Sponsorship: to sponsor something is to support an event, activity, person, or organization financially or through the provision of products or services. A sponsor is the individual or group that provides the support, similar to a benefactor.

Partnership: a cooperative relationship between people or groups who agree to share responsibility for achieving some specific goal; “effective language learning is a partnership between school, teacher and student”; “the action teams worked in partnership with the government”

If you look at the primary reasons that some sponsors don’t renew their contracts with athletic departments (for example), lack of ROI is going to be at the top of the list in most cases. Companies dish out 10-15 K hoping to gain a 5 percent rate of return on their investment. Here’s a little insight, sponsoring a halftime performance isn’t going to have people lining up at your door the next morning to buy insurance from you. It takes teamwork, creativity, and most of the time a little extra work from the party initially receiving the payment.

Now, I realize that there is a place for the $3000/year sponsorships where a banner will be hung from a railing and both parties involved are completely content. The sponsor chooses to pay the fee because they feel its their duty to have a presence at community events. I’m writing this more for the businesses that want to advertise at a sporting event for the sole purpose of seeing a drastic increase in revenue. Obviously the athletic department will receive revenue from the business for the advertising rights – but what if the athletic department went one step further? Encourage the sponsor to advertise the athletic department at their place of business, thus increasing attendance at games, which will allow more people to witness the advertising that they originally paid for.

For example, if McAlister’s Deli chooses to advertise with the ORU athletic department, why shouldn’t all McAlister’s employees be wearing ORU apparel on game days and running game day specials to increase pre-game traffic into the restaurant. So many businesses choose to buy advertising and then just hope and pray that sales shoot through the roof. Of course, this is just one example. It’s important to meet with your “partner” I find ways to make your sponsorship reach its maximum potential.

This aspect of advertising at athletic events should be called a partnership for 2 reasons: (1) The marketing staff should be active in offering advice and ideas to help build off of the marketing campaign that the business is already running. As the professional, help them devise plans to help “their dollar go further” while also increasing awareness of your department. (2) Chances are – your department needs some marketing help too! It’s not a bad idea to discount the price of the advertising if the “sponsor” agrees to advertise on their end. My suggestion is to have that partnership mentality with your sponsorships so that  both parties are gaining that highly coveted “added value” to sweeten the deal on both ends. Be creative. After all, you’re in a marketing position. Spread your creative wings and stretch to get every last dollar out of the deal.

About the Author

Kyle Krajenka is a recent graduate of Oral Roberts University (’11) and a young professional at the beginning of his career in the sports industry. He currently does marketing/game entertainment for the WNBA’s Tulsa Shock and manages social media accounts for the ORU Athletic Department (Twitter & Facebook). He can be reached on his Twitter or LinkedIn accounts or at kylekrajenka@gmail.com

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David v. Goliath (who once was David)

As I was growing up, Best Buy was unquestionably a place you would beg to be dropped off while your mom visited the nearest clothing outlet or mall, as was often the case. You would spend hours walking through an endless display of mystical, amazing, and ‘necessary’ technology. Best Buy was one of these fabulous success stories eventually rising to the top of the consumer electronics industry (and for many good reasons).

They were, without a doubt, at the top of their class.

However, as I came of age there was a David in the making. By the time I was at college in 2006, there was this cool website where you could order some of that mystical technology you had put your hands on in middle school and dreamed of owning growing up… but there was a conflict of interests.

When you were younger, you always pictured yourself buying that laptop, that external hard drive, and that flash drive from Best Buy.

So naturally, you head to Best Buy. As you arrive you are greeted by some pretty un-helpful employees. You ask about the famous price match that you used to use as the reason for coming to Best Buy instead of say, Circuit City. They ask which store you found a better price, was it Circuit City? Target? Wal-Mart?

You respond, ‘Newegg has them for $50 less. That exact product.’ The employee looks back at you oddly… I wrote about this story in February of 2010 and pointed to the fact that if something didn’t change, companies like NewEgg and Amazon were certainly going to win that race (the original blog found here).

Like I said in the previous blog, I had mad respect for Best Buy growing up. I fully expected them to figure it out and make adjustments to be competitive with online companies. Well, a recent event has forever forced me to give up hope on Best Buy and officially claim NewEgg king. Best Buy clearly doesn’t get ‘it’ and on so many levels.

The New(Egg) King

If you don’t know about the fiasco involving Best Buy issuing a cease and desist to NewEgg… well you should. NewEgg made a pretty hilarious commercial, featured below:

First off, that is a pretty classic commercial. Secondly, it is of note that in marketing it is a general fact that as long as you are not the top dog in an industry or category, poking fun at the leader is an acceptable practice.

Best Buy issued a cease and desist to NewEgg after this commercial was met with much On Air and Internet success. What happens next is something that is probably going to be the stuff of social media legend. Instead of ignoring it or hiding it or actually removing the commercial, NewEgg posted the cease and desist documentation to their Facebook Fan Page! How crazy is that! They also posted their response to their Facebook and Twitter.

Between the two posts (of both documentations on Facebook), there were over 2,000 comments and 3400 ‘likes’ on Facebook. Not only that, but the views on the YouTube commercial spiked, were imbedded in blogs like this, and the whole story covered here and in like places. This is viral in about as many ways as is possible and this is only talking about Facebook. I saw countless people tweeting and retweeting this stuff.

So What?

There is no reason, at all, that Best Buy should be losing to NewEgg. Their brand was so deeply ingrained in my brain that I literally went to their store to ask for the price match before I would even consider buying from NewEgg. They had me, my money, my word of mouth, and my loyalty… and they squandered it.

They use their social media channels to blast you with sales, deals, and new products. All the while, NewEgg is using theirs to actually interact and connect with their followers.

But so what? Why do they care about my business or my loyalty? Don’t they have 3 million fans to NewEgg’s 600 thousand? Don’t they make more money than NewEgg?

Certainly, they do. But the game is changing and NewEgg understands the new rules. In fact, they are creating them.

Best Buy’s bottom line might look good right now, but we’ll see who still stands in 5 years. My bet’s on NewEgg. It’s a shame they are private, or I know what shares I would be buying… My money would gladly rest in the laurels of David.

Zach

P.S. NewEgg got a little crazy after those two postings. To further the ‘Geek On’ marketing campaign as featured in the video ad above, they gave away 5,000 shirts with the Geek On logo on it (also seen above). The first 5,000 customers to order it from their store got it absolutely free. At the same time, if you head over to the Best Buy fan page you can catch the online only, one day sale of that Flip Mino I bought from NewEgg last year…

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This past weekend, I had an interesting experience and decided to blog about it (Kafe Bonehead). When you call out a small business, especially one that is a local coffee shop frequented by many of the people that follow you on Twitter or are friends with you on Facebook, it would be silly not to expect some disagreement or backlash.

After reading some of the tweets directed at me and also some of the responses on the blog itself, I took another look at what I had written. I don’t think I expressed clearly enough my side of things and I took for granted that everyone reading it sees things the way I do. Of course you don’t. I don’t expect or desire that you do see things the way I do. To this end, I felt obligated to offer one final response to the experience.

An Opportunity of a Lifetime

There are three ways the employees of Kafe Bona could have responded when I walked into Kafe Bona this past weekend:

1. They could have done exactly what they did. I walk in and the employee enacts some policy about me not being able to have an outside drink in their store.
2. I walk in and the employees say nothing.
3. I walk in and the employees use me having a cup of Starbucks as an event that could transform me into a lifelong customer.

I don’t think most people see it this way… and I think this is why many small businesses are set to lose in the next few years. There are two things going on here. By doing the first one, you are risking offending a customer. Obviously, you don’t want to be walked on but offending people is not a great way of promoting loyalty. Regardless, I think my last blog focused too much on this.

The point I was making was that they are missing a HUGE opportunity.

The opportunity is in number 3. First off, instead of treating me like I was five they could have treated me like an adult. More importantly, they could have easily used this to make a connection with a customer (or even just a potential customer). You know, something you might expect from a small business.

Instead of having your employees trained to walk up to customers and tell them they have to throw away their drink or leave, why not have them trained to walk up to the customer and engage them?

For example, what if instead of engaging me in the way she did the employee had sat at the small table across from me and introduced herself. She then asks about what I am drinking. She can ask if I’ve ever tried their *insert comparable drink here* and offer me a free cup of it.

After walking away and fixing my new drink, she comes back and has me try it. She can ask me about which one tastes better, why, etc. At the end of the day, even if I don’t like the drink she made for me she could say, we actually don’t allow Starbucks cups in our store (making a joke of the competition) and telling me that I can keep my drink, but I have to put it in one of their cups.

You might be thinking. Why in the world would I, as a business owner, EVER give a person who brings a competitors product into my store and buys nothing something free? You want to win, right? Well… you had better start thinking like this, especially if you are competing with a company like Starbucks.

Beating Starbucks

Let’s face it. If you are in the local cafe or coffee shop industry, you’ve got a few very serious competitors. First off, you have Starbucks (who also owns Seattle’s Best). You’ve also got Peet’s coffee. On top of all of this, you have every other local cafe and coffee shop. Looking at the competition, you’ve got to be doing some things seriously awesome to compete.

Starbucks has a lot going for them. They have one of the most recognized brands in the world, have the largest number of stores (resulting in some seriously insane economies of scale), offer free internet (that also includes free access to sites like Wall Street Journal, New York Times, and the Economist), a very good quality of coffee, and an impressive rewards program.

Looking at the list, what could possibly be their weakness? Well, I don’t think they have many formal weaknesses. However, there is one thing that a local coffee shop has over Starbucks. Any guesses?

At the end of the day, Kafe Bona has only one thing they can do that Starbucks can never do. That is simply be local… and small. They can move faster and be more personal than Starbucks. This isn’t just about remembering your customers names, but actually engaging with them. This is understanding what is going on in the local community and in your customers lives. This is being super nice to everyone that walks in. And this is taking EVERY opportunity anyone gives you to turn them into not just a customer, but a supporter.

So What?

Even if in the example above I didn’t happen to like whatever coffee they had already brewed, they spent all of 2 cents to gain some valuable information. Companies pay a lot of money to get data like why a customer does or doesn’t like a particular product over another one. They also spent that 2 cents to potentially turn me into a huge customer.

You also have to realize that I took the time to come to your store. Obviously I at the very least like Kafe Bona. Without even asking if I would or planned on buying something, your first response is telling me I cannot have the drink? I think that is poor form. It is also notable that there was lots of space available at their store. If it had been crowded or I was taking up a large space and wasn’t supporting them at all, obviously you might question that.

Worst case, what do you think the odds are that I would tweet or facebook the fact that I just got a free cup of coffee from Kafe Bona (and that it tastes great)? As I see it, Kafe Bona had a chance to turn a semi-frequent customer into a very loyal supporter. What they did was lose that customer forever.

Zach

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I woke up bright and early this morning with a full slate of client meetings planned. One of them happened to be at a Starbucks. Due to how much I love the new Tribute Blend, I had no choice but to start the day off with a coffee. Anyways, after my meeting at Starbucks I had another at Kaffe Bona (literally about 100 feet away).

It was cold and raining, but I decided to just walk anyway. I sit down inside of Kaffe Bona and start getting my computer out. One of the ladies working there walked by and said, ‘Sorry, but we don’t allow outside drinks in here’ with a smile on her face. I kind of just laughed in response as she walked away.

A few minutes later, she walked up to my table and said, “Hey. I wasn’t kidding. You can’t be in here with an outside drink.” I respond, “Really?” She just looked at me as though I were a little kid.

I said, “Alrighty.” as I began to pack up my computer.

So What?

Now, I only had about a fourth of my coffee left. I could have just thrown it away. At this point though, there was no way I was going to stay there. I had two meetings slated to happen at Kaffe Bona and had intended on eating lunch there myself. I was NOT going to give them a dime of my money.

I walked back to Starbucks and texted both of the people I had planned on meeting that I’d prefer to meet at Starbucks. The first person I met with ordered a drink from Starbucks. The second actually brought his wife and both got drinks and a snack.

Instead of eating lunch, I was able to hop on the Starbucks Network and browse through the New York Times, Wall Street Journal, and The Economist for free while waiting on people to arrive.

The sad part, I’ve had countless meetings both professionally and for school at Kaffe Bona. They have a drink and a sandwich that I love to eat and can hardly resist getting when I have a meeting there. But, I will never be going back. I almost emailed them through their site to tell them this story and how offended I am. However, they don’t deserve that. I’d rather just see them fail.

And this is why I go to Starbucks…

Zach

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I feel like business comes down to one thing, it’s not how awesome your prices are or how cool your product is; it’s all about how you treat your customers.  People like to be treated well and will actually go out of their way to have excellent customer service.

Instead of the mindset that only managers can take care of problems, think about empowering each and every one of your employees to be able to take care of a customer when they complain.  One of the worst things a company can do is train their employees to always refer problems to managers.  When a customer is mad and explains a problem to an employee they don’t want to hear, “Well, let me get a manager to take care of that”.  They want to have their problem solved then and there.  When you train your employees to take care of problems not only will you have happier customers; you will also have better employees.

What are you doing to make sure your customers are happy?

David

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This opened my eyes a little more to the fact that we need to be constantly thinking creatively (coincidentally he also teaches a creative thinking class). I’m pretty sure he didn’t have that response waiting until someone asked that perfect question. It was just a second nature reaction. This is what we as business people should be aiming for. We should constantly be thinking of everyday things that we can turn into profit for ourselves and our companies.

So What?

The so what of this post has basically already been stated, but I hope you can pull a deeper meaning from it. Often times, when a person brings up a subject such as a new bill or anything really having to do with politics, they more than likely want to strike up a conversation, maybe for boredom’s sake or maybe for plain debating. But we need not be suckered in and miss the bigger picture. As a capitalist, I want to be able to have the Midas touch; that is turn every situation possible into a profitable outcome.

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Sell an Experience

Like I said earlier, few companies have products that are so good that they sell themselves. Most of the time a company must sell itself to consumers in order to sell its actual product. When a customer is contemplating where to purchase a particular item, and price is the only difference, they will most often select the store with the lower price (as one of our bloggers Zach did when purchasing his new Flip camera – read his post here). If a company wants to make any sort of profit, they probably will not do so by trying to compete for the lowest price (unless they are the mega store Wal-Mart). So what must they do to make their more expensive product worth while? Sell an experience.

How?

Selling an experience isn’t easy, but when done correctly can be great for both the company and the customer. Many times when I go to a store to buy a product, I want to talk to someone who is an expert on the product and can reassure me that it is a good purchase decision. I want to be greeted at the door, remembered from my previous visit, be offered add-ons that I might actually need, and have some type of frequent shopper bonus. This would be a great “experience” for me as a shopper. One of the biggest elements I just mentioned (from an employee standpoint) is customer recall. A friend of mine told me recently that every time he goes into Starbucks, the barista on duty greets him by name and asks him “hot or cold?” That’s amazing to me. Starbucks has done such a great job at this element that of all the customers seen each day of the week, the barista can still remember a single customer’s order. Amazing.

Nice SHUs

No not shoes, SHUs (Super Heavy Users). A super heavy user is pretty self explanatory; it’s someone who uses a certain product or service often. McDonald’s definition is someone who eats at their restaurant at least SEVEN times a week. I would consider myself a super heavy user of electronics. I use them all the time, never get tired of them, love talking about them, and love buying them. So i would be perfect for a store that sales electronics. What I’m trying to say is basically that companies should hire super heavy users of their products to be employees. Who else better to talk to a customer about a product they love than someone who uses it every day. Some examples of companies who do this are Best Buy (look at all the geeks who have worked there, myself included), various clothing stores (where the employees are only allowed to wear that specific company’s clothes), Nike (who many times hires athletes to sell and develop its products), and many more. Having an employee who loves what he is selling and has actually used it before, compared to an employee who only has book knowledge of the product, makes such a big difference.

So What?

If you want to sell a premium product (or any product for that manner) and not be competitive with price alone, you must do something better – offer something more appealing that competitors are not (an experience). And have the people that are selling the product actually be interested in the product and willing to tell the world how much they love it. I believe these few simple changes could make any company that much better.

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Several years ago while living in the dorms at college, a few friends and I had this idea for a product. It would be slightly smaller than a piece of paper, and maybe a half inch thick. The thing would be a touch screen and you could do all sorts of things with it… Sadly, we thought of the iPad about 5 years AFTER Apple starting making it. We knew there was no way to make it happen any time soon so we just sat back and watched.

About a year later I got an iPod touch. Every time I would see one of my friends I would talk about the core functionality that it was still missing that we had talked about. Then the iPad came out… Basically the product we were thinking about and about a thousand times better. Yet, it was still missing several of the key functionalities. Yesterday I got an email from Starbucks that delighted me to no end.

I knew there were a handful of stores on the west coast that allowed you to pay with your iPhone / iPod touch, but honestly this is what I’m talking about. I salute Starbucks, Target, and Apple for being awesome at what they do. I’m tired of carrying around Starbucks membership cards, gift cards, etc. The idea that I can whip out what’s already in my pocket for yet another task in my daily life means I can save some time, energy, and thought.

So What?

I’ll tell you so what. If you don’t see this as a huge, blinking arrows pointing towards the future, let me help you out. The iPhone / iPad / iPod will replace our wallets, period. Wallets will most certainly be a thing of the past. If you make wallets for a living… sorry. Your time is limited! If you code for a living, there is lots of money awaiting to be made. Here is a list of what’s in my wallet:

- Student ID
- Credit / Debit Cards
- Business Cards
- Starbucks Gold Card
- Drivers License
- A $1 dollar bill
- AAA card

Imagine for a second when Visa and Mastercard produce an app. When checking out at a Target or Wal-mart you will no longer have to swipe a card, you’ll just click your Visa app, enter your password, and maybe press your thumb print to the screen and then put the bar code over a scanner like you do with products at the self checkout.

Ever have a situation at a store where you want to use $50 from your bank account and use $15 on your credit card? The Visa App can do that. Ever have a friend go to the store and how him $5.03? I can send you $5.03 from my Visa App. Now all of your accounts can become one, giant bank account.

Business cards you say? Imagine being able to store all the business card you ever got into a clean, easy to use categorical system. Also imagine that you can never run out, no matter how many you have given away at the conference you are at.

Do I really need to continue with this? Before it’s all said in done, Capital One won’t be able to ask “What’s in Your Wallet” because none of us will have a wallet. We will just have our iPhones or iPads or iSomethings. I imagine there are great companies out there right now figuring this stuff out. Will you be in on it? Either way you’ll enjoy the benefits of what’s to come. Here is a salute to Starbucks, Target, and Apple for pushing us into the future.

Zach

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Getting Personal

So what should your company do? Many people have the preconception that customers either want high quality at a high price, or low quality at a low price. Until recent years, there has not been a middle ground due to this misconception. In their book “Mass Affluence,” Paul Nunes and Brian Johnson argue that there is a segment of customers in the marketplace that are not currenlty having their needs met. They either have to pay too much for a product that does more than they want (say a $100 electronic toothbrush) or an inexpensive item that doesn’t do enough (A normal $2 toothbrush). A solution to this is a middle-of-the-line electronic toothbrush for around $10. Consumers wanting more functionality but not top of the line will finally have their needs met.

Raising the Bar (and Price)

In America, in order to avoid having to compare too many options, many people have created a shortcut when purchasing items. This shortcut is “expensive = good.” This is great for merchandisers. A good example of how retailers can cash in on this is told by Robert Cialdini in his book Influence The Psychology of Persuasion. Cialdini one day receives a phone call from a friend who owned a jewelry store. A certain type of jewelry was not selling well so she informed her head saleswoman to sell the jewelry at “price x 1/2″ (The owner was going out of town so she just left a note). The saleswoman misread the not and accidentally sold the jewelry for twice as much. When the owner returned, every piece of jewelry that was increased by 2 was sold out. Why? People used the shortcut of “expensive = good.”

So What?

The so what for this entry can be taken in many different ways, and I would suggest that each company take an individual approach to pricing. Many people think “sales are down so I should lower prices.” This can’t be more wrong for companies who are trying to differentiate themselves with quality. I’m not telling you to do it, and can’t be held responsible if sales decrease, but you might want to consider raising prices instead of lowering them. It just might surprise you.

-Austin

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Maslow and Herzberg

Take any Intro to Management class and the chances are the first few days you’ll learn about Maslow’s Hierarchy of Needs and Herzberg’s Two-Factor Theory. Maslow outlines the needs of humans in pyramid style with basic needs at the bottom and more specific needs towards the top. Herzberg’s two factors do sort of the same thing however his two factors are either motivators or hygiene factors. Both will be explained more later.

[Don't] Show Me the Money

Contrary to popular belief (and according to Maslow and Herzberg), money is NOT a primary motivator for employees. Author, psychologist, and business man Dr. Clotaire Rapaille supports this theory in his book, The Culture Code. He states “Money alone is the worst reward for an American employee.” Why? Well according to Herzberg, salary is a hygiene factor (a factor that does not motivate if present, but, if absent, results in demotivation). So salary is important but should not be used as a reward to not watch basketball in March. So if not money, then what?

The obvious answer would be to address the motivating factor and not the hygiene factor? But how? Well Dr. Rapaille offers some tips based on how our culture operates. He says that promotions and accolades should come with responsibilities that may help the employee to do a more effective job. This is right on track with the theories that were previously discussed. A manager shouldn’t just reward or promote an employee with money; they should tap into the appropriate motivator for that specific employee. In addition, employers should put a premium on keeping staff inspired as well as holding regular staff meetings that listen to employees’ input. Both of these give the employees a feeling that they are an integral part of a company’s success, which is a HUGE motivator that managers can target. The employee will feel a sense of ownership and greater responsibility and hopefully watch less sports in the office.

There is no “I” in Team (but there should be!)

Another important way to motivate employees is to address them and reward them as individuals and not as a team. This may go against a lot of people’s beliefs, however it makes sense. For example, if a team reward is to go off to a resort if a certain level is hit, the employee will only carry his weight in the group and no more. He only needs to work hard enough to achieve the trip and then he’ll just do average. However if he is motivated on a personal level, he will attempt to address his motivation factors (maybe subconsciously) and work harder than if he was part of a team.

Back to the Madness

I believe knowing these factors and how employees are motivated is only the first step to keeping employees motivated and focused on work and not basketball. But there is no “one size fits all” handbook for managers. I believe each manager must tailor a program that fits each individual employee and doesn’t reward with money or restrictions (by outright banning of watching games in the office). A great example of this is a creative approach a CEO took in Baltimore, Maryland (Read story here). He got in on the madness and held on office-wide pool with the winner receiving a vacation getaway. His theory was that it’s better to address the issue upfront and allow for a little watching on breaks, as opposed to watching games while working (more like not working). It also prevents employees from partying too hard and not coming in to work the next day. Two birds with one stone… I like it.

So What?

I believe a lot can be taken away from fact that nearly $4 billion will be lost this year due to a basketball tournament. It shows that Americans love their sports as much as their jobs (maybe more). It also shows that managers need to always be on their toes thinking of creative ways they can keep their employees motivated and focused, yet still allow them space to breathe when events such as March Madness come around.

-Austin

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