At present companies and industries like to sponsor sports events. Two reasons are put forward to explain this phenomenon. The f

It is common nowadays for companies and industries to sponsor big sports events. For example, many companies sponsored the 8th National Games held in Shanghai in 1997. Then, what exactly do companies and industries get out of sponsoring big sports events, such as international games? And why do they do so?
    There is an obvious answer and a not so obvious one. The obvious answer is that they get known worldwide, particularly if they are the principal sponsor of an event. This is especially important when you consider the number of countries around the world that might show the event on TV. The not so obvious answer is that sponsorship can help firms to save money.
    Then how can they save money in this way? Companies can claim expenditures on sponsorship or "support to sport and the arts" against the amount of tax that they owe. So, if they are going to have to pay tax anyway, why not spend the money on promoting their name or product?
    However, sponsorship is surely a very expensive business. So, how does one decide which events or activities to support? Companies spend a lot of time making sure that they have a perfect match between the products to be represented and the activity that needs sponsorship. Basically, companies have to make sure that the image is right and that the product gets maximum coverage through the event. I mean, you wouldn’t expect a company whose product has a young international image to sponsor a sport that has a following among older people. There are all sorts of reasons behind sponsorship. That’s what the game’s about for those who are trying to sell it.
    There are some important points to consider before agreeing to sponsor an event.
First and foremost, I suppose, is the popularity of the event -- in global terms, I mean. Events like the World Cup and the Olympics have businesses queuing up to offer sponsorship. There are the big media events: hours and hours of TV and satellite coverage guaranteed all over the world, as well as press coverage and the possibility of photographs that in some way advertise your product. Most events aren’t quite like that though. I suppose you’ve got the national games every four years in China. But most events appeal to only a limited proportion of the potential audience -- tennis, for example. Most of the audience there is young, so products for the young are the ones that you would associate with the event.
    Then how do you match up the product with the event? The most important thing with the smaller event is to identify the audience it’s going to appeal to -- in this instance, tennis and young people. That should attract drinks manufacturers, sports fashion designers, cosmetics producers, and so on. Then you look at the potential coverage in the media. It’s the sort of event that might attract Coca-Cola or Pepsi -- maybe even McDonald’s.
    In sponsoring sports events, it is not just the media coverage that matters. The important question is whether the people who’ve either been to the event or read about it in the press will be more likely to buy your product as a result. A lot of the advantages of investment in sponsorship are longer-term. People who have possibly read about or watched an event on TV may not even be able to tell you who was sponsoring the event, yet will react favourably if asked to comment on products marketed by the sponsoring company. They have been conditioned in some way. Conditioning the mind is what advertising is about. Believe it or not, straight advertising is a far more expensive way of promoting your image than sponsorship, and what’s more, sponsorship is mostly tax- free.
    To sum up, today we have talked about sponsorship of sports events by companies: the reasons behind and a few related points. I hope this will help you gain some insight into the issue.