Sports Sponsorship in Decline

The global financial crisis is causing sponsorships in Australian sport to decline, according to research by Sweeney Sports.

As Sweeney Sports General Manager Todd Deacon explains "corporate sponsors generally are cutting back on sponsorship activities, or are considering it, while rights holders are having a tough time signing new deals."

The survey shows that 27% of corporate sponsors have quit existing sponsorship as a result of the crisis; 31% have cut funding for existing sponsorships; and 48% have put a hold on signing new sponsorships.

And Sweeney Sports believes that the situation is likely to get tougher with 27% of corporate sponsors saying they will exit existing sponsorships in 2009 and 47% saying they will cut funding for existing sponsorships.

Deacon added he expected big-name sponsors to remain in their long-term sponsorship deals but he expected mid-sized and smaller sponsors to suspend deals.

By contrast, arts sponsorship has suffered less with only 17% of sponsors planning cutbacks.

20% of Australian companies experienced an increase in their sponsorship budget last year. Companies are believed to have reacted swiftly in 2009 to cut their expenditure because of threats to revenue.

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