What is sponsorship advertising? The definitive guide to sponsorship in advertising

What is sponsorship advertising, and how does it generate brand opportunities? Sponsorship advertising, also known as “sponsored ads,” is a way for companies to connect with their audience by affiliating with another well-known brand or entity. 

Since consumers have begun to ignore many traditional forms of advertisement, “sponsored ads” have become increasingly popular. They’re a valuable way to boost brand awareness and strengthen a company’s reputation while potentially generating new leads and opportunities. 

Sponsorship advertising has grown increasingly common in the world of “digital marketing.” The chances are you’ve seen countless “paid posts” or “sponsored by” statements connected to the blog posts you’ve read, videos you’ve watched, or podcasts you’ve listened to lately. 

With sponsorship, a company can effectively position itself in an entirely new landscape, either online or offline, highlight its unique brand personality, and start building relationships with a lucrative target audience.

Here’s everything you need to know about sponsorship advertising and how it works.

Sponsorship advertising definition

Sponsorship advertising and sponsorship “marketing” are two often overlapping concepts. 

In both scenarios, companies engage in a mutually beneficial partnership with another brand, organization, or event. 

The difference between sponsorship marketing and sponsorship ads is that sponsorship advertising primarily focuses on drawing attention to a specific piece of content rather than just the brand, its logo, or its image. 

In a marketing sponsorship campaign, companies (sponsors) pay for other organizations (beneficiaries) to promote them using various tactics. This could include placing signage in a company-sponsored event or showing a brand’s logo on a sports uniform. 

Sponsors may pay for marketing using cash or with “in-kind” services and support. 

Ad sponsorship focuses more on placing advertisements within specific environments in exchange for a monetary payment. 

You may have noticed the word “sponsored” placed beside certain posts on Instagram and Facebook. Companies pay to push these ads toward the top of the newsfeed for a specific group of customers to improve their potential reach. 

Alternatively, a company might pay to place a “sponsored” piece of content on a website or blog. For instance, a famous influencer might write an article about a product while showing customers that the brand has sponsored them to do so. 

In most cases, advertising sponsorship involves working with a group already invested in the promotional landscape. For example, a company may pay to be mentioned by a well-known news outlet in their industry or pay to appear at the top of the search results on Google.

Types of sponsorship in advertising

Sponsorship in advertising can appear in many different formats. 

One of the best-known forms of sponsorship advertising in today’s digital world is “sponsored content,” when a company pays to have specific content displayed on a digital platform, such as a search engine, a social media platform, or another company’s website. 

However, sponsorship advertising can also take on other forms, such as:

Program sponsorship

In the television landscape, companies frequently pay to advertise their products and services between programs and “sponsor” specific programs. 

The Just Eat company sponsored the X Factor program and placed its content before and after the ad break for each section of the show. Companies can also pay to have their products regularly mentioned or promoted during a show. 

You may even hear a radio broadcaster telling you the show is “brought to you by” a specific company.

Event sponsorship

Event sponsorship appears in both the sponsorship marketing and sponsorship advertising worlds. In this case, an advertiser may take on a portion of the costs associated with hosting an event in exchange for advertising spots and prominent mentions as a sponsor. 

Most companies will typically sponsor events related to the brand personality and values they want to showcase to their customers. 

Sponsored advertising content

Sponsored advertising content is a form of premium content that a sponsor pays a publisher to distribute and create. It’s a kind of “native advertising” which involves embedding the ad into a specific site or environment that makes it look natural. 

For example, sponsored ads on Facebook look like regular posts. Sponsored blogs on websites also appear as posts written by the website’s existing team.

Integrated brand promotion

Integrated brand promotion involves consistently paying one company to always advertise another brand. 

For example, a company might consistently show another organization’s branding and ads alongside their own promotional content or remind customers that they’re associated with another organization. 

With the integrated brand promotion, the “beneficiary” in the sponsorship is almost constantly connected to the “sponsor.” Such as the “Hot Ones” show on YouTube brought to you by “Tums.”

What is sponsorship in advertising? Sponsored content

As mentioned above, one of the most common forms of advertising sponsorship today is “sponsored content.” 

Sponsored content is a premium form that a sponsor pays a publisher to post, distribute, and promote. In some cases, the sponsor writes or develops the content, while in other instances, the “beneficiary” creates the content. 

At its core, the sponsored content partnership is relatively straightforward and similar to any brand sponsorship. Two brands or entities form a partnership. The advertiser pays for the content to be published and promoted, and another brand, organization, or influencer shares it. 

A good example of advertising sponsorship in content comes from Facebook. Companies can pay to have their ads “sponsored” by Facebook, which heightens the position of each advertisement on the social media news feed. 

Sponsored content appears above any other form of native content, which makes it easier for customers to see the brand. 

Another example is “sponsored content” in the native marketing landscape, where companies pay for companies to produce a piece of content related to their brand. You might have seen posts on sites like “Buzzfeed” sponsored by other companies designed to draw attention to the business. 

Hot Wheels once sponsored a post on Buzzfeed about children’s playtime, which included references to the company’s products.

Where did ad sponsorship come from?

Advertising sponsorship may seem like a relatively new concept because we see many examples of content sponsorship in today’s digital landscape. 

However, companies have worked with other brands on ad promotion for decades. In the 1920s, when radio was still king, radio stations produced various serial programs that told stories similar to podcasts. 

At the time, producing this content was expensive, so radio stations began approaching household goods manufacturers to seek additional funding. Procter and Gamble, one of the world’s leading conglomerates, began sponsoring content on the radio in exchange for advertisement slots. 

As the shows grew more successful, the product appearing in the ad sponsorship slots (Oxydol) also gained more attention. Many people believe the connection between P&G and the serial shows on radios was why the shows eventually earned the title “soap operas.” 

Similarly, companies have sponsored events, educational institutions, and television programs in exchange for advertising slots for decades. We’ve seen examples of this in regions all over the world. Certain television shows are commonly associated with specific companies. 

Sainsbury’s, for instance, is one of the current sponsors for the Great British Bake Off in the UK. 

When the internet began to evolve and online platforms became more cluttered, “ad sponsorship” made its way into the digital landscape. Companies began paying for better positions for their advertisements and marketing content on the channels that appealed to their target audience.

In today’s digital world, sponsors can even choose from a variety of tools to help boost the impact of their advertising sponsorship. For instance, Instagram allows companies to target specific user demographics, keywords, and groups when paying for “sponsored” placements.

What are the benefits of sponsorship in advertising?

The benefits of sponsorship in advertising are similar to the benefits of any marketing sponsorship.

In this mutually-beneficial relationship, both sides of the partnership get something important. The “sponsor” gets to draw attention to its advertisements, create more compelling content, and appeal to a wider audience for increased sales.

The “beneficiary” in the sponsored advertising world typically benefits from increased funding. However, there are cases wherein a sponsor may offer an alternative “reimbursement” for a sponsored placement.

A website looking to get a sponsored ad on another well-known website may choose to advertise the other company on their site too. This two-way strategy is a partnership that allows both companies to benefit from increased brand reach.

The core benefits of sponsorship in advertising are:

Increased brand awareness and recognition

Ultimately, sponsorship in advertising allows companies to reach customers they may not access elsewhere. Sponsoring an ad to appear on Facebook, Instagram, another website, or before a radio or television program is a way of grabbing the audience’s attention. 

Companies can reach their customers on the channels or in the environments they already visit. 

It’s also an opportunity for companies to highlight what makes them special to their potential audience. 

The food and travel video network, Tastemade, created several recipe videos with sponsorship from Michelob ULTRA beer. In each video, the recipe encourages the audience to enjoy the food with a refreshing beer from Michelob.

Improved brand reputation

Sponsorship can help companies achieve a level of “competitive positioning.” 

To stand out in today’s competitive landscape, businesses don’t just want their ads and company to be visible; they also want to improve a customer’s sentiment towards them. 

Sponsorship can help customers to associate a brand with the positive feelings they already have about another company or entity. In industry terms, this is known as “transference.” 

For instance, if a company sponsors an ad to appear alongside a funny radio show that makes customers smile and laugh, they’ll be more likely to think of the brand as a “positive” company. 

When Skoda wanted to reach a younger audience, they invested in sponsored advertising partnerships with a British cycling legend, Bradley Wiggins, to create a 22% increase their likability factor.

Enhanced content creation

One of the best ways advertising sponsorships in the content landscape can benefit brands is by giving them access to more content for online growth.

For example, a company can pay for a sponsored post to be created and published by another business, reducing their need to pay someone to create engaging content on their behalf.

Sponsored advertising can also act as a “diving off” point for creating other content. For instance, after sponsoring an event, a company might create videos, podcasts, and blog posts related to that event.

This helps them strengthen their position on search engine channels and enhance their thought leadership image.

Increased sales

The core goal of advertising and sponsorship is to increase brand sales opportunities. 

When companies leverage sponsorship in advertising, they’re looking for a way to improve their image with their target audience, drive more attention back to their business, and highlight the unique qualities of their products and services. 

All of these things fundamentally deliver an increased opportunity for sales and conversions. 

A study by Neilson found sponsorships can drive up to a 10% increase in purchasing intent among customers. In part, this is a result of increased brand awareness and recognition. However, it’s also a result of improved sentiment toward the brand. 

Advertising sponsorship turns a standard ad, which might be seen as disruptive or frustrating, into a sign of credibility and trustworthiness for the company. Even the “beneficiary” brand can see an improved bottom line due to a partnership with the right company.

Data collection

While some forms of sponsorship marketing can be challenging to track and measure, advertising sponsorships are a little more convenient for collecting data.

With many forms of “sponsored ads,” particularly in the digital world, it’s possible to collect significant data about prospects, their preferences, and the potential buyer journey.

Companies can use tracking data and built-in insights in online marketing platforms to determine which people responded to their sponsored ads.

This can help business leaders make better decisions about formulating future advertising campaigns. In some cases, the sponsored “beneficiary” in a sponsorship deal may also be able to share its own customer data with the sponsoring company to help them strengthen its user personas.

Sponsorship advertising examples

If you’re thinking of investing in sponsorship advertising, there are many ways to get involved. Sponsorship is a highly versatile advertising opportunity, not just reserved for big-name brands.

In fact, with sponsored content, virtually every business can heighten its brand awareness and boost its reputation with very little initial investment.

Let’s take a closer look at some excellent sponsorship advertising examples to inspire you as you begin your journey into this unique promotional space.

Hot Ones and TUMS

One of the most popular YouTube series around, Hot Ones is an interview show where famous individuals are asked questions while they make their way through a series of increasingly hotter wings. 

During the show’s 9th season, they partnered with TUMS for a fun yet appropriate ad-sponsoring deal. The sponsorship involved adding TUMS ad content into some of the advertising segments around the videos on YouTube. 

YouTube offers a range of ad slots for companies to choose from, including pre-video ad rolls, in-video segments (sponsored by or presented by), and in-video ad rolls. This sponsorship works so well because the product showcased is relevant to the video content on offer. 

The presenter even offers interviewees TUMs when they struggle with a hot wing.

Taco Bell

Taco Bell, one of the world’s best-known fast-food restaurants, created a sponsored advertising campaign with Snapchat, which involved using a unique filter. The filter allowed customers to transform their faces into the shape of a Taco. 

Although it might sound unusual, it was the perfect sponsorship strategy for reaching a young audience.

The filter was viewed over 224 million times and helped drive 30 million in-store visits for the company. Partnering with Snapchat in a sponsorship deal allows Taco Bell to showcase its fun and light-hearted side while attracting a specific audience of younger customers. 

The overall campaign was successful primarily because it allowed Taco Bell to deliver a unique experience to its target audience.

Rolex

Rolex is one of the top long-time sponsors in the video content advertising world. The company works with TED, the group best known for producing high-value conference shows from experts discussing a wide range of complex topics.

Since 2007, Rolex has worked as an advertising sponsor with TED, creating original branded content to showcase in short videos. Notably, these videos were targeted to show around specific TED talks connected to key aspects of Rolex’s personality – design and innovation.

In 2012, TED and Rolex also teamed up to create a new app called “Surprise Me,” which directed customers to new TED talks with a click. Over the years, the relationship between TED and Rolex has evolved from a standard sponsorship into a true partnership.

Spotify

As mentioned above, the sponsored article is one of the most common types of sponsored content in the advertising world. Types of sponsored articles have appeared throughout the digital and offline worlds for decades. 

Companies can pay for sponsored articles to appear on websites, in magazines, and in newspapers alike. One excellent example comes from Buzzfeed, where Spotify sponsored an article about the 15 bands that might not exist without their brand. 

The content featured quick profile insights into some of the top bands around the world that Buzzfeed’s audience already appreciated. The article also links each band’s Spotify profiles, encouraging users to download the service.

Heineken

Heineken is one of the best-known companies in the world associated with sponsorship advertising. The company frequently invests in promotions connected to the UEFA Champions League. 

The organization has created everything from physical in-person ads to Instagram-sponsored stories. The sponsored stories produced by the company are an excellent form of “native advertising.” 

They don’t appear as pop-ups or invasive promotions. Instead, they show up between other Instagram stories users look at themselves. 

This helps to reduce the risk of typical ads interfering with a customer’s browsing or online experience. Heineken even created a full-content story revolving around the value of in-person dating in a world of online romance.

The world of sponsorship advertising

Sponsorship advertising can be an incredible tool for today’s business leaders.

It’s an opportunity to increase brand awareness and reach and boost the reputation of a growing company. Used correctly, this tool can increase sales, build customer relationships, and even open the door for better brand equity.

However, like any marketing strategy, it requires careful planning.

Aligning with the wrong environments or entities can cause significant damage to a business. Companies must be careful to ensure they’re sending the correct message, or they could risk losing all the benefits sponsorship can bring.

Fabrik: A branding agency for our times.

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