March 9, 2009 / 5:07 PM / 10 years ago

McDonald's not cutting '09 sponsorship budget

CHICAGO (Reuters) - McDonald’s Corp (MCD.N), one of the largest corporate sponsors in the sports world, does not plan to cut its 2009 global sponsorship budget despite the recession, a top marketing executive for the fast-food giant said Monday.

However, the company will shift to a more strategic approach, with more focused events and programs within its various sponsorship deals, to try and connect better with consumers, said Johan Jervoe, corporate vice president in charge of global marketing.

“We’ll probably be at least spending flat, but in a very efficient, very focused way,” Jervoe told Reuters while attending a conference sponsored by IEG, a unit of ad giant WPP Plc (WPP.L) that tracks sponsorship spending.

“We need to apply a new model and that model is doing less things deeper and better,” he added. “It’s not about having as big a tool box as we used to have in the past.”

McDonald’s, the world’s biggest hamburger chain and one of the globe’s most recognized brands, spent $125 million to $130 million on sponsorships in 2007, ranking it the 12th biggest spender in North America, according to IEG. The research firm no longer provides estimates for individual companies, but in 2008 McDonald’s was a global sponsor for the Beijing Olympics.

McDonald’s and other fast-food companies have outperformed many higher-priced chains as a global financial crisis has forced diners to look for ways to save money on meals.

Most U.S. sports leagues have been hurt by the recession and the resulting pullback in consumer and corporate spending. The National Football League and National Basketball Association cut jobs, Major League Baseball froze its 2009 budgets and some smaller leagues have folded teams.

McDonald’s is not backing away, however, because it sees sports, whether on a large scale with the Olympics or at the grass-root level with youth programs, as a way to tap into consumers through something they feel passionate about, Jervoe said.

“Sports sponsorship in general, but in particular during rough times, is really a great enabler to connect with your consumers,” he said. “There’s a lot of buzz around sports.

“If you look at not only the current environment but the clutter in general in advertising, finding the way of being engaging and connecting through sponsorship is going to be the future,” he added.

McDonald’s is not, however, looking to add sponsorship deals as other companies cut their spending, he said.

“The hardest discipline of sports sponsorship is always saying no,” Jervoe said. “At some stage, you just can’t do it all.”

Reporting by Ben Klayman; Editing by Tim Dobbyn

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