Sponsorship spending will jump in ‘98
Corporate sponsorship spending by North American companies in 1998 will increase to $6.8 billion, a 15 percent increase over 1997’s $5.9 billion, according to the 14th annual projections of Chicago-based IEG, Inc., a sponsorship industry research and consulting firm. The 1998 projected growth equals the 15 percent rise in sponsorship spending from 1995 to 1996. Growth was limited to 9 percent last year.
"The recovery is credited to significantly higher price tags for major sports properties, notably the Olympics, major sports leagues and auto racing. Previously undervalued properties are doing a better job of determining their market value and pricing themselves accordingly," says Lesa Ukman, president, IEG, Inc.
IEG projects for 1998 that worldwide spending will be $17.35 billion, up 13 percent over 1997. In addition to North America’s $6.8 billion, European companies will spend $5 billion, an 11 percent increase; $3.3 billion will come from Pacific Rim companies, just a 6 percent growth in light of the region’s economic woes; $1.25 billion from Central and South American businesses, a 25 percent rise; and $1 billion from firms in all other countries, also a 25 percent increase.
In North America, increased activity is expected from a number of categories that emerged as sponsors in 1997, including utilities, on-line services, entertainment companies such as cable channels and movie studios, destinations, hospitals and home and garden supplies. Companies and brands new to sponsorship in the past year (Best Buy Co.; Ikon Office Solutions, Inc.; New Line Cinema Corp.; Old Navy Clothing Co.; Pepcid AC; PrimeCo Personal Communications LP; Service Merchandise Co.; and SunMaid Raisins) also should step up activity.
The number of U.S. companies spending more than $10 million in sponsorships expanded from 52 to 58 in 1997. For the second consecutive year, the top five sponsors remained the same: Philip Morris Companies ($140 million to $145 million), Anheuser-Busch Companies ($130 million to $135 million), The Coca-Cola Company ($110 million to $115 million), General Motors Corporation ($90 million to $95 million), and PepsiCo. Inc. ($75 million to $80 million).
Seven companies joined the list for the first time, while Nations Bank Corp. missed the cut following the end of its commitment to the Atlanta Olympics.
Given the rise in the number of blockbuster sports deals, the sports category will increase its share of total 1998 sponsorship revenue to 67 percent. That 2-point gain comes at theexpense of entertainment tours and attractions, which will lose one point of market share, slipping to 10 percent, and causes, whose share will erode for the first time, sliding from 9 percent to 8 percent. The festivals, fairs and annual events category maintains its 9 percent share, while the arts hold steady at 6 percent.
Forecasted dollar figures for the five categories are: sports, $4.55 billion; entertainment tours and attractions, $675 million; festivals, fairs and annual celebrations, $578 million; causes, $454 million; and the arts, $413 million.
Billboards annoy but also serve need
Touting everything from cigarettes to the nearest cheap motel, billboards can come with neon colors or 3-D effects, twinkling with glitter and lights. In some places, they’re as prolific (and irrepressible) as ditch weeds, in others; nonexistent. They’re everything from clever to annoying to downright dangerous. And 14 percent of Americans say they should be outlawed, while 62 percent disagree.
But despite the fact that most of Americans would not banish billboards, fully half of Americans do not think billboards are entertaining, and 43 percent say they’re not beautiful, either. Just 17 percent of travelers on American highways and byways feel that the signs can be entertaining, and 27 percent think they can even be beautiful. Men are significantly more likely than women to say that billboards are definitely not beautiful (33 percent vs. 24 percent), while young adults age 18-24 are more apt than other age groups to say they are.
It could be the sheer utilitarian function of many billboards (how many miles to the nearest restaurant, hotel, gas station, etc.) that tempers Americans’ distaste for roadside sig-ns. Most favor a balance between wanton proliferation and strict regulation. When asked to respond to the statement, "Billboards can be useful, but should be strictly regulated," 52 percent a~ee, 20 percent disagree, and 26 percent are neutral. Men appear to be a little soft on the subject, with just one-fourth strongly ageeing with the notion of strict regulation (compared to 34 percent of women), while 17 percent feel strongly that billboards should not be regulated (compared to less than 10 percent of women).
Consumers ready to pay for high-speed Internet access
A study by The StrateNs Group, Washington, D.C., "High Speed Internet Access. A Consumer Demand Study," found that one in five U.S. homes will subscribe to high-speed Internet service for at least $40 a month when it becomes available. "Over 40 percent of current on-line users will pay $40 a month for highspeed Internet access, while most non-on-line homes will wait for prices to decline and for more compelling content to emerge," says Samuel Book, president of consumer research at The Strategis Group.
The national survey of 500 U.S. households reveals that residential online/Interact subscribers spend about six hours per week on the Internet, including four hours a week on the World Wide Web and on-line information services. The typical on-line household sends and receives nine Email messages a week.
On-line households in the U.S. have mushroomed from under five million two years ago to over 17 million today. But higher speed is needed for mass market usage, and the next stage of Internet evolution depends on high speed broadband networks.
Fewer than 150,000 homes were estimated to subscribe to high-speed services by the end of 1997. As high-speed platforms come on line, especially from cable and telephone comparties, pent-up consumer demand for higher speed will result in accelerated growth of high-speed Internet households. The study forecasts nearly eight million high-speed Internet homes in 2001, with high-speed Intemet subscription revenues approaching $4 billion.
The wide world of women’s sports
In sports, American women are no longer content to sit on the sidelines and cheer. They want to be a part of the action - crossing the finish line, swinging for the fences, serving aces, and pumping iron.
According to a recent sports participation study by the Sporting Goods Manufacturers Association (SGMA), women are actively involved in a wide range of endeavors - especia!ly fitness activities (see tables).
This information was abstracted from a study conducted by American Sports Data, Inc. This study is prepared annually for the Sporting Goods Manufacturers Association and tracks participation in 62 different sports and activities. SGMA is a trade association of North American manufacturers, producers, and distributors of sports apparel, athletic footwear, and sporting goods equipment, is dedicated to increasing participation in sports and fostering industry gowth and vitality.
Consumers prefer snail mail to E-mail
A survey commissioned by Pitney Bowes Mailing Systems and conducted by NFO Research, Inc., Greenwich, Conn., found mail (first-class and standard) to be the most preferred, most secure and least intrusive communication method of consumers when receiving daily messages in their home. The survey revealed that, on average, Americans prefer to receive everything from bills and personal correspondence to catalogues and promotional material via mail.
The survey asked U.S. consumers to rank five communications tools by preference when receiving common communications including: bills and invoices; brochures; personal correspondence; business correspondence; newsletters; catalogues; and marketing, advertising and promotional information. The tools ranked were first-class mail, standard mail (formerly known as third-class mail), overnight delivery, fax and Email. When asked which delivery method is most preferred, first-class mail received the highest score when rating bills and invoices (88.5 percent), personal (81.2 percent) and business (71.8 percent) correspondence. Consumers also felt that, based on the level of importance, brochures, catalogues and marketing materials would be better received via standard mail, with first-class mail ranking second.
Security and degree of intrusion were also ranked by consumers. Firstclass mail consistently ranked as both the most secure (confidence that the message will be delivered correctly and privately) and the least intrusive (offering recipients the most control over when the communication is actually received, opened and read) method in receiving communication. Overnight delivery ranked second as both the most secure and least intrusive.
Overall, consumers ranked E-mail the least preferred method of receipt. It was also considered the least secure method, even by consumers with an Internet/E-mail address, and was ranked one of the most intrusive for all messages received. Mail was consistently rated better than E-mail across all age groups, income categories and geographic locations. Thirty-six percent of respondents reported they had an Intemet or E-mail address.
The survey was conducted through a mail-in study, which generated responses from 1,323 adult consumers in the U.S. The marg-in of error associated with the entire sample is +/-2.7 percent at the 95 percent confidence level.
Benefits crucial to Hispanic job hunters
A recent issue of Hispanic Perspective, a newsletter from Market Development, Inc. (MDI), San Diego, Calif., reports that more than a flexible schedule or a high income, Hispanics want a job that provides them with health insurance and other benefits.
"Good health and other employee benefits" ranked number one among eight job-related benefits evaluated by 300 Hispanic adults interviewed by MDI in the five major Hispanic markets." For U.S. and foreign-born Hispanics alike, "opportunities for advancement" and "job security" came next in importance, well above "high income."
Hispanics tend to have bigger families and, therefore, a greater concern with being able to provide health care for more members of their family. But these findings also suggest that U.S. Hispanics have a genuine interest in securing their family’s well being and, accordingly, look for jobs that offer a long-term commitment with an employer.
Clearly, among Hispanics, keeping a job, particularly one which offers opportunities for advancement, is a guarantee of a good future, which is why job security has a higher priority than a high income. Hispanics aim at establishing loyalty first and then seek compensation, rather than getting to the compensation first and then deciding whether loyalty is merited, a more prevalent attitude within the global marketplace.
For foreign-born Hispanics, holding on to one job for long periods of time - even a lifetime - is a pattern performed in their countries of origin. Low job turnover makes changing jobs and/or relocation very unusual occurrences in Latin America.
Other findings included that while lower-income households placed getting benefits on top of their importance list, higher-income households placed more importance on other issues such as job security and opportunities for advancement.
All job attributes were considered important for more than half of Hispanics. Overall, older Hispanics seem to place more importance on these eight attributes compared to younger ones. They also consider proximity to the job site and a pleasant environment more’ crucial than their younger counterparts, suggesting a set of job expectations more geared towards convenience and congeniality.