Sponsorship works.

But only when you're selling to a dedicated fan base.

Coke, Ford and ATT each pay upwards of $50 million a year to sponsor "American Idol." Nextel committed $750 million to put their corporate name on NASCAR's Cup series races. Citibank is paying $20 million a year for naming rights to the stadium where the Mets play ball.

Do big-bucks sponsorships deliver commensurate results? A lot of research that we've seen says "No." The general public just doesn't care what brand sponsors which event.

But some recent data indicate that sponsorship may yield a tremendous ROI with one important given: that the target audience is made up of fanatic followers of the sport.

When the general public is surveyed, NASCAR sponsorship doesn't motivate brand selection. When the survey is taken at Daytona or Bristol or Texas Motor Speedway before a race, it's a very different story. Because the effectiveness of a sponsorship depends on how fervently the brand's target audience is involved with the content being sponsored. That content might be online branded entertainment, a TV show, a sporting event, a concert or a participatory event, such as a marathon.

Not surprisingly, people who are true fans can be very motivated by sponsorships. More casual fans don't much care. A NASCAR fan who goes to races is much more likely to choose sponsors' brands than one who watches on TV. A runner in a community marathon may form a positive impression of the marathon's sponsor. It's unlikely that anyone else in the community is knows or cares who the sponsor is.

When the involved and engaged fan or participant base is large enough, sponsorship can be a very effective marketing tool.

A 2007 study published in the Journal of Advertising Research tracked 28 separate internet content sponsorships by marketers including Intel, Sony and Volvo. It found that online sponsorship delivers higher ROI than TV, radio and print. Brands sponsoring internet content averaged 700% greater "intent to purchase" than the "intent to purchase" driven by a typical TV spot.

Those finds were recently reinforced by a 2009 study by the MPI Foundation:

  • 26% of the senior marketing executives surveyed said event marketing is the discipline that drives the greatest return on investment.
  • 53% reported that event marketing is the best tool to build relationships with the target audience.

There is a perceptible shift in sponsorship focus toward online content:

  • 29% of marketers report that they will be shifting from event marketing to experience marketing this year because experience marketing's combination of live and online experiences enable more interaction with target audiences.
  • 68% of respondents are investing in branded entertainment--44% specifically in online content sponsorship.

The study's co-author, Brian Murphy, of TBA Global, credits that shift to online's ability to offer "...strategic and programmatic use of relevant content or entertainment as a focal point to attract, engage and influence targeted audiences."

It may take a few more years, but online sponsorship may eventually rival NASCAR in bottom-line efficacy. And that's a pretty impressive benchmark.

A national telephone survey of 1,000 self-described "big" NASCAR fans by Larry DeGaris, Associate Professor of Sports Marketing at Indianapolis University and Director of the Center for Sports Sponsorship at James Madison University, concluded "NASCAR sponsorship is the best buy in marketing." Among the study's findings were:

  • 96% of self-described "big fans" of NASCAR correctly identified Budweiser as a sponsor of Dale Earnhardt, Jr. (when their logo was on his car).
    Unaided sponsorship awareness averaged 36% for the top 30 NASCAR Nextel Cup drivers.
  • Unaided awareness of official NASCAR sponsors averaged 48% across nine product categories.
  • 51% of NASCAR fans feel that when they buy a sponsor's product, they are contributing to the sport.

Performance Research (a Newport, RI, sports research firm) interviewed 1,000 random NASCAR fans and found:

  • 57% had a higher [level of] trust in products offered by NASCAR sponsors.
  • 71% "Almost always" or "Frequently" choose a product involved with NASCAR over one that is not [involved] simply because of the sponsorship.
  • 46 % of NASCAR fans would pay as much as 10% more to purchase NASCAR-sponsor brands.

Other sports sponsorships also deliver significant results:

The Performance Research study reported fans' choice of brands in relation to sports sponsorships in other sports:

  • 52% of USTA fans choose products based on tennis sponsorship.

  • 47% of PGA fans choose products based on golf sponsorship.

  • 38% NBA fans choose products based on professional basketball sponsorship.

  • 38% major-league baseball fans choose products based on baseball sponsorship.

  • 32% of NFL fans choose products based on football sponsorship.

  • 28% of Olympics fans choose products based on Olympic sponsorship.

The degree to which the target audience cares about an event – "American Idol," a NASCAR race, online content or a participatory event – determines the extent to which that audience will be influenced by sponsorship. A study by Professors Aron Levin, Fred Beasley and Tom Gamble, of the Northern Kentucky University of Management and Marketing, confirmed that fans who score higher on metrics of identification with the event score higher on behavioral brand loyalty. Multiply that "how much they care" metric by "How many of them are there" to reckon the probable effectiveness of a sponsorship investment.

Of course, integration of the brand into the experience is essential. From the Coke glasses on the American Idol judges' table to the Sony web sponsorship's interactive integration, effective sponsorship must be integral to the experience.

And, of course, it should be interactive.

Sponsorship works in the middle level of the Maslow hierarchy of needs: social needs/belonging. It's effective because the brand becomes part of a community to which target audience members also belong. That feeling of community should be carried over into interactive promotional activities that offer opportunities for the fan base to become involved with the brand in addition to their involvement with the sponsored content.

To find about more about leveraging sponsorship possibilities, click here or call 865-330-0033.