NTL's decision this week not to renew its £4 million sterling (€6.36 million) sponsorship of the British version of Who Wants to be a Millionaire reflects current thinking on the value of broadcast sponsorship. The NTL deal began in spring 2000 and resulted in brand awareness of more than 80 per cent. Now the telecommunications company has decided to focus on consumer awareness of specific NTL products. A survey by Amarach Consulting into the Irish sponsorship industry has found that broadcast sponsorship is becoming an increasingly important area.
Mr John Trainor of Amarach says: "Sponsoring a programme or series delivers high levels of awareness very quickly, which is one of the reasons why it's so valuable."
Fifty-five sponsorship managers were surveyed for the report, which found that over the past three years, eight in 10 companies spent on average less than £250,000 (€317,000) on sponsorship every year, with half spending less than £100,000.
At the upper end of the scale, one in five companies spends more than £250,000 a year on sponsorship. This puts Eircell's £7 million two-year sponsorship of the Irish version of Who Wants to be a Millionaire at the high end of the spectrum.
Sponsorship represents less than 10 per cent of the marketing budget for four in 10 companies. One in five claims to allocate 11 to 20 per cent of all marketing spend towards sponsorship.
A quarter of the companies surveyed expected to increase the proportion of marketing outlay for sponsorship this year. The report suggests this indicates its growing importance within marketing strategy. The key problem with Irish sponsorship is the lack of leverage, the report says. Companies spend money buying sponsorship but fail to capitalise on it.
Every dollar US firms spend on sponsorship is backed by twice that advertising the fact. In Ireland the ratio is more like pound for pound.
"Our advice would be that if a company has £100,000 to spend on sponsorship, they should look for something that is going to cost them say £30,000 then spend the rest of the budget promoting the fact," Mr Trainor says.
