SBJ/20100517/Marketing/Sponsorship

Firm’s study of sponsorship proposals shows 28 percent drop in asking price for 2009

Whether you were on the buy or sell side of the sponsorship business, you were buffeted by the economy last year. How much damage was done depended on when your last deal was up or which categories you were trying to sell. If it was autos or banking, there wasn’t much movement.

However, indecision and unpredictability froze most marketing budgets, and sponsorship suffered. Like so many things in an industry devoid of, yet desperate for, metrics, quantifying the damage caused by the recession isn’t easy.

However, a study by Montreal-based consultancy Sponsorium of sponsorship proposals received by 65 American companies found that the average asking price in sponsorship proposals (sports and non-sports) dropped a stunning 28 percent last year: from an average of $66,649 in 2008 to $48,261 in 2009.

Most dramatic was the drop in media sponsorships, which plummeted from an average of $440,631 to $103,293.

“That’s a significant drop of premium type [media sponsorship] opportunities that were not being sold in the sector, which had been present the year prior,” said Seth Leeds, senior director of business development at Sponsorium.

Sports sponsorships decreased from an average asking price of $127,443 to $101,427.

And the prognosis for 2010? “Our experience has been that sponsorship tracks right along with the economy,” Leeds said. “We started to see recovery in the third and fourth quarters, along with more flexibility on the sell side, and less emphasis on just static rights.”

Another way of judging sponsorship efficacy is by how Sponsorium’s brand clients gauge how the sponsorship proposals they receive are meeting their needs. Given their multiplicity of touch points, events such as festivals and fairs, along with consumer shows (like boat and home shows), scored the highest on a 1,000-point scale. But festivals and fairs decreased slightly, from a score of 601 to 594. Consumer shows increased slightly from 494 to 500, perhaps showing that in a year where consumer spending decreased, marketers were desperate to find people with money to spend.

The relative cost of sports and media sponsorships were demonstrated here as well: sports sponsorships’ score decreased from 439 to 419; media sponsorships increased from 425 to 432. Because of relative cost and because they are developing sectors in sponsorship, the most upward movement came in areas like health (389 to 410), government relations (393 to 409), education (384 to 403) and leisure (348 to 397).

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