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Sponsorship Measurement
How
to Evaluate By Katie Delahaye Paine
Perhaps not these exact words, but something like them has passed your ears at least a dozen times in the last few years. From Little League teams to the World Cup, from naming arenas to naming road races, sponsorship of events is now one of the marketing methods of choice. As communications is increasingly impersonal and electronic, the chance to actually touch, feel and experience the brand is ever more important. Increasingly, purchasing is neatly divided into two categories -- on-line and experiential. More and more decisions are based on familiarity with the brand and ease of purchase. Now, I'm an avid Amazon fanatic, but I still go into Borders' brick and mortar store and end up buying something. Why? Because I get to touch and feel and browse and listen to products. If I need something in a hurry, I go online. If I want "retail therapy," I go to Borders. That's experiential marketing. Marketing that transcends the product and the media and allows direct interaction with the brand. A 2006 study by Jack Morton Worldwide showed that live event marketing -- experiences where consumers interact with products, brands or "brand ambassadors" face-to-face -- are among the most effective ways to influence coveted consumer audiences. The study, an online survey of 2,574 consumers ages 13-65 in the top 25 US markets, confirmed that this increasingly important marketing medium resonates strongly across all demographic and product categories. Which is why total spending on experiential marketing is expected to reach $15 billion by the end of 2007, an 11% increase over last year, according to the latest IEG research report. Companies are now allocating on average 17% of their budgets to sponsorships, compared to just 13% last year. However, 76% of companies spend less than 1% of their total sponsorship budgets on research, and in a shaky economy, if you don't measure it, you can't show ROI. And if you can't show ROI, chances are good that the program will be killed. Another factor in the measurement of experiential marketing is that simply "reaching large numbers of eyeballs" is no more relevant a goal than is "increasing market share in the buggy whip market." Therefore, new alternative metrics -- like relationship measures, engagement indices and cost per touch -- are increasingly demanded. We suggest that there are six basic steps to developing a solid measurement program for your events and sponsorships. Step 1: Be clear about what outcomes your communications program is designed to achieve. As with any effort, you can't start to measure success until you know what success means for you. For any given event the objectives might be:
Each objective, of course, requires a different type of measurement. Some types isolate the impact of PR from other communications efforts better than others. And the best objectives are specific and measurable. Step 2: Determine criteria -- quality as well as quantity Once you've agreed upon your objectives, establish the specific criteria of success that you will measure. If your objective is awareness, the criterion might be the percentage increase of unaided awareness of brand or product. If your objective is to sell product, the criterion might be the incremental sales after a particular PR or promotional program took place. Consider those numbers that best reflect the health of your business, or that best represent characteristics that most affect your business:
To a certain extent, your choice of criteria is dependent on the type of event you are evaluating. If the customer experience you are measuring takes place at a trade show or exhibit booth, you might choose as key criteria the percentage of new visitors or the cost per minute spent with a client in the booth. If the experience takes place at an event such as a concert, you need to count how many people were exposed to your brand or the brand experience you were offering. Don't trust the promoter's numbers; do your own counting. Here's why: I once met with a major auto manufacturer who wanted to measure the effectiveness of different sponsorships. It was spending many millions sponsoring car races, golf tournaments, antique car auctions and a variety of other events. According to the event organizers, attendance and therefore results were always better than the year before. But then I asked them what they were trying to achieve by these efforts. The first response was essentially: "We are always a major sponsor of these types of events." After about two hours of discussion, we agreed that the business objective was to drive potential customers into dealer showrooms. We began a series of surveys at each event to determine first if the attendees remembered the sponsors, and secondly if they were more or less likely to test drive and/or buy the sponsor's car. We collected names at the event itself and called attendees two weeks after the event. Our results showed that on average 50% of all attendees were more likely to test drive a "sponsor" vehicle after attending the event. After we had measured three different events, we were able to compare and contrast the cost effectiveness ($$ per person reached) of different events. The results enabled the sponsor to better understand the ROI from each event. By looking at the percent of people more likely to go to a dealership, they could determine the number of potential buyers. By subtracting the cost of the sponsorship from the profit and the projected number of car sales, they determined a projected ROI from the event. These results led the sponsor to dramatically alter their sponsorship strategies. It's important to look beyond simple quantitative data, especially if your objective is exposure, to assess the quality of your communication. When companies clearly define their objectives it becomes a relatively simple matter to define a set of criteria against which to measure the relationships the company establishes with its constituencies in different events. Then it's a matter of comparing and contrasting results consistently cross a number of different events to ensure that the company has the most effective sponsorship program possible. Step 3: Decide upon a benchmark The key point to remember about any evaluation program is that measurement is a comparative tool. You need to compare one set of results to something else. The most meaningful comparisons are between different events, or between you and your peer sponsors at one event. If your fellow sponsors aren't direct competitors you can learn a lot by sharing information and determining what best practices really moved the needle. 4. Select a measurement instrument Do not rely on data gathered at the event itself. It is rarely useful or actionable. Consider the following instead:
A relationship study You can also use the Grunig relationship survey instrument (downloadable for free from the IPR web site) to test the health and strength of your customers' relationships to your brand. The Grunig instrument has been thoroughly tested and shown to be an extremely effective measure of how customers perceive their relationships with an organization. The key thing about whatever measurement tool you use is to make sure that you are tying results back to the desired business outcome. A number of years ago, Country Music Television (CMT) hired tractor trailers to set up country music events in Wal-Mart parking lots. Their first measure was to ask the truck drivers how many people showed up. Realizing that those answers didn't tell them anything about what those potential customers were actually doing when they went home, CMT decided to hire my company to do follow-up studies with the attendees. The stated purpose of the events was to convince attendees to call their local cable company and request CMT or to take some other action on behalf of CMT. CMT used a sweatshirt giveaway at the events to collect names and addresses of attendees, whom we called two weeks after the event. We agreed that the common criteria against which we should measure all events was an ad hoc "level of engagement." Specifically, we asked people to rate how much the event experience affected their relationship with CMT, and then we established the mean level of interest for each event. We further defined the success criterion as the percentage of people willing to take action on behalf of CMT. Our surveys showed that 93 percent of attendees were willing to take some action and 89% were willing to make a phone call to their local cable company. We then compared results between different cities so CMT could determine where to expand the program the following year. Five final lessons for sponsorship measurement: 1. You become what you measure, so be very clear internally on the objectives of your sponsorship or event that you will measure. 2. Match the event, the speaker, and the metrics to the objectives. 3. Document any immediate or tangible results: media coverage, phone calls or inquiries, messages delivered to key audience, etc. 4. Share and leverage results internally. 5. Repeat your measurement consistently. Other resources:
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