The concept of sponsorship dates all the way back to 330 BCE, with rich Roman elites voluntarily sponsoring the gladiator games and other sporting events to garner public affection and enhance their reputation. In fact, most of the artwork and research of the Renaissance was sponsored by private families, banks, or academic bodies. The Medici family, one of the greatest and most famous patrons in history, may be one of the first examples of the use of sponsorship as a way to increase and reinforce the family’s (and their bank’s) strength in Italy and in Europe.
But we’ve promised you this would be a ‘brief’ history of sponsorship, so let’s fast forward to the birth of the TV, when commercial relationships really began to develop (but if you’re really into it, here’s more from Forbes on the topic of ancient Olympians and their sponsors).
The media boom of the 19th century rapidly advanced because of postal systems, increase in newspaper accessibility, and modernizing of education. In 1927, the TV was created, unleashing a new world of opportunity for industries born from the industrial revolution, not even three generations prior. At first, it was a “handshake” agreement: these commercial relationships kept television and radio organizations alive in exchange for their special degree of access to the consumer population. TVs and radios were truly household treasures, and brands sought to become household names through sponsoring radio and TV programs. In exchange for funds to put on the program, the sponsors often had their names featured in the titles of the shows: some people might still remember "The Maxwell House Showboat" or "The Eveready Hour."
In the late 1980s through the 1990s, corporate sponsorships exploded. For example, in the late 1980s, college bowl games lost their traditional names in favor of their sponsors: the Fiesta Bowl became the Sunkist Fiesta Bowl, the Orange Bowl became the FedEx Orange Bowl, and so on. Sports' stadium naming rights followed suit . For example, Boston’s most famous “garden” got a face lift and a new name: on March 3, 2005, Maine-based TD Banknorth, a U.S. subsidiary of Toronto-Dominion Bank, announced its purchase of the naming rights for $6 million per year (shoutout to Boston, the Bruins and the Celtics!).
Corporate sponsorships also became more integral for nonprofit organizations. You’re familiar with this type of sponsorship if your company has ever organized a run or a drive on behalf of the Red Cross or the Pancreatic Cancer Action Network.
Sponsorship made its debut across various industries at different times, but we can name a few firsts below:
- First non-profit sponsorship: YMCA, sponsored by state railworks across the US, 1877
- First sponsored stadium: Fenway Park, Boston MA, 1912
- First sponsored radio programs: The A&P Gypsies, Champion Spark Plug Hour, The Clicquot Club Eskimos, and King Biscuit Time, late 1920s
- First TV commercial: 10-second ad by Bulova Watch Company, airing on NBC-owned WNBT before the Brooklyn Dodgers game. Cost $4-$9 to make and viewed by 4000 people in NY, July 1 1941
- First TV show sponsorship: Bristol-Myers Squibb, a pharmaceutical company in NY, sponsored the TV show Geographically Speaking on NBC, 1946
- First brand-TV show sponsorship: Colgate Comedy Hour, Sept 10 1950
- First year-round sponsor of TV show: Mickey Mouse Club TV series sponsored by Mattel, 1955
As both radio and TV became more saturated over time with commercial sponsorships, it became apparent there was a glaring content control problem. Programs at the time were supported by a sole brand: resultantly, the advertiser had all the decision-making power, including over content.
Enter Pat Weaver, NBC executive. Weaver placed control of programs in the hands of the networks that broadcasted them, meaning that advertisers now could purchase rights to blocks of air time, but had no control over content. You’d think this would have caused an uproar across corporate America, but actually it led to smoother negotiations entering into the 1960s. Multiple brands could advertise on a single program, opening up access to more audiences, which was a familiar marketing concept given that it followed the same model for ad rights in magazines at the time.
Weaver used this model for TV shows like The Tonight Show and Today. It was a much more cost-effective way for advertisers to reach the masses. In exchange, the shows had creative freedom and didn't have to worry about limitations set forth by the sponsors. We will continue to observe the balance between creating engaging, authentic content and managing conflicting interest groups as we see how sponsorship evolved into the digital era. Hint: it’s important that content creators remain in-tune with the wants of their sponsors, but also free to create the content that has garnered such a following as to be valuable to the brand partner in the first place.
In the 1960s, TV watching audiences were not only aware that they were being advertised to through the screen, but they actually looked forward to watching the ads. Many now-famous jingles and mascot-characters were born during this “golden era” of advertising, earning brands massive profits, all the while earning a place in America’s heart with their catchy earworms.
But as we well know, all good things must come to an end, and much of the growth of the decades prior was quelled by the 1970s. In response to the massive growth of the previous decades, the 70s-90s saw a series of regulations against radio and TV content, heavily centering on what types of products could be advertised to which types of audiences, and how. Popular brands like Marlborro, for instance, had to stop advertising on radio and TV all-together after the The Public Health Cigarette Smoking Act of 1970, which initiated the idea that certain adult products cannot be advertised on platforms that children could be influenced by.
Throughout the 70s and 80s, commercials flourished while long-term program sponsorship relationships dwindled. Nonetheless, the SuperBowl brought us timeless traditions we still enjoy today: watching the SuperBowl commercials was and still is a highlight of the championship broadcast itself. If you’re feeling reminiscent, you can watch the 1979 Mean Joe Greene Coca Cola ad here.
Other commercial giants like Nike found their footing in commercials, such as the 1982 ad featuring the Chariots of Fire theme song that showed the evolution of running from cavemen to marathon racers. Apple wasn’t far behind: in 1984, they produced what is now known as one of the most famous commercials of all-time, directed by Ridley Scott. The results were proof that well-thought content worked wonders on sales, as the company sold $155 million in Macintosh computers just three months after the ad aired.
Throughout the 90s companies began experimenting with content, trying to better understand their audiences and leveraging commercials to tell a story about their brand. Picking and choosing from popular and successful tactics, 90s TV ads still saw their fair share of jingles, but we also saw pop culture characters involved in marketing efforts (such as the Simpsons for Butterfingers). Of course, with the rise of TiVo in 1999 and other recording/streaming services soon after (think Netflix, born in 1997, but not far from producing its first streaming content in 2007), the world of commercials was starting to change. According to a study by Duke University, about 95% of the population was still watching television live in 1999. Commercials were still the main avenue for most companies entering the new millennium, but not for long.
If you’re a millennial, you remember the evolution from the VCR cassette tape to the DVD to the Blu-ray to the digital copy that can now be streamed from a variety of 200+ modern-day streaming providers. You’ll remember going from a walkman to a discman to an iPod (bless the Gods of creation!) to the iPhone (unless you’re an Android fan, in which case you probably had the SanDisk MP3 player and later transitioned to the T-Mobile G1). With the rapid flux of technology changes we endured, our generation’s creative solutions may be partially responsible for today’s massive podcast community and followership.
The iPod was born on October 23 2001. By 2004, not even 3 full years later, the term “podcast” would be born. On September 28 2004, there were 526 hits on Google's search engine for the word "podcasts". Google Trends marks the beginning of searches for "podcast" at the end of September. On October 1, 2004, there were 2,750 hits on Google's search engine for the word "podcasts". This exponential growth saw increases of podcast searches doubling every few days, explaining why we now can find over 1 MILLION unique podcasts on iTunes, with a whopping 30 Million episodes collectively.
Where exactly did the idea of the podcast come from? Adam Curry and Dave Winer are widely credited for inventing podcasting. Originally developed as a method of downloading internet radio broadcasts to a portable device, former MTV video jockey Adam Curry and software developer Dave Winer wrote a program called iPodder that coded these downloads to the iPod device. After several improvements and developments, podcasting was officially born. Fun fact, Curry now hosts a show called The Daily Source Code, one of the most popular podcasts on the Internet.
The first mentions of the word we can trace to an article by Ben Hammersley, writing for The Guardian. No one at the time quite knew what podcasting would evolve into, but with the new tech abilities of the iPod to store and playback recorded audio, and consumer attention to TV, radio, and music at an all-time high, it seemed like the next step to begin backlogging digital visual and audio content.
Podcasting made its way into the People’s Choice Awards not but two years later, showing the rapid growth in followership experienced between the iTunes update and the first podcast creation softwares. It’s almost as if podcasting technology had to catch up to the instant demand it encountered. An early copy of Marketing for Dummies reflects the following resources already existed to podcasters in 2007:
Sponsors weren’t far behind on the trend: in Dec 2005, the podcast Mommycast, a radio talk show for and by mothers, struck the first commercial deal with Dixie. Some textbooks still use this historic deal as a model for how brands can strategically choose content producers with a very specific demographic that will have the most appeal for their product or service.
Still, most of the early sponsors of podcasts were other publications like magazines and talk shows.
However, we can see on a security podcast in 2006 that Core Security and Syngress (e-book platform) became consistent weekly sponsors. Pulling up a comparison over time, we can see that Technology podcasts were in the top 3 of sponsored content between 2006-2008 when the first sponsorships were just beginning. We can see that podcast may have had more consistency, but YouTube was still the dominant area for brands to sponsor content even back in 2006-08:
By 2008, Edison research showed that approximately 37% of Americans had heard of podcasting, and 19% of internet users had downloaded at least one podcast. Here lies the key to podcasting: even in its first years of growth, it wasn’t a saturated marketplace for brands to explore. Most of the early podcasters were the exact opposite of the traditional sponsorship model: whereas famous celebrities, athletes and cartoons were used to sell products throughout the past 50 years, podcasting was one of the first examples of how absolute “nobodies” could gain, maintain, and grow audiences of nearly 1 Million global subscribers. The podcast may have been the birthplace of the “micro-influencer” for this very reason.
In 2013 many of these well-known podcasters were sued by Personal Audio LLC - now known as the “Patent Troll” - for royalties for any podcasts produced since 2009, where they claimed to have a patent for podcasting. Nearly four years later, the Electric Frontier Foundation ruled that Personal Audio did not invent podcasting, settling the matter. Around the same time, we see the emergence of celebrities into the podcast world. Joe Rogan, Dave Ramsey, Dax Shepard and Bill Simmons are currently running the highest-paid podcasts, showing that micro-influencers and celebrities alike are exploring the possibilities of podcast.
YouTube was born at almost precisely the same moment in time as the podcast, but with a much more definitive purpose even in its origin. Co-founder of the platform Jawed Karim uploaded the first YouTube video to the site on April 23 2005. Since then, the video, entitled “Me at the zoo”, celebrated its 10 year anniversary measuring 2 billion daily views on the the platform. In 2015, 18-49 year-olds spent 4% less time watching TV, while time on YouTube went up 74%. Just like podcasting, YouTube saw a dramatic and steep increase in growth, jettisoning the platform to the most-searched and watched provider, only behind Google in total daily searches.
Now, according to Statista, as of May 2019, more than 500 hours of video were uploaded to YouTube every minute. EVERY. MINUTE. The site is a content smorgasbord with too much content to manage, and typical problems YouTube still deals with is content labeling, censorship and removal of videos that violate its community policies, and intellectual property rights infractions or licensing issues.
Early records of YouTube are almost impossible to pull - YouTube’s search features allow you to sort by upload date, but not by recent vs. first posted. Thus, the challenge of digging up the first videos that existed on the platform, let alone the first videos that were sponsored by a brand, requires a bit of powerful tech. Luckily, ThoughtLeaders’ platform pulls all content from any influencers’ channels regardless of sponsorship, so we’re able to dive deep into the history of YouTube.
For an understanding of how commercial relationships evolved on YouTube, we should look at the lifetime of content of some of the biggest content creators. Smosh had an account by November 2005, and not long after, Ask a Ninja channel created their account the next month. Sponsors appeared on Ninja’s channel in 2006 briefly, whereas Smosh didn’t get a single sponsorship deal until 2015. It’s a wide range of time between starting a channel and getting sponsors. Nonetheless, we can see Smosh has a solid lineup of sponsors after their initiation in 2015:
On the flip side, if we look at the “sponsors” of Ask a Ninja, we are seeing, of all surprises, a PODCAST sponsoring a YouTube video (littlemanpodcast).
This isn’t exactly the type of sponsorship relationship we see on YouTube today… let’s keep digging. We’re looking for some of the first channels that framed their content as a marketing tool for brands.
Nigahiga is a very interesting channel that was also among the earliest to create a channel (2007) and gain a massive following (21 million subscribers and counting!). Most of the content is filled with many different skits, “How to” videos, rants, and music video parodies. He also answers fan's questions, and he calls this series “Dear Ryan.” Nigahiga is still very active thru 2020, but again, we are only seeing consistent sponsorship on his channel starting in May 2018 with a sponsorship by Epic Games.
So which content creator was the ultimate “pioneer” of sponsored content? Actually, it’s none of these majorly followed channels, showing that YouTube is a tricky beast, indeed. The first video on YouTube to reach 1 million views was in fact a commercial from none other than Nike, featuring Ronaldinho. The video aired October 2005 on Nike’s periphery channel Nikesoccer, and is the first real example of a video that was created as an advertising mechanism on YouTube. You can check out more on the video and all the audience engagement it generated on the site WayBackMachine, one of the only 3rd party sites that hosts historic YouTube content.
While the Nike video isn’t an example of how brands sponsor content producers on YouTube nowadays, it shows that brands were leveraging YouTube to sell and increase brand awareness even back in 2005 only months after the site was even created. Martha Stewart and her related brands took a very similar approach on YouTube, creating a channel in 2006 and posting links to popular Martha Stewart products in the captions of her “How to” videos. Organic mentions and owned media was the earliest form of marketing we’re seeing on YouTube, but as we continue past 2010, these channels began to receive a lot less followership, as YouTubers were creating channels en masse and saturating the platform with content.
If you checked out some of our industry trend reports, you wouldn’t be surprised to know that the majority of the YouTubers that began building commercial relationships during this phase were in fact gamers. iJevin was sponsored over Acixs Hosting in over 1600+ unique gaming videos the content creator made since 2011. Similarly, iJevin was sponsored 1500+ times by Feenix, with both these brands popping up on almost every single video the gamer ever made.
Between 2006-2008, here are a list of the top channels mentioning “sponsorships” in their content:
Besides Martha Stewart’s channel, every other channel showing the most mentions of “sponsors” from 2006-2008 on YouTube is a gaming channel. Gamers sell products really well: everything from apparel to energy drinks to computer tech and audio accessories works really well on various channels. For more insight into the modern gaming channels and best sponsorship practices, check out our industry report here.
So - we know that Nike and Martha Stewart were definitively the leaders in early advertising on YouTube, and we know that gamers were definitely the content pioneers for sponsorships on YouTube. But who is the king of sponsored content on YouTube? Who got their start during this explosion period and is still winning big on YouTube, nearly 10 years later?
DadLabs is probably the first YouTube channel to get multiple, repeat sponsorships from well-known brands. The YouTube channel features unboxing videos and reviews of popular baby and kid products. In 2007, just before the “big YouTube boom” of branded content marketing, DadLabs had JetBlue, BabyBjorn, SitterCity, Graco, and Boon. We can see how they attracted some major names to their channel because they have a strong, consistent format of reviewing products parents can find useful. We’re showing at least 473 sponsored videos from 2007-2012 - videos slowed and stopped from DadLabs after 2012, but it makes sense. Their focus on authentic parenting content means that when the kids grow up, the baby product review videos stop coming. Their last video was officially in 2016, and even though they only produced 25 total videos between 2013-2016, they were still getting major sponsors in the last years of producing content. BestBuy, Dove Men’s Care, Clorox and Hot Wheels added themselves to the channel to sponsor videos between 2013-2016, showing that there was still a solid ROI from this channel for family brands even without producing the usual weekly videos.
From the trend chart above, which shows mentions of “sponsored by”, “brought to you by”, and “thanks to our sponsors” (among other keywords that identify sponsored videos on YouTube), 2010 is when brands really started queuing up influencers on YouTube. GoDaddy, Anchor, Audible, and Cisco all began sponsoring heavily in 2010 (and all of these brands have continued to ramp up over time, showing that they’re investing more money annually into branded content efforts on YouTube). While new brands that make their debut into sponsorship now can quickly build up to an enormous audience reach and 1000+ mentions, we’re seeing that the older the brand, the more likely that they are a leader in their content space(s) and brand strategy when it comes to sponsorship. Possibly because they’ve tried and tested so many channels throughout the years, they might have a head start on the data side of understanding how to successfully test YouTube.
Brands can learn some very important lessons by looking at the historic trends of other brands, whether they’re direct competitors or “guide brands” that fit the same demographic. A brand’s sponsorship trends can tell you whether to test podcast, YouTube, or a mix of both. You can gain insight on how to promote your product by looking at how brands change up their offerings over time, and most importantly, you can understand which types of content and which unique influencers will drive those sales best for your brand.
Some key takeaways from the early days of sponsorship?
What does this mean? Influencers are doing a decent job at integrating promotional and marketing materials from their brand sponsor into the content of their videos.
What does this mean? YouTube audiences are evenly split on their likelihood to trust or distrust a sponsored YouTube channel or video.
What does this mean? Brands, whether centuries old or still in their infancy, are able to use branded content to increase audience engagement and brand awareness. Now, many D2C brands are funneling most of their marketing budget into branded content efforts, showing that “micro-influencers” have always been an important element of any company’s marketing strategies, and that YouTube and podcast have brought it into the digital era.
What does this mean? Podcasts have a more engaged audience, generally speaking. YouTube’s visual format just makes it slightly easier for consumers to click-thru to the advertisement landing page. Many people have called for a podcast aggregator, essentially a platform built like YouTube but for podcasts. They’ve suggested a centralized database could allow for more visual content relating to podcasts to help facilitate more click-thrus, but this centralization would run the risk of ostracizing popular indie podcasters.