview of Research 1
1.1

Introduction and Aim 1

1.2

Research Question 2

1.3

Scope of Research 3

1.4

Research Approach, Methodology and Structure of Thesis 4

2 Literature Review 8
2.1

Sponsorship 8

2.1.1

History and Significance for Today 9

2.1.2

Review of Sponsorship Definitions 19

2.1.3

Advances in Sponsorship Research 24

2.1.4

Definition and Measurement of Sponsorship Objectives 27

2.1.5

Measurement of Sponsorship Success 31

2.1.6

Sponsorship as a Means of Marketing Communication 32

2.1.7

Exploitation of Sponsorships 33

2.2

Events and Event Sponsorship 37

2.2.1

Events – Staging of the Unusual 37

2.2.2

Definition and Key Characteristics of Event Sponsorships 38

2.2.3

Audiences of Event Sponsorships 40

2.2.4

Role of the Media 42

2.3

Brands and Brand Equity 43

2.3.1

What Is a Brand? 43

2.3.2

Customer-Based Brand Equity 45

2.4

Perception, Learning and Moderating Factors 47

2.4.1

Perception 48

2.4.2

Cognitive Learning 49

2.4.3

Schema and Congruence Theory 52

2.4.4

The Role of Consumer Involvement in Cognitive Learning 53

2.4.5

Mood State’s Influence on Encoding, Recall, and Attitude 57

2.4.6

Multi-Sensory Experiences 57

2.4.7

Vivid Memories of Events: the Role of Episodic Memory 58

2.5

How Does Event Sponsorship Affect Brand Equity? – A Summary of Current Research 59

3 Case Studies Freestyle.ch 66
3.1

Research Design and Methodology 66

3.2

Reason for Case Selection and Focus of Case Study 67

3.3

Freestyle.ch: Authenticity, Professionalism, Innovation 67

3.3.1

Facts and Figures 67

3.3.2

Sponsorship Environment at Freestyle.ch 68

3.3.3

Sponsorship Structure 71

3.3.4

Sponsorship Effectiveness Tracking at Freestyle.ch 71

3.4

Rivella case: Experiencing the Cool Side of a Traditional Brand 73

3.4.1

Facts and Figures 73

3.4.2

The Rivella Brands – Color Coding 73

3.4.3

Rivella’s Brand Equity 74

3.4.4

Brand Targets and Marketing Communication Activities 74

3.4.5

Rivella’s On-Site Activities 75

3.4.6

Excursion: The Case for Integrated Communication 77

3.5

Case Chupa-Chups: Evoking Vivid Memories through Product Sampling 78

3.5.1

Facts and Figures 78

3.5.2

Brand Equity, Brand Targets, and Marketing Activities 78

3.5.3

Chupa-Chups’ On-Site Activities 79

3.6

Results: Impact on Brand Equity 80

3.6.1

Rivella 81

3.6.2

Chupa-Chups 81

3.7

Discussion of Findings 82

3.8

Reliability and Limitations of the Research 83

3.9

Conclusions and Next Steps 84

4 Survey of FIS Alpine World Ski Championships St. Moritz 85
4.1

Research Question and Hypotheses 85

4.2

Methodology and Operationalization of Variables 89

4.2.1

Methodology 89

4.2.2

Measurements 90

4.2.3

Questionnaire Design 92

4.3

Data Collection and Demographics 92

4.3.1

Data Collection 92

4.3.2

Demographics 94

4.4

Testing of Hypotheses 96

4.5

Regression Analysis 99

4.6

Discussion of Findings for Each Sponsor 100

4.6.1

Audi 100

4.6.2

Carlsberg 102

4.6.3

Milka 104

4.6.4

Swisscom 105

4.6.5

Xbox 107

4.7

Reliability and Limitations of the Research 109

4.8

Conclusions and Next Steps 110

5 Designing the On-Site Brand Experience 113
5.1

Overview of Design Techniques for Event Site Brand Presences 113

5.1.1

Empirically Observed Techniques 114

5.1.2

Additional Techniques 115

5.1.3

Introduction of Framework 116

5.2

Congruence with Event 118

5.2.1

Event Reference 118

5.2.2

Target Group Specificity 119

5.3

Relationship Forming 120

5.3.1

Personal Interaction 120

5.3.2

Obligation Forming 122

5.4

Audience Participation 122

5.4.1

Audience Participation in Activity 122

5.4.2

Product Usage 124

5.5

Brand Display 125

5.5.1

Semiotic Engineering 125

5.5.2

Integration 126

5.5.3

Multi-Sensory Perception 127

5.5.4

Dramaturgy 129

5.6

Does a First-Best Sponsorship Execution Exist? 130

5.6.1

Event Site Brand Experience 130

5.6.2

Enhancement of Sponsor-Event Fit 133

5.6.3

Situational Factors 134

5.6.4

Sponsorship Execution Matrix 136

5.7

Cost implications 137

5.7.1

Leveraging Existing Materials 138

5.7.2

Creativity and Focusing 139

6 Influence of Selected Sponsorship Design Techniques on Brand Image
(Experiment) 141
6.1

Research Model and Hypotheses 142

6.1.1

Conceptual Model 143

6.1.2

Development of Hypotheses 147

6.2

Research Design and Methodology 153

6.2.1

Experimental Set-Up 153

6.2.2

Operationalization of Independent Variables 157

6.2.3

Data Collection Procedure 159

Building Brands through Event Sponsorships – Providing On-Site Audiences with a Vivid Brand Experience vii
6.2.4

Evaluation of Measurement Scales 162

6.3

Hypotheses Testing and Discussion 170

6.3.1

Influence of Brand Experience Level on Brand Attributes, Vividness, and Attitude
as Well as on Sponsor–Event Fit (H
1a
-
d
) 171

6.3.2

Influence of Enhancing Sponsor–Event Fit on Perceived Sponsor–Event Fit (H
2
) 173

6.3.3

Influence of Perceived Sponsor–Event Fit on Brand Attributes,
Vividness, and Attitude (H
3a–c
) 174

6.3.4

Moderating Effects of Event Involvement and Product Involvement (H
4–5
) 177

6.4

Modeling the Influence of Perceived Sponsor–Event Fit on Brand Image 180

6.4.1

Model Specification and Hypotheses 180

6.4.2

Hypotheses Testing and Overall Model Fit 182

6.4.3

Discussion 184

6.5

Limitations of the Research 186

6.6

Conclusions 187

7 Overall Discussion and Conclusions 190
7.1

Overview and Discussion of Key Findings 190

7.2

Implications for Practitioners 192

7.2.1

Implications for Sponsorship Managers 192

7.2.2

Implications for the Sponsorship Industry 195

7.3

Future Research Directions 200

References xii
Interviews xxviii
Appendices xviii
A. Interview Guide, Expert Interviews xviii

B. Survey Instruments FIS Alpine Ski World Championships xix

Questionnaire Group 1 xix

Questionnaire Group 2 xxi

Questionnaire Group 3 (Audi example) xxiii

C. Stimulus Material and Questionnaires Classroom Experiment xxiv

Scenarios (Pringles example) xxiv

Comparison of illustrations for different brands (scenario 2 example) xxxvi

Questionnaire Product Involvement (Potato Chips Example) xxxvii

Questionnaire Event Involvement xxxix

Questionnaire Event Attributes xl

Questionnaire Sponsor Evaluation (Pringles Example) xli

Questionnaire Demographics xliv


List of Figures
Figure 1: Structure of this dissertation. 7

Figure 2: Worldwide sponsorship rights expenditure 1987-2005E. Source: SRI 2001 14

Figure 3: Sponsorship markets and growth rates by region 1998-2000. Source: SRI 2001 15

Figure 4: Breakdown of sponsorship rights expenditure (percent) by sector. Source: SRI 2001 16

Figure 5: Forces behind sponsorship growth. Source: own illustration, partly based on Meenaghan 1983 17

Figure 6: Overview and critical review of sponsorship definitions 22

Figure 7: Corporate objectives in sponsorship. Source: IEG/Performance-Research 2001; 2002 31

Figure 8: Dimensions of sponsorship exploitation 34

Figure 9: Classification of event audiences (sponsorship target groups). 41

Figure 10: Customer-based brand equity. Source: adapted after Aaker 1991 and Keller 1993. 46

Figure 11: A model of consumer information processing. Source: based on Greenwald and Leavitt 1984 51

Figure 12: Persuasion routes of factual and emotional messages with low-involvement consumers.
Source: Kroeber-Riel and Weinberg 1999, p. 596 ff. 56

Figure 13: Persuasion routes of factual and emotional messages with high-involvement consumers.
Source: Kroeber-Riel/Weinberg 1999, p. 596 ff 56

Figure 14: Selected factors influencing audience-based brand equity. 60

Figure 15: Characteristics of Freestyle.ch as a sponsorship platform. 69

Figure 16: Sponsorship structure at Freestyle.ch. Source: Interview with Erwin Flury (2002). 71

Figure 17: Measurements of audience-based brand equity at Freestyle.ch 72

Figure 18: Facts and figures on Rivella’s on-site booth. Source: Interview with Catrin Wetzel (2002) 76

Figure 19: Rivella's integration of advertising and event-site sponsorship. Source: Rivella 78

Figure 20: Basic input-output model for on-site brand experience. Source: based on Kotler and
Bliemel 2001, p. 324 87

Figure 21: Overview of the research design deployed at FIS Alpine World Ski Championships
St. Moritz 2003. 89

Figure 22: Sponsors’ on site-activities at FIS Alpine World Ski Championships St. Moritz 2003 90

Figure 23: Demographic profiles of audience group 3 (direct contact) for individual sponsors 95

Figure 24: Audi’s brand scores among different spectator groups 101

Figure 25: Carlsberg’s brand scores among different spectator groups. 102

Figure 26: Milka’s brand scores among different spectator groups. 105

Figure 27: Swisscom’s brand scores among different spectator groups 107

Figure 28: Xbox’s brand scores among different spectator groups 108

Figure 29: Framework for event site execution 117

Figure 30: Determinants of brand experience. 131

Figure 31: The on-site brand experience pyramid 132

Figure 32: Matrix combining brand experience and enhancement of fit 137

Figure 33: Conceptual model of relationships between sponsorship execution techniques and selected
elements of brand image. 143

Figure 34: Scenarios for the independent variables. 158

Figure 35: Running-order of classroom experiment. 160

Figure 36: Proposed causal model of how sponsor–event fit influences image transfer 182

Figure 37: Revised model with observed relationships among product and event involvement,
sponsor–event fit, and selected elements of brand image. 183

Figure 38: Overview of the main findings of this dissertation 192

Figure 39: Sponsorship planning and execution process. 197


List of Tables
Table 1: Streams of sponsorship research and main contributing authors. Source: based on Cornwell and
Maignan 1998. 25
Table 2: Time series of audience-based brand equity of selected sponsors. Source: Venetz 1999; 2000; 2001;
2002 81
Table 3: Demographics of audience groups 94
Table 4: Frequency of brand use among audience group 3 95
Table 5: Awareness levels of sponsor brands among different spectator groups 96
Table 6: Scores on image dimensions of sponsor brands among different spectator groups. 97
Table 7: ANOVA table for individual sponsors 98
Table 8: Standard deviations of individual groups 99
Table 9: Regression analysis of potential predictors for unaided sponsorship awareness. 100
Table 10: Potential factors influencing the impact of event site sponsorship execution 112
Table 11: Empirically observed techniques for the design of event site brand presences 115
Table 12: Brand strength of selected snacks/sweets brand in percent relative to the strongest brand in
Switzerland. Source: AY&R 2003 156
Table 13: Clusters with brand/scenario combinations 159
Table 14: Sample sizes for each brand scenario combination 161
Table 15: Demographics of participants in classroom experiment. 161
Table 16: Evaluation of study measures: stages and criteria deployed. 162
Table 17: Summary of measurement instruments 163

Table 18: Evaluation of product involvement scale 164
Table 19: Evaluation of event involvement scale. 165
Table 20: Evaluation of brand attitude scale 165
Table 21: Evaluation of brand vividness scale 166
Table 22: Attribute scores for Street Parade. 167
Table 23: Table of variance for event attributes 168
Building Brands through Event Sponsorships – Providing On-Site Audiences with a Vivid Brand Experience ix
Table 24: Rotated component matrix for event attributes 168

Table 25: Assessment and scores of event attributes retained for Street Parade 169

Table 26: Evaluation of Sponsor–Event Fit scale. 170

Table 27: Summary of research hypotheses 171

Table 28: Mean scores for brand image and sponsor–event fit depending on the level of brand experience. 171

Table 29: ANOVA table for constructs depending on the level of brand experience 172

Table 30: Mean scores for sponsor–event fit depending on the factor enhancement of sponsor event fit 173

Table 31: ANOVA-table for sponsor–event fit depending on the factor enhancement of sponsor–event fit 174

Table 32: Mean scores and t-tests for brand image depending on sponsor–event fit 175

Table 33: Correlations between perceived sponsor–event fit and elements of brand image 176

Table 34: Mean involvement scores for product categories and Street Parade 177

Table 35: ANCOVA results of product involvement for sponsorship execution and sponsor-event fit. 178

Table 36: ANCOVA results of event involvement for sponsorship execution and brand vividness 178

Table 37: ANCOVA results of product involvement for sponsorship execution and brand image. 179

Table 38: Comparison of models with regard to goodness-of-fit statistics 183

Table 39: Results of hypotheses testing (standardized regression weights and p-levels) 184

Abbreviations

AGFI adjusted goodness of fit index
ANCOVA analysis of covariance
ANOVA analysis of variance
CAGR compound annual growth rate
CAGR E estimated compound annual growth rate
cf. confer; compare
CRM cause-related marketing
e.g. exempli gratui, for example
etc. et cetera; and so forth
f. following page
ff. following pages
FIFA International Football Association
GFI goodness of fit index
i.e. id est; it is
IOC International Olympic Committee
p. page
pp. pages
POS point of sale
RMR root mean square residual

ROI return on investment
UCI Union Cycliste Internationale; International Cycling Association

Building Brands through Event Sponsorships – Providing On-Site Audiences with a Vivid Brand Experience 1

1 Introduction and Overview of Research
1.1 Introduction and Aim
In a fiercely competitive world strong brands have become a major source of
competitive advantage. Brands help companies to differentiate themselves from
competitors, to justify a price premium, and to fend off potential market entrants.
Consequently, companies with strong brands consistently earn significantly higher
returns on investments than their industry counterparts. A recent study using the PIMS
database shows that brand leaders in a specific category have an average of 30–50
percent higher ROIs than the number two brands (Morgan 1999, p. 11).
To strengthen their brands, companies today spend significant amounts on marketing.
In some markets, such as consumer goods, marketing spend amounts to some 40
percent of turnover (e.g., Red Bull: 35 percent; Economist 2002). While the lion’s
share of this amount flows into distribution and traditional “above-the-line”
advertising (i.e., electronic and print mass-media advertising, billboards), companies
increasingly deploy alternative channels to communicate to their customers and to
build and shape their brands. Most companies today use direct marketing (often in
combination with CRM), and interactive media such as the Internet. Among these non-
traditional channels, sponsorship has emerged as a very popular alternative. Global
expenditure on sponsorship rights has increased by an average of 12.4 percent per year
over the last decade, reaching USD 26 billion in 2001 (SRI 2001). Germany, Europe’s
largest market, accounted for DM 4 billion (USD 2.4 billion) in 1998 (Thomas 1999,
p. 10).
Paradoxically, while sponsorship engagements are among companies’ most publicly
visible and discussed marketing communications activities, little research has so far
been conducted on the subject from a branding perspective (cf. Cornwell and Maignan

1998). Also, while most marketing departments today are proud of their brand
strategies and their professional standards and best practice procedures, sponsorship is
often performed more as an art than as a science – or worse, is determined by the
personal preferences of the CEO.
Even though many sponsorship engagements these days show a good fit with
companies’ brand strategies, it appears that sponsors have difficulty fully capturing the
Introduction and Overview of Research 2
potential value of their engagements. Creating brand equity through sponsorship
requires two integrated and sequential steps. The first is the easy one: getting access to
sponsorship rights. The second is where many companies fail: leveraging their
sponsorship engagement through creative and consistent implementation both directly
(e.g., at the site of an event) and indirectly, through other communication channels.
This thesis discusses how targeted on-site implementation of event sponsorships can
positively influence audience-based brand equity – the return on the sponsorship
investment.
1.2 Research Question
This research was inspired by several experiences the author had at sponsored sports
events, both as a visitor and as a member of a number of organizing committees. Why
was it that some sponsors seemed to have an omni-presence in visitors’ minds, while
others were hardly remembered? And, more strikingly, why are smaller sponsors often
better recalled than the main sponsors? If it is not the amount of money paid for an
event’s sponsorship rights and thus the amount of signage at the event site that
determines the “presence” of a sponsor within visitors’ minds then, what is it?
A small number of publications have proposed partial explanations of what makes
sponsorship work, such as perceived brand-event fit, duration of event attendance, or
the level of event involvement of spectators. Strikingly, these assumed factors of
sponsorship success are to a large degree outside the direct sphere of influence of
sponsors (as they are mostly dependent on the attitudes and behavior of the event
audience). In other words, the main body of the existing literature implicitly
suggests that sponsors can do little to influence the success of their sponsorships.

If this suggested lack of control were true, sponsorship would hardly be suitable as an
effective brand-building instrument. Further, the majority of research on sponsorship
deals with sponsorship strategy (i.e., which properties to sponsor). This contrasts
sharply with sponsorship practice, where considerable resources are allocated to
sponsorship execution (i.e., getting the most out of existing sponsorship engagements).
Apparently, there is a major knowledge gap as to whether and how the execution of
sponsorships increases the return on investment in sponsorship rights.
Building Brands through Event Sponsorships – Providing On-Site Audiences with a Vivid Brand Experience 3

This leads to the research question:
Q: At sponsored events, how can a sponsor influence the build-up of audience-based
brand equity through on-site sponsorship implementation?
Lutz (1991), the former editor of the Journal of Consumer Research, called for more
research on substantive consumer behavior issues that are important to someone other
than the researchers themselves. Event organizers increasingly invite sponsors to help
them shape and enrich visitors’ event experience. Sponsors, therefore, need a frame of
reference for how to best deploy this design freedom. As the many interviews
conducted in preparation for this piece of research have shown, the question of how to
best implement their sponsorships at the site of the event is of immense importance to
marketers. A thorough review of the existing literature indicated that no published
scientific empirical or theoretical work was available to answer this question. Closing
this knowledge gap may, therefore, be deemed useful to both researchers and
practitioners (cf. Vradarajan 1996, p. 1-2).
1.3 Scope of Research
This thesis focuses on selected aspects of sponsorship. First, the subject is approached
from a branding perspective. Sponsors may also have other goals for their sponsorship,
such as entertaining guests or portraying themselves as good corporate citizens. In
essence, however, sponsorship activities are a form of marketing communication
(e.g., Meenaghan 1983; Drees 1989) and as such will affect the public’s perception of
the sponsor’s brand.

Second, this thesis concentrates on event sponsorship. While, as will be shown in this
thesis, the success of event sponsorships depends to a significant extent on the direct
contact between the sponsor and the audience, different factors may be more
important for other forms of sponsorships (e.g., the sponsorship of a cause, or
broadcast sponsorship).
Third, the research is restricted to the event site audience of a sponsored event. This
means that branding effects on a larger audience that may participate in an event via
mass media are not considered. Existing research mostly ignores the on-site audience
and focuses solely on the TV audiences. However, on-site audiences can be quite
substantial in size (e.g., 5 million at the Deutschland Tour of Cycling, 600,000 at the
US Tennis Open), and many small and medium-sized events are not televised.
Introduction and Overview of Research 4
1.4 Research Approach, Methodology and Structure of Thesis
Research approach
Due to the absence of any research on this specific aspect of sponsorship, the present
work is, to a large extent, an explorative dissertation. Imagine an explorer landing on
an unknown island. The explorer would typically collect and describe the things he
sees on the island, such as plants or animals (collecting and describing empirical data).
The explorer may also draw a map of the uncharted territory he has discovered (i.e.,
structuring the data in a useful way). This will allow the next person coming to that
island to more easily find his or her way around. Up to this point, the work of the
explorer is mainly descriptive, answering the question “What?” However, a curious
mind is seldom satisfied with knowing the “What”, but aims to investigate “why”
things are the way they are. Thus, the researcher seeks causal relationships between
the empirical phenomena observed (cf. Yin 1994).
During the course of writing the present work, the author has, at times, felt like this
explorer. The main difference is that the island he walked around (i.e., event
sponsorship) is not unknown. In fact it is heavily populated, but no researcher so far
has bothered to systematically draw a map of it or attempted to explain why things are
the way they are. This, therefore, leads to the approach of this dissertation: exploring a

new field of research, structuring it in a meaningful way with a view to determine
causal relationships.
The research question as stated above comprises three distinct sub-questions:
1. What techniques can sponsors deploy to design their event-site presence?
2. What is the influence of these techniques on the build-up of audience-based brand
equity?
a) Is there a causal relationship at all?
b) How much can brand equity be influenced by the event-site execution of a
sponsorship?
3. How do the individual techniques influence the build up of audience-based brand
equity?
Building Brands through Event Sponsorships – Providing On-Site Audiences with a Vivid Brand Experience 5

Methodologies
Considering the three-step research approach of exploring, structuring and determining
causal relationships, as well as the three research questions, a mix of research
methodologies is indicated to allow choosing the best-fitting methodology for each
research step.
Answers to question 1, which asks, “What techniques exist to influence audience-
based brand equity?” were found mainly through the use of two case studies at a
popular Swiss youth sports event.
Research question 2a (“Is there a causal relationship at all?”) was approached using a
mix of quantitative and qualitative methods. Mainly, it consisted of a quasi-experiment
in the field (Stier 1999, p. 244) which was administered by means of a survey among
different audience groups at the FIS Alpine World Championships 2003. Additional
qualitative data was collected by means of interviews and systematic observation. The
qualitative data was deployed to aid in the interpretation of the survey results.
Answers to the question of how brand equity is influenced by the on-site execution of
a sponsorship (question 3) were first developed on a theoretical basis. The key
concepts were then empirically tested, yielding also (partial) answers to the question of

how large the effects on brand equity are (question 2b). The testing of causal
relationships between selected on-site execution design techniques and brand equity
required a high degree of control and therefore called for a classic experiment (e.g.,
Yin 1994, p. 6; Stier 1999, p. 219). In the last phase of this dissertation a classroom
experiment was therefore conducted with a sufficiently large sample of bachelor
students of the University of St. Gallen.
The research to date on other aspects of sponsorship has produced a host of
methodological insights which facilitated the study design of the present work. The
main academic debate circles around the question whether surveys or experiments are
the best means for researching cause relationship effects. Surveys have the advantage
that they assess real-life situations. Skewed results in favor of the researcher’s
hypotheses due to a biased study design can be largely ruled out. On the other hand,
Pham (1991) rejects survey methods entirely due to their inability to discern the
confounding effects of advertising and other promotional effects. Bennet (1999) and
others argue, however, that advertising effects can be reasonably controlled. This
Introduction and Overview of Research 6
holds, especially, for surveys which are only concerned with short-term effects. This
dissertation attempts to cope with these conflicting views through a research approach
which explores the research question through both survey and experimental
approaches.
This dissertation consists of three largely independent empirical studies, with regard to
the research objects (i.e., the events and sponsors concerned) and the methodologies
deployed. It applies source and methodology triangulations (Locke 2001). One main
benefit of this approach is that it leads to increased reliability of the findings (Stake
1995).
Structure of Dissertation
This dissertation was outlined and written as a series of scientific papers in the sense
that the individual chapters could be read and fully understood on their own (cross-
references between chapters were added to help interested readers find additional
information on a topic and to generally ease navigation through this thesis). At the

same time, the individual parts build on each other, steadily developing the
understanding of the core constructs and mechanisms. The structure of the present
work follows the thread of the three research questions (see Figure 1).
After a thorough review of the existing literature on the main constructs of
sponsorship, events, brand equity and cognitive learning (chapter 2), two empirical
sections discuss how event-site sponsorships can be executed (chapter 3) and whether
exposure to sponsors’ event-site activities have an impact audience-based brand equity
at all (chapter 4).
Chapter 5 combines the findings of the two empirical sections and research on event
marketing with the theoretical background of cognitive theory as discussed in the
literature review. A framework is presented which allows discussion of individual
techniques used to design event-site sponsorship executions.
The influence of two selected key design techniques on the perception of sponsoring
brands is analyzed in a classroom experiment (chapter 6). The experiment also allows
development of a model of how these techniques of on-site sponsorship execution
influence some key precursor variables and how these causal relationships are affected
by moderating variables.
Building Brands through Event Sponsorships – Providing On-Site Audiences with a Vivid Brand Experience 7

Chapter 7, the concluding chapter, presents an overview of the key findings of this
dissertation and discusses their implications for practitioners.
Review of literature
Chapter 2
Event-site sponsorship execution
at Freestyle.ch
empirical (qualitative)
Chapter 3
Brand equity at the World Ski
Championships St. Moritz
empirical (quantitative & qualitative)

Chapter 4
Discussion of design techniques determining
the event-site brand experience
conceptual
Chapter 5
Brand equity impact of
selected instruments (experiment)
empirical (quantitative)
Chapter 6
Conclusion
Chapter 7)
Introduction and overview
of research
Chapter 1

Figure 1: Structure of this dissertation.

Building Brands through Event Sponsorships – Providing On-Site Audiences with a Vivid Brand Experience 8
2 Literature Review
Worldwide sponsorship expenditure grew from USD 2 billion in 1986 to 26 billion in
2001. Since its early days, sponsorship has evolved from surreptitious advertising to
a major element of the marketing communication mix, with the main goal of
building brand equity. Sponsorship of events, defined as unique and artificially
created happenings, may target several audiences, mainly on-site and mediated
audiences such as TV viewers. Key factors influencing the success of event
sponsorships are the perceived sponsor–event fit and the event-site execution of the
sponsorship. The creation of brand equity through ievent sponsorship can be
explained by cognitive learning theory.
Before the principal research question can be addressed, its main elements,
sponsorship, events, and brand-equity must be introduced and clearly defined. This

chapter summarizes the main advances reported in previous research on these topics
culled from an extensive literature review.
Because an in-depth understanding of the characteristics of event sponsorship is the
main aim of this thesis, the subject (in general and event-specific) will be looked at
from various angles, ranging from an extensive review of definitions to an anecdotal
history of sponsorship. The heavily researched topic “brand equity” will be discussed
at a level appropriate to the needs of this study. The same is true for the construct
“event,” which will be looked at from a sociological perspective. As a basis for the
empirical and conceptual work in chapters 1–1 a number of key psychological
constructs are introduced which help explaining how consumers learn about brands at
sponsored events. At the end of this chapter the elements will be combined in a
framework which summarizes the current view of the research community on how and
why event sponsorship affects brand equity.
2.1 Sponsorship
Sponsorship is a relatively new medium in the communications mix of companies.
This section provides a comprehensive overview of the topic. Starting with the
exploration of sponsorship’s roots in ancient Rome, a review of historical and current
definitions is provided. Later, the wide range of sponsorship goals is discussed, with a
focus on the role of sponsorship as a marketing communications instrument. This
Literature Review 9

section is concluded with an overview of the advances in and different areas of
sponsorship research over the last two decades.
2.1.1 History and Significance for Today
History
This section presents a brief overview of the history of sponsorship. Given the research
purpose of this thesis, it appears useful to put an emphasis on why and how
sponsorship developed, rather than on the exact determination of when. An anecdotal
approach to the history was therefore chosen, looking at a few selected milestones in-
depth, rather than approaching the task strictly chronologically.

The Roots of Sponsorship
Many authors credit the origin of sponsorship to Gaius Clinius Maecenas (e.g., Bruhn
1986; Drees 1989; Dischinger 1992), who around 70 BC lived in Rome as a friend and
advisor to Cesar Augustus. His enormous fortune allowed him to invite some of the
most renowned poets of the time, among them Horacius and Virgil, to his estates and
to pay for their living expenses. The term maecenas is today used synonymously with
patronage, and stands for the selfless, purely altruistic support of causes such as the
arts, research or community matters (for a distinction between sponsorship and
patronage, see also section 2.1.2). While Maecenas was hardly the first to engage in
such an activity, his case is well documented (e.g., Realencyclopädie 1991) and
therefore a welcome object of analysis. If we consider Samuel Johnson’s dictum that,
“to act from pure benevolence is not possible for finite beings. Human benevolence is
mingled with vanity, interest or some other motive” (quoted after Meenaghan 1983, p.
17), it can be argued that Maecenas’ support was a de facto sponsorship of the arts.
After all: Maecenas’ support was well received by the poets, who in return thankfully
included Cesar Augustus and himself in their oeuvres. As a result, both August and
Maecenas (the sponsors) as well as the poets (the sponsees) were able to extend their
recognition, fame and esteem among the people of the Roman Empire. Put in today’s
marketing lingo, they were all able to increase their brand equity.
Olympic Sponsorship
To study the evolution of modern day (event) sponsorship, it may be revealing to
review the history of the world’s single, most-coveted sponsorship property: the
Olympic Games (based on IOC 2002). Commercial association of companies with the
Building Brands through Event Sponsorships – Providing On-Site Audiences with a Vivid Brand Experience 10
Olympic Movement started at the very first games, which were held in Athens in 1898.
While a private benefactor, George Averoff, financed the major expense of
refurbishing the Olympic stadium, companies provided revenues by advertising in the
souvenir program (one of the first advertisers, Kodak, is a current member of the
Olympic Partner Program (TOP)). In 1924 (Paris), venue advertising signage was
introduced – for the first and last time in Olympic history. Today, a fair share of the

commercial value of the marketing rights of the Olympics may be attributed to their
“clean” commercial-free look. In 1952 (Helsinki), the first sponsorship rights contracts
were issued. Subsequently, the number of sponsorships associated with the Olympics
exploded, peaking at 396 sponsors and official licensees in 1980 (Lake Placid). That
year, the IOC adopted a “less is more” policy and started the already-mentioned TOP
program, which bundles the exclusive worldwide marketing rights to both Winter and
Summer Games, and limits the marketing activities of the local organizing
committees. While the number of local sponsors and licensees (122 at the last Winter
Games in Salt Lake City 2002) has since dropped by two thirds, the total funds
provided by them have increased nearly 30-fold, from USD 32 million in 1980 to USD
865 million in 2002 – after accounting for inflation
1
, today’s average local Olympic
sponsor contributes roughly 40 times more than two decades ago.
Endorsement and the Fight for ‘Clean’ Athletes
The Olympics were also the stage for the first widely noticed sponsorship of an athlete
(endorsement, see section 2.1.2). When Jesse Owens, a track and field athlete from the
United States, won four Gold Medals at the 1936 Olympic Summer Games in Munich,
he was wearing shoes manufactured by a German cobbler by the name of Adi Dassler.
Adi Dassler had realized early on that not only were top athletes reliable and insightful
testers of his footwear, but that they also had a powerful impact on shoe sales.
However, for a long time he believed in word-of-mouth promotion rather than in
endorsement advertising. This self-imposed restriction may well have contributed to
Adidas’ defeat in the fight against marketing powerhouse Nike.
While sponsors and athletes grew more expansive in the number and form of
sponsorship deals they entered, not everybody involved tolerated the increasing
commercialism. One particularly resistant party was the International Olympic
Committee, whose statues excluded professional (i.e., paid) athletes from competing in

1

118% according to the US Bureau of Labor Statistics (UDL 2003)
Literature Review 11

its quadrennial Olympic Games. The IOC’s fight against commercialism first climaxed
in 1972, when it banned dominant Austrian downhill ski racer Karl Schranz from
competing in the Winter Olympics in Sapporo. While many athletes were rumored to
have accepted money from sponsors, the famous ski racer had done so most openly
(the IOC based its decision on a picture which showed Schranz playing soccer sporting
the logo of a coffee brand on his jersey). The fans reacted with indifference if not
support vis-à-vis sponsorship. More than 100,000 supporters welcomed Schranz on his
return to Vienna, and infuriated fans set afire the apartment of the president of
Austria’s National Olympic Committee. 16 years later, the IOC officially reinstated
Schranz in a small ceremony, giving him a symbolic medal as a participant in the 1972
Winter Games in Sapporo (based on Suttner 1998, p. 30, Clarey 2001, p. 7).
Sponsorship and the Arts
Examples of cultural sponsorship can be found as far back as the 1950s. Rowohlt, the
German publisher, allowed sponsors to place advertisements in its popular “RoRoRo”
paperback book series. In their advertisements, sponsors pointed out how, thanks to
their support, the books were available to more people at lower cost (Dischinger 1992,
p. 90). While corporate giving (as either patronage or sponsorship) has a long tradition
in the Anglo-Saxon world, cultural sponsorship only became a mainstream
phenomenon throughout Europe in the early 1980s. The need for cultural institutions
to look for funding sources beyond the state coincided with the demand of companies
to advertise to target groups which were elusive or hard to reach through their
traditional advertising and sponsorship activities. Sponsorship of the popular arts,
especially music, is now a common practice and widely accepted among the target
groups. The intrusive character of commercial sponsorship is more critically regarded
in the more sophisticated and elitist arts. (cf. Hofmann 2002).
Sponsors Get Creative
A large share of the brand-building value of sponsorships lies in the mental link which

consumer make between the sponsor and the sponsored entity (to be discussed in detail
in section 2.5). It was only a matter of time until companies that were not sponsors
would start to associate themselves with events sponsored by other companies – often
their fiercest competitors. This practice, called ambush or parasitic marketing, made
its first appearance on a large scale at the 1984 Olympics, when – among others – film
manufacturer Kodak tried to ambush Fuji’s sponsorship of the Summer Games. While