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Sponsorship Evaluation: Moving from Theory to Practice (1)

Theoretical Bases

Sponsorship is based on Exchange Theory
Sponsorship activities principally rely on exchange theory (McCarville & Copeland, 1994), an appropriate transfer of value between parties through the sponsorship.

Sustainable Competitive Advantage
Sport sponsorship has proven to be effective in shaping competitive advantages in the market (Amis, Pant & Slack, 1997).

Movement from philanthropy to ROI
Well documented in the literature and most recently by Sweet in the April 29 Sport Business Journal (p. 27). ROI Drawing Closer Attention from Sponsors. “Many sport sponsors say they are taking a closer look at their return on investment, especially in light of the slow economy and a sport landscape that offers a wider variety of opportunities.”
Stadium naming rights fees, that had seen tremendous growth during the past 10 years, experienced a 16% decrease in value in 2001 (Bernstein, 2001a).
In addition, the downward movement in many corporate stocks and projected earnings shortfalls and decreased company profitability may cause some shareholders to question sport sponsorship as an appropriate expenditure of funds.

The work of Kuzma, Shanklin, and McCally (1993) laid a framework based on a construct for sport organization engaged in packaging and selling sponsorship with an underlying premise focused on sponsor objectives.

Berrett and Slack (1999) contend that a multitude of unique factors within the sponsor’s infrastructure have a substantial influence on sponsorship decisions and tactics. Similarly, Ludwig and Karabetsos (1999) reported a high level of variability with sponsor objectives for the 1996 Olympic Games in Atlanta.

This is represented in the Model through the Input module.
Research in the field has suggested that a variety of corporate objectives can be pursued through sport sponsorship including (Stotlar, 2001, Pope & Voges, 2000; Thwaites & Aguilar-Manjarrez, 1997; Copeland, Frisby, & McCarville, 1996; Irwin & Sutton, 1994; Kuzma, Shanklin & McCally, 1993):

• hospitality
• trade relations
• enhanced corporate image
• increased marketshare
• client acquisition
• product awareness
• on-site sales

Go to the second part of this article

David K. Stotlar
University of Northern Colorado
[email protected]

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