Global sponsorship spending to rise 5.2% in 2011

Global spending on sponsorships of sports and other activities is projected to rise 5.2% this year after a stronger-than-expected increase in 2010, according to a research firm that tracks such spending.

Spending on sports, causes, festivals, the arts, entertainment tours and associations is expected to grow to USD 48.7 billion in 2011 from USD 46.3 billion last year, said IEG, a unit of advertising giant WPP Plc.

In North America, such spending is expected to rise 5.8% to USD 18.2 billion, IEG said.

"We're confident the industry has rebounded from the historic low point of 2009," IEG Senior Vice President Jim Andrews said in a statement.

A year ago, the North American sponsorship industry lamented 0.6% lower spending in 2009 -- the first decline ever -- as corporate backers slashed budgets during the recession. Global spending rose 2.1%, however.

Last year, spending rose 5.2% globally and 3.9% in North America, ahead of IEG's projections for growth of 4.5% and 3.4%, respectively.

Expected sponsorship spending growth in 2011 should outpace media spending, projected to grow 3.9% in North America this year according to WPP's GroupM.

By category, sponsorship spending on sports -- the largest segment -- is expected to increase 6.1% this year after increasing 3.4% last year, IEG said. While the four major North American sports leagues saw 7.6% growth last year, other types of sports saw little or no increases.

Growth in spending on cause sponsorships is expected to slow slightly to 5% this year from 6.7% last year, IEG said.

Growth in spending on the arts is expected to rebound to 5.1% from 2.7% last year as the segment's two largest backers -- automotive and financial -- return, IEG said.

Spending on entertainment tours and attractions in 2011 is expected to grow 5.9%, followed by 5.6% for associations and membership organizations, and 4.9% for festivals, fairs and annual events, IEG said.

As for total dollars spent, the breakdowns in North America are expected to remain unchanged from 2010 with sports at 68%, followed by entertainment tours (10%), causes (9%), arts (5%), festivals (5%) and associations (3%), IEG said.

Outside North America, Europe will remain the largest source of sponsorship spending, followed by Asia Pacific, IEG said. However the fastest growing region will be Central and South America.