Sponsoring something (or someone) is the act of supporting an event, activity, person, or organization financially or through the provision of products or services. The individual or group that provides the support, similar to a benefactor, is known as the sponsor.
Sponsorship [1] is a cash and/or in-kind fee paid to a property (typically in sports, arts, entertainment or causes) in return for access to the exploitable commercial potential associated with that property.
While the sponsoree (property being sponsored) may be nonprofit, unlike philanthropy, sponsorship is done with the expectation of a commercial return.
While sponsorship can deliver increased awareness, brand building and propensity to purchase, it is different from advertising. Unlike advertising, sponsorship can not communicate specific product attributes. Nor can it stand alone, as sponsorship requires support elements.
A range of psychological and communications theories have been used to explain how commercial sponsorship works to impact consumer audiences. Most use the notion that a brand (sponsor) and event (sponsoree) become linked in memory through the sponsorship and as a result, thinking of the brand can trigger event-linked associations. Cornwell, Weeks and Roy (2005) [2] have published an extensive review of the theories so far used to explain commercial sponsorship effects.
One of the most pervasive findings in sponsorship is that the best effects are achieved where there is a logical match between the sponsor and sponsoree, such as a sports brand sponsoring a sports event. Work by Cornwell and colleagues [3] however, has shown that brands that don't have a logical match can still benefit, at least in terms of memory effects, if the sponsor articulates some rationale for the sponsorship to the audience.
All sponsorship should be based on contractual obligations between the sponsor and the sponsored party. Sponsors and sponsored parties should set out clear terms and conditions with all other partners involved, to define their expectations regarding all aspects of the sponsorship deal. Sponsorship should be recognisable as such.
The terms and conduct of sponsorship should be based upon the principle of good faith between all parties to the sponsorship. There should be clarity regarding the specific rights being sold and confirmation that these are available for sponsorship from the rights holder. Sponsored parties should have the absolute right to decide on the value of the sponsorship rights that they are offering and the appropriateness of the sponsor with whom they contract. [4]
The sales cycle for selling sponsors is often a lengthy process that consists of researching prospects, creating tailored proposals based on a company's business objectives, finding the right contacts at a company, getting buy-in from multiple constituencies and finally negotiating benefits/price. Some sales can take up to a year and sellers report spending anywhere between 1–5 hours researching each company that is viewed as a potential prospect for sponsorship. [5]
These are the terms used by many sponsorship professionals, which refer to how a sponsor uses the benefits they are allocated under the terms of a sponsorship agreement. Leveraging has been defined by Weeks, Cornwell and Drennan (2008) as "the act of using collateral marketing communications to exploit the commercial potential of the association between a sponsor and sponsee" while activation has been defined as those "communications that promote the engagement, involvement, or participation of the sponsorship audience with the sponsor." [6]
Money spent on activation is over and above the rights fee paid to the sponsored property and is often far greater than the cost of the rights fee." [6]
IEG projects spending on sponsorship globally to grow 4.5 percent in 2018 to $65.8 billion, including $24.2 billion in North America alone (a 4.5% increase from $24.1 billion in 2017). [8] Europe is the largest source of sponsorship spending, with €26.44 million (US$29 million) in just the EU member states in 2014, [9] followed by North America, the Asia Pacific region. Growth in Central and South America during 2010 did not materialize to the extent projected—3.8 percent versus a forecast of 5.7 percent—despite the FIFA World Cup and Olympic Games in Brazil in 2014 and 2016, respectively. With the 2010 World Cup concluded, sponsorship activity should begin to heat up, thus the region is projected to be the fastest-growing source of sponsorship dollars outside North America, with a forecast growth rate of 5.6 percent for 2011.
Relaxed television industry legislation surrounding product placement has led to a small but increasing rise in TV programming sponsorship in the UK. However, commercial sponsorship of British sports teams and players is a multibillion-pound industry. For example, Adidas became the sponsor and supplier of Manchester United's kit for ten seasons, in a 2014 deal with a guaranteed minimum value of £750 million (more than US$1.1 billion). [10]
As it has in most years over the past two-plus decades, sponsorship's growth rate will be ahead of the pace experienced by advertising and sales promotion, according to IEG.
Naming rights are a financial transaction and form of advertising or memorialization whereby a corporation, person, or other entity purchases the right to name a facility, object, location, program, or event, typically for a defined period of time. For properties such as multi-purpose arenas, performing arts venues, or sports fields, the term ranges from three to 20 years. Longer terms are more common for higher profile venues such as professional sports facilities.
Powerade is a sports drink created, manufactured and marketed by The Coca-Cola Company. Its primary competitor is Gatorade, owned by PepsiCo.
Miller Lite is a 4.2% ABV light American lager beer sold by Molson Coors of Chicago, Illinois. The company also produces Miller Genuine Draft and Miller High Life. Miller Lite competes mainly with Anheuser-Busch's Bud Light. Miller Lite is the official beer sponsor of the Green Bay Packers, Milwaukee Brewers, Milwaukee Bucks, Dallas Cowboys, Baltimore Ravens, Chicago Bears, and Bellator MMA.
Castrol is a British oil company that markets industrial and automotive lubricants, offering a wide range of oil, greases and similar products for most lubrication applications. The name Castrol was originally just the brand name for company's motor oils, but the company eventually changed its name to Castrol when the product name became better-known than the original company name CC Wakefield.
Search engine marketing (SEM) is a form of Internet marketing that involves the promotion of websites by increasing their visibility in search engine results pages (SERPs) primarily through paid advertising. SEM may incorporate search engine optimization (SEO), which adjusts or rewrites website content and site architecture to achieve a higher ranking in search engine results pages to enhance pay per click (PPC) listings and increase the Call to action (CTA) on the website.
Alcohol advertising is the promotion of alcoholic beverages by alcohol producers through a variety of media. Along with nicotine advertising, alcohol advertising is one of the most highly regulated forms of marketing. Some or all forms of alcohol advertising are banned in some countries. There have been some important studies about alcohol advertising published, such as J.P. Nelson's in 2000.
Winfield is an Australian brand of cigarettes, currently owned by multinational company British American Tobacco. Cigarettes are manufactured by British American Tobacco Australia (BATA), its local subsidiary.
Ambush marketing or ambush advertising is a marketing strategy in which an advertiser "ambushes" an event to compete for exposure against other advertisers.
Cause marketing is marketing done by a for-profit business that seeks to both increase profits and to better society in accordance with corporate social responsibility, such as by including activist messages in advertising.
The European Sponsorship Association (ESA) represents those involved in sponsorship across Europe.
Li-Ning Company Limited is a Chinese sportswear and sports equipment company founded by former Olympic gymnast Li Ning. The company endorses a number of athletes and teams worldwide.
Red Bull GmbH is an Austrian private company known for its range of energy drinks of the same name. It is also known for its sponsorship of a range of sporting events and teams. The headquarters of Red Bull GmbH are located in Fuschl am See, Salzburg.
The Indian Premier League (IPL) is a men's T20 franchise cricket league in India. It is annually contested by ten teams based in seven cities and three states. The league was founded by the Board of Control for Cricket in India (BCCI) in 2007. Brijesh Patel is the incumbent chairman of IPL. It is usually held annually in summer across India between March to May and has an exclusive window in the ICC Future Tours Programme.
Sport industry is an industry in which people, activities, business, and organizations are involved in producing, facilitating, promoting, or organizing any activity, experience, or business enterprise focused on sports. It is the market in which the businesses or products offered to its buyers are sports related and may be goods, services, people, places, or ideas.
Skateboarding sponsorship is the commercial sponsorship of an individual or team of people who participate in skateboarding, competitions or public activities. Typically, the individual or team will receive cash payments, reduced-price or free merchandise or equipment from a sponsor in return for public and in-competition use of that sponsor's merchandise or equipment for promotional purposes and recipient testimonial or endorsement. Skateboarding sponsorship may also extend to the sponsorship of major competitions or venues by larger distributors or manufacturers of skateboarding equipment and merchandise.
Sports marketing as a concept has established itself as a branch of marketing over the past few decades, however, a generally accepted definition does not exist.
Asian Sponsorship Association is a non-profit organisation whose mission is to significantly improve sponsorship practices in Asia in order to drive knowledge, business and market share of the global sponsorship industry.
Advertisements in schools is a controversial issue that is debated in the United States. Naming rights of sports stadiums and fields, sponsorship of sports teams, placement of signage, vending machine product selection and placement, and free products that children can take home or keep at school are all prominent forms of advertisements in schools.
Rule 40 is a by-law in the Olympic Charter stating that only approved sponsors may reference "Olympic-related terms". It was introduced by the International Olympic Committee (IOC) to prevent so-called ambush marketing by companies who are not official sponsors and to sanction links between athletes and unofficial sponsors during a blackout period starting nine days before the opening of the Olympic Games and continuing until three days after the closing ceremony.
As nicotine is highly addictive, marketing nicotine-containing products is regulated in most jurisdictions. Regulations include bans and regulation of certain types of advertising, and requirements for counter-advertising of facts generally not included in ads. Regulation is circumvented using less-regulated media, such as Facebook, less-regulated nicotine delivery products, such as e-cigarettes, and less-regulated ad types, such as industry ads which claim to discourage nicotine addiction but seem, according to independent studies, to promote teen nicotine use.
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