Challenges facing sponsorship decision-makers
Every sponsorship decision-maker knows the feeling: After endless negotiations with rights owners, their marketing representative and internal stakeholders, the new sponsorship agreement is finally cut and dried. However, the expenditures are higher than originally budgeted, reducing the already scarce resources for implementation and activation even further. And this time around, you really wanted to give some smart thought to how to deploy the content effectively on the right media channels before the contract started…
Using limited resources to justify conservative – or at least unspecific – activation is all too familiar to those in the industry. The problem still persists despite the fact that even small sponsorships offer significant opportunities. While this potential is growing as the value of live content continues to rise, media channels become more diverse and big data opportunities abound, sponsorship departments are often hampered by limited resources. As a result, instead of creative campaigns, all they can implement is a short-term “one size fits all” solution.
Guidelines for successful planning: Four steps to smart sponsorship analysis
A way out of this dilemma is urgently needed. Nielsen Sports’ “Smart Sponsor” concept tackles this problem head-on, offering sponsors a methodical approach to managing their sponsorship projects. Four steps are fundamental for every decision-maker during the strategic planning process ensuring smart sponsorship:
1. Break down the target group to identify the most attractive segments – which can be up to 300% more receptive sponsorship messages – quickly and efficiently: customized fan segmentation by understanding the fan DNA!
2. Activation is always on equal footing with rights acquisition: Activate the sponsorship by tailored communication to the target group – appealing to critical success segments based on their needs!
3. Base all strategic and creative process measures on data-backed decisions: Measure and evaluate success holistically to quantify the Return-on-Sponsorship-Investment (ROSI) to leverage the sponsorship effectively!
4. Optimize the sponsorship using ROSI tools to systematically identify further potential. Integrate and rely on external partners for strategic and creative planning to ensure smart Optimisation based on lean management methods.
These fundamental rules helps every sponsor make decisions and maximize the potential of a sponsorship more effectively, no matter what the budget for their campaign is. Like any marketing instruments in the digital age, intelligent use of data and tools is essential for successful sponsorship.
The link between the two is particularly relevant in the fourth phase when it comes to Optimisation of smart sponsorships.
Nielsen Sports’ ROSI model supports holistic campaign evaluation by mapping media reach and brand effects transparently. To calculate ROSI, the overall monetary value is divided by the total expenditures and activation costs.
This enables to compare projects within your own sponsorship portfolio, and allows benchmarking your engagements against other sponsors. More than that it also offers the most relevant insight for any decision-maker in the sports business: By incorporating Nielsen trade data the actual impact of sponsorship measures can be mapped on sales.
Best practice sponsorship
The ERGO Group is a prime example of how to use the “Smart Sponsor” method successfully. Europe’s leading insurance group consistently uses a campaign monitoring process in order to continuously optimize its sponsorship of the German DFB Soccer Cup. Let´s reflect their four phases:
1. Fan segmentation: Using the Nielsen Sports FanDNA (TM) to identify the most relevant segments for sharp campaign targeting.
2. Activation by tailored communication: Ergo keeps on developing data-driven activation concepts by telling convincing “Fan Stories”, consistently provided into the relevant channels
3. Holistic Evaluation: Leveraging a monitoring model, ERGO links findings and data from media and market research to a holistic evaluation, giving the company valuable data on its return on investment
4. Smart Optimisation: Ergo ensures transparency by keeping all relevant stakeholders into the loop and thus levering available synergies on a frequent basis.
Jan B. Thelen
Vice President Business Relations Sports & Entertainment (DACH)
Nielsen Sports Deutschland GmbH