Sponsorship marketing: evolution of the sponsorship industry

Anyone who knows sponsorship understands that it is an unquestionable value to give visibility to the brand and, within the marketing strategy, a fundamental tool to connect it with its target audience. Organizations use corporate sponsorship to create an emotional connection between the brand's value and mission and its audience. This connection helps to generate greater loyalty and a positive perception of the brand in consumers and customers. 

Corporate sponsorship is a common practice in business, where the brand finances or supports a person, team, event or project with the objective of obtaining a return and improving its brand positioning.

In its early days, one of the most important corporate sponsorships in living memory was by the Philip Morris tobacco company in 1972, when Marlboro sponsored the BRM Formula 1 team, which took a victory in that year's Monaco Grand Prix. This event became a success and proved that corporate sponsorship could be an effective marketing tool. In the 1980s, corporate sponsorship expanded into sports and companies began sponsoring sporting events and teams. One of the earliest and most successful examples was Nike's sponsorship of basketball player Michael Jordan, which helped boost sales of its sneakers.

Nowadays there are different types of sponsorship, such as sports sponsorship, where a company sponsors a team, an athlete or a sporting event. Cultural sponsorship is also common, when a company supports a cultural institution or event, such as a museum, an exhibition or a music festival. Similarly, and increasingly common, is the so-called social or cause-based sponsorship, whose investments are increasing, due to social awareness and sustainability policies that are forcing many companies to focus on environmental, social and governance style (ESG), which undoubtedly implies an exercise in transparency in order to reduce risks and detect opportunities.

On the other hand, there are important challenges facing the sponsorship industry, such as increasing competition, which is forcing many companies to be much more selective in their decisions and to focus on differentiation. Likewise, they must adapt to changes in consumer habits, new applied technologies and, increasingly, analyze reputational risks, since social networks have become a double-edged sword where any controversy or scandal can be transferred in real time and globally, immediately affecting the reputation of the sponsored brand, causing the loss of large sums of money in a short time.

However, one of the biggest challenges facing companies today has to do with measuring the attribution and return on investment of sponsorship. This is what 92% of sponsorship experts from leading companies say according to the study to be published at the end of March by ICEMD, the Innovation Institute of ESIC Business & Marketing School: Sponsorship Marketing - Trends in Sponsorship 2023. Measuring, measuring and measuring is more relevant than ever. Technology is providing a more efficient solution to calculate the return on investment of campaigns through data analysis, applied artificial intelligence, blockchain, data models and tools that offer professionals greater analytical capacity to measure the success of each sponsorship action. On the other hand, the use of applied technologies for the automation of reports is a trend, allowing the generation of detailed reports on the ROI of campaigns quickly and efficiently. This saves companies time and resources and allows them to make investment decisions for future campaigns.

Corporate sponsorship opportunities

There are also opportunities that are constantly evolving this field through innovation. The most prominent trends are:

Going digital

With the COVID-19 pandemic, many companies have turned to sponsorship of electronic sports or eSports which are gaining popularity around the world and becoming a growing industry. Companies are sponsoring eSports teams, players and tournaments to reach new audiences.

Cause-based sponsorship

As I noted, companies are increasingly using sponsorship to support social and environmental causes. This approach allows companies to enhance their brand image and connect emotionally with their target audience.

Sponsorship customization (adhoc)

Companies are customizing their sponsorships to suit the needs of their target audience. This involves choosing events, characters and athletes that are aligned with consumers' interests and creating personalized experiences for them.

Technology integration

Through technologies such as blockchain and artificial intelligence to improve the measurement and tracking of sponsorship ROI.

Sponsored LiveStreaming

Live broadcasting sponsored by an influencer, streamer or other type of content creator to broadcast your brand or product.

In short, the sponsorship industry has evolved significantly over the past 5 years and is expected to continue to change and adapt as trends change and new technologies emerge. But without a doubt, the trends we are going to see the most in the coming years have to do with an increased focus on ROI, looking for more and more reliable and accurate metrics. On the other hand, we will see an increase in personalization in order to attract an increasingly segmented target and improve the emotional connection with consumers, enhancing augmented and virtual reality experiences. We will also see a greater focus on corporate social responsibility or ESG and a strong integration of technology in the sponsorship industry.

If you want to stay informed about trends in the world of sponsorship, sign up to receive the next Innovation Series of ICEMD, the Innovation Institute of ESIC: "SPONSORSHIP: THE WAY TO REACH YOUR AUDIENCE " https://icemd.esic.edu/knowledge/estudios/innovation-series-patrocinios/