Rupert Pratt, managing director, Generate
Rupert Pratt, managing director, Generate
A view from Rupert Pratt

Think BR: What value is your sponsorship really giving you?

There is a danger in relying on branding as the sole means of evaluating sponsorship, writes Rupert Pratt, managing director, Generate.

The global recession has seen a slowdown in marketing spend while sponsorship remains in good health.

The latest European Sponsorship Association (ESA) figures show a 14% increase from €23.3 billion in 2010 to €26.5 billion in 2011.

Much of this uplift reflects significant deals around the London Olympics and European Championships but with a host of major international events on the horizon (ie, RWC 2015), sponsorship is becoming more and more critical within the marketing mix.

So with this in mind, we get to the crux of this article, measurement. I’ll start by saying the key point I want to make - Advertising Value Equivalent,  AVE, EMV, call it what you want - has been one of the most important tools for the sponsorship industry in terms of justifying spend but also one of the most damaging. Why?

Sponsorship evaluation was outdated from the start.

You miss the key reason why you sponsored in the first place. If you want to grow awareness then just advertise, but if you want to engage, then do it through sponsorship

  • Therefore, don’t devalue sponsorship by measuring brand media alone.
  • Advertising rates are falling (reduced effectiveness and global recession) - this will affect your sponsorship justification.
  • It is now harder for Rights Holders to achieve the staggering AVE they were routinely hitting in a booming economic climate. As the ad rates fall, so will the value of your sponsorship - but your sponsorship may not be any less effective, in fact, it’s likely that its being more effective.

The old adage "finance guys may not get marketing. They will get AVE" cannot be allowed to dictate how we measure the value of a sponsorship by relying on outdated tools.

We are noticing an evolution of sponsorship evaluation:

  • We started with ROI (Return on Investment) - did I get value for money via EMV?
  • Then moved towards ROO (Return on Objectives) - did I achieve what I wanted to?
  • We now need to move towards ROII (Return on Involvement and Impact) - did I engage the target audience? What was the impact and therefore, what was the value to me, the sponsor? How many more customers did I sign up? How many did I retain? What was the value of that to the business?

Sponsorship evaluation is easy

There are a host of sponsorship tool that can be bought off the shelf to enable you to understand the value of your sponsorship better - they must then be tailored to suit your objectives.

  • Behavioural Measurement - increase in overall sales figures, new distribution channel and sales leads, new products trails, interest levels of trade partners, employee satisfaction, etc.
  • Cognitive Measurement - consumer research, perception of product, feedback from employees, etc.
  • Exposure Measurement - how many peoples attended the event, media reach, rating of event, website visits, social media activity, PR impact, etc.

It’s what you do with them that count. We create robust evaluation models that track the real impact of a sponsorship enabling our clients to answer: Is my sponsorship effective? But most importantly is my sponsorship efficient when compared to other channels? That’s what ‘the finance guy should be asking’.

I’ll leave it to Sally Hancock, director Olympic marketing and group sponsorship at Lloyds TSB, to sum up the value of EMV in sponsorship at a recent Generate Sponsorship conference we ran.

She was asked: "How difficult did you find it to sell in your London 2012 partnership, given the lack of branding within the sponsorship inventory?" She answered: "None at all. In fact, even if we had branded media inventory, we would have placed such a low value on it that we would not have even bothered evaluating it."

Rupert Pratt, managing director, Generate