Generalizing across generations, or not? A comparative study of sport sponsorship outcomes across generational cohorts

Abstract

Millennials are the ‘new shiny thing’ - everyone seems to want a piece of the largest consumer segment in history. However, alarmingly for sports businesses, Millennials do not seem to be consuming sport. TV viewership is falling, and to make matters worse, the Millennials who do consume sport are believed to have low sponsorship responsiveness. This threatens the ability of the sport to score lucrative sponsorships since the size, attractiveness and responsiveness of the sport’s audience is a key determinant of sponsorship value. The resultant situation is highly concerning as without sponsorship revenues, the sport would financially bleed. Despite this alarming context, the hard facts are missing. No comprehensive research exists across the three main cohorts (Millennials, Generation Xers and Boomers) to investigate how the cohorts differ on key sponsorship outcomes. This research gap forms the basis of our study. Our study uses Formula 1 as a case study and is based on highly identified fans of the sport. Using the communication hierarchy as a framework, we studied six key sponsorship outcomes (starting from sports consumption up to sponsorship influence on purchase ) across cohorts. The findings revealed that Millennials were on par with Gen Xers and Boomers for every sponsorship outcome - in essence, there was no evidence to show that Millennial consumers were less responsive to sponsorship. We also noticed that the sports consumption habits of Millennials and Gen Xers are converging, and that sports businesses would be well served to expand their measures of sport consumption to include digital platforms. Further, we developed models to predict sponsorship outcomes overall and by cohort for involvement, sponsorship awareness and sponsorship influence on purchase - as well as identified their key drivers. Our research helps sports businesses understand / adapt to ongoing changes in the sporting landscape with respect to Millennials - and also gives them the tools to make a strong business case for sponsorship. For sponsors, our findings can contribute to better sponsorship selection, valuation, design and effectiveness.