Evaluating Sponsorship

More and more, marketers are needing to validate their marketing spends. They are being challenged by their executive teams, their CFOs, and their procurement specialists to justify investments both in terms of the value being acquired and the return on investment being delivered to the brand and the business. 

Sponsorship is no different and marketers need to know where their investment is going, how partnerships will be leveraged and the return they can deliver. 

Sponsorship can be an important way for brands to create emotional connections with consumers and to demonstrate a brand’s values.  Sound strategy lies at the heart of a brand’s ability to achieve this successfully. Implementing that strategy though effectively and efficiently requires the ability to measure and understand the value a particular sponsorship (assets, entitlements, associative benefits) can deliver to a sponsoring brand. 

This is commonly referred to as “valuation”.  Property valuation derives ‘the number’—the single commercial category rights value that a property is worth to the brand based on the industry category(s) the brand competes in along with the rights and entitlements the property provides. 

A vital component of good governance, property valuation provides a consistent approach to the assessment of sponsorship opportunities across an organization and serves as the foundation to a data-driven, insights led sponsorship property evaluation.   

Property valuation is at the core of property evaluation, but it is important to distinguish between the two. While property valuation provides the value of the category rights for a particular sponsorship, property evaluation is a more comprehensive assessment that is informed by the property valuation. 

Lumency’s approach to sponsorship evaluation delivers both the value and the context, all to provide a deeper understanding of a property’s value to the specific brand. 

Rigorous and tailored to each Lumency client, a thorough property evaluation is a data-driven examination of a new or renewing sponsorship. A property evaluation considers target efficiency, alignment to business and commercial strategy, activation and connections planning considerations, and asset and entitlement mix.  The evaluation delivers insights and recommendations around deal structure, negotiation strategy, variable compensation models, among other considerations.  All informed by the quantitative valuation process as the foundation.  

Comprehensive and effective analysis in the form of a property evaluation unlocks value. Providing a holistic understanding of a property’s value to the brand facilitates evidence-based decisions for even the most intricate of deals and ensures sponsorship investments support measurable objectives. 

Looking to gain clarity for where value truly lies, and opportunity exists within your sponsorships?   

We can help—for a no-obligation, no-cost, one-hour consultation on how you can better evaluate your sponsorship investments reach out at [email protected]

By: Jeff Rothlein

Evaluating Sponsorship