The sponsorship conundrum

Marketing to ethnic communities seems, at first glance, like a no-brainer. Some 12 million Canadians list neither English nor French as their mother tongue. In urban areas such as Greater Toronto, ethnic Canadians account for the majority of the population. Moreover, as Bobby Siu, president of marketing consultancy Infoworth, notes: 'Ethnic markets are growing much faster than the overall market, and this means great future business potential for companies which become fixtures in ethnic markets now.' Still, most Canadian marketers don't have the budgets to plan and execute several concurrent campaigns aimed at different cultural groups, leaving sponsorship and PR as obvious choices for reaching out without breaking the bank.

Marketing to ethnic communities seems, at first glance, like a no-brainer. Some 12 million Canadians list neither English nor French as their mother tongue. In urban areas such as Greater Toronto, ethnic Canadians account for the majority of the population. Moreover, as Bobby Siu, president of marketing consultancy Infoworth, notes: ‘Ethnic markets are growing much faster than the overall market, and this means great future business potential for companies which become fixtures in ethnic markets now.’

Still, most Canadian marketers don’t have the budgets to plan and execute several concurrent campaigns aimed at different cultural groups, leaving sponsorship and PR as obvious choices for reaching out without breaking the bank.

At least they would be obvious, were it not for the fact that sponsorship and PR are still seen as ‘soft’ advertising tools – methods that can eat up a lot of money without producing easily measurable results. Rightly or wrongly, the budgets for such efforts are often the first to get the axe when hard times hit.

‘In the overall advertising mix, sponsorship of events is only one aspect of promoting a brand or an image,’ says Albert Yue, president of Dynasty Advertising of Markham, Ont. ‘A lot of companies measure the response in sales based on advertising performance. Events can augment image-building, but often it’s a less direct, softer approach. If the budget comes to a crunch, those are the first things to go, unfortunately.’

Major sponsors drop out

In fact, several major companies have reduced or dropped their sponsorship of ethnic events as a cost-cutting measure in a down market. These include Air Canada, Bell Canada and Telus. Air Canada says that its retreat on sponsorships is not aimed only at the ethnic communities: the airline recently pulled the plug on Vancouver’s only PGA-level golf tourney as well.

Telus, for its part, used to sponsor Chinese and Sikh New Year events, but has left the field. ‘Today, our sponsorship criteria have changed,’ says Janet Borkowsky, enterprise event marketing manager, ‘and we now measure return on investment as the deciding factor. So, no, we do not actively market to the ethnic market.’

Telus’ rival, Bell Canada, has also abandoned ethnic sponsorship. The telecom carrier now prefers to focus on ‘large, broad audiences rather than small segments,’ says spokeswoman Marie Michelle Nadon.

‘Five years ago, Bell was a major player in ethnic sponsorship, but not in the past 18 months,’ confirms Dynasty’s Yue. He notes that Bell’s long-distance rates for calls to Taiwan and China fail to match those of Primus Telecom, which has, in turn, stepped up its participation in events such as Chinese New Year. ‘Sponsorship has to go hand in hand with sales,’ he notes.

Believers still picky

Many other marketers still believe in ethnic sponsorship, and many marketing experts warn that drastic pullbacks are shortsighted.

‘Each company has to decide whether a particular ethnic group will be a long-term customer,’ says Sharifa Khan, president of Toronto-based Balmoral Advertising & Marketing. ‘At the very least, you should have a maintenance program. Once you cut yourself off from a certain community for a long period of time, it means you’ll have to start all over again, because people do forget.’

Firms that do sponsor ethnic events are still picky about the recipients. ‘Everyone is looking for support. I’ve become more selective in the last couple of years,’ says Zahir Keshavjee, VP of sales and marketing for Tropical Treets, a Toronto-based retailer of exotic ice-cream flavours.

The firm donates $5,000 to $10,000 annually to the Aga Khan Foundation’s World Partnership Walk, held to promote international development. But Keshavjee has rebuffed the Caribana Festival, calling it as an ‘unprofessionally run event’ plagued by financial troubles and infighting – which resulted in a confusing renaming of the festival, as the ‘Toronto International Carnival,’ due to a copyright dispute this past summer.

That perception of Caribana is widespread among marketers. While Western Union remains on board, the Toronto hotels – arguably the major winners of the tourist-rich festival – give it a collective pass. Even Royal Bank, which sponsored the event for three years, has pulled out.

(The bank, however, says it remains committed to black community events, and co-sponsors the Black Business and Professional Association’s Harry Jerome Awards.)

Still, while auto companies, banks and realtors that are asked to sponsor ethnic celebrations often have a ‘show-me-the-numbers’ attitude at the head office, they do often allow their local branches or dealerships to get involved for goodwill reasons.

Century 21, for example, tends not to sponsor at the corporate level, but leaves it to franchisees to decide upon supporting small-scale ethnic events at the local level. Two years ago, the Century 21 Prudential brokerage in Richmond, B.C. donated $500 toward the Filipino Community Association’s annual picnic. But there’s no way to gauge the payback, concedes brokerage manager Bill Blackall. As a sales tool, the donation is ‘a shot in the dark, but our philosophy is to put something back into the community.’

Head office needs numbers

Head office, meanwhile, is likely to apply more strategic criteria, emphasizing return-on-investment, when large sponsorship requests are on the table. That doesn’t necessarily mean all corporate-level decision-makers will race Bell and Telus to the exits; however, it does mean the business case for sponsorship of a particular ethnic event will have to be able to bear closer scrutiny by the higher-ups.

‘If you don’t measure the results of an event, then you can’t determine whether that event was successful or not, or whether you should renew it,’ says Patricia Straker, Royal Bank’s director of sponsorship marketing. ‘We’re building [measurement] into all of our events.’ And, she adds, the event organizers should be able to provide persuasive research. ‘How can they go to a buyer without knowing the effectiveness of their event?’

The Toronto International Dragon Boat Race Festival, which enlists 30-plus blue-chip sponsors annually, has learned that the key to keeping them on board is to provide plenty of raw data about the audience they’re reaching. The festival’s surveys of people attending the events reveal ethnicity as well as age group, profession and place of origin. The surveys even measure which sponsors achieve top-of-mind awareness among the crowds.

Not surprisingly, the festival’s top-tier sponsors, such as Bank of Montreal, Procter & Gamble, Bank of Nova Scotia and Tour East Holidays, achieve the highest recognition. ‘The ones who create a lot of noise are the ones who are most noticed,’ says Sharifa Khan, chairwoman of the festival development committee. ‘But it’s not a question of just giving money; they must create programs of their own. And it’s not only a matter of being present at the events; they must run ads in the ethnic newspapers to lure people to their booths.’

Ethnic community organizers know, too, that it’s easier to win sponsors if they can demonstrate that their event is not just a one-off, self-contained chance for visibility. Tele-Latino Network, for example, organizes the annual Latinfest concert, then reprises the live event as specialty-television programming. This creates multiple opportunities for marketers to reach the Hispanic population.

‘There’s a promotional campaign that advertisers participate in over two to four weeks preceding the event,’ says Alf De Blasis, TLN’s promotions manager. ‘Then there are on-stage announcements throughout the concert and banners and other signage on site. Finally, there are three 60-minute telecasts of the event shown on our network. All three opportunities are important to the sponsors.’ (For more on reaching Hispanic Canadians, see ‘Hispanics hit mainstream’ on page 20.)

Sponsors reap on-site sales

Other marketers that are committed to sponsoring ethnic events don’t just settle for the exposure; they’re also expecting to reap solid on-site sales. Labatt Breweries, for example, has been lead sponsor at the Toronto Greek community’s Taste of the Danforth event for at least five years, securing the status of preferred beer supplier. The company says it assesses a sponsorship on three criteria: the opportunity for brand and corporate exposure, on-site sales of its beer, and whether it will enhance the event.

Labatt spokeswoman Kathy Murphy is unsure whether on-site beer sales sometimes enable the brewery to break even on an event. Certainly, that’s not always so. At Taste of Little Italy, a Toronto event for which Labatt has been lead sponsor the past two years, pouring rights are not even available. ‘What it’s about for us is building partnerships and relationships in the communities where we do a lot of business,’ says Murphy.

Sponsorship aims at marketing a product or service to an ethnic community by, in effect, creating a shared affinity with the community on its home turf. ‘We can touch people in an environment where they feel an emotional bond,’ says Royal Bank’s Straker.

But the flip side of such efforts is to try to reach the ethnic community by coaxing it into the mainstream. The Toronto Raptors basketball team pursues this approach through a series of promotional nights that coincide with important holidays on the multicultural calendar.

In April, for example, when Sikhs celebrate their New Year’s festival, the Raptors stage a Baisakhi Night, selling as many as 7,000 tickets (worth $88,000) to the local Sikh community. To highlight the event, an elephant carries a basketball to centre court for the game’s opening tip-off, and the Jumbotron flashes announcements. The Raptors have organized similar promotions for the Chinese, Serb and Jewish communities, and plan one for the Greek population.

‘Where we have success is where we find a ‘centre of influence,’ someone strongly involved in their community,’ says Jim Edmonds, the Raptors’ director of sales. For Baisakhi Night, the franchise relies on Nav Bhatia, a Brampton, Ont. car dealer who never misses a Raptors home game. Bhatia not only takes – and sells – an entire block of tickets for the evening, he also uses his influence in Sikh religious and business circles to help the franchise sell 10 season’s tickets.

PR still popular

If sponsorships and promotions don’t yield results – or even if they do – there’s always the option of a PR campaign using media relations and special events as a low-cost complement to media buying. Corporate head offices that have become hard-nosed toward the sponsorship of ethnic festivals often seem readier to have faith in PR campaigns aimed at ethnic groups.

As Midas Canada’s emissary to the ethnic Chinese market for the past five years, Creative Empire, of Toronto, has organized ribbon-cutting ceremonies, known as ‘grand openings,’ whenever the muffler maven has launched new outlets in strongly Chinese locales. The agency usually invites five to 10 community leaders, hoping their status will ‘lend credibility’ to Midas, says Pandora Ho, Empire’s director of PR & events. The agency also sends news releases and photos to the Chinese-language media.

‘The events are organized not just to get immediate publicity but to build long-term community relations,’ says Ho. ‘In this ethnic Chinese market, the building of trust is especially important. You can’t expect results in just a week; you have to be there for the long haul.’

For Remy Martin, the French distiller, the challenge in using PR is to build on the brand equity that its cognacs already enjoy among Chinese immigrants, who became familiar with the product in Asia. Last fall, Nina Ko, a partner at Toronto’s National Public Relations, organized a luncheon for the Chinese-language media at a downtown Toronto restaurant, and brought in Jason Bowden, RM’s roving ambassador, to demonstrate how to taste different cognacs.

Having a multi-course banquet rather than a straight cognac swilling reflects the consumption habits of ethnic Chinese, says Ko. ‘Chinese consumers like to drink cognac throughout a meal, not just at its end.’

The event, which drew approximately 25 print and electronic media people, yielded a slew of food-and-drink reviews and lifestyle articles focused on XO Excellence. ‘It’s hard to measure how this coverage directly impacted sales,’ admits Ko, ‘but this has certainly helped Remy Martin open more doors of Chinese restaurants.’ The event will be repeated later this fall.

When Mayumana, Israel’s Stomp-style dance troupe, moved into Toronto’s Elgin Theatre for a two-week run last April, it also unleashed a PR offensive, this time to create a buzz within the city’s Jewish community.

Jaye Kornblum-Rea, VP of Aerial Communications, Toronto, says, in fact, one-third of the overall promotion budget was allocated to PR. She used ‘guerrilla marketing’ tactics that included putting posters and flyers in 300 Jewish stores and restaurants as well as creating ‘word of mouth’ among their owners.

Once its Toronto run began, though, Mayumana relied on reviews in the mainstream, neighbourhood and Jewish press to reach its target audience. ‘In live theatre, PR is critical,’ says Kornblum-Rea. ‘Advertising lets you know that something is coming, but PR is huge’ in putting it over the top. That’s a conclusion that cost-conscious marketers seem likely to keep in mind as they continue to evaluate their outreach to Canada’s multicultural communities.