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Sponsorship Index

A METHOD TO EVALUATE THE EFFECTIVENESS OF EVENT SPONSORSHIPS

A standardized research approach used by OLG for the past four years has proved a valuable tool in assessing the value of their sponsorships.

Much has been written about the need for companies and organizations to measure the effectiveness of their event sponsorships. Actually doing so has proven to be a thorny problem, however.

Unlike advertising tracking, which is widely carried out and for which a core body of research techniques is in common use, sponsorship evaluation remains in a comparatively less developed state. There are a number of reasons for this. To name a few:

Budgets for individual sponsorships are generally lower than budgets for major advertising campaigns. Measures that are appropriate for advertising tracking may therefore not be sensitive enough to detect the impact of a typical sponsorship.

As a corollary, sponsorship research budgets tend to be lower than advertising research budgets, thereby adding more constraints to the methods used.

Prevs. post measurements as used in advertising tracking are often of little benefit for sponsorship evaluation. For many sponsorships there is little awareness of the event itself, let alone the sponsorship, prior to the event actually taking place.

Advertising is typically the end product of a long process of strategy development, creative design and execution designed to deliver a very targeted message. Many sponsorships act more subtly through positive associations with events aligned with the desired brand image.

For many already highly regarded sponsors, sponsorships are more about image maintenance than image change. It's difficult to measure non-change. This doesn't make sponsorships any less valuable, however.

Basis for the Sponsorship Index

One method that has been used to evaluate sponsorships has been to use "impressions" data. For example, this may involve logging the number of times a sponsor's sign was visible on air during a TV broadcast of a car race, and multiplying by the TV audience size.

There are at least two potential limitations with this approach, however. First, this method counts potential impressions (often times in the millions or tens of millions), but does not assess whether consumers even noticed the sign in the background. Second, it does not assess the quality of the impression in terms of building a favorable brand image.

Research Dimensions has therefore developed a research model which is currently being used to address these limitations. The model recognizes the following key elements of a successful sponsorship:

Awareness of the sponsorship – This is the quantity measure that assesses how effectively the number of potential impressions combined to generate actual awareness and recall of the sponsorship.

Interest in the event – This affects the degree of positive association generated by the sponsorship. An impression made on a "fan" of an event is more valuable to the sponsor than one made on someone with little interest in it.

Image of the sponsor – The more positive the image of the sponsor, the more valuable the impression. This is independent of whether it is a pre-existing positive image or whether the positive image was generated by the sponsorship itself.

Fit with the event – The consumer should ideally see a fit between the sponsor and the event. For example, major beer companies are probably better off sponsoring sweaty sports events rather than genteel piano recitals.

Perceived value added – As sponsorships become more widespread, consumers are less likely to respond positively unless the sponsor provides some perceived benefit to them. Increasingly it is not enough for sponsors to just "put up a shingle."

These key elements of success are measured through the use of random post-event telephone surveys. The results are numerically combined to create a Sponsorship Index, a single number which "scores" the sponsorship in terms of its overall impact. (The Sponsorship Index has a theoretical range of 0 to 1,600.) This allows for easy comparisons across sponsorships – the bigger the number the better.

A case study

OLG has assessed over 30 sponsorships using this framework. The results from two of these are shown in Exhibit 1. It can be seen that Event B scored higher on most attributes and therefore achieved a better Sponsorship Index score.

EXHIBIT I

The analysis is taken a step further by calculating the value for money of a sponsorship as follows:

Overall value = Sponsorship Index x Market size Dollars spent

Essentially this formula calculates the number of Sponsorship Index points achieved in relation to the cost per M of reaching the target market. Again, the bigger the number the better.

Exhibit 2 shows how this calculation applies to the two lottery sponsorships. It can be seen that the positive results for Event B were at least partly attributable to a greater spend in a smaller market. The value for money for Event A was therefore better.

EXHIBIT 2

Additional measures

The measures described above are not the only ones evaluated in a typical Sponsorship Index interview. For example, the following questions are standardly asked:

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