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Is It Worth It? Leveraging Data to Value Sports Sponsorship Investments

Sponsorship Innovation, Analyses   |   Feb 03, 2022   |  by Antoine Laurient

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Sports sponsorships are on the rise. While this method of reaching valuable segments of customers and potential customers has always been popular, more and more brands are jockeying for a seat at the table. Why? Because the combination of captive audiences with new and dynamic ways of reaching them means the return on investment can be huge. Sports sponsorship success comes with many challenges, but the payoff can be immense.

Consider a traditional television advertisement. The viewer is so inundated with advertisements that they may well not pay attention at all. The viewer might even leave the room for a snack or a trip to the restroom. Is television advertising still effective? Certainly. Would it be more effective if the audience could not opt-out at a moment's notice to grab a sandwich or take a phone call? Absolutely.

Sports sponsorships give brands the opportunity to reach that audience more directly. While a person may be focused on what's happening on the field, it is hard to miss a brand logo if it is in their line of sight every time they look at the scoreboard or watch a home run go over the right-field wall.

The Value of a Sports Sponsorships

Sports sponsorships are often difficult to value. It can be hard to determine the market impact of sponsorship. Additionally, it can be difficult to agree on a metric for measuring the success of a sponsorship.

Depending on the brand and the sponsorship placement, a return of 2x to 5x is within normal bounds. Are their outliers? Of course. Sometimes a sports sponsorship is about maintaining “share of voice” and blocking out a competitor. On the other end of the spectrum, sometimes a highlight from a game goes viral. As a result, a brand's signage is in the frame for millions of additional unpaid impressions. But a standard 2x to 5x ROI fits the norm of what can and should be, expected.

Yet despite the opportunity to more directly impact an audience and an understanding of potential return on investment, many of those investing in sports sponsorships still struggle to justify their investments. Why?  Because calculating that ROI relies on reliable data. Reliable data sources are hard to come by. Metrics for measurement are difficult to agree on. In some cases, market impact is difficult to determine not because it is not happening, but because the data is not showing the right information.

One Number That May Surprise You 

Small and mid-sized brands allocate less than 2% of their sports sponsorship investments to tracking and measuring the performance of the sponsorships themselves. For years, receiving performance data from teams and partners has been a standard operating procedure. Sadly, this blind trust has led to a misalignment of goals and many sponsorships that failed when they could have otherwise been successful. In truth, more robust data sources are available to help quantify the value of sports sponsorships.

One immediate place where challenger brands can gain competitive advantage? Investing in the tracking and management of the data associated with their sports sponsorship initiatives. This data provides insights and analysis to help align business initiatives with sponsorship value.

Data as Power in Sports Sponsorships

The use of data in advertising is only now permeating sports sponsorships. Updated, accurate, and complete data make a significant difference in the success of a sponsorship.

Data For Setting a Budget

When it comes to sports sponsorships, data is key in helping to set a budget. Data can help identify areas where a brand may want to invest more or less, and also help to determine how effective sponsorship is likely to be. Even further “white space,” or the unused and/or untested areas of a stadium or jersey where a sponsorship might make sense, give forward-thinking marketers even more potential areas of opportunity. When negotiating a sponsorship agreement, data can also be used to show the value that a brand places on the placement. In short, data is essential in understanding and maximizing the value of a sports sponsorship.

Data For Measuring Performance

Data can be used to determine how a sponsorship is performing after the fact. Data shows where a brand might have been most visible, and whether or not its message was received by the desired audience. This data can also help brands identify issues that may need attention. For instance, if a sponsor's logo garnered more attention from an unexpected demographic, they might want to consider adjusting their marketing strategy accordingly to target those individuals with greater specificity in the future.

Data For Negotiating Agreements

In addition to helping ensure that a sponsorship delivers on its promised value, data also helps shape the terms of the agreement itself. Using data collected about the performance of past partnerships makes it possible for sponsors to make better business cases when going to the table to negotiate with a team or league. Further, this data helps sponsors justify proposed investments to leadership in their own organizations.

Analytics, Data and the Worth of a Sponsorship

The core of calculating the worth of a sports sponsorship is the data upon which determinations and decisions are made. Without a quality source of data, you will be making critical marketing decisions without all of the information.

So what is a quality source of quantitative information? What does that look like?

A Good Data Source Is Accurate

When it comes to something as important as a sports sponsorship, it's crucial that the data be accurate. After all, if you're basing decisions on incorrect information, you're going to end up making mistakes that could cost you a lot of money. For example, if you think that a particular sponsorship is doing better than it actually is, you may be more likely to renew it; but if the data shows that the sponsorship is actually underperforming, you might decide to end it instead. In short, accuracy is key when it comes to data in sports sponsorships.

Analytics Should Be Complete

A complete source of information and analytics is one that delivers information both wide and deep. For example, data about average attendance can be useful. Metrics around attendance per game can also be useful. Having the former with no access to the latter means missing out on key insights.

Furthermore, data around demographics identified affinities, and other meaningful traits captured about event or game attendees is also meaningful. Not all data will be useful all of the time. That doesn't mean you should accept a limited amount of data.

Insights Should Be Timely

Many teams and data providers deliver data at irregular or inconvenient intervals. It is not uncommon to not receive any data until a season is over. How can a challenger brand adjust and iterate its live activations if it receives data after the season is complete?

A good data source provides the information you need to make decisions as needed, not only at the completion of a season or sponsorship term. Data that is updated as close to real-time as possible AND available to you as soon as the next day is critical for challenging brands looking to succeed with sports sponsorships.

Intelligence Should Be Segmented 

Segmentation is key to modern marketing. Ideal customer profiles, prospect targeting, campaign optimization...none of these things is possible without the ability to segment data. From income to age, seat-location to ticket value, segmenting the data will inform better decisions in choosing sponsor opportunities, negotiating rates, and adjusting as needed.

What Bad Information Looks Like

Conversely, bad data or analytics are incomplete, delivered at irregular intervals, and show only big picture information with no opportunity to segment or explore key data points. The cost of bad data comes in making bad decisions. You certainly can make decisions that are directionally correct if you are using big picture or slightly outdated data. But making optimal decisions cannot happen if your data source is flawed.


Good Analysis Made Easy

Relo Metrics provides sports sponsorship analytics that is both timely and complete. The Relo Metrics platform allows for segmentation and custom views that inform not just sponsors, but also teams and leagues. This makes alignment between the sponsor and the team not only possible but inevitable.

With Relo Metrics, sports sponsors benefit from:

  • Near real-time performance updates
  • Clear valuation of specific sponsorship opportunities
  • Analytics that are easily understandable for brands and teams alike

Sports sponsorships are more competitive than ever, but many brands still struggle to fully justify their investments. The right sources of insights help make those investments more effective. Marketing intelligence and information can be used for budgeting, measuring performance, and negotiating new agreements. And it is an essential tool in understanding what impact a sponsorship had after it has ended as well as during its term.

Leveraging this data is about more than evaluating sponsorship opportunities. It is about making sure your entire sports sponsorship program is properly allocating resources and making wise investments. To better understand how Relo Metrics is the favored sponsorship analytics platform of sponsors and teams alike, contact us here to view a demo. Relo Metrics gives all parties reliable and near real-time insights purpose-built for both sides of the sports sponsorship table.


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