As my colleagues know, and readers of this blog may be aware, I am a pretty big stickler for sponsorship accountability. OK, I’m a Nazi about it. This is nothing new. Ever since doing my Master’s thesis on sponsorship effectiveness and discovering the “sausage factory” that is sponsorship measurement over 10 years ago, it has been my contention that to be meaningful and worthy for a sponsor, sponsorship initiatives must do more than create awareness and exposure for a brand.
Everyone used to talk about ROI and accountability, but very few actually demanded it. After seeing the ghost of the economic implosion in the last year or so, the rhetoric about the need for measurable and quantifiable results became louder. Proving they weren’t just “crying wolf “anymore, marketers began...
As Mike alluded, sponsorships have to be part of an integrated marketing/branding strategy/initiative, and no one can convince me that any rational officers in any rational company would demand pure ROI on EVERYTHING in that marketing/branding strategy. However, as we all know "rational" is certainly relative, and, even worse, some officers are of the impression that marketing has to do with the BOTTOM line instead of the TOP line. Not coincidentally, they're also the same people who still believe in Santa Claus.
Not every sponsor is looking for sales as their ROI. For example, in the Baltic (Estonia/Latvia etc) bank sponsors talk the language of 'trust' and 'confidence' as the primary sponsorship ROI deliverable. This is due to customer concern that their bank will close and they will lose their life savings. Hence, the role of sponsorship is to reassure the public not drive sales. Sponsorship demonstrating it's versatility in this case to deliver.
Sure, many companies will think sales as the sole ROI metric but in fact, ROI comprises more than one metric. It may be purchasing, attitude or related to brand, sale and corporate image or a combination of all of them. If a sponsor does invest to generate sales then measurement of effectiveness for that sponsor needs to cover the sales angle. The basis of sponsorship ROI is just tailoring the measurement metrics for individual sponsors own stated objectives.
Sponsorship can also deliver 'creativity' as a primary deliverable. If that was the case we would measure the extent to which a property is perceived to enhance the image of a sponsor on the 'creativity' point of view. Again something quite measurable but not in sales or dollars but perceptions. Ie., do fans really think it is creative and does it enhance the sponsor's creativity by association.
One thing the sponsorship industry needs to get clear it that there is no magic pill except to follow the guidelines of sponsorship ROI provided by individual sponsors. Each have their own business model and current measurement approaches. A sensible approach is just to measure sponsorship ROI against the series of objectives or ROO. (Return on objectives).
There are a lot of pseudo-science models floating around talking about ROI for sponsors. Measuring ROI by scorecards and logo counting without actually considering the fans. Confusing a lot of people more than anything and making some sponsors demand the wrong type of sponsorship ROI from their properties.
The sponsors need to articulate their sponsorship objectives and measure performance against those objectives. I would say 90% of the problem for sponsorship ROI starts with sponsors not necessarily having clear sponsorship objectives to start with and tossing it to properties to try and work it out for them.
The other thing forgotten by the sponsorship industry for the last 20 or so years is the fan. They are the ones that buy from sponsors yet have not been part of the prevailing measurement approach.
Logos don't buy things people do.