sponsorship thought-pope

Commentators have found various historical contexts for the origins of sport sponsorship: The wealthy of ancient Greece supported athletic and arts festivals in order to enhance social standing and gladiators could be supported (or owned) by members of the Roman aristocracy for the same purpose (Sandler and Shani, 1993; Cornwell, 1995). But the first modern, commercial use of this promotional activity has been traced to the placement of advertisements in the official programme of the 1896 Olympic Games and the product sampling rights purchased by Coca Cola for the 1928 Olympics (Sandler and Shani, 1993; Stotlar, 1993). Australia may have been the first nation to have been involved in sport sponsorship when, in 1861, Spiers and Pond sponsored the first tour of Australia by the Marylebone Cricket Club, claiming a profit from the activity of ŁAUS 11,000 (Sleight, 1989; McCarville and Copeland, 1994). The first recorded use of the sponsorship of sport in the United Kingdom occurred in 1898, when the Nottingham Forest soccer team (that year’s League champions) endorsed the beverage company Bovril (Marshall and Cook, 1992).

Despite this early history, researchers in the area argue that corporate sponsorship of sport, as it is understood today, is a phenomenon of the period from 1975 to the present (Meenaghan, 1991; Sandler and Shani, 1993). They observe that the largest increase in sponsorship of sport occurred between the 1976 Montreal Olympic Games and the 1984 Los Angeles Olympic Games, partly as a reaction to the losses incurred by the city of Montreal (Stotlar, 1993).

The global expenditure on corporate sponsorships was reported as being $US 5 billion in 1989 (Meerabeau, Gillett, Kennedy, Adeoba, Byass and Tabi, 1991). By 1993 this had increased to an amount reported variously as $US 10.8 billion (Meenaghan, 1994) and $9.6 billion (Cornwell, 1995). The 1988 winter and summer Olympics gained $US 350 million in sponsorship (Hoek, Gendall and West, 1990), while each of fourteen major sponsors of the 1996 Summer Olympics was asked to pay some $US 40 million, seven times "what the 1992 Summer Games sponsors paid and ten times what a 1984 sponsor contributed" (Kuzma et al, 1993, p. 27).

This paper examines the current state of knowledge regarding sport sponsorship and discusses current issues developing in the academic literature examining this phenomenon. The subject matter is approached in the following sequence: the definition of sport sponsorship; research methods used to examine sponsorship; objective setting and evaluation of sponsorship programmes.

There have been difficulties in defining sport sponsorship itself and in delimiting the group(s) of activities that are involved in it. Reasons for this are two-fold: partly from popular confusion with concepts such as charity, philanthropy, endorsement and patronage; and also because of the labelling as "sponsorship" of various activities which might not be considered as such by commentators (Sandler and Shani, 1993, p. 39). For example, the "sponsorship" of a telecast, or the "sponsorship" of tickets (by placing advertising on the reverse) do not fall within the definitions used by most researchers.

Sandler and Shani, in order to eliminate these types of activity from the discussion, offer the following definition:

A problem with this definition is that it ignores the activity of sponsoring a team or individual competitor (or other individual: as in the arts, for example). It does however, strictly categorise the nature of the support, a failing of some other definitions (eg. Armstrong, 1988; Hoek et al, 1990; Gardner and Shuman, 1986). In this paper, the definition of sponsorship that will be used is as follows:

Hoek, Gendall and West (1990, p. 88) describe an "...absence of a coherent body of research..." as a "...feature of sponsorship". This view is supported by other commentators, notably Gilbert (1988, p. 6), who states that a "scan of the literature will show that sponsorship has extremely limited coverage".

Similar comments can be found in Sandler and Shani (1989), Javalgi et al (1994), Meenaghan (1994), and Copeland et al (1996). Research priorities which have been identified in the more recent literature are: ambush marketing, sponsorship’s role in the communications mix, sponsorship selection, corporate image creation through sponsorship, and sponsorship evaluation (Meenaghan, 1994).

But these comments relate to sponsorship purely from the point of view of the academic. Kuzma et al (1993) argue that the practice of sponsorship by marketing practitioners has developed by trial and error and that much has been learnt in this manner. Indeed, "only in recent years have academicians and consultants turned their attention to studying corporate sponsorship in a systematic way and publishing their results in a public forum" (Kuzma et al, 1993, p. 28). This would seem to indicate that practice has preceded theory and that important work has, in fact, been highly empirical, but unfortunately, not always open to academic scrutiny. Where this type of work has been reported (Sandler and Shani describe it as "war stories", 1993, p. 39) it has concentrated on "macro-level issues, such as which companies sponsor events and what their objectives are. Micro-level issues, such as sponsorship’s effect on the consumer, have been largely ignored. Can consumers correctly identify sponsors? How do consumers feel about sponsorship and does it influence their purchase behavior?" (Sandler and Shani, 1993, p. 39).

One reason for relationships between variables not having been established lies in the methodologies used by previous researchers. Most work in the area has been descriptive (Gross, Traylor and Shuman, 1987; Armstrong, 1988; Gilbert, 1988; Abratt and Grobler, 1989; Hoek, Gendall and West, 1990; Witcher, Craigen, Culligan and Harvey, 1991) or prescriptive (Mescon and Tilson, 1987; Ansett, 1989).

Some more recent work has used more sophisticated methodologies such as multivariate analysis (Stotlar and Johnson, 1989; Pope and Voges, 1995), but this work has been into specific aspects of sponsorship, for example stadium signage recognition, and to date such methods have rarely been employed to establish relationships at the macro level of sponsorship activity. Two notable exceptions to this are Javalgi et al (1994) and Sandler and Shani (1989, 1993).

Sandler and Shani (1993) identify three broad categories of sponsorship objective:

3. media objectives (cost effectiveness, reaching target markets) (Sandler and Shani, 1993, p. 40)

Several commentators have noted individual objectives (Gardner and Shuman, 1986; Abratt et al, 1987; Gross, Traylor and Shuman, 1987; Gilbert, 1988; Abratt and Grobler, 1989; Stotlar, 1992). These objectives tend to fit well within the Sandler and Shani (1993) categories. This is presented in tabular form at Table 1.

Table 1: Aggregated objectives for corporations involved in sponsorship of sport

Corporate Objectives

Marketing Objectives

Media Objectives

Personal Objectives

public awareness

corporate image

public perception

community involvement

financial relations

client entertainment

government relations

employee relations

compete with other companies

business relations

reach target market

brand positioning

increase sales

sampling

generate visibility

generate publicity

enhance ad campaign

avoid clutter

target specificity

management interest

Sources: Abratt, R., Clayton, B. and Pitt, L. (1987) "Corporate Objectives in Sports Sponsorship", International Journal of Advertising, Vol. 6, pp.299 - 311. Abratt, R. and Grobler, P. (1989) "The Evaluation of Sports Sponsorship", International Journal of Advertising, Vol. 8, pp.351 - 362. Gardner, M. and Shuman, P. (1986) "Sponsorship: An Important Component of the Promotions Mix", Journal of Advertising, Vol. 16, No. 1, pp. 11 - 17. Gilbert, D. (1988) "Sponsorship Strategy is Adrift", The Quarterly Review of Marketing, Autumn, pp. 6 - 9. Gross, A.C., Traylor, M.B. and Shuman, P.J. (1987) "Corporate Sponsorship of Art and Sports Events in North America", ESOMAR Congress, pp. 9 - 13. Stotlar, D. (1992), "Sport Sponsorship and Tobacco: Implications and Impact of Federal Trade Commission v. Pinkerton Tobacco Company", Sport Marketing Quarterly, Vol. 1 No.1, pp. 13-17. Sandler, D.M. and Shani, D. (1993) "Sponsorship and the Olympic Games: the Consumer Perspective", Sport Marketing Quarterly, Vol. 2 No. 3, pp. 38-43.

Most of these objectives can be categorised into Sandler and Shani’s groupings successfully, but one does not seem to fit well. Sleight (1989) observes that "management interest" is one of the worst reasons to embark on a sponsorship programme, and there is evidence that management has come to (Kuzma et al, 1993). It would appear then, that with the deletion of that objective, Sandler and Shani’s groupings are confirmed both by the literature and in practice. The importance attached to each of these objectives is still debated, however.

Armstrong (1988), Yeo (1989), Witcher, Craigen, Culligan and Harvey (1991), and Javalgi et al (1994) argue that sport's effectiveness as a promotional vehicle lies in its ability to shape corporate image. Other commentators have identified marketing and product/brand related objectives as being the superior effect of sponsorship. Mescon and Tilson (1987), argue that:

In similar vein, Abratt et al (1987), in discussing sponsorship, argue that "an increase in sales is always the ultimate goal" (p. 306). Still others have pointed to such marketing related objectives as Kodak’s use of their 1988 Olympic sponsorship to launch two new products (Stotlar, 1993, p.37), while Cornwell (1995) argues for both marketing and corporate level objectives. In an overview of literature relating to sponsorship, she reports:

The empirical evidence tends to confirm her contention that objectives will be mixed. In a survey of 261 corporate sponsors involved in the 1991 Special Olympics, Kuzma et al (1993) found that their most important objectives were to increase company awareness, improve company image and demonstrate community responsibility, all corporate objectives. Morgan's (1992) findings showed objectives of image being reported by twenty-two percent of his respondents, awareness by forty-two percent and a combination of image and awareness by thirty-two percent. But Gross, Javalgi and Traylor (1992) found forty-one percent citing brand building, although forty-four percent stated corporate image.

Similar results are found in Australia, Canada and the United Kingdom. In all of these cases awareness is linked to image and brand development, and in all cases, corporate image is the highest ranked factor in corporate objectives in sport sponsorship (Marshall and Cook, 1992; Scott and Suchard, 1992; Thwaites, 1994; Copeland et al, 1996).

Some researchers (Marshall and Cook, 1992; Pope and Voges, 1994) still report the setting of media objectives, although Sandler and Shani (1993) note a trend away from these among sponsors over the last fifteen years, a trend they identify as happening in Australia as well as North America. But as will be shown, despite a lack of objectives, media measurement remains the dominant method of sponsorship evaluation.

Arani (1992) links evaluation directly to objective setting, as does Sleight (1989), adding the need to specifically identify anticipated results. But not all of the objectives mentioned by commentators readily lend themselves to quantification (eg managerial interest, synergy, client entertainment), nor is there an abundance of evidence that sponsors engage in evaluation of any kind, let alone of pre-defined objectives. Indeed, Gross et al (1987) found that forty-seven percent of respondents to their survey did not engage in any form of evaluation, and similar findings are reported by Armstrong (1988). Pope and Voges (1994) reported a direct link between the setting of objectives, evaluation and length of sponsorship agreements which showed that shorter sponsorship agreements (less than three years) occurred among those who failed to set objectives and evaluate. It would appear from this that sponsorship agreements without these characteristics are less satisfying to sponsors, if not actually less successful.

Sleight (1989) also emphasises the importance of evaluation, and recommends the use of attitudinal surveys, which would certainly give a justifiable evaluation of corporate related image objectives. He is extremely critical, however, of the use of media survey for evaluative purposes. The mechanism of media survey is based on the television or print exposure of the sponsor's name or logo apart from paid- for media advertising, measured in television minutes or print inches. The estimated monetary value of this exposure, had it been bought, is compared to the monetary cost of the sponsorship. Sleight argues that 1.) the quality of the message is different, 2.) receipt of the message by the audience is not measured, and 3.) the cost of bought advertising is measured only at the highest rate, and few major advertisers ever pay this.

Despite these contentions, figures from media audit are impressive, but it is easy to see that they may be misleading. For example, in a discussion of American media audit by the firm Joyce Julius and Associates, Stotlar, (1992, p.14) observes:

It will also be noted that this form of evaluation does not fit well with many of the objectives given earlier (eg. employee motivation, governmental relations, and product awareness) and it must, therefore, be seen as questionable when used in isolation. Despite these criticisms and difficulties, media audit remains widely used. It also would seem to give some means of measuring media cost-effectiveness.

In terms of market or product/brand related objectives, some evidence exists for accepting sales increase measures. For example, "Visa conducted its own research, which demonstrated market share gains" after the 1988 Olympics (Stotlar, 1993, p.37) and, "Volvo, which has determined that for every dollar spent on its sport sponsorship programs it realizes six dollars in return, has measured the cost effectiveness of sponsorships by the general popularity of an event, media-impressions-generated event growth, and dealer response" (Irwin and Asimakopoulos, 1992, p. 43-44). Similarly, Jeannet and Hennessey (1988) report that:

Demonstrations of such financial benefits are impressive and may account for reluctance to evaluate on the part of those who cannot produce such figures. For example, it has been argued by one group of researchers that "individuals who are responsible for sponsorship may be reluctant to examine its effects because of possible career risk, especially as the amount of money devoted to sponsorship increases" (Javalgi et al, 1994, p. 48 - 49).

As noted by Sandler and Shani (1993, p. 41): "A first step in sponsorship effectiveness is the correct identification of a firm as a sponsor." This correlates strongly with the corporate objectives noted by the same authors. Much research has been conducted into recognition and recall of sponsorship signage. Stotlar and Johnson (1989), in assessing stadium advertising, noted that between sixty-two and seventy-seven percent of attendees at sporting events "noted the advertising" (p. 97). By comparison, Stotlar and Johnson found:

In a repeat of Stotlar and Johnson’s (1989) method, Cuneen and Hannan (1993) found that of 451 subjects at a LPGA golf tournament, ninety-eight percent noticed the advertising, ninety-one percent of these were not consciously looking, and that the most noticed signs (seventy-four percent) were in concession areas, followed by leaderboards (fifty-six percent) and playing tees (fifty-six percent). It was also noted that "sponsors who had products/services available on site were recognized in greater frequencies than those who had not" (p. 55).

Australian research has similarly regarded problems of signage recall and recognition. Analysis of 180 responses to a survey of recall and recognition of televised State of Origin Rugby League matches, led Pope and Voges (1995) to conclude that three or four signage locations are most beneficial for recall and recognition effects at televised stadium sporting events. They also concluded that advertisements in commercial breaks had little or no impact. Shilbury and Berriman (1996) conducted recall and recognition of sponsors and advertisers at the St. Kilda Australian Football League club, observing that sponsorship takes time to be recalled and recognised. But in all of this recall and recognition research, both in Australia and overseas, the emphasis has been placed on the awareness rather than the effect of that awareness.

Corporate sponsorship of sport has received little academic attention, and what has occurred has tended to occur after the practice. Consequently, much research has tended to examine awareness as an individual phenomenon, rather than as the antecedent to an effect. Similarly, practitioners have tended to evaluate sponsorship through media exposure rather than through any other means and little evidence is available to show behavioral response to sponsorship.

In spite of this, there is empirical and anecdotal evidence that awareness of corporate sponsorship of sport impacts on corporate image. The need exists to further examine this phenomenon and increase our understanding of its efficacy.

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