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Ask an Expert: Which Sponsors Are Spending Now

William Chipps is senior editor of IEG Sponsorship Report, a biweekly monitor of the sponsorship industry published by IEG Inc., in Chicago.

What is the state of the sponsorship industry today?
The sponsorship industry is incredibly healthy. The growing popularity of TiVo, iPods, satellite radio, and other forms of the technology that let people tune out advertising messages has promoted more interest in nontraditional marketing vehicles for corporate marketers.

Companies and advertising agencies have also started to realize that sponsorship can be leveraged in many different ways, including on-site sampling, PR exposure, retail promotions, and customer hospitality. So sponsorship as a marketing medium is becoming increasingly popular. IEG expects North American-based companies to spend $13.39 billion in 2006, a 10.6 percent increase over the $12.1 billion spent in 2005.

Where is that money coming from?
We’re seeing a growing number of companies converting large segments oftheir ad spending to sponsorship. That demonstrates the growingimportance of sponsorship to many of these companies.

To what markets should event planners be trying to sell sponsorships?
In addition to the typical automotive, packaged goods, banks, and otherindustries that have traditionally been active sponsors, we’re seeing anumber of emerging categories scouting sponsorship opportunities. Thisincludes everything from cosmeceutical companies (like Botox), online gambling companies, flash drive manufacturers (like Sandisk, Maxell, and Imation), private jet services (like Marquis Jet and Sentient), digital music companies, and even labor unions.

Do you see differences in the things sponsors look for or the way they measure success?
Companies are increasingly putting more focus on tracking return oninvestment. It used to be that companies kind of threw money atsponsorships and hoped for some kind of ROI. Companies have gotten moresophisticated and are actually establishing metrics to measure thesuccess of a particular sponsorship even before they sign a deal. Eachcompany uses different metrics, but it’s definitely a good thing forthe health of the industry because it demonstrates that sponsorshipworks.

Are there other industries or sectors that are stepping up their sponsorship efforts?
Keep [your] eyes open for mature categories going through some kind of change. A great example here would be the film category. Kodak and Fujihave adopted new sponsorship strategies to promote their digitalofferings as the photography category moves from film to digitalproducts.

Erika Rasmusson Janes


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