Chapter 2: Theoretical framework
This research has a two sided theoretical framework to find a complete overview of corporate art sponsoring and corporate sponsoring in the opera and ballet sector. The two parts are in line with each other and have a logical follow up. The first part will explain the phenomenon corporate art sponsoring, the second part will explain corporate art sponsoring in The Netherlands
The first theoretical part will discuss corporate art sponsoring, to a large extent based on the theory of Volker Kirchberg, clarified in Corporate Art Sponsorships (2003). This theory is based on four motives for art sponsoring and gives a clear picture why companies sponsor culture institutions. But also the content of the articles of Thompson (2005), O'Hagan and Harvey (2000) and Thomas, Pervan and Nutall (2009) have been of great contribution to the literature about specifically sponsoring in the cultural sector.
Next to the definitions and explanation of corporate art sponsoring, the motives of companies for making corporate art sponsoring part of their business, will be enlightened. Because the theories about corporate art sponsoring given are not solely devoted to opera and ballet, briefly the characteristics of opera and ballet will be discussed, based on inter alia Opera and Ballet of Ruth Towse and the book of Philippe Agid and Jean Claude Tarondeau, The Management of Opera. To see which theories and motives are more specifically applied to opera and ballet, these characteristics and the formerly discussed collected works will be linked.
The second part will look to the situation of cultural sponsoring in the Netherlands since 1990. Arts have been a government affair since the rise of the welfare state in 1940. Because of this the commercial market of businesses did not feel responsible for the cultural sector. If we look abroad towards The United Kingdom or the Unites States, we see another tradition, were the government never has been very involved in the arts and therefore companies discovered the possibility of culture sponsoring earlier.
2.1 Corporate art sponsoring
2.1.1 The theory of Kirchberg
Image, the leading concept in the theory of Volker Kirchberg about corporate art sponsorship. His theory consists out of four major ideal types, notwithstanding partial overlapping. They can be labelled as the neoclassical/corporate productivity model, the ethical/altruistic model, the political model and the stakeholder model (Kirchberg, 2003). Coming paragraphs will discuss the models individually.
126.96.36.199 The neoclassical/corporate productivity model
The neoclassical model comes closest to the foremost commercial purpose of corporate sponsorship: increase the returns to a company (Kirchberg, 2003). The immediate objectives of corporate sponsorship are improving product sales, service sales, the corporate image and other public relation goals. Consequently, the market position of a company can be extended and symbolized by donations. By donating corporate income to a cultural institution, the company shows supplier and other organizations on the production flank, but also competitors, that it is economically in a good position. But most of all, the sponsoring of corporations is supposed to improve and promote sales. Reaching out to a new target group, the visitors of a cultural institution, can be done by corporate art sponsoring. So making a direct improvement in its own income, by making more profit or improve the corporation's image, is the main goal in the neoclassical model.
188.8.131.52 The ethical model
This model focuses on the corporate social responsibility of businesses, where the ‘good corporate citizen' is fully contained in the management culture. According to Kirchberg (2003) this is mostly induced by the corresponding personal attitudes of the senior management. The personal significance of the CEO and other senior management members is the traditional factor in helping the arts. Mainly, the goal of the ethical model are showed in creating or maintaining the image of a sustainable corporation, enrich the local cultural landscape and strengthen corporate community relations with the local government, the other economic actors and of course the citizen of a place, which are the potential customers. There is a clear overlapping between the neoclassical and the ethical model, whereas both have increasing the returns by occupying a favorable market position as main purpose.
184.108.40.206 The political model
In this model, create and preserve corporate power and autonomy from for instance other publicly controlled bodies, but also from other powerful establishments, are centralized. Corporations strive to limit the political control over their work, building and maintaining a positive climate of free enterprise is a useful method. However, the process of the political model has pieces of social coercion. Keeping up with other corporate entities in the neighborhood is knowable. The local business network is dominant in which institutions are being funded by companies (Kirchberg, 2003). Also in this model, creating a positive image by helping the cultural institutions is key. Supporting the arts can have a positive effect on the society and therefore also a positive effect on the economic development. By sponsoring the culture and the arts, corporations can expand their power in the local environment (Kirchberg, 2003).
220.127.116.11 The stakeholder model
The stakeholder model sees corporate arts support as a two-way-street: as a sponsor you are not only influencing the cultural institution, other interest groups also influence you. A corporation finds itself in a feedback loop, through their own corporate behavior towards the society (Kirchberg, 2003). So for example, if corporates are investing in the cultural environment, highly skilled people are more attracted to this surrounding, which give local corporations the possibility to hire highly skilled labor force. Also investing in cultural real estate can be a good option to make profit and create a positive company image (Kirchberg, 2003). So, also this model is seeking for profit and increasing the company's income in the end. Kirchberg (2003) states that all models of motives for corporate arts support has overlaps, although corporations are not always aware of them or do not mind these ‘academic ‘ differences in their motives. Nevertheless it is important to keep a good overview, why you sponsor a cultural institution, both for the goals a corporation has, but also for the cultural institution, so they can make sure to meet the expected returns and to make sure they establish a solid and good relationship.
So these four models show why companies sponsor art institutions and all have two things in common:
• Companies want to invest in (local) society
• Companies want promote their corporate image
How they do it, depends on the model. For instance a company invest in society (art) to improve their corporate image to increase their sales (neoclassical model). But another possibility is the investment of a business in society to have the possibility to recruit more highly skilled personal (stakeholder model).
Kirchberg was not the first who came up with a model to define motives for corporate art sponsorship. In 2000, John O'Hagen and Denice Harvey state that the neoclassical model, where direct promotion of the corporation by the cultural institution is the main goal, shows the most similarities with sponsoring. The other models are more about investment, which do not have a concrete return, especially on the short term. That's why it is important to name the difference between corporate sponsoring and corporate philanthropy. Lewandowsa (2016) describes the difference as follows: ‘sponsorship is a win-win agreement between the non-profit and commercial organizations, whereas philanthropy is an altruistic act of support.' That's why the some motives of sponsoring have a stronger connection with philanthropy than marketing, while it is still called sponsoring by both parties. A useful definition of sponsoring is: ‘the funding of an event that is not basically linked to the core products of the corporate sponsor'. Sales could increase because of the sponsoring, but this is because of the increased positive image, instead of direct promotion. Another definition of sponsoring by Colbert, Nantel & Poole (1994) that is used by O'Hagen and Harvey to explain corporate art sponsoring is: ‘Sponsorship is a two-way commercial exchange between a company and an organization, whereby the company gives resources (primarily money, but donations in kind are also possible) to the sponsored event. In return, the company receives promotional or other benefits of having its name associated with the event.'
Daellenbach, Davies and Ashill (2006) did a comprehensive study to corporate art sponsoring. They made a clear distinction between sponsoring, philanthropy and cause marketing. Where a philanthropic donation comes without expected returns and with cause marketing (a common beneficial collaboration between a commercial party and a non-profit organization) the donation depends on the sales, sponsoring is a two-way street. Both parties would like to benefit and therefore establish a strategic partnership. The difference can be found in the value of the exchange.
They also made a distinction between different motives for sponsoring, based on until then published literature. The four motives are:
• Media and visibility: Sponsoring is a method to influence the people by showing the perception of the company and the brand image by culture sponsoring (Thomas, Pervan & Nutall, 2009). Make a connection between the company and a cultural project, event or an arts institution, which has a certain degree of prestige and find appreciation by the crowd.
• Relationship management: Sponsoring a cultural institution or event gives the possibility to network with potential customers and other stakeholders. Also the possibility to lobby is an important aspect for corporate art sponsoring.
• Marketing: Sponsoring the arts gives the possibility to promote the company or brand. Brand awareness, increased sales, greater customer base, communication, all aspects, which can be achieved by sponsoring the arts.
• Public Relations (PR): the perception of the companies image can be defined by the public through corporate art sponsoring. Creating goodwill and receiving involvement of different or new stakeholders can be achieved by sponsoring.
2.2 Corporate art sponsoring in The Netherlands
The private sector of financing is becoming more important since the 90's. The government has cut the budgets for the culture sector since that time. This meant the culture business needed to find new possibilities of earning money (Jitta & Geertsma, 1987). Van Berkel - Van Schaik (2006) has done a very thorough and complete research in corporate art sponsoring, especially to the sponsoring of classical concerts in The Netherlands. Her findings will be of much use to shape a complete overview of the art sponsoring and the process of this in The Netherlands. Also the Robecco Summerconcerts at the Concertgebouw will be discussed. This is a perfect example of a very successful cultural activity.
Third and last part of the theoretical framework will discuss the Royal Opera House, Covent Garden (ROH) and the Sydney Opera House (SOH). Both houses have a particular position in their city. This position of the institute will be enlightened on the basis of Nopper & Lapierre (2005) and Colbert (2003). Besides the position these two houses occupy, the position of Dutch NO&B will be described and with that similarities and differences can be showed. Based on this the possible connection with sponsoring of all three houses will be showed, with the backing of the theories clarified in the first part of the theoretical framework.
So a theoretical framework that illuminated corporate art sponsoring from three different sides. Starting from the core, the definition, towards corporate art sponsoring in development, practice and in relation with the institutions: opera houses. With these sources different sides of corporate art sponsoring are showed, which could lead to a possible recommendation for Dutch NO&B, or aspects of corporate art sponsoring they could bare in mind in their search for new and more corporate sponsors.
What is corporate art sponsoring and what are the motives for corporate art sponsoring?
How developed corporate art sponsoring in the Netherlands since 1990 until now?
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