Ad placements in media must be clearly labeled as sponsored messages.
Advertising and sponsorships actually are correlated terms that have much overlap in practical marketing applications. Advertising is the nonpersonal delivery of an paid advertising message through some form of mass medium. Paid sponsors are generally speaking for the companies that pay a particular medium to use space or time for ad placement. Event sponsorships are a unique form of sponsorship in which companies pay to help fund an event in exchange for sponsorship mention.
Advertising Basics
Richard F. Taflinger of Washington State University notes in his lengthy discussion "A Definition of Advertising," that advertising must meet three specific criteria. First, it is a paid message, meaning the sponsoring company pays for time or space to deliver it. Second, it is delivered via a mass medium (eg. TV, radio, magazine, newspaper, Internet). Third, it attempts to persuade. Public relations, though similar, is not technically advertising because companies do not by media space in PR.
More About Advertising
Traditional media used in advertising are TV and radio (broadcast), magazines and newspapers (print) and, most recently, the Internet. Large companies routinely use one or more of these media, while small businesses typically have to seek out the least expensive options. Other support media, such as billboards, transit, specialty items, directories and many other niche media, often are used to further reinforce a company's advertising campaign. Companies put together objectives, strategies and budgets and then pay to deliver advertising messages through various media, attempting to induce a particular customer segment to buy.
Sponsorship Basics
When advertising agencies and media refer to sponsors, they are typically talking about the company or organization that pays to buy media space. Thus, the general use of sponsorship is in reference to the paid sponsor of an advertising message delivery. In fact, Taflinger discusses legal context of sponsor disclosure in media. The Federal Trade Commission (FTC) has oversight over ethical advertising practices and requires that advertising messages have clear distinction from media content through sponsorship disclosure. For instance, a newspaper reader should know the difference between media content and an ad placement through clear labeling of an advertisement, typically noting the sponsor. This makes it clear to the reader the message is not endorsed by the medium but is paid for by a sponsor.
Corporate or Event Sponsorship
Corporate sponsorship is defined by Business Dictionary as the "financial backing of a public-interest program or project by a firm, as a means of enhancing its corporate image." Corporate or event sponsorship is a more specific form of advertising. US Legal actually uses the phrase "a form of advertising" in its definition of corporate sponsorship. Companies sometimes sponsor charitable events or community activities to build their image as a socially responsible company. Others sponsor major events or activities to connect with targeted audiences at the events or viewing through media coverage.
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