Back on Track
It was miniscule, but it was an increase at least. Spending on sponsorships by North American companies rose a little more than 1 percent to $9.4 billion in 2002, according to Chicago-based IEG, Inc. Brands are showing that they are ready to return to the race tracks, the skate parks, or the next big major league sporting — despite the economy. IEG forecasts that spending will grow 9.1 percent to $10.2 billion this year.
But the nature of the sponsorship game continues to evolve. “Sponsors are getting a lot more for those dollars than they used to, and when you factor that in, the increase is not as dramatic,” says Jim Andrews, IEG Sponsorship Report’s editorial director.
For example, rights holders are more likely to bundle media deals and retail partnerships into sponsorship packages. “Both sides are realizing that more value must be delivered in this economy,” says Brett Smith, VP and partner at marketing shop Fuse in Burlington, VT.
The biggest category, sports, continues to grow and is expected to claim 69 percent of spending in 2003 (up two points). To the surprise of many, sponsors have shown that the age of huge naming rights deals is not over as Coca-Cola forked over $100 million to rename Houston’s Enron Field as Minute Maid Park. In Philadelphia, Lincoln Financial Group signed a 20-year, $140 million deal to name the NFL Eagles’ new stadium Lincoln Financial Field. “It’s a great way to associate your brand with a set of marketing activities,” says Gloster Current, VP-corporate marketing for Lincoln.
Touring attractions
The increase in sports’ share means smaller slices of the pie for festivals, fairs and annual events, as well as entertainment tours and attractions. Both are expected to slip one point to 8 percent this year, per IEG. Within the entertainment segment, non-traditional music tours that merge brands with bands are growing more and more popular. American Honda Motor Co. this year revamped its third Civic Tour with an additional title sponsor (MTV’s Total Request Live) and increased promotional activity. The tour, featuring alternative bands Good Charlotte and New Found Glory, kicks off this month. Marketing Factory, Inc., Venice, CA, created and produced the tour; Irvine, CA-based American Honda Motor Co.’s lead agency, Rubin Postaer and Associates, Santa Monica, CA, handles ads.
In addition to giving away 12 Civic SI three-door cars customized by the bands through sweepstakes and other programs, Honda is incorporating a Civic Tour Non-Stop Music Lounge at most venues. The 35-by-35-foot lounge is sponsored by Alpine, the sound system provider for the cars. Inside, visitors can check out sound equipment or hang out by the video arcade or DJ booth. “Sometimes it’s like the band speaks Russian and the brand speaks Portuguese,” says Rob Tonkin, president and CEO of The Marketing Factory, Inc. “So unless you find a way to marry the two together, you don’t have anything.”
One example of a good fit is painkiller Aleve and the Arthritis Foundation. Bayer Consumer Care Division’s Aleve has signed a three-year presenting sponsorship for the Arthritis Foundation Walk. In its first year in 2002, 43 fundraising walks were held and $1.2 million was generated. “Most people think that arthritis is an old persons’ disease, but female baby boomers are at a higher risk,” says Kelly Gifford, associate VP-strategic marketing alliances at the Atlanta-based nonprofit. “The mature audience and baby boomers are Aleve’s target demos, which worked perfectly.”
The walk will take place in 117 locations this year with an estimated 50,000 walkers. Aleve will activate with sampling and information on the foundation on packaging and at its Web site.
SPONSORSHIPS SNAPSHOT
total spent in 2002: $9.4 billion
Spending inched up 1 percent
Sports sponsorship bounces back after year of decline
Naming rights deals are not dead
