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Nonprofit, Association Sponsorships Expected to Rise in 2005

February 21, 2005

(Feb. 21, 2005) For-profit corporations and businesses are expected to spend more than $1 billion in sponsoring nonprofit causes in 2005, according to industry forecasts by the IEG Sponsorship Report.

In addition, those entities will spend nearly $340 million on sponsorship arrangements with associations and membership organizations.

Chicago-based IEG Inc. develops and publishes educational products and services focusing on all aspects of sponsorship. The IEG Sponsorship Report forecasts sponsorships levels every year. The publication estimates that overall sponsorships will increase by 8.8 percent to more than $12 billion in 2005.

The Report breaks down sponsorship projections into six areas:

  • Sports: $8.39 billion, up 9.4 percent from $7.67 billion in 2004
  • Entertainment tours and attractions: $1.15 billion, up 8.8 percent from $1.06 billion
  • Causes: 1.08 billion, up 9 percent from $988 million
  • Festivals, fairs and annual events: $507 million, up 5.2 percent from $482 million
  • Arts: $630 million, up 3.3 percent from $610 million
  • Associations and membership organizations: $339 million, up 10.4 percent from $307 million

Sports sponsorships are expected to make up about 69 percent of all sponsorship deals. In contrast, causes will receive about 9 percent of all sponsorship spending and arts approximately 5 percent.

In past forecasts, association and membership organization sponsorships were grouped as part of the festivals, fairs and annual events category because a majority of them were sponsorships of annual events. However, IEG reports that sponsors are no more likely to sign year-round sponsorships with these entities, necessitating a change in the groupings.

'Clearly, the for-profit sector continues to see the value of partnering with and sponsoring nonprofits and their programs,' said AFP president and CEO Paulette V. Maehara, CFRE, CAE. 'As opportunities grow, though, charities must be careful to guard the most precious asset they have--their good name and reputation.'

The AFP International Conference on Fundraising in Baltimore, Md., April 3 - 6, features a track on corporate relations, including sessions on cause marketing and developing corporate sponsorships.

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