Marktanalyse - Sponsorship and sport: A marriage of convenience

Introduction

Sport is big business in the 21st Century and never before has the link between sport and the corporate world been so strong. Sponsorship in sports ranging from soccer to basketball to cricket is omnipresent. With both sponsors and sponsees becoming increasingly aware of the mutually positive effects of sponsorship, the link between sport and big business looks set to become stronger still.

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Highlights

• The costs associated with staging events such as the FIFA World Cup and Olympic Games are increasing and while host nation governments contribute significant funds, money raised by the likes of the International Olympic Committee (IOC) and FIFA through corporate sponsorship is necessary to meet these rising costs.
Sponsorship is not limited to such major global events. Smaller, national events including little leagues are sponsored and companies are keen to put money back in to grassroots sport as a component of their CSR strategy. Sports teams have come to see it as a vital revenue stream as costs rocket.
Major corporates are the most prolific sponsors and they too benefit greatly from the arrangements. While it is very difficult to quantify this benefit in terms of a specific financial figure, the effect on brand equity and corporate image is undoubtedly positive. For them, this boost represents a good return on their investment in sponsorship.

Your key questions answered

* Why and to what extent is sponsorship necessary to cover the cost of hosting a major sports event?
* How vital is sponsorship as a revenue stream to sports clubs and franchises?
* What benefits do sponsoring companies derive from the arrangements?

OVERVIEW

Catalyst

Summary

ANALYSIS

The cost of staging major events is extremely high

Corporate sponsorship plays a significant role in footing the bill

The need for sponsorship revenue is not limited to sporting events

Sponsorship is a revenue stream that sports clubs can no longer afford to ignore

Successful brands want to be associated with successful clubs and players

Companies benefit in a number of ways from being a sponsor

A good product fit is highly beneficial to the sponsoring company

Exposure is the ultimate aim

Some experts doubt the efficacy of a strategy centered on exposure

The facts speak in favor of heavy exposure

Geographically relevant sponsors are using major sports events to their advantage

Sponsors enjoy a positive and socially responsible image from sports sponsorship

Companies can use sponsorship to counter specific criticisms

Companies also derive internal benefits from sponsorship

CONCLUSIONS

The coming together of sponsorship and sport is a marriage of convenience and one that proves mutually beneficial

APPENDIX

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