Sponsorship set for growth

9 January 2013

NEW YORK: Brand owners will boost their spending on sponsorship to more than $53bn worldwide in 2013, helping this channel fully enter the marketing "mainstream", a study has predicted.

According to IEG, the consulting, research and analytics group, expenditure on sponsorship should reach $53.3bn globally in 2013, measured against $51.1bn in 2012 and $48.6bn in 2011.

The primary impetus supporting this growth, IEG suggested, was an "unprecedented recognition" among senior corporate decision-makers that sponsorship builds brand loyalty and attention.

"Sponsorship ... is more likely to be discussed in the context of integrated marketing programs that can take advantage of the reach of traditional advertising as well as the emotional and experiential benefits earned through partnerships with sports, entertainment, cause and cultural entities," IEG said.

The North American market will be worth $19.9bn in 2013, a 5.5% increase on an annual basis. Europe should see a comparatively modest 2.8% gain to $14.5bn, with Asia improving by 5% to $12.6bn.

Central and South America was projected to experience a 4.5% leap, generating $4bn as a result, while all other areas witness a 4.5% expansion to $2.3bn.

When breaking out the figures for North America, the study forecast that sports sponsorship would remain the most valuable individual segment, up by 6% to $13.8bn, with entertainment on $2bn.

Cause-related initiatives were pegged to deliver a further $1.8bn, with similar schemes in the field of the arts on $920m. Festivals, fairs and annual events are set to accrue $849m, with associations and membership organisations on $572m.

IEG added that the 5.5% lift in sponsorship revenues in North America is likely to outpace the 3% uptick for sales promotion previously outlined by Veronis Suhler Stevenson, and the 2.6% growth in adspend forecast by GroupM.

This confirms a longer-term trend, which has seen the sponsorship category expand at a faster pace than these competing channels during the financial crisis.

"Although moving sponsorship out of its silo and into the mainstream marketing conversation is, overall, a remarkably positive development, it carries meaningful ramifications," IEG said.

"What used to be clearly identified as sponsorships, with discrete budgets and contracts, are now far more likely to be part of multi-platform, cross-channel programs ... where multiple players have a role in planning, execution and evaluation."

Data sourced from IEG; additional content by Warc staff