How to apply a sponsorship formula to measure ROI


Measurement is the holy grail of all marketing activity. Without it, we don't know how far we have come or how much further we've got to go in reaching our target market. The budget for many marketing departments is now set according to the quantifiable outcomes of previous sponsorship campaigns.

There are a number of ways to measure sponsorship success. From an increase in sales revenue to a growth in social media engagement, companies are now able to gauge with a degree of accuracy the efforts of their marketing team. What is a little more unknown is what the return on investment (ROI) will be prior to activating a sponsorship campaign. This insight would most certainly help a potential sponsor in the decision-making process. After all, it's a little bit late to find this out once the sponsorship term has concluded. For example, how do you really know if your prestige vehicle dealership is going to secure new customers from sponsoring a fashion show? While we can take calculated guestimates, having a formula to apply to all potential sponsorship agreements is far more beneficial.

I'm going to share with you our own EventSponsors formula for sponsors measuring ROI. This is a formula we apply to all our sponsorships and it's one that has been proven time and time again. It goes like this:

O + P(L + C) = ROI

Objective + Partnership x Creative Leveraged Activity = ROI

In other words, your return on investment is directly a result of your sponsorship objective and the partnership you choose multiplied by the planned leveraged activity. The more creative your activation the better!

O = Objective. The objective of your sponsorship is whatever you decide it to be but it is usually based on your company objectives. If your business needs to increase its reach by entering a new territory, the sponsorship objective many be to increase brand awareness. The point is, you need to know exactly what your objectives are (and that of the other party) before you start.

P = Partnership. The partnership is between the sponsorship-seeker and the sponsoring party. While there may be other parties to the sponsorship, the one you're centrally needing to focus on is the one that directly impacts your return on investment.

L = Leverage. Any sponsorship needs to be leveraged if it is to be successful. Simply partnering in an agreement and doing nothing to activate it is no better than throwing money to the curb. Leverage can take on many forms from leveraging via social media, publicity efforts and advertising.

C = Creativity

Creativity is the fuel you give your sponsorship to fire. It's the spark that ignites the excitement and engagement of your target market. While many people profess they don't have a creative bone in their body, in my mind that's just a cop out. Being creative is as much about playing it smart as anything else. When you know what your mission is and who your partners are, applying your smarts to achieving your goal is straight forward.

When you apply this formula, you are giving yourself the best possible chance of meeting your sponsorship objectives. The key is to apply the formula before you finalise any agreement. If you can't vouch for every part of the equation then you either need to look harder or reconsider your options.

Sponsorship is a science but it's also a lot of fun when you know how to make it work for you. We can help you find that joy by working with you on your sponsorship selection, strategy, partnerships, negotiations and more. Contact me at

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