The major tailwinds and headwinds that propelled and buffeted the sponsorship industry last year will continue in 2015, providing marketers across sports, entertainment, cause, cultural and other sectors with reasons to be optimistic but also prepared to fight harder to maintain and grow revenue and return from partnerships.

IEG’s 30th annual year-end industry review and forecast shows continued steady growth in sponsorship spending. But for the second year in a row, the growth rate in North America is projected to be lower than the previous year, while global growth will remain at the same rate as 2014.

Spending by North American companies is projected to rise just four percent in 2015 to $21.4 billion. Growth in 2014 was 4.2 percent, just below the 4.3 percent IEG forecast a year ago.

TOTAL NORTH AMERICAN SPONSORSHIP SPENDING
TOTAL NORTH AMERICAN SPONSORSHIP SPENDING

Globally, 2015 spending is forecast to rise 4.1 percent to $57.5 billion, matching 2014’s growth rate.

TOTAL GLOBAL SPONSORSHIP SPENDING
TOTAL GLOBAL SPONSORSHIP SPENDING

The growth rate for sponsorship spending is expected to hold its own versus other forms of marketing in North America. According to the worldwide media and marketing forecast produced by IEG parent company GroupM—the global media investment management operation of WPP Group plc.—North American ad spending will grow 3.8 percent in 2015. The rise will be driven by double-digit increases in digital spending, which should offset nominal growth for TV and out-of-home, and declines in radio and print advertising.

Spending on other forms of marketing—including public relations, direct marketing and promotions—is expected to grow 3.5 percent in 2015, according to the GroupM report.

ANNUAL GROWTH OF ADVERTISING, MARKETING/PROMOTION AND SPONSORSHIP- NORTH AMERICA
ANNUAL GROWTH OF ADVERTISING, MARKETING/PROMOTION AND SPONSORSHIP- NORTH AMERICA

Internationally, GroupM expects advertising expenditures to rise 4.9 percent, led by nearly 10 percent growth in China, as well as strong spending in Brazil, the U.K., Japan and India. Marketing and promotion spending is projected to grow at the same 4.1 percent rate as sponsorship.

ANNUAL GROWTH OF ADVERTISING, MARKETING/PROMOTION AND SPONSORSHIP- GLOBAL
ANNUAL GROWTH OF ADVERTISING, MARKETING/PROMOTION AND SPONSORSHIP- GLOBAL

Properties Must Determine If Digital Disruption Is Opportunity Or Obstacle

As noted in IEG’s 2014 spending report, marketers’ focus is on digital marketing activity, an emphasis that won’t wane this year. Thus the goal for rightsholders remains positioning their commercial partnership opportunities within the new digital ecosystem.

Properties that do this successfully are those that have recommitted to the fundamental idea at the heart of sponsorship: Be the best at delivering the audience corporate partners seek.

In 2015, that begins with the ability to collect, analyze and apply audience data in order to offer true understanding and insights. Rightsholders must then work with partners on creating value for fans, viewers, participants, members, etc. The end result, often achieved through digital and social means: partners that are relevant to and meaningfully engaged with audiences.

NORTH AMERICAN SPONSORSHIP SPENDING BY PROPERTY TYPE

PROJECTED 2015 SHARES OF NORTH AMERICAN SPONSORSHIP MARKET
PROJECTED 2014 SHARES OF NORTH AMERICAN SPONSORSHIP MARKET

Global Breakout
Excluding North American spending, sponsors from all other parts of the world spent $34.7 billion in 2014. That number should increase four percent to $36.1 billion this year.

Economic conditions in Europe should continue to keep the region at the low end of the growth spectrum, as spending by European companies is projected to grow by 3.3 percent in 2015. While low, that is a significant improvement over 2014’s 2.1 percent growth.

The Asia Pacific region will continue to see strong interest in sponsorship across nearly all countries. Its projected growth of 5.2 percent should outpace Central and South America, even with the contributions from sponsorship spending connected to the 2016 Olympic Games in Rio de Janeiro.

GLOBAL SPONSORSHIP SPENDING BY REGION