Sponsorship Growth the Lowest in Two Decades
IEG, which claims to be the leading provider of consulting, valuation, measurement, research and training to the global sponsorship industry has announced from its 24th annual annual industry forecast that spending on sponsorship by North American companies, will grow by just 2.2 percent this year. This would be the smallest growth rate in the forecast’s history.
IEG, also said that no other economic downturn in the past two decades has had such a negative impact on the outlook for industry spending. This includes difficult times such as the post-9/11, period which included the the dot-bomb era of the early 2000′s. That down period saw a 2.9 percent growth. Has the sponsorship market matured to a point where growth will become more difficult or are we just seeing the severity of the economic impact finally hitting the sponsorship world?
You probably need to look no further than the dollars spent by the automotive and financial services industries as an indicator to the overall horrific trend of business today. That said, yesterday IEG announced that Worldwide sponsorship spending on amateur and professional tennis tournaments, including leagues and sanctioning bodies will total $581 million in 2009 a 1.3 percent increase from ’08, according to IEG Sponsorship Report.
I have seen first hand some major teams scrambling to fill high profile sponsorships at the 11th hour. This has led to significant reductions in rate cards and standard pricing in order to get the inventory sold in time for events and season’s games.
In a press release last month, IEG announced that the music industry overall has fared better than the industry with North American-based companies expected to spend $1.08 billion to sponsor music venues, festivals and tours in 2009. This would be a 3.8 percent jump from the $1.04 billion spent in 2008.
The May 14th blog should entry also interest you, and it related to Sponsorship Growth. It is called Sponsorship & Addressable Advertising or the April 29th entry which breaks down all of the sponsors in Major League Baseball, called Sponsorship 101 for Baseball
Major League Baseball is the first of the major sports having to work through smaller dollar amounts from sponsors. It will be interesting to see the impact on the NFL season moving forward. Hopefully a better economy in 2010 will help elevate Sponsorship Growth to better times.
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Important Links:
Reuters related story on Sponsorship
Thanks for the mention, Charles. Just wanted to point out that the numbers you cite in the post are actually from the forecast we put out in December, but as the Reuters article mentions, we have this week revised that forecast down in a mid-year update.