Sport sponsorships and endorsements are prevalent today as it is an investment with a high potential return in the form of public awareness to the company brand and/or cash (Copeland, Frisby, & McCarville, 1996; Myung-Soo et al., 1997). There is no doubt about what sport sponsorships can potentially achieve for the companies and the sport properties. In fact, sport sponsorship is one of the best channels to reach out to potential consumers (Buchan, 2006). So, is there a reason why sport sponsorship and endorsement is so effective in its outreach and influence?
In my opinion, I would like to borrow the psychological concept of what is called “Halo effect” to explain the phenomenon mentioned above. First of all, what is Halo effect?
As explained and illustrated in the video, Halo effect is a form of cognitive bias in which an individual will associate their initial impressions of a person, event or business with every other aspect of that mentioned entity. For example, in a classroom setting, teachers might think that a well-behaved student will be able to perform better in class. However, it is not necessarily true and the teachers had fallen prey to the Halo effect where he or she associated a positive impression of the student with other non-related aspects of the student (Lasky J, 2016).
With that being clarified, we will now discuss how Halo effect has an impact on sport sponsorships and endorsements.
Spectators of a sporting event are generally passionate followers of the sport or a religious supporter of a certain team as they are willing to invest their time and money to watch the game in person. These group of people tends to get emotional as they cheer for their team, feeling the excitement and adrenaline coursing through their body. What they are feeling then is a form of feel-good stimulus, and if the event were to conclude without any major hiccups, these people will have a good impression of the event. Since the sponsors’ logo are highly visible in the venue, Halo effect will cause spectators to associate this positive vibe for the event with the sponsors, strengthening the credibility and impression of the sponsors.
Likewise, Sport celebrities are established personalities who have favourable traits or skills. They have great influence over the general masses as many look up to them and treat them as their role model or even idol. These sport celebrities are well respected and people treat them with admiration. So, if these celebrities were to endorse a brand, Halo effect can be observed whereby people will associate the brand with the celebrity. As a result, the brand will seem more trustworthy and reliable than before.
The opposite of Halo effect is also possible where people tend to associate a bad trait or impression of a person, event or business with other aspects of that entity. The reason for certain failures of sport sponsorships and endorsement is due to the Horns effect. For example, Tiger woods lost $22 Million of endorsement in 2010 due to his sex scandals and bad performances. Brands such as Gatorade, AT&T, and Accenture withdrew their sponsorship as they were afraid that the suffering reputation of Tiger Woods might jeopardize their brand equity and credibility.
In conclusion, the Halo effect can be used to explain why sport sponsorship and endorsement is such an effective tool to improve companies’ brand and awareness to it. On the contrary, the Horns effect can be used to explain why some companies decided to terminate their sponsorship with certain sport property.
Copeland, R., Frisby, W., & McCarville, R. (1996). Understanding the sport sponsorship process from a corporate perspective. Journal of Sport Management, 10(1), 32-48.
Bucha, Nick. (2006). “Sports Sponsorship – Still Giving Enough bang for the Buck?” B&T Weekly, 56 (2567), 5.
Lasky J, (2016 Jan). Halo effect. Salem Press Encyclopedia of Health.
Wei W. 2010. Tiger Woods Lost $22 Million In Endorsements In 2010. Business Insider. Available from: http://www.businessinsider.com/tiger-woods-lost-22-million-in-2010-endorsements-2010-7?IR=T&r=US&IR=T