With 85% of marketers planning to maintain or increase their sponsorship investments this year, the current macroeconomic uncertainty means the pressure to prove their value and impact has never been greater.

Yet many marketers struggle to do this. At their core, sponsorships are more varied and complex than other marketing investments, making it difficult to benchmark opportunities, determine whether they're the right marketing vehicle at the right price, and optimize effectively once in-flight.

The good news is that a data-driven measurement approach can help marketers to overcome these challenges and build confidence in their sponsorship investments across the business.

The measurement struggle is real

Unlike other marketing investments, sponsorships often lack standardization in both structure and measurement. Each deal tends to be unique, with its own set of rights, activation opportunities, and data availability. What’s more, most details are kept confidential, making it difficult to benchmark value across opportunities.

This complexity leaves marketers struggling to answer critical questions such as:

• What's the maximum we should bid for a sponsorship renewal?
• How can we compare sponsorship performance to other marketing channels?
• Which metrics will best demonstrate we're meeting our objectives?
• What data should we collect to represent sponsorship activities effectively?
• How can we measure the commercial impact across both short and long-term horizons?

Without answers to these questions, marketers are unable to evaluate or optimize their investments and demonstrate value to stakeholders. But transforming sponsorship measurement from a challenge into a competitive advantage is possible with the right approach.

Six steps you should follow for effective measurement

Building a robust, data-driven measurement program is key to success. The following six-step approach will help you to get started on this journey:

1.      Define and align on core objectives - Rather than setting broad goals, successful measurement requires more precision. For example, instead of saying "target Gen Z," it’s better to say "establish credibility and change attitudes among 18-30-year-olds who play basketball over the next 12 months." It’s also crucial to get agreement on the objectives you set because it helps to create a shared language between key stakeholders.

2.      Audit existing sponsorships and categorize them - this is important because it provides a baseline for comparison and helps identify patterns in what works across different sponsorship types.

3.      Focus on collecting the best possible data – focus on gathering information that represents audience exposure, is consistent, and provides context around results. When it isn't possible to collect perfect data, utilize proxy data as it can provide valuable insights.

4.      Choose appropriate measurement tools – there are a wide variety of advanced analytics techniques available today that can be applied depending on the sponsorship type, your goals, and the available data. Principal Components Analysis, Sensor™ and Agent-based Modelling are three that may be worth exploring.

5.      Activate the measurement program to achieve quick wins and long-term goals – it’s important to achieve and demonstrate both short-term performance and more sustained value creation.

6.      Continually assess and evolve the program – It’s important to evolve as business needs change. Don’t take a ‘set-and-forget’ attitude to sponsorship measurement.

By implementing this approach, marketers can better understand the true commercial impact and make more confident decisions about their sponsorship investments.

What does this look like in practice? Let’s look at how two ambitious brands are using this approach to transform their sponsorship measurement and decision-making.

How a retailer and a financial services company applied this approach

A North American retailer wanted to measure the value of their Major League Baseball sponsorship, specifically the impact of in-stadium signage during games. Using variation in TV viewership within a geo-based analytical model, we were able to determine the correlation between signage visibility and sales. For the first time, the retailer could see exactly how the sponsorship performed in each geographic area and compare it to other marketing channels. The analysis proved the sponsorship was not only driving sales but delivering comparable returns to other marketing investments.

In contrast, when a global financial services company was evaluating a potential motorsport sponsorship, the approach helped them avoid a costly mistake. Thanks to nested econometric models enriched with audience data, driver performance, and brand engagement metrics, we were able to test the impact across paid, owned, and earned media. This analysis, which included simulations of different race outcomes, revealed the sponsorship was unlikely to generate sufficient ROI to justify the investment. As a result, the company cancelled the sponsorship and pivoted to identify more suitable motorsport opportunities.

These two examples show how a robust measurement approach can both validate successful investments and prevent unsuccessful ones. Of course, every brand's sponsorship journey is different but there are some steps you can take no matter what sector you’re in or sponsorship you’re targeting.

Four steps to take now

To set your brand on the road to more effective sponsorships, I recommend four key actions:

1.      Review your existing sponsorship measurement strategy or, if you don’t have one, get started on creating one using our 6-step approach as a guide

2.      Ensure there's agreement on the specific objectives and over what timeframes they will be achieved. This is critical as it informs the data you need to collect and the appropriate measurement technique

3.      Challenge your measurement partners to think beyond standard measurement tools and techniques used for media-based channels

4.      Regularly assess and evolve your measurement program as business needs change

Sam Fellows is Managing Partner at Gain Theory. For more information visit: gaintheory.com

To learn more about how to measure sponsorship investments, download Prove your sponsorship value: A measurement guide for marketers