Why Do Businesses Sponsor Certain Sports & Athletes?

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A golfer preparing to putt near a stand filled with fans.
A golfer preparing to putt near a stand filled with fans. (Image: Tim Boyles/Getty Images Entertainment/Getty Images)

Small and mid-size businesses use corporate sports sponsorships to enhance their public image and increase awareness, just like larger companies do. In exchange for providing some of the funds an amateur or professional sports team requires for necessities such as uniforms, equipment, facilities and travel, the team promotes the company name. When a business supports a certain athlete, the reason most often relates to attempts to influence customers purchasing decisions.

Increase Market Awareness

Sponsorships generally create cost-effective ways for a small business to get their name out. Most either add their business name to a t-shirt or jersey, or hang signage or banners around the perimeter of a baseball diamond or football field. The team might also give a sponsoring business the opportunity to run a food booth, distribute free fan paraphernalia, such as bobble-head dolls, or sponsor a free t-shirt giveaway where the t-shirt includes both the team’s name and the business’s name.

Community Relations Benefits

Ongoing direct support for a children’s soccer, football or basketball program can help to portray a business as a good corporate citizen. The benefits for some businesses can be even greater when sponsorships are part of a larger community effort to improve the quality of children’s lives or accomplish a specific purpose such as reducing crime. Businesses can also enhance their public image by supporting efforts to construct and maintain community sports facilities, most often through fund-raising events.

“One-up” the Competition

Partnering with a top athlete can be a good way for a small-business owner to establish and maintain a competitive edge. Most often, the more exclusive the relationship, the more effectively a business can work to divert attention away from direct and indirect competitors. For example, the business might hold an in-person autograph event or expand its mailing list by holding a give-away for an autographed item. It also could offer lunch with a local sports celebrity, with a sign-up sheet that asks customers to provide contact information such as a postal or e-mail address.

Endorsements and Transference Marketing

Endorsements are a primary component of a transference marketing campaign. According to Anita Elberse, a Harvard Business School associate professor, athlete endorsements are especially effective at influencing customers purchasing decisions, and ultimately increasing sales. These work because fans tend to transfer the trust and positive feelings they have for a sports celebrity to the quality of an endorsed product or brand. In addition, fans tend to associate a brand or company endorsement with the athletes lifestyle, which for many customers is quite appealing.

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