Sponsorship is an avenue of marketing that can have many benefits, as long as the events or products sponsored are correctly targeted and relevant to the objectives the company wants to achieve.

The Benefits of Sponsoring Events

Sponsoring gives large companies an opportunity to be seen by their clients, employees and stakeholders to support another brand that holds desired values and prestige. They can thus take advantage of the ‘reflected glory’ that association with a bigger and possibly more established brand can bring.

Sponsoring enables large companies to focus on specific sections of their target audience, such as ethnic minorities (sponsoring an ethnic minority event) or sports lovers (sponsoring a game) and therefore resonates more strongly with niche audiences than a mass promotion and in today’s world, reaching a target audience and showing your customers that you are interested in them is incredibly important. Sponsoring not for profit or charities also sends positive CSR messages about the large companies. As consumer decisions are increasingly influenced by the extent of corporations CSR agenda, this is becoming a more pertinent factor in sponsorship decisions. This is also a great way to gain additional marketing collateral, as the wider consumer press tends to cover charity and sporting events much more readily than corporate ones.

Large companies can also garner support in its immediate operating area or distribution points by sponsoring local community projects. While this is also important for local businesses, even large multinational corporations have acknowledged the great benefit to be gained from establishing an interest in small local communities, as a vehicle for representing themselves in the light of a ‘company that cares’ at a local level.

Sponsoring also can bring a ‘cool factor’ to a company’s brand by choosing fashion, art, music, racing events, brands to sponsor, take a look at the likes of Red Bull and Virgin who have achieved great success by sponsoring events. Companies that may be completely un-associated with art for example, like a bank, will choose to establish an interest via sponsorship, in order to give themselves a ‘corporate’ or ‘intellectual’ or ‘cultural’ profile in the minds of their high-end customers. It can thus serve as a complimentary component of branding.

Sponsoring not only allows the company to communicate to its sponsorship to its employees, customers, stake-holders but also to the wider audience it is accessing via sponsorship. By associating itself with and event or brand it will indirectly be accessing the database and extending its reach beyond its typical or traditional sphere of influence.

Other than having its brand on marketing materials, large companies often, via sponsorship buy access to events or special seating areas, tickets, private dinners etcetera that bring kudos when they invite their key clients and employees to attend. Sponsors are often given priority at events in terms of table, seat or box allocation and this can be key in networking at the event, as well as giving them added prestige among VIP clients invited to take advantage of their access to the event.

Sponsoring a specific area such as art sends a message to its target audience (art lovers) that the company is ‘my kind of people’ and therefore that their values are in sync, for example Deutche Bank sponsors the Frieze Contemporary Art Fair, in Regents Park, London each year, and in turn the bank is therefore able to give their clients and key staff special access to the fair.

Sponsoring of historic events such as the Olympics, gives corporations the opportunity to participate in something with great historic significance. This is a massive press opportunity as coverage will be worldwide and comprehensive. It gives companies unparalleled access to markets across the globe, and at the same time associates them with the ‘best in the world’ calibre of participants. Sponsoring individual teams can also bring the added benefit of being seen as supporting their home country and building a strong profile as a British (for example,) company.

In the short term benefits accruing from sponsorship are largely that such associations promote the company brand to a new audience through exposure of ‘sponsor logos’.

In the long term benefits can include helping to build relationships when clients and employees are invited as guests to sponsored events. It further builds trust in clients and employees that the company is supporting ‘good causes’. Moreover the subliminal effects of repeated exposure to logos in association with prestigious social, cultural, sporting and charitable events is well documented, hence the corporate sponsorship of Formula 1 racing. One study showed that the most common brand often associated with Formula 1 racing, in the minds of spectators, was Pirelli Tires, which has never sponsored a car, but has always had their banner most prominently and strategically displayed over the race-track.

Long-term collaborations resulting from sponsorship, such as Pirelli and Formula 1, can build a company image for years to come in the minds of the public and help a brand to align itself with within a particular sector that may be outside its direct traditional domain. They can also help off-set a negative image that the company has been struggling with, so for example, McDonalds has recently launched an ‘Olympic Plan to get Kids moving’. In addition as a top-tier International Olympic Committee sponsor, McDonald’s will provide the only branded food in the Olympic Park and the Athlete’s Village, including its largest restaurant in the world; all this to dispel its image as a purveyor of unhealthy food. So it stands to reason that sponsorship works and is an invaluable marketing tool.

Originally featured in Business Review Europe, May 2012.

Curzon PR is a London-based PR firm working with clients globally. If you have any questions, please feel free to contact our Business Development Team [email protected]