Sponsorship effectiveness: What we know

Brand sponsorship can create awareness and build brand equity. We look at the best practice, evidence and insights driving sponsorship effectiveness.

The primary objectives of sponsorship are to create awareness and build brand equity. In today’s media landscape marketers can leverage multiple touchpoints to activate a sponsorship. Natural synergies between brands can boost the impact of sponsorship, and the effectiveness of this can be enhanced by emotive storytelling and employee engagement.

Sports settings are natural environments to promote healthy behaviours and in Australia, sport is synonymous with sponsorship. Nielsen Sports, a global leader in sponsorship analytics and fan intelligence, has highlighted through the recent Nielsen 2022 Sponsorship Outlook report, it shows sponsorship spend increased in 2022, rising to 21.3% of total marketing budget, compared to 19% last year, reaffirming a positive trend towards the importance of sponsorship in marketing.

Ash Barty BARTYMITE

Limited-edition BARTYMITE jar with Australian tennis star Ash Barty and Vegemite. Image credit: @ashbarty/Instagram.

Sponsorship investment typically divides into two areas

Sponsorship rights are the fee that the advertising brand pays for the sports team, event or media it is sponsoring. Activation fees include the promotional costs of the sponsorship such as PR, in-store collateral or social media outreach.

Traditionally, brands have paid for sponsorships via a fixed package of assets focused on upper-funnel brand metrics. However, in the wake of the pandemic, many Australian brands are scrutinising investments more closely, and expect opportunities for impact throughout the purchase funnel and measures of effectiveness compared to other channels.

This is giving rise to sponsorship models where all parties are motivated to generate success for the sponsor, by linking the rights fee paid to a set of business outcomes delivered through the sponsorship. Different models can include an incentive-based bonus, shared revenue deals or a cost-per-acquisition bonus.

What should healthcare brands consider when looking at sponsorships?

Brands must build a robust sponsorship evaluation framework before they can accurately access any investment.

Assessing the value of your sponsorship

New models can be used to demonstrate how sponsorships deliver financial value beyond their equivalent media value.

British financial services company Barclays has a history of high-profile and successful sponsorships, including 15 years as title sponsor of the top division of English football, the Premier League.

According to WARC, the new model for evaluating its sponsorship investments across different geographies and sports recently enabled Barclays to make more sophisticated investment decisions. The model encompasses six key areas:

How the sponsorship brings the brand purpose to life
How it creates and converts commercial opportunities
How it showcases products and services
How it deepens customer relationships
How it inspires colleagues
How it impacts society.

In terms of application, for example, Barclays wanted to assess the impact of reducing investment in the Premier League from title sponsor to financial services partner. Modelling revealed the precise impact of different levels of sponsorship out of 100:

Title partner: 74/100
Financial Services partner: 61/100
Exit: 14/10.

As a result, Barclays concluded that it could afford the shift to a financial services partner but could not justify a total exit from football sponsorship. The brand has funnelled more money into the growing space of women’s football, where it says it can provide greater impact both for its business and for an important and traditionally underfunded audience.

Whilst there can be problems in measuring effectiveness (often because sponsorships are often managed in silos and it can be difficult to compare to other media touchpoints), this can be overcome by integrating sponsorship measurement into existing measurement approaches.

Think of sponsorship as your communications platform

Sponsorship can help brands reach highly engaged audiences but, without strong activation, it is little more than a media buy.

To maximise ROI, brands should view sponsorship as a brand communications platform that can be brought to life across a broad range of touchpoints with creativity and strong multichannel planning. Brands should develop insights about their audiences and their relationship with the brand they are sponsoring that can be married to an effective and authentic role for the brand.

There are ten ways in which brands can use sports sponsorship effectively, to be considered as part of your broader brand strategy:

Brand exposure and awareness
Positive brand benefit
Access to assets for content creation
Newsworthiness
Product and promotions
Inspiring and galvanising internal audiences
Direct sales and client relationship opportunities through hospitality
Rewarding loyalty, incentivising acquisition
Business capability
Community and cause-related benefits.

Sustainability and ethics are important

Consumers and brands are increasingly concerned with sustainability and ethics, as seen recently leading up to and at the Qatar Football World Cup.

According to WARC, many brands are looking for sports brands to help drive sustainable change. Examples include: the English football team Forest Green Rovers building an environmentally friendly stadium and serving vegan food on match day; the Tokyo Olympic games making 5,000 medals from discarded electronic devices; and F1, the largest sport to rely on combustion engines, pledging to be carbon neutral by 2030.

For brands focused on CSR, sustainability and ethics of need to be considered as part of any sponsorship activity.

Virtual environments are now as just as important

With the rise in e-sports, and the continued evolution of digital technology, sports sponsorship can reach broader audiences with a much richer consumer experience than ever before. To maximise effectiveness, healthcare brands embarking on sport sponsorship should consider:

Select carefully: find a property that fits your target and brand strategy, and balance popularity with the opportunity to be visible
Go beyond branding: integrate your healthcare brand’s product or service into the fabric or experience of the event, get involved through social media and respond to what’s happening in real-time
Invest in multi-platform activation: activate around the sponsorship, budget around the rights fees and work with a brand experience partner to expand content possibilities to new video, audio and digital formats
Unleash creativity: create compelling creative ideas, which align with consumer insights
Create ‘staying power’: maximise the effectiveness of your investment by broadening campaign activation across all your marketing channels, and in the lead-up and following any event.

Better Known is a marketing agency building better brands at the intersection of people and technology. We work with healthcare brands to build brand and digital marketing strategies that focus on growth. For a proven strategy to begin and succeed at healthcare marketing, let’s get started.

Marketing Customer Experience

“Sponsorship can help brands reach highly engaged audiences but, without strong activation, it is little more than a media buy.”

Sponsorship effectiveness: What we know