BUS203: Principles of Marketing

Many of you have heard of the Staples Center (Figure 12.2), where the Los Angeles Lakers play basketball. But imagine how many more people heard about the Staples Center following the announcement that Michael Jackson’s public memorial would take place there. All the news stories talking about tickets and information about the memorial provided "free" publicity for the center and for the office supplies store, Staples, for which the center is named. Staples paid $375 million for naming rights of the center, which was built in 1998. Indeed, the chain has gotten a huge return on its sponsorship of the center.

Figure 12.2

The Staples Center in Los Angeles is an example of a venue sponsorship. The office supplies store Staples paid for the naming rights to the stadium.

A sponsorship involves paying a fee to have your name associated with different things, such as the following:

• A particular venue (Wrigley Field; the Staples Center)
• A superstar’s apparel (Tiger Woods wearing Nike hats and shirts)
• An event (the AT&T National Golf Tournament; the Chick-fil-A Peach Bowl)
• A cause (M&M’s support of the Special Olympics)
• An educational workshop or information session
• A NASCAR vehicle (by Pfizer, the maker of Viagra; see Figure 12.3)

Even though sponsorships are expensive, they are growing in popularity as corporations seek ways to strengthen their corporate image, increase their brand awareness, differentiate their products, and reach their target markets. Worldwide, corporations spent over $43 billion on sponsorships in 2008; however, the recession has taken a toll and the new stadium for the Dallas Cowboys still doesn’t have a sponsor with naming rights. Over two-thirds of the sponsorships in North America are for sports, followed by entertainment (e.g., music and performing arts) and causes (e.g., the Susan G. Komen Race for the Cure and "alternative spring breaks" for college students). Other organizations and structures, such as buildings and bridges, may seek sponsorships as a means of generating revenue. Imagine how many people drive across the Brooklyn Bridge in New York or the Golden Gate Bridge in San Francisco and how much awareness an organization would get if they were allowed to pay to have their name on either of the bridges.

Figure 12.3

Pfizer, the maker of Viagra, is one of the many companies that sponsor NASCAR racing teams.

Cause-related marketing is one of the fastest-growing types of sponsorships. It occurs when a company supports a nonprofit organization in some way. For example, M&M’s sponsors the Special Olympics and American Airlines raises money for breast cancer research with an annual celebrity golf and tennis tournament. The airline also donates frequent flier miles to the cause. Yoplait Yogurt donates money for breast cancer research for every pink lid that is submitted. Cause-related marketing can have a positive PR impact by strengthening the affinity people have for a company that does it.