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Sponsorship is the financial support for a sport (whether this is an event, organisation or performer) by an outside body (be it a person or organisation) for the mutual benefit of both parties.

Sponsorship occurs at all levels of sport. School teams may have sponsored kit while elite athletes may be paid large sums of money to wear certain sportswear or use branded equipment. Sponsorship can be financial or in-kind payments. Sponsorship means both parties receive benefits from the agreement.

Types of sponsorship

• Individuals – display a logo, wear a particular brand, endorse products, pay training, competition and travel costs.
• Teams and clubs – wear kit, display banners, have a company name for the team or for the ground or for a stand/court in the ground, pay competition and travel costs.
• Sports – rename competitions, cups and leagues, brand their development programmes, improve facilities.
• Events – allow use of their logo on sponsors' products, provide free products to participants, and fund the running of the event.

Benefits for sport

• Individuals – covers costs such as kit, equipment, travel, accommodation, competition fees, time to train.
• Teams and clubs – subsidises kit, equipment, grounds or clubhouse maintenance.
• Sports – pays for coaching and coach development, beginner programmes, talent development.
• Events – covers venue hire, catering, hospitality, publicity, programmes, officials’ costs.

Disadvantages for sport

• Sponsorship can be limited or easily withdrawn – no security.
• A performer can become reliant on a particular sponsor, which could then pull out.
• Some sponsorship (for example, alcohol) gives a bad image to sport.
• Generous sponsorship is only available to the elite few.
• Performers, teams and events can be manipulated or exploited to suit the sponsor.
• Difficulty of minority sports or those with little media coverage to attract sponsorship.

Benefits for sponsors

• Raises awareness of their company or brand.
• Advertises products and services.
• Promotes a positive and healthy image of their company by linking it with a popular activity, even if the product is not particularly healthy.
• Improves company's reputation in the UK because the company is supporting British sport.
• Provides rewards or incentives for staff and customers.
• Increases sales or revenue through increased media exposure.
• Reduces tax through tax relief.

Disadvantages for sponsors

• Uncertain investment – sporting success is not guaranteed.
• If the event is disrupted, media exposure and advertising potential are lost.
• If the sport or performers cause bad publicity, this reflects badly on the sponsor.

Negative effects of sponsorship

Sponsorship of sport creates tensions when a sponsor's image or product appears to undermine the sporting message. For example, tobacco firms sponsored sporting events until 2005 when they were banned from doing so across the European Union (EU). Companies that sell alcohol are allowed to sponsor sport although many British MPs want a ban as they believe it sends the message that sporting performance and drinking alcohol are linked. The same is true of fast food companies – should they sponsor sport when their products are believed to contribute to childhood obesity?

Case study – Los Angeles Olympic Games

The Los Angeles Olympic Games in 1984 were the first modern Olympics to be financed by corporate sponsors and the first Games since 1932 to make a profit. The two previous Games – in Montreal (1976) and Moscow (1980) – had left the organisers with huge debts. This commercial approach became the model for future Games. The organisers also used some of the profits to support youth sports and coach development, which benefited grass roots as well as elite sport.