The question often asked about sports marketing and sponsorship itself is how effective is it? It is a fairly straightforward question and it really is a something that is a key issue any CEO, Marketing Director, Finance Director would be expected to question. Answering this question does generally require market research as a key component of the evaluation process. This is because both attitudes and behavior metrics are usually part of the overall business objectives. (See the Sponsorship Research & ROI presentation for more details on objective measurement).

Looking at the results of SponsorMap evaluations we can take a deeper look at what tends to drive a high performance sponsorship as opposed to one that is less effective. (A high performance sponsorship delivers above required business and marketing objectives).

In the attached diagram involves results based on various types of sponsors and property types from sports through to TV sponsorship and looking at different categories of sponsors as well. They include variety of evaluations that have conducted for sponsors in more than 18 markets.

One the left axis we measured the Passion Index, or passion that the target audience feels towards the sponsored property. The higher the emotional bond to the property, the higher the Passion Index. Generally, this means that the property (eg., sporting team, league, event or personality) that has the high rating has the strongest appeal to a target audience. Properties with less emotional appeal have a lower Passion Index rating. Sponsors generally, seek properties that have the highest appeal to the target audience itself and naturally these properties themselves tend to be more valuable.

On the horizontal axis we measure sponsor appreciation (Gratitude Index). This is a measure of the level of appreciation that a targeted audience feels towards the sponsor based on their sponsorship itself. Appreciation has be influenced by activation strategy, goodwill and general sponsorship fit itself. Some sponsors do not create a lot of appreciation if it is simply a logo viewing experience, but others that activate the sponsorship and engage consumers can create appreciation with consumers in the process. A well planned sponsorship integrated into a variety of marketing activities can certainly improve this rating.

Now the diagram below shows the Passion Index and Gratitude Index ratings from sponsorships where people were able to recall the sponsor itself. So we are looking at all those being aware of the sponsor, so it is a sponsorship related impact we are examining in detail.

What is interesting is that the high performance sponsorships have often involved both a high level of passion to the property and strong appreciation to the sponsor itself. The are the sponsorships most likely to achieve the best results.

There are always exceptions to the rule, but the implication for sponsorship itself should be a focus on effective property selection together with effective sponsorship activation. Many in the industry would already know this, but if anything, our research does tend to confirm good industry best practice. Nevertheless,  we are continuing to develop useful benchmarks for industry performance that should better answer the question on how to measure sponsorship effectiveness.

]]> http://www.sponsormap.com/sponsorship-performance/feed/ 0 http://www.sponsormap.com/april-webinar-dates-measuring-sponsorship-roi-webinars/ http://www.sponsormap.com/april-webinar-dates-measuring-sponsorship-roi-webinars/#comments Wed, 25 Mar 2009 05:25:07 +0000 SponsorMap http://www.sponsormap.com/?p=482 April will see the start of the monthly sponsorship measurement webinars. The webinar is free and is for those properties, sponsors and agencies seeking to learn more about sponsorship measurement. A presentation is conducted via the internet with a conference call and IM to allow for interaction from participants.

The main areas covered include:

• The Business Case for Measuring Sponsorship
• Understanding Sponsorship Theory and how it relates to measurement
• Developing a measurement plan based on clear sponsorship objectives
• An explanation of the various methods for measuring sponsorship
• Examination of some case studies from both sponsors and properties
• Issues particular to properties, sponsors and agencies
• Q&As

The following schedule for is for April:

April Measuring Sponsorship Effectiveness Webinars

US/Americas Zone (2 dates)

• April 3rd Friday US ET 2.00pm to 3.30pm
• April 9th Thursday US ET 2.00pm to 3.30pm

To register your interest please leave your registration details. Once registered we will send a reminder email with more information on the webinar.

The main areas covered include:

- Understanding Sponsorship Theory and how it relates to measurement of ROI
- Developing a measurement plan based on clear sponsorship objectives
- An explanation of the various methods for measuring sponsorship
- Examination of some case studies from both sponsors and properties
- Q&As

The webinar is free and will be conducted on the first week of every month and is for 60 minutes duration.

To register your interest please leave your contact details by clicking the link here.

Or visit the Webinar section of website.

We intend to schedule several different time slots depending on registrations.

Let’s take three examples, a soft-drinks sponsor, a mobile phone provider and an airline where the property for arguments’ sake is an european soccer team.  These three sponsors are distinctly different businesses that have quite distinct business models. When each sponsor discusses the ROI for their sponsorship investment they will consider it in terms of their own industry. A soft-drinks company will typically want to sell more cases of soft-drink whilst a mobile phone provider may want to see subscription growth and the airline may want to obtain more business class passengers or the opening of additional airline routes.

Whilst we a talking about ROI for all three, the actual numbers reported will vary depending on requirements. Any methodology that is used to report ROI needs to take into account the three different businesses themselves. If we are talking about soft-drink sales then we need to account for that in any ROI approach, the same goes for mobile phones or the airline business.

This is often forgotten and it is common to talk about ROI in terms of metrics that do not necessarily relate to the sponsor’s business. For example, the use of reports of logo exposure and media reach or arbitary rating systems that have their own series of metrics in the context of sponsorship ROI. This is useful information itself, but it is not a final ROI measurement that is sufficient to demonstrate how sponsorship benefits the business. This can be a serious mistake to make at board level where most senior executive are also seeking a financial perspective of the value of a sponsorship. A presentation that relies on estimates of media exposure is not going to be as effective as one that demonstrate sales lifts, brand equity improvements and a financial result in the language of the sponsor’s own metrics.

Dependence on pseudo ROI measures as central to sponsorship measurement often results in a sponsorship that is considered somewhat outside the regular marketing function. This may manifest itself in sponsorship research reporting that is considered in isolation from regular market reports or financial reporting. It is treating sponsorship as a ‘silo’ outside the regular business that does not integrate well with the rest of marketing simply because it chooses it’s own series of ROI metrics, a case of not comparing apples to apples.

For sponsorship ROI to work for a sponsor, it has to integrate into the language of the business. It needs to be evaluated as another part of the marketing budget and provide comparable marketing and financial metrics. Heads of Marketing and CEOs want to be able to see exactly how the sponsorship is contributing to their overall business.

This is a key consideration for the application of the SponsorMap approach. Measure all elements of the sponsorship based of how sponsorship works and then link these to existing business performance metrics. By doing so, we can identify sponsorship driven outcomes and put them into the context of the sponsor’s overall business performance.

Demonstrating how sponsorship is working on achieving business objectives by providing detailed information on sponsorship outcomes. Understanding how brand activation works for brands and identifying improvements.

For a soft-drink company we sponsor provide an estimate of soft-drink sales as well as brand specific information on brand equity improvements depending on the research brief. For a mobile phone company we can examine the sponsorship ROI in terms of key company issues such as subscription growth, total offers and churn. Airlines sponsorship ROI may involve 2 key areas, the first passengers and the second more related to corporate hospitality. The requirements for sponsorship ROI will need to be adjusted to reflect the nature of the business.

What we would be aiming for is to provide a series of ROI metrics including financial ones. A key consideration is that the ROI metrics we use need to be a currency that the sponsor understands. Talking simply about the number of media impressions or a high sponsor recall number is not enough. We should be able to talk about how the sponsorship has improved the brand, increased sales and put a dollar figure on returns made for the investment.

For properties, providing sponsor ROI is possible but is better with some customization of the measurement approach. In the example of the European Football team, providing key metrics in the language that the sponsors can easily take and report to their management teams is just smart relationship management.

This process of relating the sponsorship ROI to the sponsor’s actual business is a key reason why a considered approach to sponsorship ROI measurement will deliver a much better result that is understood and valued. It requires more effort but the results are much more meaningful and valuable to sponsors as a result of the process.

However, design of the scale is strongly influenced by Balance Theory. Observably, most people modify their attitudes to a sponsor if the sponsor supports a property which is important to them. According to the theory, this represents a shift from imbalance in a relationship to balance generally resulting in better perceptions of a sponsor or benefactor.

The scale is based on core questions and is specific to SponsorMap™.

These are fair questions for the sponsorship industry, as the slower we pursue measuring the value of sponsorship, the quicker we may hasten sponsorship’s demise. If we do not provide fair and objective estimates of the effects of sponsorship, there may be less money available for sponsorship activities as marketing dollars are allocated elsewhere, perhaps to those areas of marketing that can demonstrate effectiveness.

Most of us believe that we can at least partly measure the impact of a sponsorship investment. We are generally free of the dark old days of sponsorship, when accountability seemed less an issue. This was when sponsorships provided senior executives the chance, to side up to big name stars or to have one’s company associated with a major cause or event, irrespective of the value of that alignment to the company.

Over the years, as sponsorship has grown in popularity and became more expensive, sponsors have examined various ways to quantify the value of their investment. One of the first techniques offered involved tracking televised logo time. One person viewing a logo at one time is an impression. One hundred thousand people viewing the logo over a period of time would provide one hundred thousand impressions. The impressions would be ascribed an equivalent media value and often compared to paid up advertising. Hence, a $300,000 sponsorship investment may have an equivalent media value of $1.2 million, this being the basis for deciding the sponsorships return on investment.

Not surprisingly, many marketing professionals have questioned the value of tracking logo displays as the primary means of evaluating a sponsorship. Although flashing a company’s logo during an event might be cheaper than running advertising during the event, the two are not interchangeable in terms of communication effectiveness.

Sponsorship is the most emotional of all communication mediums, no other medium can compare against the strength of emotional attachment that consumers have with the events and properties they so dearly love. It would seem that to simply rely on an equivalent media value for evaluating sponsorship, completely misses the uniqueness of this relationship.

Measuring the value of sponsorship’s return on investment is certainly achievable. As with other communication tools, sponsorship should be evaluated against clearly defined objectives that can be agreed prior to the commencement of the program. It is against these objectives that the success or failure of a sponsorship program should be decided. Obviously, they need to be set in such a way that performance can be fairly measured. These objectives are invariably given as the principal rationale for the sponsorship of any event whether it be for sports, broadcast, community, cause, arts, business to business or entertainment. The underlying goal is for organizations to obtain a tangible return through the link that is established between the sponsorship property and the company or brand.

The marketing objectives of commercial sponsorship are often based on the properties’ ability to build brand loyalty, awareness and to change/reinforce brand imagery. After all, sponsorship is about changing consumer perceptions and behavior.

When it comes to using sales as the main means of evaluating sponsorship, this is less frequently used. Primarily, it is very difficult to isolate sponsorship’s role in the overall marketing mix from the effects of price, competitor activities and so on. This is not to say that sales should not be used as an objective for the sponsorship program, after all, not many Marketing Directors would be able to convince a Board of Directors or CEO of the merits of sponsorship, if this was not the case. It is better to look at increased sales as an objective alongside other more tangible measures such as sponsorship awareness, brand imagery, customer loyalty and purchase disposition.

Consumer research offers one of the best means of measuring perceptions and behavior in the sponsorship arena. Typically, with the right research methodology we can use sponsorship specific measures such as Sponsor Recall, Passion, and Gratitude to measure against key brand metrics. These metrics generally include brand image, loyalty and purchase intention for example. Such surveys will often pick-up strong indications on how the sponsorship is paying off. It is also common to track sponsorship over a period of time, as this medium is more of a longer-term investment, compared to more traditional media such as advertising.

Besides marketing objectives, other sponsorship objectives may involve building corporate image, hospitality and motivation of internal staff. These also can be measured, as long as we agree that we are measuring attitudes and perceptions be they those of the general public, business partners or employees.

Marketing Directors, Sponsorship Managers and even CEOs are being challenged to justify their forays into event marketing. Whilst most might have clearly defined objectives, if they cannot be measured, how can they quantify the value of the sponsorship investment?

Many companies spend little or nothing on measuring the effectiveness of this important communication tool. This contrasts markedly with advertising where high levels of pre- and post- testing and evaluation are widespread. It would seem that measuring the contribution of sponsorship warrants more attention that it has previously received given its value to a corporation especially in these days of media fragmentation.

Considering sponsorship’s prominent role in representing the core values of the brand or company, surely it is something that we should expect to measure its impact on our consumers, business partners, employees or the wider community. After all, sponsorship is not likely to continue to grow unless it can demonstrate its effectiveness and this means providing tangible measures of its return on investment.