Sport and corporate hospitality go hand-in-hand for obvious reasons. Sport brings people together, ignites their passions and leaves a lasting mark on those who watch it – a perfect combination for businesses that want to entertain and engage their contacts. As the UK prepares to host a series of major sporting events this summer, marketers should ask whether their brands are making the most of upcoming opportunities.
Notable events include the UEFA Champions League final at Wembley, Britain’s top tennis player Andy Murray’s first appearance as a Grand Slam winner and Olympic champion at Wimbledon and the first Ashes cricket series in England since 2009. The London 2012 Olympics might be a fading memory, but it has provided a boost to hospitality at sporting events as companies look to extend last summer’s feel-good factor and secure lucrative deals along the way.
The British Private Equity & Venture Capital Association (BVCA), for example, reports that its showpiece hospitality event at Wimbledon will be its biggest. The trade association will host its fourth annual event at the tennis tournament by using the Gatsby Club facility at the All England Club and a hospitality package by events company Keith Prowse.
This includes use of the Speakeasy, a separate private area that allows companies to create their own bespoke events. The BVCA will also offer its members around 80 Centre Court seats located in the same part of the arena – a key difference with arrangements at other sporting stadia where large groups are often split up in the seating plans.
“[The arrangement] means the networking continues outside of the hospitality suite,” explains Cheryl Chickowski, business development and marketing consultant at BVCA. “Once guests sit down, they can banter, get excited about the game or continue their conversations.”
The BVCA is linking this year’s event to its new foundation, which aims to support entrepreneurship among disadvantaged young people in the UK. Chickowski reveals that the organisation is looking to extend its programme of hospitality events to other sports such as golf, sailing and cricket – a move encouraged by the growing demand for corporate hospitality among members.
“We used to do quite a bit of this pre-Lehman Brothers,” she says, referring to the bank’s disastrous collapse in 2008. “When that happened, a lot of people thought it might be rather inappropriate. We used to do golf and sailing but that kind of went away.
“Over the years, our members started calling and asking us to do this again, which is why we started the [Wimbledon] event four years ago. Compared to throwing large conferences and extravagant dinners, it’s quite cost-effective. You can get a great day out for the same amount of money you might have spent on a very expensive conference and dinner.”
Offering value for money is also a major concern for Caroline McEleney, head of hospitality sales at Manchester United. Since joining the football club in 2008, she has helped to diversify its hospitality offer so that it includes a wider range of prices and packages.
“Rather than simply saying that we’re Man United and therefore people will want to come here, we realise that people are having to be very careful about how they spend their money nowadays,” she says. “We want to get under the skin of customers and understand why they would benefit from having hospitality at Old Trafford.”
Manchester United’s overall hospitality provision has transformed in recent years to include more contemporary interior designs, outdoor seating around the executive boxes and more diverse food and drink options. The boxes have also been fitted with new technology including Wi-Fi and touchscreens to allow guests to order refreshments and merchandise from the stadium store.
McEleney says careful customer profiling has supported the hospitality department’s growth in recent years. The business now caters for more than 8,000 covers per season across 155 boxes and 19 suites. “We’re very big on CRM [customer relationship management] and on intelligence in our marketing,” she explains.
“So instead of going ‘scattergun’, we’re very targeted and like to profile who is buying our facility, where are they travelling from and what they want to get out of the hospitality. Our marketing simplifies our product offering for everyone.”
McEleney notes that an increasingly diverse mix of companies and individuals are using the hospitality service in order to make new contacts and explore business opportunities. The club has sought to cater for this demand by setting up communal bar areas where box holders can network before going to their own private space to dine and watch the match.
“We work with customers more as a business consultant rather than just trying to sell to them,” she says. “We want it to work for their business and for them to come back year on year. That means we have to understand and adapt to change all the time and never become complacent in what we’re doing.”
As the economy continues to stutter and the pressure on budgets remains, businesses are scrutinising the benefits of their events in greater detail. A new study by Keith Prowse, for example, reveals that companies are keen to build strong business relationships through their events, rather than simply use them to entertain clients or staff (see The Latest, below).
The most popular reason for using corporate hospitality with 34 per cent of the vote is to ‘build stronger relationships by putting clients in a less formal atmosphere’, according to the survey of 166 company directors and other decision-makers. This was followed by the ability to make it ‘easier to engender long term relationships’, with 24 per cent.
The study also includes a ‘face time indicator’ to illustrate the number of hours that host companies can expect to spend engaging face-to-face with their guests during a typical event. It suggests that a day-long horse racing event offers the most face time, with the sporting action lasting an average of two hours against refreshment time of more than six hours. By contrast, a day at a cricket match involves more than six hours of sport against around three hours of refreshments.
Businesses are increasingly looking for ways to extend the face time they have with contacts during hospitality days. For example, Morgan Stanley, Paddy Power and Smurfit Kappa are all clients of a steam train service that runs from Toddington station to Cheltenham racecourse during the Cheltenham Festival. The service grants companies more time to network and entertain guests in their own section of the train before arriving at the course to enjoy the hospitality.
The package by Classic Hospitality, a subsidiary of the Corporate Entertainment Company, also includes a champagne reception on the Toddington station platform, which features a live band and servers in period dress. Packaging company Smurfit Kappa described it as “the only way to travel to Cheltenham”.
However, not all companies are looking for new experiences in big sporting occasions – some prefer old fashioned glitz and glamour instead. For example, American media company NBC Universal decided to convert most of the function space at London’s Savoy Hotel for its Olympic hospitality last year. It ran events to celebrate its official status as America’s Olympic broadcaster.
The company hired events agency Ruby J to create an “upscale yet relaxing atmosphere” that incorporated bars, a sound stage and dance floor. Jill Parcells, vice president of corporate events at NBC Universal, praised the event for its “ability to incorporate NBC branding without losing any of the beauty and richness of The Savoy”. She claims that it was the most successful hospitality programme the company has hosted.
Although one of the main aims of the corporate hospitality programme was to entertain clients and company executives, Parcells says it was also important to ensure the events resonated with a major sporting occasion like London 2012.
“We are proud to be part of the Olympic Games and want to share the experience with our clients and guests that make it all possible,” she adds.
“Our ultimate goal is to make sure that our clients are happy. We strive to give them Olympic memories that will last a lifetime and a well-run hospitality programme for any event helps to accomplish this.”
Business decision makers are time-poor and primarily want to use corporate hospitality to build stronger relationships with their clients and contacts, according to research by events company Keith Prowse. The survey of 166 company directors and partners also shows that a lack of time for workplace meetings has made face-to-face contact in a relaxed setting increasingly important.
In a work context, the average meeting time for most decision makers (40 per cent) is one hour, while just over 20 per cent will hold 90-minute meetings. By contrast, when the same people host corporate hospitality at the Henley Festival, they spend an average of six hours with their business contacts, the research shows. This includes both watching the event and during refreshment periods. For a day of polo, the figure is nearly eight hours.
The research found that company directors prefer face-to-face meetings for a variety of reasons. While 21 per cent say it helps to build stronger business relationships, 17 per cent cite the ability to gauge the situation through body language. A further 9 per cent say the main reason is that it allows for better thinking and creativity.
There are also clear differences between the perceived benefits of boardroom meetings and corporate hospitality. Nearly 70 per cent say the term ‘engagement’ is most applicable to hospitality as opposed to a formal meeting, but most decision makers (57 per cent) believe the boardroom is better for ‘candour’. They also overwhelming favour the boardroom when it comes to issues like ‘accountability’ and ‘focus’.
The BIG 3 challenges
Judging the summer weather is not an easy task. Businesses that want to put on hospitality at sporting events should realise the dangers of their glitzy event becoming a wash-out. Most at risk from the rain is cricket series The Ashes, which takes place in July and August. Bad weather has blighted many cricket matches and if the rain strikes for long periods, hosts face the challenge of keeping guests entertained with nothing but snacks and drinks. Wimbledon is also at risk from the rain as only Centre Court has a roof.
Britain is blessed with many wonderful stadia and sporting events. Unfortunately, it is also burdened with crowded trains and roads that make attending such occasions a challenge. The FA has been criticised for deciding to hold the FA Cup final at Wembley Stadium at 5.15pm on 11 May – effectively preventing Wigan Athletic and Manchester City fans from getting the last train home if the match finishes late. Companies hosting hospitality at busy events should consider the transport practicalities for guests.
Companies are waking up to the need to make their own opportunities while the economy remains flat. In many cases, being seen at events is half the battle. “It’s a tough market and in order to grab business you need to be out there entertaining clients and networking,” says Cheryl Chickowski, business development and marketing consultant at the British Private Equity & Venture Capital Association. “It’s important for a company to be seen hosting people and doing business. If you’re not in the game, you can’t play the game.”