Improving Sponsorship Accountability Metrics

July 10, 2018

By Bill Duggan

Black Salmon/Shutterstock.com

The ANA and MASB (Marketing Accountability Standards Board) have partnered on a project to provide greater insight and guidance into sponsorship measurement. As an important first step, a survey was fielded to ANA members to better understand current practices in sponsorship measurement. Key findings of that survey are:

  • Only 37 percent of respondents have a standardized process for measuring return on sponsorship — this is a "foundational finding" of the research.
  • Top metrics used to measure ROI (return on investment) of sponsorship are total sponsorship investment financial return, total media exposure financial return, and product or service sales. These are also the top-valued ROI metrics. ROI metrics are focused on financial outcomes. (This and all subsequent key findings are based on those respondents with a standardized process for measuring return on sponsorship.)
  • Top metrics used to measure 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. Top-valued metrics for ROO are awareness of brand, brand preference, and attitudes towards the brand. ROO metrics are focused on behavioral outcomes.
  • Fifty-seven percent of respondents have a sponsorship measurement budget. Looked at another way, among the supposedly "best in class" companies — those with a process for measuring return on sponsorship — 43 percent don't have a separate measurement budget for sponsorships or are unsure.
  • Among those with a sponsorship measurement budget, 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 need for validated results for sponsorship initiatives has increased in importance for 78 percent of respondents. Marketers are always under pressure to validate results!

This was the third survey of ANA members focused on sponsorship. In addition to 2018, surveys were conducted in 2010 and 2013. In all cases where there are comparisons available, results did not change in 2018 versus prior surveys. Therefore, despite the continued growth of sponsorship investment and the repeated sentiment from marketers that there is a need for improved measurement and assessment of sponsorship's business impact, there has been little progress toward this goal. Key considerations for marketers to improve sponsorship measurement are:

Sponsorship accountability should move towards financial outcomes. Sponsorship accountability has three distinct phases, the most sophisticated of which is financial attribution. The sponsorship accountability journey (1) starts with media equivalency (the number of impressions generated and how much similar levels of impressions would cost) and (2) moves to return on objectives (focused on behavioral outcomes including awareness, attitudes, and brand preference), and then (3) a few leading marketers apply methods of financial attribution, measuring the financial outcomes generated from sponsorships and how that compares to other marketing investments.

Brand preference should be a key sponsorship metric. Prior MASB work confirms that brand preference plays a pivotal role in financial outcomes from brand marketing — across categories and brands, preference has the highest correlation to sales and share. Only 57 percent of survey respondents reported using brand preference for sponsorship measurement, but brand preference was rated as one of the highest valued metrics used to measure sponsorship return on objective. Marketers are encouraged to use brand preference as a metric for sponsorship, as that would align sponsorship with other marketing activities and can be translated into ROI.

Social media metrics are available, but "distracting noise." Social media exposure financial return and the amount of social media exposure (i.e., views, likes, shares) are metrics used by many marketers to measure sponsorships. It is important to note that we did not find evidence of social media contributing to sustainable changes in attitudes or behaviors. Marketers are advised to use social media metrics for sponsorship with caution and view those only as a complement to other metrics because of their weak relationship to sales, being reactive to differences in activation, and not being tied to the purchase process for many customers.

It is now time for the industry to take a stand on sponsorship accountability. This report is a first step for the ANA and the MASB to better assess sponsorship measurement and provide new solutions. The full report is here!

 

Bill Duggan is a group EVP at the ANA.


You must be logged in to submit a comment.