Why Big Companies Are Investing in Corporate Sponsorships

Think back to the last time you watched a major sporting event on television. How many brand logos did you see in the opening credits alone? If you were paying attention, probably several. In fact, it’s most likely that the arena or stadium where the event took place was outfitted with a corporation’s name. Across all live events, including sports, concerts, festivals, and fashion shows, brands are clamoring for real estate to display their entities and further ingratiate themselves with relevant audiences. In today’s always-on content dominated landscape, corporate sponsorships are responsible for major portions of brand marketing strategies.

It used to be that logos comprised the extent of corporate sponsorships. If brands were willing to pay up they could slap their logos across step-and-repeats, event invitations, and swag. Today, however, brands can explore event associations and partnerships with more creativity.

SAP is one organization that has revamped its approach to sponsorship programs. Understanding that their technology can improve live event experiences, they lead sponsorship programs in which their data provides real-time analytics to athletes, fans, and ownership alike, subsequently improving the in-game experience from all angles. This new approach to sponsorship is showcased in the partnership between SAP and the NHL. Chris Foster, Director of Digital Business Development at the NHL explains, “Together, we’ve tackled not only a hundred years of NHL statistics, but the future of how NHL data is collected, analyzed, and presented to fans around the globe. We have tested in-game player and puck tracking technology, which has the potential to revolutionize the way fans consume the game, the way broadcasters deliver insights to our audiences, and the way players, coaches, and franchises measure and analyze performance.

While corporate sponsorship programs are growing increasingly innovative, one fact remains: they are still driven by money to an extent. For example, this year’s Academy Awards corporate sponsors included Rolex, Swarovski, and Walmart — all brands with deep enough pockets to buy their way into Hollywood’s biggest night. It might seem like growing companies and startups have no opportunity to compete with Fortune 500 corporations for sponsorship spots simply because they don’t have the cash flow. And while a startup like Betterment probably cannot go toe-to-toe with Capital One, there are different ways they can align themselves with major consumer events.

Startups are pushing the envelope at a rate of change arguably faster than their larger, more established counterparts. They enter the market with new ideas and innovations to share, and bigger companies often follow their leads and devise their own branded versions. Startups have the opportunity to align with larger corporations as partners, enabling them to get their feet through the doors of major events.

Sponsorships Allow Brands to Forge Deeper Audience Connections

Sponsorships give brands the opportunity to reinvent themselves, or, at least present another facet of themselves to the public. It’s difficult for a brand like American Express, a credit card company, to come across as cool and culturally tuned-in all on its own. After all, at its core, AmEx is a financial institution and there’s typically nothing less exciting to young consumers than finance and credit. But American Express doesn’t rely on its own likelihood to grow brand awareness and forge deeper connections with consumers — it relies on sponsorships. American Express sponsors events like the U.S. Open and Coachella as a means of meeting target consumers where they are already spending their time and focusing their attentions. By being a part of an exciting live experience, they’re able to reshape the narrative around their own brand. At the 2016 U.S. Open, AmEx created a Pro Walk fan experience that let fans step into the shoes of their favorite players and experience what it’s like to step onto the storied court in front of thousands of screaming fans. As a financial company AmEx is dedicated to serving customers, whether that is through helping them organize their financial health or providing unique lifestyle opportunities for card carrying members to experience. In line with their mission to serve customers and enhance their lifestyles, the augmented reality installation allowed fans to live out their sports fantasies.

Sponsorships give companies, big and small, a means to reintroduce themselves to audiences. But the key to being a successful sponsorship today means never resting on a company’s laurels; fans are no longer paying attention to logos blasted on napkins, but they are tuning into technology-boosted experiences.