Sponsorship Measurement: How to Measure What’s Important

sponsorship measurement how to measure what's importantA while back, I read a blog by Seth Godin. In it, he asked a question that has stuck in my head ever since:

Do you measure it because it’s important,
or is it important because it’s measured?

Our industry is guiltier than most of the latter, and that is one of the biggest factors that keep sponsors from performing at their peak. The fact is that once we have worked out what constitutes a “success” – what we are measuring that “success” against – we work to that measure. Create a strong, strategic measurement strategy, and you leverage program becomes immediately more strategic. Measure the wrong things, and your sponsorship leverage will be going inthe wrong direction.

Getting away from measuring mechanisms

A frighteningly large proportion of sponsors still measure mechanisms, often the same mechanisms they’ve measured for years. How much exposure have we got? How many people can name us as a sponsor? Sponsor who use those measures of success are the sponsors that get pedantic about where their signs are placed and whether some other sponsor’s logo is two millimetres bigger on the sponsor thank you page.

These are the sponsors who revolve their whole leverage campaign around being the loudest, most visible, and most memorable sponsor at a given event, in the hope that their awareness levels go up. Okay, so you’ve annoyed people into remembering you… has that changed their propensity to buy? Loyalty? Perception of your brand? Alignment to your brand? Advocacy? Sentiment? Anything at all?? Probably not, but who really knows? Awareness measures have nothing to do with results. It’s like judging the quality of a cake based on how many people walked past it in the shop window or stopped to have a look.

Leaving bargain-thinking behind

For some sponsors, all they want to know is if they’ve got a bargain. What would those benefits have cost us a la carte? What are they “worth”, individually? They are concerned about getting “bang for their buck”, but that “bang” isn’t tied to real objectives at all. For these sponsors, it’s all about the deal – “what have we got for our money?” not, “what have we accomplished with this investment?” This is like judging the quality of a cake based on whether the whole cake cost less than it would have cost you to buy the ingredients. The cake could be crap, but at least it was a bargain!

And enough with the ratios!

The worst measurement strategy of all is to try to convert every useless mechanism, the value of every benefit, and every genuine result, into a dollar figure, so sponsorship “results” can be related in a tidy little ROI ratio. Here’s how that generally goes – and I know, because at the start of my career, this is exactly how I used to do it.

“We spent $150,000, in total. We got $100k in profit on incremental sales, $35k in tickets and hospitality, and the signage would have cost us $40k, a la carte. Plus, we got a bit of logo exposure, which the logo-counting hacks tell me is worth $110k. There were some what-money-can’t-buy experiences that were worth… geez… $15,000?? The miscellaneous logo stuff on websites, plus a few mentions in rightsholder social were worth… oh, god… I have no idea. Let’s go with another $10,000. Alright, then we have intangibles – you know, that good corporate citizen, brand halo stuff. Surely, that’s worth quite a lot. How about $140,000??

Okay, doing the sums… we got $450k in value, and spent $150k and for an ROI of 3:1. 

Oh man… that’s not very good. The boss wants ROIs of 4:1 or more for all sponsorships. Better pump up a few of these numbers. Uhh… what-money-can’t-buy goes up to $25k. I can add another $5k to social mentions. And what the hell, I’ll just make the intangibles number a round $300k. It’s not like these are fixed figures.

Redoing the sums… we got $625k in value, spent $150k, for a revised ROI of 4.2:1. 

Yeah, baby. Nailed it.”

Here’s the thing, while you can measure a lot of sponsorship outputs in dollars. But there’s also a ton of results – real results – that you can measure, but don’t lend themselves to being reflected in some usually arbitrary dollar figure. So, give it up. Leave anything near this kind of thinking behind you, because there is a better way.

But more than that, there’s hardly any media that can be measured using spend-vs-results dollar ratio. You can know you spent half a million on advertising last week, but do you know exactly how much that was worth to your bottom line? How about social? Earned media? You know you don’t. The exception is direct response, but that’s about it.

Measuring what’s important

I could go on and on about the folly of measuring mechanisms, meat-grindering a grab-bag of outputs into some tidy ROI ratio, or trying to post-justify an investment by demonstrating that you got a bargain. But I won’t, because it just ticks me off.

Instead, let’s talk about those real objectives and how to start measuring what’s important.

Step 1: Choose your objectives

Note, I didn’t say “create your objectives”, I said “choose”. That’s because you don’t create sponsorship objectives. Each sponsorship should be achieving a subset of overall brand marketing, sales, loyalty, and other business objectives. Work with stakeholders across your business, to understand their objectives. Then, for any given sponsorship, you can determine the objectives that apply.

Step 2: Determine the benchmarks

Once your stakeholders have chosen the relevant objectives, don’t let them off the hook until they’ve specified the existing benchmarks they have, and how they’re measured. You can’t possibly know what you’ve accomplished if you don’t know where you started.

It’s all well and good to say you’ve moved 10,000 cases of cereal in a given market where you’ve got a sponsorship, some on-pack or in-store activity, and a social promotion, but if you have no sales benchmark, how do you know if you’ve actually changed purchase behaviour?

I would be delighted to hear that purchase intent of people who had participated in your sponsorship leverage activity had hit 56%, but only if you could show that was an improvement over your ambient purchase intent, as measured in ongoing or recent brand tracking research.

And while we’re on brand tracking, you measure changes in perceptions and alignment around your brand by asking a selection of brand tracking questions – just a few, maybe 4-5 – of attendees, fans, and other people at varying degrees of involvement in the property and your sponsorship. That will tell you how you moved the pin on those key performance indicators – that’s an apples-to-apples comparison. Slapping on some gigantic, arbitrary figure with the heading “intangibles” will never provide you with that kind of insight.

Step 3: Set realistic targets

You’re still not done with your stakeholders! Based on the objectives selected, and the benchmarks nominated, what would those stakeholders consider a success? What mechanisms can they use to measure those results?

Yes, stakeholders will be measuring their own results. They have the mechanisms to do that at their fingertips, and your company has already decided they trust in those measures. Having anyone but Sales report on sales, retail, or promotion figures is just silly. Having anyone but HR report on employee satisfaction, pride, or retention is in the same category. You have experts in Net Promotor Scores, social sentiment, customer churn, and every other metric your company tracks on a regular basis. Every stakeholder that is impacted by a sponsorship is in the best position to measure against objectives in their area. Period.

Step 4: Measure

Once the planning has been done, measurement becomes very straightforward. Most of your stakeholders will be measuring against multiple objectives in multiple ways, all against benchmarks, and at the end of the day, will provide a realistic set of data from which you can create a complete, defensible report.

Step 5: Reporting

Reporting is about collating the data into a multi-faceted report that tells the real story of the success of a sponsorship.

Reporting isn’t about mashing all of this good, solid, benchmarked information into some kind of neat little ratio, just because that’s what your senior executives are used to. Reporting is about collating the data into a multi-faceted report that tells the real story of the success of a sponsorship.

It’s about using the data you’ve got and reflecting it against both benchmarks and projections, and because that data has come from the stakeholders who “own” those pieces of your business, it will be credible.

As someone who has created many, many of these measurement reports for corporate clients, I can tell you with hand on heart that even the most die-hard, ratio-loving, C-level executives would much rather read a multifaceted report, which reflects the credible results of a multifaceted marketing endeavour, than try to make themselves believe that a nice looking ratio means anything at all.

Need more assistance?

You may be interested in my white papers,  “Last Generation Sponsorship Redux” and “Disruptive Sponsorship: Like Disruptive Marketing, Only Better“.

If you need additional assistance with your sponsorship portfolio, I offer sponsorship consulting and strategy sessions, sponsorship training, and sponsorship coaching. I also offer a comprehensive sponsorship capacity-building service for large and/or diverse organisations. Please feel free to drop me a line to discuss.

© Kim Skildum-Reid. All rights reserved. To enquire about republishing or distribution, please see the blog and white paper reprints page.

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