Marketing Sponsorships—Measurement, Impact Assessment Need Improving

Introduction

According to a new study from the Association of National Advertisers (ANA). Marketing sponsorships have increased considerably over the past several years. But progress in measuring and assessing sponsorship’s business impact has been marginal.

The new report was conducted by the ANA and Marketing Accountability Standards Board for Improving Sponsorship Accountability Metrics. This report provides greater insight and guidance into sponsorship measurement.

North America Sponsorship Spending

The study said that total sponsorship spending in North America is estimated by ESP Properties to be $24.2 billion in 2018. This is up 41% since 2010, the year of the ANA’s first sponsorship measurement survey. Also, it is up 22% since a follow-up 2013 ANA study. However, the study revealed that only 37 percent of respondents reported having a standardized process for measuring their return on sponsorship.

The study also found that among respondents with a defined measurement process, 57 percent have a sponsorship measurement budget. Of those, most spend 5 percent or less on sponsorship measurement as a percentage of sponsorship rights (i.e., the cost of the sponsorship itself, not including activation costs).

The survey also found:

• The top metrics used to measure the ROI (return on investment) of sponsorship are total sponsorship investment financial return, total media exposure financial return, and product or service sales. ROI metrics are focused on financial outcomes.
• Top metrics used to measure the ROO (return on objective) of sponsorship are awareness of the brand, awareness of the company’s/brand’s sponsorship, attitudes towards the brand, amount of total media exposure, and amount of social media exposure. ROO metrics are focused on behavioral outcomes.
• The need for validated results for sponsorship initiatives has increased in importance for 78 percent of respondents, indicating that marketers are always under significant pressure to validate results.
• Only 40 percent of respondents write expectations about sponsorship measurement into contracts with properties, a finding that is interpreted as a missed opportunity by client-side marketers.

Sponsorship Accountability

“The survey points out the continuing, unmet need for more sophisticated sponsorship measurement and valuation practices,” said MASB President and CEO Tony Pace in the release. “Developing and disseminating such practices is the next step for the MASB’s Sponsorship Accountability Metrics Project team.”

The study highlighted the ongoing need for advanced sponsorship measurement. This confirmed that only slight progress had been made toward reaching that goal. In all cases where comparisons were available, results did not change this year versus prior surveys.

The report also concluded that sponsorship accountability is framed in three strategic areas:

• Media equivalency, which measures the number of impressions generated and how much similar levels of impressions would cost
• Return on objectives, which addresses brand and behavioral outcomes
• Financial attribution measures the financial outcomes generated from sponsorships and how they compare to other marketing investments. Sponsorship accountability is strongly recommended to move in this direction.

Sponsorship ROI

The report determined that brand preference should be a key sponsorship metric. It plays a pivotal role in financial outcomes and has the highest correlation to sales and shares. Even more than metrics such as awareness, brand loyalty, purchase intent, advocacy, and brand relevance. According to the MASB, brand preference indicates the strength of a brand in the hearts and minds of consumers. This represents the brands that are preferred under assumptions of equality in price and availability.

Conclusion

Going forward, the report recommended that marketers begin challenging the measurement community to assist with additional perspective and prioritize brand preference attribution for sponsorship, in addition to developing guidelines, benchmarks, and best practices.

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