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Articles and Press Releases:

Sponsorship Spending On Cause-Related Organizations To Grow 20.5 Percent In 2006

June 19, 2006:

Bundled media buys, third-party aggregators help fuel increased spend

For More Information Contact:
William Chipps, IEG, LLC, Tel: 312/944-1727
william.chipps@sponsorship.com
www.sponsorship.com

Nonprofit Sponsorship SpendingChicago, Ill. — It’s a good time to be selling sponsorship to cause-related organizations.

Spending on cause partnerships by North American companies is expected to total $1.34 billion in ’06, up a whopping 20.5 percent from the $1.11 billion spent last year, according to projections by IEG Sponsorship Report, the world’s leading authority on sponsorship.

The projected year-over-year increase makes cause sponsorship the fastest-growing segment of the sponsorship industry, sharply outpacing the 10.6 percent expected increase overall.

That growth should lift causes’ share of total sponsorship spending one point to 10 percent. Total spending on sports properties, on the other hand, is expected to dip three points to 66 percent.

“Companies are realizing the powerful marketing benefits that can be gleaned from nonprofit affiliations,” said William Chipps, IEG Sponsorship Report’s senior editor.

A key growth trend for cause marketers: using charitable programs to reach and/or strengthen relations with teens and 20-somethings. Case in point: FedEx Corp. and The Home Depot Inc. earlier this year teamed with the United Way of America and MTV to sponsor an alternative spring break program to help rebuild communities damaged by last year’s hurricanes.

Similarly, prepaid wireless service provider Boost Mobile LLC last year rolled out a cause-related marketing program dubbed Boost Mobile RockCorps that awards concert tickets to consumers who perform four hours of volunteer service. The program is unique for a category that traditionally sponsors action sports, music and other entertainment-related properties to reach the youth demographic.

The specialty retailer category (clothing, toys, etc.) posted the largest increase in interest in cause marketing programs in ’05, with 54 percent of nonprofits reporting a sponsor in the category, up from 24 percent in ’04, according to IEG’s annual property survey. Other categories showing increased interest include the automotive, financial services and insurance segments.

Categories showing declining interest in cause marketing included the airline, beer, personal care and telecommunications industries.

About IEG, LLC

IEG is the world’s leading provider of independent research, consulting, training and analysis on sponsorship. Founded in 1981, IEG provides corporations and properties with the strategies and tools to harness the sales and marketing power of sports, arts, entertainment and cause marketing.

IEG offers services that include sponsorship consulting, competitive intelligence and valuation. IEG also publishes IEG Sponsorship Report, the international biweekly newsletter on sponsorship; the IEG Sponsorship Sourcebook, the definitive guide to sponsors, properties and agencies; and other industry publications and sources.

IEG also is the leader in sponsorship training. Its internationally renowned Sponsorship Conference, now in its 25th year, attracts a capacity crowd of delegates each year. Through its conferences, seminars and webinars, IEG has trained more than 45,000 sponsorship executives worldwide.

For more information about IEG and the sponsorship industry, please visit www.sponsorship.com or call 800/834-4850 (outside the U.S. and Canada, 312/944-1727).