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3. How sponsorship evolved
In this chapter the origin and evolution of sponsorship will be described. First the term sponsorship will be defined. A brief introduction will be given in academic research in the field of sponsorship. Than a review on the evolution of sponsorship will be given. It starts from its origin in philanthropy, via early sponsorships and cause-related marketing to sponsorships fully integrated in the marketing-mix. From that point sponsorship is seen as to be evolved to strategic sponsorship, and in a most developed status a sponsorship can be seen as a co-marketing alliance.
3.1 Defining sponsorship
In this period only in Amsterdam four cultural institutions were found with this new money: Rijksmuseum (1885), Concertgebouw (1888), Stadsschouwburg (1894) and Stedelijk Museum (1895), and in the beginning of the 20th century several cultural institutes with private money followed: Rembrandthuis (1906), Scheepvaartmuseum (1916/1918) and Koloniaal Instituut (1910/1926) (Steenbergen, 2008). This can not be seen as corporate sponsorship, but as (corporate) philanthropy. There were no direct commercial reasons for investment in arts and culture. The private parties donated money because of prestige and interest for culture. However, cultural involvement had a positive influence on the image of the donating persons and their companies and brands.
A good example of successful fund raising in the early 20th century is the case of the Scheepvaartmuseum (Maritime Museum) in Amsterdam (Steenbergen, 2008). The Amsterdam harbour was the most important harbour of Netherlands in that time. The foundation needed 1 million Dutch guilders (times 15 to estimate the current value) to finance the building and collection of the museum. The chairman of the foundation, the shipowner Stoomvaart Maatschappij Nederland, started donating 100.000 guilders with his own company. By asking his network of shipowners, shipbrokers, transhipment companies and traders in Amsterdam he managed to get 640.000 guilders after the first meeting. Besides goodwill all donors also had commercial interest in the museum where they could promote their company, as competition with the harbour of Rotterdam was increasing. Within several months the foundation found all funds because board members of donation companies started to raise funds in their own network, especially traders and bankers. The following years the board members of the Scheepvaartmuseum kept on investing in the collection and therefor the museum became a valuable and prestigious project to be identified within the industry. This model can be seen as collective patronage by network systems.
In contrast with the current situation, in the beginning of the 20th century most cultural and civil institutions and initiatives were initiated by private parties and than they tried to get the government involved in it as well (Steenbergen, 2008). In that time governments got hardly budget for sewerage and garbage collection and so art had not a high priority. Another reason why art traditionally mostly was financed by private parties was that the audience almost exclusively existed of the higher class (Steenbergen, 2008). However, this started tot change in the end of the 19th century. In 1872 the Dutch gentlemen society De Grootste Club included in their society objectives that they would do now something for Amsterdam (Steenbergen, 2008). Within this society they collected funds for their civil initiatives like arts and culture which would be available for a broader audience.
After WWI the traditional collective patronage by rich entrepreneurs started to change (Steenbergen, 2008). The younger generation rather bought a car than a painting. But the structure of museums, concert halls, orchestra's and theater groups were fundamented (Steenbergen, 2008). The whole infrastructure like the buildings, collections but also the exploitations costs were covered by private parties. In 1945, after WWII, the support by private parties decreased rapidly because lack of money, but government institutions could easily take over the existing structure to save institutions to disappear (Steenbergen, 2008).
Something else changed after WWII. Where traditionally society was leaning on strong family bonds, religion and social classes, individualism increased rapidly and with that individual philanthopy was taking over the collective patronage (Steenbergen, 2008). The peergroup pressure which made entrepeneurs donating more into charity and arts was disappearing (Steenbergen, 2008). From here giving money for arts and culture started to become more a marketing thing than a philanthopy thing, and the market-driven nature of contributions resulted in a change in the use of terms from philanthropy to sponsorship (Cornwell, 1995). Giving money for arts and culture should pay off and therefor is a corporate investment. From here we can talk about (corporate) sponsorship.
Early sponsorship
First commercial sponsorships date back in the end of the 19th century, although such sponsorships were rare. For example the Dutch bicycle race team of Jaap Eden was sponsored in 1896 by tire producer Humber-Dunlop (Hover & Breedveld, 2009). Sponsorship as a marketing promotion tool started to increase slowly since early 1950s (Cornwell, 1995). Since the late 50ties big American corporations started to invest in arts; for example Chase Manhattan Bank and Philip Morris were engaged in art collections and supported symphonies (Rectanus, 2002). David Rockafeller (chairman of the board of Chase Manhattan Bank) established in 1967 the Business Committee for the Arts (BCA), which should encourage business leaders to support arts (Rectanus, 2002). Supporting arts would improve public relations and morale of employees and help attract qualified personnel. Rockafeller’s ideas were beyond corporate philanthropy or patronage. Corporate interest in arts became an instrument for maintaining and documenting social legitimacy.
In the 1970s and 1980s sponsorship grew in popularity (Rectanus, 2002). Lokerman (2004) stated modern sponsorship started in 1970 in Netherlands, as from than on sponsorship was not only utilized accidentily but more structural.
Sport sponsorship preceded cultural sponsorship, social and environmental followed in the late 80s in the US and the late 90s in Europe (Rectanus, 2002). In the beginning of the 1990s cultural organizations started to search for more funds, sponsors included, as governments started to cut more on culture (Rectanus, 2002; Steenbergen, 2008). Besides of that markets emerged in Europe due to the EU and increasing corporate globalization. In the early 90s financial support for causes became integrated in corporate identity, marketing communication and public affairs (Rectanus, 2002). It seems corporate philanthropy started to be taken over by cause-related marketing in the early 1990s (Varadarajan & Menon, 1988; Cornwell & Maignon, 1998; Rectanus, 2002).
Cause-related marketing
Traditionally sponsorship had a big philanthopic reasoning. Corporate involvement in social issues began as voluntary reponse by firms, than evolved into mandated corporate involvement. During early 80ties many corporations still perceived support for culture as philanthropy however in the late 1980s corporate philanthropy evolved in a phase in which social involvement in social issues is viewed as an investment. Based on these rationale of profit-motivated giving the new term of "cause-related marketing" emerged (Varadarajan & Menon, 1988). Cause-related marketing (CRM) can be seen as corporate philanthropy, or sponsorship with which firms show social involvement.
Nickson (1991), former director of development at ENO, replied on this blame explaining the development with a postscipt by the sponsorship programme manager of Peter Wilkinson of IBM, sponsering arts since 1970. In the end 1980s governments were cutting expenditures on arts, and therefore among others ENO needed to find new ways to finance their programme. At the same time sponsors were competing for profile and sponsorship had potential. As Wilkinson writes in Nickson (1991): "There is the relationship that can build up between the organizations leading to exhanges of skills and ideas. Business can offer its expertise in management, promotion and marketing; the arts can offer creativity and a window on a wider world." Nickson writes: "ENO welcomes sponsorship, not only for the much needed money, but for the enthusiastic new audiences and powerful new friends it brings." Besides filling the gaps in the budgets, sponsorship encourages innovation in the arts organization at a business level, what subsidising governments cannot. In the end arts and commercial firms are in the same business of selling and reaching their audiences.
Also in sports corporate sponsorship was not immidiatily accepted by its audience. For example the introduction of shirt sponsorship at the Dutch soccer premiership "Eredivisie" in 1982-1983 caused for much fuss (Hover & Breedveld, 2009). In the end of the 1980s firms were searching for the balance between the social part and the profit part as cause-relative marketing became more socially accepted by both the firms and the not-for-profit organizations (Varadarajan & Menon, 1988). However, in 1990 the Eredivisie was renamed to "PTT-Telecompetitie" after the league its main sponsor, the Dutch telecom company PTT (now operating as KNP). Again, audience got much difficulty accepting this sponsorship involvement in sports (Hovern & Breedveld, 2009).
Sponsorship as an integral part of the marketing mix
From the mid 1990ties sponsorship became an integral part of the marketing mix and became also a subject of research (Cornwell, 1995). The idea of sponsorship as a marketing promotion tool was not new in the 1990s, the implementation of it was, because it became rapidly more popular among corporations (Cornwell, 1995). Mainstream advertising, especially at big events like Olympic Games, were very popular in the 1990s so the costs were high. Sponsorship became a more cost-effective tool to engage to (Cornwell, 1995). And with sponsorship mass media could also be reached. Besides of that sponsorship relationships had much more potential than advertising. That time sports sponsorship became one of the largest markets for the alcohol and tobacco industry (Rectanus, 2002).
Rust & Oliver (1994) forcasted advertising would be death by 2010. Also Zyman (2001) stated advertising is death as it was known. However, advertising is not death, but tradtional advertising is outdated and needs re-evaluation. Zyman (2001) states advertising is about "selling more stuff more often to more people for more money" and traditional mass advertising became so expensive it does often not give as much return on investment as for example sponsorship can do if utilized well
The rapid growth of sponsoring during the 1980s and 1990s was facilitated by an increasing awareness of new definitions and uses of culture and sports within the contexts of everyday life (Rectanus, 2002). Sponsorship became a corporate communication method. The “new partnership” between corporations, cultural institutions, sport entities and communities, attempt to engage audiences on an emotional level, also outside their product (Rectanus, 2002). Sponsorship became integrated into corporate identity, communication and management philosophy (Rectanus, 2002), but also in stragetic plans (Varadarajan & Cunningham, 1995).
Objectives of sponsorship
Firms and organizations of all sizes and markets are involved in sponsorship. Some sponsorships are almost pure philanthropic, some are pure commercial. Sponsorship can be utilized in many different models and can have many different objectives. In table 1 a list of possible objectives for a firm to engage in sponsorship is given. Cornwell (1995) devided the objectives into corporate and marketing objectives, and additional objectives from Amis et al. (1999) are added or integrated into the tabel. Sponsorship are rarely utilized to fullfill one single objective, more likely a combination of multiple objectives. Note that the "Personal interest of a senior executive" as an objective is actually not a direct corporate objective.
NOTES
A history of patronage in mainly Netherlands can be found in (Steenbergen, 2008). Sponsorship has its roots in patronage. However, this book focuses on the traditional art and museums.
Schreiber (1994): “In reality, corporate philanthropy has been almost entirely replaced by cause-related marketing. What’s the difference? Simply that philanthropy was sometimes giving money away. Lifestyle marketing, of course, gives money too. But it goes beyond that. It shares values. It’s an overt demonstration and statement that a company not only gives cash but shares certain attitudes and beliefs with its consumers. There is also more of a synergy to lifestyle marketing than to philanthropy.” Quoted in (Rectanus, 2002).
3.1 Defining sponsorship
When the first studies toward the phenomenon of sponsorship appeared, researchers attempted to define sponsorship. Several definitions are use to describe sponsorship in the past decades. Cornwell & Maignan (1998) mentions and criticised a few definitions from early sponsorship studies: "... sponsorship can be regarded as the provision of assistance either financial or in-kind to an activity by a commercial organization for the purpose of achieving commercial objectives" (Meenaghan, 1983). A clear goal of sponsorship is lacking, and it implies sponsorship can not be of non-commercial kind. Clearer goals are included in the definition by Gardner & Shuman (1988): "Sponsorship may be defined as investments in causes or events to support corporate objectives (for example, by enhancing corporate image) or marketing objectives (such as increasing brand awareness)." Otker (1988) included the managerial aspect is his definition: "Commercial sponsorship is (1) buying and (2) exploiting an association with an event, a team, a group, etc., for specific marketing (communications) purposes." As many examples exist where sponsorship is not solely used to reach marketing objectives, but also to reach other corporate objectives, Cornwell (1995) defined sponsorship as "Sponsorship is investing in causes and or events to support overall corporate objectives and or marketing objectives."
Sponsorship utilized as solely marketing communication tool, either directly linked or in-direct linked to the product marketed, can be called sponsorship linked-marketing (Cornwell, 1995). A direct link is where the sponsorship directly links to the product as it is used, consumed or demonstrated, for example Peavey Electronics Corp., a manufacturer of a range of musical instruments, sponsoring a rock music tour. An indirect linkage may link to consumers as they watch, attend, and/or participate, for example Jägermeister sponsoring a rock music tour as it believes the audience as possible consumers of its product.
With the sponsorship-linked marketing approach focus lies on the link, as a sponsorship usually requieres some kind of association between the sponsor and the sponsee. Hence, Cornwell (1995) defines sponsorship-linked marketing as: "Sponsorship-linked marketing is the orchestration and implementation of marketing activities for the purpose of building and communicating an association (link) to a sponsorship". The word orchestration was chosen by Cornwell (1995) in preference to planning, as sponsorship necessitates harmonious organization. The elements in sponsorship linking are not new to marketing planning, but the challange of successful implementation of sponsorship lies in the coordination of interacting employees, audiences, voluneers, events, activities, sales promotions, merchandise, co-sponsors, media, etc. (Cornwell, 1995). Also the word marketing was used in preference to promotion, as promotion implies sponsorship is limited to communication alone, however the implications of sponsorships extend beyond (Cornwell, 1995). More about the sponsorship-linked marketing can be found further in this paper.
With the sponsorship-linked marketing approach focus lies on the link, as a sponsorship usually requieres some kind of association between the sponsor and the sponsee. Hence, Cornwell (1995) defines sponsorship-linked marketing as: "Sponsorship-linked marketing is the orchestration and implementation of marketing activities for the purpose of building and communicating an association (link) to a sponsorship". The word orchestration was chosen by Cornwell (1995) in preference to planning, as sponsorship necessitates harmonious organization. The elements in sponsorship linking are not new to marketing planning, but the challange of successful implementation of sponsorship lies in the coordination of interacting employees, audiences, voluneers, events, activities, sales promotions, merchandise, co-sponsors, media, etc. (Cornwell, 1995). Also the word marketing was used in preference to promotion, as promotion implies sponsorship is limited to communication alone, however the implications of sponsorships extend beyond (Cornwell, 1995). More about the sponsorship-linked marketing can be found further in this paper.
3.2 History of sponsorship research
Although the phenomenon of sponsorship does exists for several decades and started to become a marketing tool in the 1950s, academic research to sponsorship was lacking for a long time. In the 1980s the amount of money spend on sponsorship worldwide has grown rapidly; from 2 billion in 1984, 4,3 billion in 1993 and 44 billion in 2009 (see figure XXX). This resulted into the first academic research to sponsorship as a phenomenon distinct from other promotional activities launched in the mid 1980s, and an increase in the early 1990s (Cornwell & Maignon, 1998). Still as part of marketing research, although in the end of the 1990s sponsorship got attention from a strategic management point of view (Amis et al., 1999).In the early stage of sponsorship it was a new corporate activity and was lacking of an own status within the organisation and therefor needed to be associated with another group within the business. Researchers found sponsorship to be associated with advertising, public relations, promotions or personal selling, or even to be directly under the responsibility of the CEO (Cornwell & Maignan, 1998).
Cornwell & Maignon (1998) published a, according to them, first review of sponsorship research before 1998. This review was limited to the sponsoring firm and not from the perspective of the event organizer. Cornwell & Maignan (1998) identified five streams of sponsorship research: 1)nature of sponsorship, where definitions and characteristics are described, 2)managerial aspects of sponsorship, where corporate motivations and objectives are described, 3)measurement of sponsorship effects, where effectiviness are eximined, 4)strategic use of sponsorship, and 5)legal and ethical considerations in sponsorship. Measurement of sponsorship effects is not part of the objectives of this study and therefor not further being reviewed, neither are the legal and ethical considerations. Literature on the strategic use of sponsorship kept most attention after 1998, which also got the most attention for this study.
The first studies (mid 1980s) on sponsorship deal with the description of the phenomenon of sponsorship (Cornwell & Maignan, 1998). Definition and characteristics are presented in these studies (Meenaghan, 1983; Gardner & Shuman, 1988; Otker, 1988). These early sponsorship studies were necessary to establish sponsorship as a new topic of research. Although these studies show an increase in use of sponsorship as a marketing tool, they do not provide explanation of this development (Cornwell & Maignan, 1998). In the end of the 1990s studies started to apply the resource-based view of the firm (Wernerfeld, 1984) on sponsorship relationships and see them as a resource to create competitive advance (Farrelly et al., 1997).
Many researchers attempted to identify the motivations and objectives why corporations invested in sponsorship. Also the attempt to describe the audience targeted by sponsorship was an topic of interest in the early stage of sponsorship research (Cornwell & Maignan, 1998).
Managerial aspects of sponsorship vary according to the type of firm engaging in sponsorship and the type of cause sponsored (Cornwell & Maignan, 1998). Sponsoring an arts museum requests a different approach as sponsoring a sports event and a soft drink company needs a different managerial approach towards sponsorship as an airplane producer.
The effect of sponsorship, in an direct or in-direct financial way, got the interest from businesses investing in sponsorship. And therefor many researchersattemptto measure the effectiviness of sponsorship (Cornwell & Maignan, 1998). In most cases sponsorship does notdirectlylead to increasing profit (whatis always the goal of a companyin the very end). An increase in brand awareness, what sponsorship easily can result to, does not neccesarily lead to increasing sales (Zyman, 2002).
Cornwell & Maignon (1998) found that there was a big lack of research on strategic use of sponsorship before 1998. However, the last decade it got much more attention.
Although the phenomenon of sponsorship does exists for several decades and started to become a marketing tool in the 1950s, academic research to sponsorship was lacking for a long time. In the 1980s the amount of money spend on sponsorship worldwide has grown rapidly; from 2 billion in 1984, 4,3 billion in 1993 and 44 billion in 2009 (see figure XXX). This resulted into the first academic research to sponsorship as a phenomenon distinct from other promotional activities launched in the mid 1980s, and an increase in the early 1990s (Cornwell & Maignon, 1998). Still as part of marketing research, although in the end of the 1990s sponsorship got attention from a strategic management point of view (Amis et al., 1999).In the early stage of sponsorship it was a new corporate activity and was lacking of an own status within the organisation and therefor needed to be associated with another group within the business. Researchers found sponsorship to be associated with advertising, public relations, promotions or personal selling, or even to be directly under the responsibility of the CEO (Cornwell & Maignan, 1998).
Cornwell & Maignon (1998) published a, according to them, first review of sponsorship research before 1998. This review was limited to the sponsoring firm and not from the perspective of the event organizer. Cornwell & Maignan (1998) identified five streams of sponsorship research: 1)nature of sponsorship, where definitions and characteristics are described, 2)managerial aspects of sponsorship, where corporate motivations and objectives are described, 3)measurement of sponsorship effects, where effectiviness are eximined, 4)strategic use of sponsorship, and 5)legal and ethical considerations in sponsorship. Measurement of sponsorship effects is not part of the objectives of this study and therefor not further being reviewed, neither are the legal and ethical considerations. Literature on the strategic use of sponsorship kept most attention after 1998, which also got the most attention for this study.
The first studies (mid 1980s) on sponsorship deal with the description of the phenomenon of sponsorship (Cornwell & Maignan, 1998). Definition and characteristics are presented in these studies (Meenaghan, 1983; Gardner & Shuman, 1988; Otker, 1988). These early sponsorship studies were necessary to establish sponsorship as a new topic of research. Although these studies show an increase in use of sponsorship as a marketing tool, they do not provide explanation of this development (Cornwell & Maignan, 1998). In the end of the 1990s studies started to apply the resource-based view of the firm (Wernerfeld, 1984) on sponsorship relationships and see them as a resource to create competitive advance (Farrelly et al., 1997).
Many researchers attempted to identify the motivations and objectives why corporations invested in sponsorship. Also the attempt to describe the audience targeted by sponsorship was an topic of interest in the early stage of sponsorship research (Cornwell & Maignan, 1998).
Managerial aspects of sponsorship vary according to the type of firm engaging in sponsorship and the type of cause sponsored (Cornwell & Maignan, 1998). Sponsoring an arts museum requests a different approach as sponsoring a sports event and a soft drink company needs a different managerial approach towards sponsorship as an airplane producer.
The effect of sponsorship, in an direct or in-direct financial way, got the interest from businesses investing in sponsorship. And therefor many researchersattemptto measure the effectiviness of sponsorship (Cornwell & Maignan, 1998). In most cases sponsorship does notdirectlylead to increasing profit (whatis always the goal of a companyin the very end). An increase in brand awareness, what sponsorship easily can result to, does not neccesarily lead to increasing sales (Zyman, 2002).
Cornwell & Maignon (1998) found that there was a big lack of research on strategic use of sponsorship before 1998. However, the last decade it got much more attention.
3.3 Philanthropy
However sponsorship goes back to Ceasar's gladiators in 65 BC (Cornwell, 1995; Hover & Breedveld, 2009), this study will concentrate on the evolvement of modern sponsorship, which got its roots in philanthopy and fund raising. In the end of the 19th century the world economy came in a rush and with that alsophilanthropy. Successful entrepreneurs formed a new group of rich people. Often these entrepreneurs had their own (family) company in which they had much decision-making power. Investing in arts had more prestige than an other cause or charity and big parts of this new money went to arts and culture (Steenbergen, 2008). In this period only in Amsterdam four cultural institutions were found with this new money: Rijksmuseum (1885), Concertgebouw (1888), Stadsschouwburg (1894) and Stedelijk Museum (1895), and in the beginning of the 20th century several cultural institutes with private money followed: Rembrandthuis (1906), Scheepvaartmuseum (1916/1918) and Koloniaal Instituut (1910/1926) (Steenbergen, 2008). This can not be seen as corporate sponsorship, but as (corporate) philanthropy. There were no direct commercial reasons for investment in arts and culture. The private parties donated money because of prestige and interest for culture. However, cultural involvement had a positive influence on the image of the donating persons and their companies and brands.
A good example of successful fund raising in the early 20th century is the case of the Scheepvaartmuseum (Maritime Museum) in Amsterdam (Steenbergen, 2008). The Amsterdam harbour was the most important harbour of Netherlands in that time. The foundation needed 1 million Dutch guilders (times 15 to estimate the current value) to finance the building and collection of the museum. The chairman of the foundation, the shipowner Stoomvaart Maatschappij Nederland, started donating 100.000 guilders with his own company. By asking his network of shipowners, shipbrokers, transhipment companies and traders in Amsterdam he managed to get 640.000 guilders after the first meeting. Besides goodwill all donors also had commercial interest in the museum where they could promote their company, as competition with the harbour of Rotterdam was increasing. Within several months the foundation found all funds because board members of donation companies started to raise funds in their own network, especially traders and bankers. The following years the board members of the Scheepvaartmuseum kept on investing in the collection and therefor the museum became a valuable and prestigious project to be identified within the industry. This model can be seen as collective patronage by network systems.
In contrast with the current situation, in the beginning of the 20th century most cultural and civil institutions and initiatives were initiated by private parties and than they tried to get the government involved in it as well (Steenbergen, 2008). In that time governments got hardly budget for sewerage and garbage collection and so art had not a high priority. Another reason why art traditionally mostly was financed by private parties was that the audience almost exclusively existed of the higher class (Steenbergen, 2008). However, this started tot change in the end of the 19th century. In 1872 the Dutch gentlemen society De Grootste Club included in their society objectives that they would do now something for Amsterdam (Steenbergen, 2008). Within this society they collected funds for their civil initiatives like arts and culture which would be available for a broader audience.
After WWI the traditional collective patronage by rich entrepreneurs started to change (Steenbergen, 2008). The younger generation rather bought a car than a painting. But the structure of museums, concert halls, orchestra's and theater groups were fundamented (Steenbergen, 2008). The whole infrastructure like the buildings, collections but also the exploitations costs were covered by private parties. In 1945, after WWII, the support by private parties decreased rapidly because lack of money, but government institutions could easily take over the existing structure to save institutions to disappear (Steenbergen, 2008).
Something else changed after WWII. Where traditionally society was leaning on strong family bonds, religion and social classes, individualism increased rapidly and with that individual philanthopy was taking over the collective patronage (Steenbergen, 2008). The peergroup pressure which made entrepeneurs donating more into charity and arts was disappearing (Steenbergen, 2008). From here giving money for arts and culture started to become more a marketing thing than a philanthopy thing, and the market-driven nature of contributions resulted in a change in the use of terms from philanthropy to sponsorship (Cornwell, 1995). Giving money for arts and culture should pay off and therefor is a corporate investment. From here we can talk about (corporate) sponsorship.
Early sponsorship
First commercial sponsorships date back in the end of the 19th century, although such sponsorships were rare. For example the Dutch bicycle race team of Jaap Eden was sponsored in 1896 by tire producer Humber-Dunlop (Hover & Breedveld, 2009). Sponsorship as a marketing promotion tool started to increase slowly since early 1950s (Cornwell, 1995). Since the late 50ties big American corporations started to invest in arts; for example Chase Manhattan Bank and Philip Morris were engaged in art collections and supported symphonies (Rectanus, 2002). David Rockafeller (chairman of the board of Chase Manhattan Bank) established in 1967 the Business Committee for the Arts (BCA), which should encourage business leaders to support arts (Rectanus, 2002). Supporting arts would improve public relations and morale of employees and help attract qualified personnel. Rockafeller’s ideas were beyond corporate philanthropy or patronage. Corporate interest in arts became an instrument for maintaining and documenting social legitimacy.
In the 1970s and 1980s sponsorship grew in popularity (Rectanus, 2002). Lokerman (2004) stated modern sponsorship started in 1970 in Netherlands, as from than on sponsorship was not only utilized accidentily but more structural.
Sport sponsorship preceded cultural sponsorship, social and environmental followed in the late 80s in the US and the late 90s in Europe (Rectanus, 2002). In the beginning of the 1990s cultural organizations started to search for more funds, sponsors included, as governments started to cut more on culture (Rectanus, 2002; Steenbergen, 2008). Besides of that markets emerged in Europe due to the EU and increasing corporate globalization. In the early 90s financial support for causes became integrated in corporate identity, marketing communication and public affairs (Rectanus, 2002). It seems corporate philanthropy started to be taken over by cause-related marketing in the early 1990s (Varadarajan & Menon, 1988; Cornwell & Maignon, 1998; Rectanus, 2002).
Cause-related marketing
Traditionally sponsorship had a big philanthopic reasoning. Corporate involvement in social issues began as voluntary reponse by firms, than evolved into mandated corporate involvement. During early 80ties many corporations still perceived support for culture as philanthropy however in the late 1980s corporate philanthropy evolved in a phase in which social involvement in social issues is viewed as an investment. Based on these rationale of profit-motivated giving the new term of "cause-related marketing" emerged (Varadarajan & Menon, 1988). Cause-related marketing (CRM) can be seen as corporate philanthropy, or sponsorship with which firms show social involvement.
Varadarajan & Menon (1988) defined cause-related marketing as "the proces of formulating and implementing marketing activities that are characterized by an offer from the firm to contribute a specified amount to a designated cause when customers engage in revenue-providing exchanges that satisfy organizational and individual objectives." Like sponsorship, CRM is commercially motivated. However, the difference with sponsorship is that CRM is defined in terms of the activities undertaken how to leverage the association rights (Polonsky & Speed, 2001). For example a sport shoes manufacturer gives 1 Euro of every sold pair of shoes to a project promoting sports in a poor country. So CRM can be seen as a strategy within the broader definition of sponsorship, however in literature it is often seen as aseparate subject(Polonsky & Speed, 2001).
Varadajaran & Menon (1988) warned firms the line between cause-related and cause-exploitive marketing is small. At one side generating increased sales, goodwill and positive publicity and at the other side negative publicity and exploitation of causes. The same counts for sponsorship in general. Audiences, especially of arts, struggled with the fact that corporations increasingly started to be involved in arts (Rectanus, 2002) and sports. In Hartford (1990) can be read that the sponsorship relation between IBM and English National Opera (ENO) is blamed to be an "unholy alliance". It would make the sponsor feel good and make its peers look up at him. The sponsor would like to have his name on front of the programm and free tickets for its contacts. The sponsor would believe it all is possible because of the sponsor.
Nickson (1991), former director of development at ENO, replied on this blame explaining the development with a postscipt by the sponsorship programme manager of Peter Wilkinson of IBM, sponsering arts since 1970. In the end 1980s governments were cutting expenditures on arts, and therefore among others ENO needed to find new ways to finance their programme. At the same time sponsors were competing for profile and sponsorship had potential. As Wilkinson writes in Nickson (1991): "There is the relationship that can build up between the organizations leading to exhanges of skills and ideas. Business can offer its expertise in management, promotion and marketing; the arts can offer creativity and a window on a wider world." Nickson writes: "ENO welcomes sponsorship, not only for the much needed money, but for the enthusiastic new audiences and powerful new friends it brings." Besides filling the gaps in the budgets, sponsorship encourages innovation in the arts organization at a business level, what subsidising governments cannot. In the end arts and commercial firms are in the same business of selling and reaching their audiences.
Also in sports corporate sponsorship was not immidiatily accepted by its audience. For example the introduction of shirt sponsorship at the Dutch soccer premiership "Eredivisie" in 1982-1983 caused for much fuss (Hover & Breedveld, 2009). In the end of the 1980s firms were searching for the balance between the social part and the profit part as cause-relative marketing became more socially accepted by both the firms and the not-for-profit organizations (Varadarajan & Menon, 1988). However, in 1990 the Eredivisie was renamed to "PTT-Telecompetitie" after the league its main sponsor, the Dutch telecom company PTT (now operating as KNP). Again, audience got much difficulty accepting this sponsorship involvement in sports (Hovern & Breedveld, 2009).
From the 1990s audiences started to accept sponsorship as aphenomenon which is integral part of the sports and cultural experiences.
Sponsorship as an integral part of the marketing mix
From the mid 1990ties sponsorship became an integral part of the marketing mix and became also a subject of research (Cornwell, 1995). The idea of sponsorship as a marketing promotion tool was not new in the 1990s, the implementation of it was, because it became rapidly more popular among corporations (Cornwell, 1995). Mainstream advertising, especially at big events like Olympic Games, were very popular in the 1990s so the costs were high. Sponsorship became a more cost-effective tool to engage to (Cornwell, 1995). And with sponsorship mass media could also be reached. Besides of that sponsorship relationships had much more potential than advertising. That time sports sponsorship became one of the largest markets for the alcohol and tobacco industry (Rectanus, 2002).
Rust & Oliver (1994) forcasted advertising would be death by 2010. Also Zyman (2001) stated advertising is death as it was known. However, advertising is not death, but tradtional advertising is outdated and needs re-evaluation. Zyman (2001) states advertising is about "selling more stuff more often to more people for more money" and traditional mass advertising became so expensive it does often not give as much return on investment as for example sponsorship can do if utilized well
The rapid growth of sponsoring during the 1980s and 1990s was facilitated by an increasing awareness of new definitions and uses of culture and sports within the contexts of everyday life (Rectanus, 2002). Sponsorship became a corporate communication method. The “new partnership” between corporations, cultural institutions, sport entities and communities, attempt to engage audiences on an emotional level, also outside their product (Rectanus, 2002). Sponsorship became integrated into corporate identity, communication and management philosophy (Rectanus, 2002), but also in stragetic plans (Varadarajan & Cunningham, 1995).
Objectives of sponsorship
Firms and organizations of all sizes and markets are involved in sponsorship. Some sponsorships are almost pure philanthropic, some are pure commercial. Sponsorship can be utilized in many different models and can have many different objectives. In table 1 a list of possible objectives for a firm to engage in sponsorship is given. Cornwell (1995) devided the objectives into corporate and marketing objectives, and additional objectives from Amis et al. (1999) are added or integrated into the tabel. Sponsorship are rarely utilized to fullfill one single objective, more likely a combination of multiple objectives. Note that the "Personal interest of a senior executive" as an objective is actually not a direct corporate objective.
NOTES
A history of patronage in mainly Netherlands can be found in (Steenbergen, 2008). Sponsorship has its roots in patronage. However, this book focuses on the traditional art and museums.
Schreiber (1994): “In reality, corporate philanthropy has been almost entirely replaced by cause-related marketing. What’s the difference? Simply that philanthropy was sometimes giving money away. Lifestyle marketing, of course, gives money too. But it goes beyond that. It shares values. It’s an overt demonstration and statement that a company not only gives cash but shares certain attitudes and beliefs with its consumers. There is also more of a synergy to lifestyle marketing than to philanthropy.” Quoted in (Rectanus, 2002).
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