Sponsorship spending worldwide is expected to grow by 4.5% this year to $62.8 billion, according to the 32nd annual industry review and forecast from IEG. That 4.5% growth rate is relatively steady from last year (4.6%) and up from the two prior years (4.1%), as spending on sponsorships is projected to increase at a greater rate than spending on advertising (4.4%) and marketing/promotions (3%).
Those latter figures come from a report from IEG parent company GroupM.
Spending Growth by Region and Property Type
North America remains the world’s largest sponsorship market, according to the IEG report, capturing roughly 37% of the forecast spending this year (or a predicted $23.2 billion). Growth in the North American market will be slightly slower than the global average, though, at a forecast 4.1%.
The fastest-growing region for sponsorship spending last year was Asia-Pacific (5.7%), and it looks to improve its growth rate this year with a projected increase of 5.8%. That would bring the Asia-Pacific total to $15.7 billion, narrowing the gap with spending in Europe (forecast for a 4.5% increase to $16.7 billion).
Looking closer at the North American sponsorship market, the study indicates that sports will account for the lion’s share of spending, with a projected 70% share this year. Sports will also command the fastest growth rate, of 4.3%. With spending expected to reach $16.37 billion, that would equal almost the entire sponsorship spending in Europe.
No other property type comes near sports in the North American market: the next-leading category, Entertainment, is projected to comprise just 10% of sponsorship spending, or $2.3 billion (+3.9%).
Other categories include Causes (forecast 9% share; 3.6% growth to $2.06 billion) and the Arts (4% share; 3.3% growth to $994 million).
What Spenders Think
Highlights from an accompanying survey of 102 sponsorship decision-makers indicate that:
- Category exclusivity is the most valuable benefit to respondents, ahead of on-site signage and the right to property marks and logos;
- When evaluating properties, the most important objectives are creating awareness/visibility, increasing brand loyalty, and showcasing community/social responsibility, with accessing audience data further down the ranks;
- Social media is the most popular channel used to leverage sponsorship, by virtually all respondents (98%), and is followed by on-site interaction (86%) and public relations (84%);
- Among social channels used to promote sponsorships, Facebook (92%) and Twitter (90%) have the broadest appeal, ahead of Instagram (64%) and YouTube (55%);
- The vast majority of respondents intend to either increase (39%) or maintain (49%) their current levels of spending in 2017;
- Three-quarters are considering new sponsorships this year, while 45% are seeking to drop out of a current sponsorship; and
- For almost 6 in 10 decision-makers, ROI from sponsorships has been on the increase. Still, 22% don’t know, perhaps related to 27% not having a budget for measuring return.
