_{published April 2024}

Understanding the Return on Investment (ROI) of your marketing partnerships is essential for brands. ROI guides strategic decisions, allowing a brand to evaluate the effectiveness of its investment and make informed decisions about future sponsorship opportunities.

ROI in sponsorships isn't just about financial return. Sponsorship ROI encompasses a broad spectrum of benefits from enhanced brand exposure, brand awareness, and audience engagement to stronger business relationships and improved brand loyalty. These intangible benefits are as valuable as direct sales boosts, if not more so, in building a brand's long-term equity.

Definition of ROI
In the context of sponsorships, ROI measures the total return on sponsorship investments against the costs associated with the partnership, considering both tangible and intangible benefits.

Key Steps to Measuring ROI

• Set Clear Objectives: Define what success looks like for your sponsorship—be it increased brand awareness, customer engagement, or direct sales.
• Benchmark and Gather Data: Understanding the landscape is key to setting realistic goals and expectations, so conduct comprehensive market research, benchmark against competitors (and past partnerships), and draw inspiration from successful sponsorships. The SponsorUnited platform can aid in this step, so sign up for a demo today.
• Choose Metrics Wisely: Select metrics that accurately reflect progress towards your goals. These could include social media mentions, website traffic spikes during sponsored events, or even direct sales linked to sponsorship activities.
• Evaluate and Adjust: Measuring ROI is not just a one-time task but a continuous process. Regularly assess your sponsorship's performance against your goals, and don't hesitate to pivot your strategy along the way to maximize impact.

Components of ROI

• Brand Awareness: How well does the sponsorship increase visibility for your brand? This is often measured through media value, which includes traditional press coverage, digital media mentions, and social media exposure.
• Direct Sales: Is there an increase in sales numbers directly attributable to the sponsorship? For many sponsorships, especially those in product-centric industries, direct sales uplift is a key metric. Tracking sales figures before, during, and after sponsorship events can provide clear indicators of impact.
• Digital Engagement: How does the sponsorship improve your engagement metrics on social platforms? This involves metrics such as social media likes, shares, comments, hashtag usage, and increased followers. It also includes engagement on digital platforms such as branded content views and interactions on websites.
• Customer Perception and Brand Alignment: Do customers see your brand differently, based on the sponsorship? Surveys and focus groups can assess changes in customer perception pre- and post-sponsorship. This qualitative data helps understand how well the sponsorship aligns with brand values and affects consumer attitudes.
• Employee Engagement: Particularly for corporate sponsorships, the effect on employee morale and engagement can be significant. Engaged employees can boost brand advocacy internally and externally.

For a longer list of components that might affect sponsorship ROI, read part one of our ROI blog series.

Key Performance Indicators (KPIs) for Sponsorships

• Media Exposure Value: Assesses the estimated monetary worth of a brand's exposure across media platforms due to sponsorship activities.
• Social Media Interactions: Tracks likes, comments, shares, and other engagement metrics on social media content that is related to the sponsorship.
• Lead Generation Numbers: Measures the number of potential customers or contacts generated through sponsorship-related activities.
• Customer Conversion Rates: Calculates the percentage of leads from sponsorship activities that become paying customers.
• Audience Growth Metrics: Monitors increases in the brand's audience size, including followers and subscribers, as a result of the sponsorship.

For a longer list of potential KPIs for sponsorship deals, read part two of our ROI blog series.

Methods of Measuring Sponsorship ROI

Direct vs. Indirect Metrics: Direct metrics, such as sales conversions, provide a clear and measurable impact of sponsorships. Indirect metrics, including social media engagement and audience sentiment, contribute to long-term brand loyalty and recognition, offering a broader view of a sponsorship's effectiveness.

Quantitative Methods

• Sales Tracking: Implement promotional codes and unique landing pages to track online sales and inquiries directly resulting from the sponsorship.
• Traffic Analysis: Use web analytics tools to monitor spikes in web traffic and user behavior linked to sponsorship activities.
• Social Media Analytics: Employ platforms that track engagement rates, reach, and interaction trends to gauge digital performance.

Qualitative Methods

• Surveys and Polls: Conduct post-event surveys to collect attendee feedback, which helps in assessing the perceived value of the sponsorship.
• Focus Groups: Gather detailed insights from selected audiences to discuss their views on the sponsorship and its influence on their perception of the brand.
• Sentiment Analysis: Analyze social media and other digital communications for public sentiment regarding the sponsorship.

Final Thoughts

Whether your brand is well-versed in sponsorships or just starting out in the space, one constant remains—the importance of sponsorship data and insights in making informed decisions. Measuring and evaluating ROI will help you understand the value your marketing partnerships bring to your brand. By setting clear goals, leveraging data and insights for informed decision-making, and staying adaptable, brands and rights holders can ensure their sponsorship strategies—and dollars—drive meaningful results.

Did you see our comprehensive list of sponsorship deal KPIs? You'll want to review this list before finalizing your ROI in order to optimize your marketing partnerships for success. We also have info for you to gauge the success of your individual sponsorship activations and, if you missed it above, learn about the components of a sponsorship deal that could affect ROI. You can also visit our insights page to read about corporate sponsorship trends and other news.

Sign up for a quick demo to learn more about our media and sponsorship database. Clients might refer to our sponsorship platform as a sponsorship marketing platform or even a sponsorship analytics platform since we track over 360,000 brands, 1.8 million deals, and 16.9 million data points across sports, entertainment, media, and talent.