March 26, 1998 | Read Time: 2 minutes
Charitable causes last year received $535-million through joint marketing ventures with companies — 10 per cent more than in 1996, according to a new report.
Early projections for 1998 show that charities can expect to receive $9-million more from such deals than in 1997.
IEG, a Chicago consulting and research company that specializes in corporate sponsorship deals with charities and other groups, compiled those figures. While some marketing deals between charities and corporations involve a corporation paying to sponsor a charity’s special event, in many cases the company pledges to give a specific amount to a charity for every consumer who buys the company’s product or service.
The figures provided by IEG do not include additional money that companies spend to advertise and promote their marketing deals with charities. On average, companies spend two to four times more on promoting their charitable arrangements, IEG says.
While charitable causes should see an increase in corporate marketing dollars this year, their share of the overall amount companies spend is predicted to drop, from 9 per cent last year to 8 per cent, as sports consume a greater share of corporate funds.
IEG predicts that companies will spend a total of $6.8-billion this year on sports events, music tours, festivals, and other such marketing opportunities, a 15-per-cent increase from the $5.9-billion they spent last year.
The arts — which IEG reports separately from charitable causes — received $354-million last year, or 6 per cent of total spending. Projections show that spending will increase to $413-million this year, and stay steady at 6 per cent of total spending.
Festivals, fairs, and annual events — which include numerous non-profit events like the New Orleans Jazz & Heritage Festival — received $558-million, or 9 per cent of the total. The IEG group estimates that such organizations will receive $578-million this year and remain at 9 per cent of the total.
Entertainment tours and attractions — which include tours by rock groups like the Rolling Stones, who were sponsored by Sprint — received $650-million, or 11 per cent of the total. Projections show such tours receiving $675-million this year, or 10 per cent of the total.
Sports, which have received the vast majority of sponsorship dollars since IEG began tracking spending in 1988, received $3.8-billion in sponsorship fees last year, or 65 per cent of the total. This year, predictions show that sports will receive $4.6-billion, or 67 per cent of overall spending.
For a copy of the “IEG Sponsorship Report,” contact IEG, 460 North LaSalle, Suite 600, Chicago 60610; (312) 944-1727; e-mail ieg@sponsorship.com.
