As we reflect on a busy summer of sport, it’s been clear that brands have been going for gold in the sponsorship category. But the effectiveness of measuring these sponsorship investments is all too often coming in as a last place consideration.
Sponsorship is a complex marketing platform that rarely has just one objective, but media equivalency is still being used as the primary form of measurement used to determine its holistic value. While this makes sense for the media assets included in sponsorship, as the industry evolves brands are missing out on the real prize of sport sponsorship by only taking media value into account.
While some sponsors have become more sophisticated in the way they track sponsorship, this remains the exception rather than the norm.
What’s wrong with equivalent media value?
There is inherently nothing wrong with the metric itself. It is crucial to understanding brand exposure and having a view on a “Marketing Return” vs. the sponsorship rights fee — therefore a key player in negotiation, shaping rights packages and comparing different properties.
However, equivalent media value unfortunately can miss many of the nuances necessary when dealing with sponsorship. It does not tell you how your target audience is reacting to the sponsorship, how noticeable your branding is, how your ATL campaign is performing, or give you a true sense of how fans are engaging with your sponsorship.
Too often referred to as ROI analysis, the method is still the norm for measuring partnership success. Suppliers often repackage the measurement process, updating it with current AI terminology — but apart from normalisation of social monitoring and better on-screen tracking capabilities, the metric has not meaningfully evolved in the last 20 years.
So yes, you should use media valuation, but not as the only metric for success — it’s just one part of the puzzle.
The common missing step — the measurement framework
The basis of measuring any activity is to understand what success looks like from the start. As emotions and belief are still very strong drivers of decision making in the sponsorship industry, it is not unusual that clear objectives and KPIs are not set from the start.
While ultimately the aim of marketing is to drive sales, there are numerous steps to get there — whether this is shifting perception, increasing top-of-mind awareness, or building relevance to an audience.
To build an effective measurement framework, brands and their agencies must be clear from the outset about the objectives and KPIs for the partnership. They should identify which ones will be tracked over the long term and which in the short term, and then map them against each stage of the sponsorship cycle or burst of activity. For example, as sponsorship is a long-term brand building platform, any significant shift in consideration is unlikely to happen in the first year.
Additionally, clarifying not only the core objectives but also understanding the depth of usage of the partnership across the entire business will be key to ensuring holistic reporting and assessment. Questions such as: what parts of the business are using sponsorship assets and IP and how are we measuring success across these? The measurement framework should cover all of these elements even if deemed secondary at the start.
All of this to say — there isn’t one single metric that will really help you understand impact of sponsorship or success. The measurement framework should be the bible to refer to at any point to understand how we are measuring success.
Full Funnel Measurement
Sponsorship doesn’t answer just one objective, as previously stated. This means that various techniques must be put in place to understand impact, requiring agile researchers to tie it all in together.
At Fuse we look at measurement across three pillars: media performance, impact on brand health and econometrics modelling.
We use various research methods and combine media research and our consumer research experience to extract the right story and insights from all the data points.
Ongoing optimisation is possible in sponsorship
We have been used to waiting for an entire competition or league to end before reporting on performance. This is historically due to the focus on equivalent media value and the fact that metrics such as global TV audiences can be hard to collate on a frequent basis. This has been topped off by the lack of flexibility in sponsorship rights, meaning optimisation wasn’t possible. However, growth of digital and social rights combined with the growing role of paid media, means that inflight optimisation and reporting should be a fundamental.
This will provide the ability to test different assets, be reactive and culturally relevant to immerse the brand into fans conversation, shift distribution strategy in real time to ultimately deliver better results.
Business outcomes — the industry challenge
Measuring actual ROI is still a challenge for the entire marketing industry. When this big question comes up, it’s pertinent to investigate how the brand is currently measuring ROI of its marketing mix and map out if we can replicate the existing and trusted methodology for sponsorship.
Econometrics modelling has been improving and becoming the norm across the media industry. The good news is that models are becoming better at measuring long-term impact and we have been successful in integrating sponsorship into these for some clients.
In order to do this, getting the fundamentals of data collation is key. The model is only as good as the data that goes into it. So even if businesses do not currently have MMM in place, it’s still possible to collate the data in the right way for future integration.
If companies really want to go for gold in their sponsorship activities, they need to step away from an over-reliance on old measurement systems and look to set up detailed frameworks that allow for ongoing adjustments based on the sponsorship output, audience outtakes and business outcomes.