Three questions to ask before your next sponsorship
This Month at Foresight!
Welcome to our (nearly) fall newsletter! In this issue we share some learnings from our work on how to identify and value brand sponsorships – one of the most powerful ways for a brand to connect with its target audience.
In our “In the News” section we highlight a recent post from one of our senior team members, dealing with some provocative findings on gender equality and how it might help explain some differences between men’s and women’s country FIFA ranking.
Hope you enjoy reading, and we look forward to your feedback or questions!
Managing Director, Foresight Associates LLC
Feature article: Three questions to ask before your next sponsorship
Sponsorships can be a powerful way to communicate your brand’s essence and build its equity. From stadium naming rights to globally televised events, sponsorships can reach millions and make iconic brands synonymous with cultural touchstones and consumer passions from sports to entertainment.
Yet as the marketing community becomes ever more data-driven and pressured to create efficiencies, there is an increasing standard of proof required for evaluating and justifying these sometimes large investments. In our work on this topic, we have identified three simple but crucial questions to ask before going all-in:
1. Does the sponsorship fit with your brand?
A good sponsorship is about more than just publicity – It is about synergy between asset and sponsor. Your brand should benefit from the attitudes and perceptions consumers have about the asset, with a clear alignment in values and purpose. Consider Rolex’s investment in tennis championships. The luxury watch brand now sponsors all four Grand Slam major events, embodying brand values like precision (it’s the official timekeeper at Wimbledon), prestige, and quality.
One way to assess fit using analytics is to compare the demographic or attitudinal profile of your consumer targets to that of the asset’s audience. Many brands are now starting to survey consumers about their interactions with dozens of potential assets. Armed with this information, you can use statistical techniques to narrow the field to the most relevant opportunities for your brand.
2. What is your strategic objective?
It sounds obvious, but this is the most critical question for every new investment, partnership, or sponsorship. We think of objectives in terms of intended impact on consumer choice – are you trying to win new consumers, find ways to loyalize or retain your existing consumers, or drive them to a new product or offering? If your objective is to expand your consumer base, then investing in assets that are popular among your current consumers may not necessarily be your best bet – no matter how well they align with your values and purpose.
3. How much can you afford to invest?
This is one of the most common question we hear on assets, and it is a function of a) available resources and b) expected return. Although available resources can be viewed as an operating constraint, remember that there is often a difference between the budget for sponsoring the asset itself and the additional marketing spend required to fully leverage that asset and take advantage of its reach and equity.
That said, the ROI tends to be the confounding question. It’s important to employ a logical framework to review the different types of ‘bottom-line’ benefits that come with sponsorship – things like the size of reach, the intensity/frequency of impact (i.e., would you rather reach a million indifferent consumers or 10,000 potentially die-hard fans?) all play a part. In addition, the time horizon is an important consideration. On the one hand, multiple years of sponsorship may be required to solidify the brand association in the minds of consumers and achieve full impact. On the other hand, the lifetime value of consumers impacted by a sponsorship may go well beyond the time horizon of the sponsorship itself. Beyond these there are the various types of impact that may be more difficult to assign dollar values to – hospitality benefits, stakeholder engagement, etc.
Although just the tip of the iceberg, these quick tips highlight some of the intuitive ideas underlying our recent work on sponsorships. A key theme is that the discipline of data-driven decision-making has a critical role to play in successful sponsorship marketing – from leveraging well-designed research surveys to developing analytical frameworks to get more value out of existing data.
In the News: What does your Women’s FIFA ranking tell you about your country?
This summer we all tuned in for the Women’s World Cup. In addition to the spectacle of the athletics, there has been an ongoing controversy surrounding the fair compensation of players. In fact, LUNA Bar recently made headlines by writing a check to cover the difference in roster bonuses between the women’s and men’s team – both a good cause and a savvy marketing decision.
As we watched the games from our offices, one topic that came up is why certain women’s teams consistently perform better than their males counterparts (think of the Scandinavian countries) – is it greater investments in amateur training programs? Specific policies (like Title IX in the U.S.)? Support from top clubs (an emerging trend in Europe)?
One hypothesis was that FIFA rankings are in part a reflection of overall gender equality, with stronger women’s teams coming from countries with better measures of equality.
Publicly available data seems to support the hypothesis. The Global Gender Gap Index suggests that the average equality score is ~70%, meaning that the average country has a 30% gap from full parity (read more here). Among the top 10 ranked countries, we see a much higher average (77%), with clear decreases as we expand to the Top 25, Top 50, and so on.
Obviously this does not prove causality, but it does suggest that countries with more successful women’s teams tend to have stronger gender equality. We shared these thoughts on LinkedIn a couple weeks ago, and enjoyed the conversation that followed.