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budSponsorship and internet marketing are proving to be a tough couple. But they need immediate attention and innovation if brands have a shot at finding an effective presence on social media networks.

Two recent datapoints illustrate the issue. Yesterday's IAB report of 2008's ad results showed a 40 percent drop in sponsorships online. That is a shocking plunge for a business that tracked a 10 percent overall increase. And IDCs report on social media advertising delivered last week showed sponsorships may be the only form of advertising social network users will tolerate. "Tolerate" is the operative word here. They will not tolerate any kind of traditional display approach.

That leaves marketers with three options. Get right with sponsorship, waste money on display ads, or take a pass on social networks. The only viable option is the first one. But there are understandable obstacles here, even some barriers that explain why sponsorship has been basically abandoned by marketers.

The business model for sponsorship is problematic right now. It is not a CPM-based ad model. It's not worth it for marketers to embrace it as such. It's not a performance-based model either, because sponsorship by its nature does not invite interaction. It ties a brand message or image to an event or service. It forms a relationship between a brand, content, and environment. Anyone who has seen a Coke billboard or Budweiser sign at a ballgame has seen sponsorship at its purest.

Sponsorship is a project-based model. Agencies hate project-based models, and on the internet project based models have been rare. In fact, effective sponsorship models have been rare. When The New York Times bailed on its paid content experiment in 2007, American Express was the sponsor of that once paid content. Did it work? It's hard to say because sponsorship isn't exactly branding and isn't exactly measurable through page view metrics.

However, sponsorship needs to make a comeback, and it can. Here are three ways brands can revisit the concept for social media:

  • Events: Social networks can be targeted like any other media.Brands can look for event opportunities that won't alienate relevant viewers, and won't reach irrelevant targets. If a social network can identify mothers within its network, for example, maybe that's an opportunity for a brand like 1-800-Flowers to make a statement.
  • Time Periods: Just as Budweiser shook up the internet disaply world in 2000 with its "happy hour" ads on Marketwatch.com, social networks should be able to assemble packages of dayparts or even weeks. This could be a ripe opportunity for entertainment companies. Apple has been telling the world that it's Keith Urban week. What if Facebook allowed his record company to sponsor a week for country music fans?
  • Creative executions: Site takeovers, contextual ads, spins on logos -  all of these are tried, true and abandoned models for sponsorship.

In no way should brands strike out and risk their equity, image or audience in the neverending pursuit of social media cred. But they can test, and they can start to focus on solutions for sponsorships. Brands have faced tougher challenges. The internet as a media has faced tougher challenges.

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Published 31 March, 2009 by John Gaffney

John Gaffney is US Editor at Econsultancy. Follow him on Twitter

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Comments (2)

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Matt

I'm really excited about the emergence of a sponsorship platform in social media and believe in a fourth option, namely the opportunity for brands to sponsor the content providers within a community. Not in a clandestine way, but in an open way in which their involvement is welcomed because it's funding the time of an independent expert to input into a community seeking advice. Admittedly, this approach would be highly involved and difficult to scale or automate. But I would argue that this kind of micro-involvement is what defines social media.

Brand sponsorship has for decades looked to claim attributable kudos from an association with mass consumer status holders (eg Michael Jordon and Nike) so it's not a great leap to brand sponsorship of niche consumer status holders. Offline, the currency is image. Online, the currency is knowledge. The reality is that very few major brands have the mandate to be able to add this value in an objective and independent way that would guarantee a positive reception. I would suggest it is likely to fall to the smaller, more empowered brands to experiment in the sponsorship areas you've suggested.  

over 7 years ago

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Sponsorshipportal-kevar

about 7 years ago

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