How to Quantify & Measure Sponsorship Success
According to IEG, a leading research company in the sponsorship industry, in 2010 sponsorship expenditures for North American companies grew 3.2% to $17.2 million. The amount of money companies spend on sponsorships is expected to continue to rise for the next five years. Companies sponsor sports, arts, entertainment, and nonprofit causes through offering products, services or financial support to increase brand loyalty, create awareness and visibility, and drive website traffic and sales. Sponsorships are effective supplements to fund-raising or marketing campaigns.
It is best to think of a sponsorship as a partnership. Setting up a comprehensive sponsorship plan that includes evaluation measures is critical to ensuring that all aspects of your relationship are profitable for both parties. Sponsorship evaluation increases the performance, legitimacy and ultimate success of a sponsorship relationship.
Other People Are Reading
Instructions
-
-
1
Create a list of clearly defined results that you plan for the sponsorship to achieve. If you are seeking sponsorship as part of your marketing plan, define how many people you want to reach, how many new clients or customers you seek, and how much you expect in increased sales and website traffic. Also define clearly what you can give through sponsorship. Include specific financial figures taken from your budget, inventory, services and staff support.
Conversely, if you are seeking sponsorship for your organization or event, define what your financial needs are and any other resources needed. Also define what benefits an organization or individual will receive through sponsoring your event, program or organization. An example of a sponsorship outcome for a nonprofit health organization seeking sponsorship for a half-marathon to support free community health clinics to at-risk youth is: "All sponsors will receive advertising space to drive brand awareness at our events, on our website and in all print marketing materials."
-
2
Measure data from each outcome using a return on investment (ROI) calculation. The ROI is a common evaluative measure used to determine profitability. To calculate the ROI, first calculate the gross profit from each outcome. For example, consider the outcome, "All sponsors will receive advertising space to drive brand awareness at our events, on our website and in all print marketing materials." To calculate the gross profit, collect data on how much money was brought in from advertising from each sponsor for this campaign.
Calculate the total investment in obtaining or offering the sponsorship. Add up the cost of staff hours spent on sponsor communication, marketing costs, website costs and any other costs related to the sponsorship. Use this total investment figure when calculating all outcomes.
Use the following formula to calculate your return on investment:
ROI = [(Gross Profit - Investment)/Investment)]*100
-
-
3
Track and report behavioral statistics. To measure behavior, create a process to track increases in sales over the entire sponsorship campaign as compared to the previous 12 weeks and the same period in prior years. Code all leads and new clients generated during the sponsorship period and track the conversion rate after three months, six months and one year.
-
4
Track emotional connections. The emotional pull of a sponsor or cause can increase customer or client loyalty over time. Developing, nurturing and tracking the emotional connections of customers and clients is a critical element of a successful sponsorship. Send a survey to customers and clients to track the results of emotional connections. Create an incentive for individuals to answer surveys, such as a free product. Ask questions such as, "How did you feel after attending X event or program?" and, "How do you feel about our partnership with X?" Also ask for recommendations or preferences for future sponsors, events or programs.
-
5
Compile all data in an annual evaluation report. Use this evaluation report to guide future relationships with sponsorships. Present the evaluation report to your staff and share the results with the sponsor or sponsored event, program, team or organization. A critical factor in successful evaluation is a commitment to the process. Think of the time you prepare and present the evaluation report as a time each year to evaluate and nurture each sponsorship relationship. The time you spend will ensure a solid foundation for these relationships in the future.
-
1
Tips & Warnings
If you are an organization seeking sponsors, keep a timeline of all events and sponsorship revenue, so that you can demonstrate growth to your fund-raising team. The point in measuring success is using the results to shape and motivate the people who work the closest with sponsors and program development.
References
- IEG; Measure Your Sponsorship ROI
- CapturePlanning; How to Calculate ROI (Return on Investment); Stone Evans;
- IEG Sponsorship Report; Sponsorship Spending: 2010 Proves Better Than Expected; Bigger Gains Set For 2011; December 2010
- IEG; IEG's Guide to Why Companies Sponsor; 2011
- IEG Executive Brief; Measuring High Performance Sponsorship Programs; IEG Sponsorship Consulting; 2009
Resources
- Photo Credit Thinkstock/Comstock/Getty Images
