Sports Sponsorship, Brand Value, Financial Performance: An Empirical Analysis
Keywords:
Sports Sponsorship, Brand Value, Financial Performance, Sponsorship Investment, Brand-Sponsorship congruence.Abstract
In this Study, the impact of sports sponsorship spending on brand value and financial performance of businesses between 2015 and 2024 will be explored. It is a model that is based on the resource-based approach and signalling theory, and suggests that brand value is a mediator between returns from investment in sponsorship and financial success, as measured by return to equity, return on assets, and Tobin’s Q. The research uses a longitudinal panel of sponsorship activations for 180 firm-years across 62 publicly listed companies across four sectors: beverage, financial services, automobile, and telecommunications and clothing. The suggested associations are methodologically tested with bootstrapped mediation analyses and fixed-effects panel regression. The results demonstrate a strong positive relationship between the increase in brand value and amount of sponsorship expenditure (β = .58, p,.001). In addition, brand value (β =.41, p < .001) is an important determined of financial success. Interestingly, 68% of the net effect of sponsorship on financial performance is due to the brand value, meaning that the brand value partially mediates this effect. This correlation is enhanced by other factors, such as brand-sponsorship congruence and duration of sponsorship relationships, as shown by the moderation analyses. Sponsorships in the athlete endorsement category had the highest brand value gains, among all the categories of sponsorship analysed. The findings are very significant in support of the conceptualization of sponsorship as a strategic investment to boost intangible assets instead of merely a frivolous marketing cost. These are relevant to the chief financial officers, marketing managers and sport property rights owners and highlight the importance of strategic brand value management in sports. A number of limits are mentioned in the text that potentially affect the accuracy of brand value assessment: those regarding sample makeup and that concerning methods of measurement. It also recommends further studies which should be conducted in future, and the need for cross-national and longitudinal studies to better understand and apply it in different situations.
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