The surest way of gaining sponsorship for your expedition, your team or you as an athlete is by quantifying the return on investment (ROI) you can create for each and every sponsor. The simplest way athletes and adventurers do it today is by classifying logo size and product placement and guessing how much general media exposure they expect to muster. Race Recon can assist you in better quantifying your sponsors´ ROI and demonstrating that their marketing dollars are better spent on you than their traditional marketing channels.
There is a long-running debate about whether the impact of sports sponsorship can be accurately quantified. To make it all worthwhile, a sponsor has to know the value their investment created. Measuring ROI not only provides an assessment of what has happened it also provides a useful negotiating tool for future sponsorships.
To compare the effectiveness of sponsorship against other marketing activities, a comparable ROI is required and the evaluation process is similar to that used for advertising. Sponsorship ROI measurement consists of three elements:
- media exposure,
- awareness and purchase,
- commitment.
The importance of these three elements varies by the sponsorship’s scope and duration. For larger sponsorships, awareness is often the key element, followed by commitment and brand usage, and finally media exposure. In general, sponsorships take about three years to mature i.e. a successful sponsorship shows increases in brand awareness and commitment by the third year. For one-time events, awareness and media exposure are the key aspects as commitment is difficult to build with single events.
Media exposure is the most common method used to measure ROI. It benchmarks a dollar value on your sponsorship, and includes television, news/promotional segments, print, on-site, radio and any international audience data. However, when evaluating sponsorships, it is important to note that 30 seconds of logo exposure creates a smaller dollar value than 30 seconds of advertising.
Measuring media exposure has traditionally been done by individuals looking and listening for brand names or company logos on signage at events, team equipment, verbal mentions and event materials. However, today’s newest and most sophisticated method to determine exposure uses digital technology. Race Recon uses this method as it provides faster and more reliable information as it eliminates human error and bias. It also provides a better range of coverage including logo position and size – and can even measure exposure time to a hundredth of a second.
To calculate the potential sales value generated by sponsorship, the awareness level of the brand is multiplied by the supporters’ actual purchase or intent to purchase ratio. The types of questions asked to determine awareness include overall awareness of a sport or event, category awareness, and the brand image associated with the sponsored team, athlete or event.
Commitment is the final factor in the calculation of ROI. Stronger than satisfaction or loyalty, commitment is a measure that combines both attitudes and emotion and has the ability to predict future behaviour. It determines the strength of the relationship between a consumer and a brand and is a key element in brand building. Commitment measures enable a sponsor to answer questions like:
- which sponsorship creates the strongest relationship with my target customers?
- which sponsorship has the greatest potential for attracting new customers?
The more committed a supporter is, the more he or she is prepared to spend. It is possible to calculate the financial impact of sponsorship activities by analyzing the average expenditure for each commitment segment.
Measuring each of the factors in an ROI evaluation independently is necessary in effectively managing your brand communication. When these elements are combined, the result is a wide-angle view of sponsorship that includes opportunity as well as attitudinal, emotional and behavioural measures.
As you probably now appreciate, professional sponsorship management is a complex and time consuming task that if not done well can actually detriment the relationship with your sponsor or even worse threaten contract termination or remove the chance of renewal.
Race Recon have developed a comprehensive and sophisticated approach to gaining sponsorship and managing existing relationships that develops large returns for a given investment almost guaranteeing a healthy and long standing financial partnership.
If you would like more information on how Race Recon can help you or your team attract and retain sponsorship contact us.