Sponsorship is a fast growing form of marketing in the western world. Businesses of all sizes utilise sponsorship opportunities as an effective way to boost their visibility in their community, establish goodwill and develop brand recognition.

Sponsorship Theories

Why Sponsor?

Kotler at al (2009) indentify eight reasons why companies would sponsor events:

1. To identify with a particular target market or life style
2. To increase brand awareness
3. To create or reinforce consumer perceptions of key brand image associations
4. To enhance corporate image
5. To create experiences and evoke feelings
6. To express commitment to community
7. To entertain key clients or reward employees
8. To permit merchandising or promotional opportunities.

Sponsorship impact on consumer behaviour

It is suggested that event sponsorship is able to alter consumers’ behaviour – generate positive feelings towards the sponsor’s brand and increase goodwill that will lead to the purchasing of sponsor’s products in the future. The concept of attitude and goodwill will be looked into in more detail to understand the theoretical basis for this claim.

Attitude

According to Mason (2005), understanding how customers’ attitudes are formed and changed is the key to effective sponsorship.

There are three components that together form an attitude:

1. Beliefs – customers’ cognitive processes and perceptions;
2. Affection – emotional attachments; and
3. Behaviour tendencies

Changing any of the three components will affect a person’s attitude towards a particular company or product.

Sponsorship is able to change the ‘affection’ component by creating a positive association between the event and the sponsor. It can also affect consumer beliefs by altering brand perceptions (Mason, 2005). Both, in turn, can change the behaviour tendencies and result in a positive action such as purchases of the sponsor’s products (Mason, 2005). This is supported by the model of ‘sponsorship effects’ that suggests that positive attitudes are “an antecedent of consumer purchase intentions as well as actual purchase behaviours” (Meenaghan, 2001, Dees et at., 2008). Consumers who develop a positive attitude to a brand are expected to form a purchase intention that will lead to the actual purchase (Dees et al., 2008).

Dean (1999) suggests that people desire their attitudes to be harmonious. They alter the three attitude components mentioned above to achieve consistency (Mason, 2005). And the sponsor hopes that the end result will manifest itself in the form of “positive feelings” linking the event with the company – also termed a “rub off” effect (Mason 2005).

Goodwill

Goodwill distinguishes sponsorship from other types of advertising. It is suggested that consumers reward companies that support events that they like (Meenaghan, 2001, Dees et al., 2008).

Goodwill is described as the positive attitude of consumers towards a sponsor or a brand (Dees et al., 2008). Goodwill is something that is earned by companies providing consistent service and positive shopping experience. Goodwill is something that is priced very high when companies change hands or merge with others. It is the customers’ loyalty and commitment to a brand or a company.

According to the research, people who attend the events are more likely to consider purchasing from the sponsor in the future if they believe that the sponsor is genuinely supporting the event (Dees et al., 2008).

Schema-Based Affect Theory

Schema-Based Affect theory is a follow up on the Fiske’s theory of schema triggered affect (McDaniel et al., 2000). A schema is a category or knowledge based on previous experience that is stored in the memory. A schema, or a memory category, can be more easily retrieved than individual pieces of information. People are more likely to remember the setting of an event, rather than individual details. The theory suggests that information stored in a “schematic fashion” is likely to impact people’s affective and behavioural responses (Dees et al., 2008). It follows that the attitudes and memories formed during a sponsored event re-emerge in similar settings in the future (Dees et al., 2008).

Further research by McDaniel and Heald’s focussed on the effect of promoting unhealthy products like alcohol, tobacco, and fast food on young consumers attending a sporting event. The results suggested that at the next event (e.g., another football game) consumers were likely to purchase products that they saw promoted at the previous events.

There are two key points that can be concluded from this theory:

1. Sponsorship and product promotion is said to affect post event consumer behaviour. Sponsors can expect commercial benefits from the sponsorship in the months following the event.
2. The importance of sponsoring more than one event in order to take advantage of the full potential of the sponsorship opportunity.

Social Identity Theory

Social identity theory suggests that people’s ideas and social identity are influenced by their association with certain social groups or events (Dees et al., 2008). People’s involvement with an event is described as the “extent to which consumers identify with, and are motivated by, their engagement and affiliation with particular … activities” (Meenaghan, 2001; Dees et al., 2008). This is important because the degree of people’s involvement with the event has a direct correlation to their willingness to establish personal or commercial relationships with the sponsor (Dees et al., 2008).

In layman terms, people who are highly involved with the event have a deep understanding of what the event is all about and able to place a value judgement on whether the sponsor is genuinely supporting the event or not. It is closely related to the concept of goodwill discussed previously in this paper. This underlines the importance for sponsors to choose events where their brand is favourably accepted.

Diffusion Innovations

Diffusion of Innovations theory can be used to illustrate the benefits of sponsorship opportunities for small and new companies in the market.

This theory describes the progression of new technological or business ideas from creation to use. It suggests that technological innovations are communicated through a number of defined channels, through the members of a social system (Anderson et al., 2009).

The theory suggests that some individuals have a higher propensity to adopt new products and services (early adopters) than others. The theory demonstrates a good business sense in trying to convince the early adopters first and together with them, present the new services to a wider market (early majority).

Social Systems

Sponsorship is a three-node or “triad” relationship between the sponsor, event organisers and people attending the event (sponsor, sponsee and customers as illustrated by exhibits 2 and 3).

The importance of studying the triad relationship is underlined by research in sociology by Cook et al (1983), Simmel (1950), and others. The social systems theory suggests that the dependency of one node on the other is contingent on the availability and performance of the third node. For example, sponsors depend on organisers to promote the event and attract consumers in the same way as the event organisers depend on the sponsor to provide timely funding for the event.

To be successful, this three-node relationship needs to be in balance – a concept described by the balance theory – a theoretical framework from behavioural psychology (Hummon, 2003) and the structural-hole concept from sociology (Simmel, 1950). The balance theory suggests that a three-way relationship tends to balance out to a point of harmony between the three nodes. For example, a consumer who has a positive relationship with the event organisers will tend to develop positive feelings towards the sponsor, because of the fact that the sponsor also has a positive relationship with the event organisers.

This is often demonstrated by what is known as the “word of month” consumer referrals. People would purchase products just because other people referred them to this company. Sponsorship provides an opportunity to demonstrate this “word of mouth” testimony, by the event organisers endorsing the sponsor’s services.

Attribution Theory

The attribution theory looks into the relationship between the sponsor’s motives and event beneficiaries. It explains the effects of consumer perception of sponsor motives (Ruth at al., 2006).

The theory suggests that people perceive event sponsors in two ways:

1. Sponsors with goodwill intentions
2. Using the sponsorship opportunity as a means to generate more revenue.

The research suggests that goodwill motives of sponsors enhance attitudes of consumers and improve the sponsor’s credibility, whereas the “sale-focussed” motives result in lower brand attitudes and decreased purchase intentions after the event (Ruth at al., 2006).

It is suggested that the sponsor’s “motives will not only influence attitudes toward the event but also likelihood of attending, ad credibility, and attitude toward the named sponsor” (Ruth et al., 2006 p. 8).

Why is this important? It demonstrates that sponsorship opportunities can result negatively on the sponsor if used as a podium for sales pitch propaganda.

Economic Signalling Theory

Economic signalling theory suggests that in a sponsorship framework, consumers’ perception of an unknown sponsor’s brand is enhanced if it is presented alongside a well known brand – when the second brand “signals credibility” (Ruth at al., 2006).

This theory underlines the importance for the event organisers to choose the right major sponsor which will attract smaller companies willing to be presented alongside the major sponsor.

References

Anderson, M., and R. Comrie. 2009. Adopting Preoperative Fasting Guidelines. Association of Operating Room Nurses. AORN Journal 90, no. 1, (July 1): 73-80.  http://www.proquest.com.dbgw.lis.curtin.edu.au/ (accessed July 23, 2009).

Cook, K., Emerson, R., Gillmore, M., Yamagishi, T. 1983. The Distribution of Power in Exchange Networks: Theory and Experimental Results. American Journal of Sociology. 89 (2): 275-305.

Dean, D. 1999. Brand endorsement, popularity, and event sponsorship as advertising cues affecting consumer pre-purchase attitudes. Journal or Advertising. 18: 2-12.

Dees, W., Bennett, G., Villegas, J. 2008. Measuring the Effectiveness of Sponsorship of an Elite Intercollegiate Football Program. Sport Marketing Quarterly 17: 79-89.

Kotler, P., Keller, P., and Burton., S. 2009. Marketing Management. Frenchs Forest: Pearson Education Australia.

Mason, K. 2005. How Corporate Sport Sponsorship Impacts Consumer Behaviour. Journal of American Academy of Business, Cambridge. 7(1): 32-35.

McDaniel, S., Heald, G. 2000. Young consumers’ responses to event sponsorship advertisements of unhealthy products: Implications of schema-triggered affect theory. Sport Management Review. 3: 163-184.

Meenaghan, T.  1991. The Role of Sponsorship in the Marketing Communications Mix. International Journal of Advertising 10, no. 1, (January 1): 35.  http://www.proquest.com.dbgw.lis.curtin.edu.au/ (accessed July 23, 2009).

Meenaghan, T. 2001. Sponsorship and advertising: A comparison of consumer perceptions. Psychology and Marketing. 18(2): 191-215.

Meenaghan, T. 2001. Understanding sponsorship effects. Psychology and Marketing. 18(2): 95-122.

Ruth, J., Simonin, B. 2006.The Power of Numbers – Investigating the Impact of Event Roster Size in Consumer Response to Sponsorship. Journal of Advertising. 35(4): 7-20.

Simmel, G. 1950. The Triad. Glencoe: The Sociology of George Simmel Free Press. Translated by Wolff, K.

Looking For More Information?

Make sure to explore other articles in the Communication category or contact us to suggest a website or a service to review.

Need to FIND something QUICK? SEARCH!