On a charm offensive

Norton Rose and Addleshaw Booth & Co have both packed a punch by using hospitality campaigns to raise their profile and improve client relations.

But are such firms justified in spending what can be a lot of money? asks Philip Hoult

When Norton Rose took a party to the Heineken Cup rugby final at the Millennium Stadium in Cardiff last month, it must have ranked as the largest corporate hospitality exercise ever undertaken by a law firm.

Around 700 people, including journalists and clients with their families, partners and staff, boarded a specially chartered train for the match between English champions Leicester and Irish province Munster.

The atmosphere, with the roars of a 70,000-strong crowd bouncing off the closed stadium roof, was electric as Leicester won a thrilling game.

But at a time when firms are beginning to feel the pinch of tougher market conditions, was it worth it? Is hospitality of this type a valid way for practices to spend their marketing budget?

According to David Daw, Norton Rose's director of marketing, the firm's role as one of four key sponsors of the Heineken Cup represented value for money.

The firm's decision to sponsor the Heineken Cup for two years at a cost of around 500,000 a year stemmed from a desire to raise its profile in a more co-ordinated way than was previously the case.

'When I joined Norton Rose a year ago, one of the first jobs I was asked to do was to review what we do as a top ten firm,' Mr Daw says.

'A lot of the money we spent was dispersed and we wanted to present ourselves as an integrated firm.'

Mr Daw says that reports commissioned from management and marketing consultants, such as Cox Consulting, had revealed that the firm was one of the least well-known brands among the top City practices.

'We looked at the kind of things you can do,' he explains.

'You can have a high-profile Financial Times or Economist advertising campaign, but these things are very short-lived.

You can also continue with what you do already - such as getting hospitality packages for Wimbledon and the cricket at Lord's - and try and make it more integrated.'

Mr Daw said the rugby offered several ways to show that the firm was a big player.

It associated Norton Rose with major corporates such as Heineken - the competition's main sponsors - and its other partners Peugeot, Orange, and Parker Pens.

'It also gave access to our audience in a high-profile way,' Mr Daw adds.

'Most of the games were televised, and because it's also an international competition, with games in France and Italy as well, it helped integrate the offices.'

He argues that although 500,000 might seem a large sum, this came almost entirely from the firm's existing budget being redirected, and that in return the firm got an estimated 1.5 million to 2 million worth of television coverage.

This is on top of the benefits of spending a day informally with existing and potential clients.

He says judging the success of any corporate hospitality and sponsorship package depends on whether a firm can engage all its stakeholders - the partners, the clients and their families.

Most important, the marketing team must ensure that the partners feel the money is being spent wisely.

'The conventional wisdom in marketing services is that you do not cut the marketing budget when times are tough but that you should do it in a more focused way,' Mr Daw says.

But this can be a difficult task in such circumstances.

Another law firm to have made a significant effort in the corporate hospitality and sponsorship arena is Addleshaw Booth & Co.

The national firm has extended its innovative fees-for-sponsorship deal with the Commonwealth Games to the level of becoming an official sponsor, alongside the likes of Microsoft, Cadbury and Asda.

It also sponsors the north-west's leading rugby union club, the Sale Sharks, as well as several arts bodies such as the Royal Exchange Theatre and the Chethams School of Music in Manchester.

It has several other initiatives involving its various offices.

The rationale, according to Addleshaws partner Quentin Smith, who is also chairman of the Sale Sharks, is to contribute more than just money.

Thus the firm has done much fee-earning work for the Commonwealth Games, negotiating all the major contracts that have been put in place.

It has also provided legal advice to the Sharks.

'Our style is not just to throw money at something,' Mr Smith says.

'We get bombarded by requests, so we look at where our contribution can make an impact.

We are looking for that third dimension.

'There is also a desire to expand our sports unit and we can do that in part through sponsorship.

You are helping to build the club with legal advice.

It is not just a case of putting your name on the shirt.'

Norton Rose and Addleshaws' initiatives receive support from leading marketing professionals.

Paul Jaffa, chairman of the Professional Services Marketing Group (PSMG), says there is a place for corporate hospitality and sponsorship but adds that it is often easily criticised.

'The problem is that a lot of firms do it without thinking, taking people to the Stella Artois tennis tournament at Queen's, or hiring a box at Lord's,' Mr Jaffa says.

'Corporate hospitality does have a role to play in business development - it keeps the connection with existing client business, although you may run the risk of a client saying "this event must cost a lot of money and that's why I am paying big fees".'

Therefore, corporate hospitality has to be used carefully.

It has to be targeted, focused and appropriate to the clients' expectations, because too many firms fall into the trap of inviting people to events they are not interested in, such as a golf day when they do not play golf.

Nevertheless, corporate hospitality can be a particularly useful method in the legal profession because buying legal services is for the most part a personal sale.

'People have to know you - they are buying a personal service,' Mr Jaffa says.

'They are still buying a service from an individual and they see it as that.

'With corporate hospitality, you can also control who attends, unlike public relations or advertising.

This is true whether it is a question of taking one person and his wife to the opera or taking 700 people to the rugby.'

However, one major problem is that the people on the receiving end of invitations are becoming much more discerning about which events they will attend.

They will often be invited to literally hundreds of events and there is a danger of hospitality 'fatigue'.

Another criticism of corporate hospitality is its cost, but, Mr Jaffa says, this is often unfair.

'People make a lot of this but compared to other methods of marketing it can be quite cost-effective,' he points out.

'But you do have to sign real cheques against a budget so it can look a bit ugly.

With many other forms of marketing, the cost is dispersed across a range of things and very seldom identified.'

Not all firms of course think that large-scale corporate hospitality is for them.

This will often depend on the industry sector they are looking to target.

For example, the insurance industry has a reputation for enjoying hospitality.

Fi Inchbald, director of business development at City firm Taylor Joynson Garrett, says: 'We have always been quite modest when it comes down to it- we tend to go to the likes of Glorious Goodwood, some departments have golf days, and typically it is the same clients that go each year.

'But in our market of major corporates and some institutions, a busy in-house lawyer would find it hard to have a day out.

'I also don't think that if you are going to take someone out that they will bung you a big chunk of work.

It is more of a thank you.

Where we have done it is in focused initiatives, such as a drinks party for the private equity industry at the Courtauld Gallery last year.'

Ms Inchbald adds that it is often important to ensure corporate hospitality is done on a cross-departmental basis, even when there are departments who are more active than others.

The firm's annual Goodwood trip, for example, involves lawyers from the property, finance and dispute resolution teams.

If targeted appropriately, budgeted accurately and organised efficiently, corporate hospitality can prove to be an important part of a firm's marketing efforts.

In this way, hospitality can be effective and value for money - and suspicions that it is simply 'a jolly' can be banished.

Philip Hoult is a freelance journalist