To What Extent Is Sponsorship In Sport A Mutually Beneficial Arrangement?
Sports has always been one of the most beneficial and profitable areas for investment, but any money investment leads to certain risks for both sides, sportsmen or team and the sponsor himself, therefore this is always a matter of chance whether sponsorship can become a mutually favorable. This paper aims at proving that sponsorship in sport is mutually beneficial agreement for both parties.
To begin with, it is necessary to define the sport sponsorship and its major aims. Sports sponsorship is one of the most important sources of profit for teams and professional sporting organisations (Watt, 2004). In addition, it is an effective marketing tool for the companies, mainly large ones, having their commercial objectives and aiming at gaining high profits through sports sponsorship (Schwarz, Hunter and LaFleur, 2012). In this respect, the companies and sports entities should have good and mutually trustworthy relationships. Furthermore, the companies should have their own marketing strategies that fit the interests of the sports entity. In this case, the relationships between the sponsor and the sport entity will be fruitful and mutually beneficial. Moreover, the mutual success and benefit of sports sponsorship depends upon the aims of the parties and is not always measured by the funds returned, so saying that mutual benefit is just financial revenue is incorrect, as different parties have different objectives. For the sports entities, being sponsored by the financial organizations is important, because such sponsorship will increase popularity of the entity and interest to the organization-sponsor (Schwarz, Hunter and LaFleur, 2012). The sponsor in his turn receives positive brand image and increases his popularity among the customers (in case if the sponsor is a financial organization).
The sponsorship is a mutually beneficial agreement, which is much fueled by publicity and is presupposed by the numerous political, social and other factors (Watt, 2004). The history of sport sponsorship has witnessed many examples of beneficial sponsorship arrangements and some agreements were extremely long and beneficial for both parties. It is noted that the agreements that work best are those, when each side or partner works hard and faithfully when delivering their objectives. In other words, both parties understand that the more they invest into the sponsorship, the more they can receive from it. One of the examples of successful and mutually beneficial sponsorship is the case when Bank of Scotland was sponsoring the Scottish Football Premier League during seven seasons, in addition to providing it with the annual support funding. As a result of such agreement, both parties turned out to be in the wining situation, as either has received its benefits. The bank has received its credibility and its perception has been greatly changed; furthermore, the bank has attracted more clients and increased its annual turnover. In relation to the league, large competition and recognition throughout Europe were achieved; attractive and entertaining football was encouraged; youth football was developed and, finally, the suitable image for league and its sponsor was developed (Mullin, Hardy and Sutton, 2007).
To sum up, it is necessary to state that sport sponsorship is, in most cases, a mutually beneficial agreement for both, sponsor and the sport entity, as sponsorship is aimed at increasing popularity of the parties, augmenting revenues of the sponsor and improving the image of both. This fact is proved by numerous examples and this is the major reason why nowadays, the sponsorship is so popular.
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