Measuring the Effectiveness of True Sponsorship
BILL HARVEY | TRA, Inc. | [email protected]
STU GRAY | Independent Consultant
GERALD DESPAIN | Next Century Media, Inc.
Originally published in the Journal of Advertising Research December 2006
Twenty-eight studies were conducted for leading advertisers to measure the persuasion of sponsorship without advertising on the internet. Experimental design maintained identical content except for the sponsorship message in the test group missing from the control group. The two groups were random replicates. Persuasion measures used were those accepted by the advertisers involved as being most predictive of sales. Average lift in purchase intent/brand consideration was 29 percent, which compares to an average lift of 4 percent across all ARS Persuasion tests. Across the 28 studies the results were consistent in 100 percent of cases, with the test group higher than the control group. Statistical significance was achieved in virtually all cases at 95 percent confidence. In a different study, the sponsored content was specifically courseware offered free on the internet by major advertisers. Here the measurement was ROI based on a questionnaire self-report of brand purchase and price paid. Sample size was over 196,000 intab questionnaires with a 65 percent response rate. ROI for sponsored educational content averaged 55:1, about 27 times the published average of all MMA ROI results. The latter study also obtained supplementary measures of satisfaction, increased brand perception, brand promoter, willingness to take future courses, etc., the results of which were highly positive and hence strongly supportive of the ROI results. These studies point strongly to a major role for classical “True” sponsorship in the future of advertising in all media, including internet, linear TV, VOD, mobile, etc.
Sponsorship is again on the rise, and marketers have called for new efforts by researchers to
measure the business value of this form of marketing communications.
The methodologies appropriate to making sponsorship accountable are similar to those used for other forms of advertising, and the effects of sponsorship fit within the continuum of effects known as the ARF Model. What causes Persuasion in the sponsorship context appears, however, to be logically different from what causes Persuasion in the advertising context. Advertising appears to work by causing improvements directly in brand perception, whereas sponsorship appears to work by causing improvement directly in the perception of the sponsoring company and often indirectly by halo effect in the brand perception. However, even when brand perception is not affected, sponsorship can increase purchase intent, apparently as result of gratitude toward the sponsor.
Background to this Study Series
In 1999, Next Century Media was approached by Studio One, a major creator and syndicator of sponsored content on the internet and in broadcast outlets, and was asked to develop a methodology for measuring the effects of internet sponsorships. In subsequent meetings with industry associations, including the Association of National Advertisers (ANA), the American Association of Advertising Agencies (AAAA), and American Demographics Magazine, Studio One Networks and Next Century Media organized SEI LLC, whose purpose is to make those methodologies applicable across all media, including television and event sponsorships. The methodology has been applied first to the internet and is expanding, using constant yardsticks across all media. Between 2000 and 2006, SEI has executed 30 sponsorship studies for 12 top advertisers. Twenty-eight of these studies for 10 top advertisers have been completed, and their results are contained in this report.
Sponsorships were the original advertising form on radio and television. Sponsored events today generate more total dollars than all media advertising combined (from a combination of sponsor expenditure plus ticket sales).
On the internet, sponsorship revenues are expanding faster than banner revenues. In the future, the rise in penetration of personal video recorders [(PVRs) also known as digital video recorders (DVRs)] such as TiVo, as well as the duplication of PVR function by cable and satellite set top boxes is expected to increase the consumer’s ability to avoid normal advertising.
Pundits are proclaiming that the future shall be a new Golden Age for sponsorship, product placement, and cast presenter commercials, in an effort by marketers to keep up the consumer’s diet of marketing messages in face of the new hurdles—avoiding zapping by merging into the programming.
Despite all of the indicators pointing to the need for a clear understanding of the business value of sponsorships, marketers today remain unsure of how sponsorship works and how to properly measure its business value. Marketers see sponsorship as something different from advertising—but there has been no general clarification of how sponsorship differs from advertising, and what this implies in terms of how to make sponsorship accountable. Thus there has been a recent groundswell of interest expressed by advertisers and agencies alike in devising new forms of research to measure the business effects of sponsorships in all media—including events.
Hypotheses of the Sponsorship Effectiveness Index Studies
- Sponsorship has recall and persuasion effects like traditional advertising.
- Sponsorship operates through different cognitive processes than those utilized by traditional advertising.
- Advertising changes the consumer’s perception of a specific product while sponsorship changes the consumer’s perception of a specific sponsor— which can rub off positively on the brands of that sponsor and may increase the willingness to purchase those
- Sponsorship’s positive business effects are maximized when:
- The target audience is highly involved in the subject of the program or event being sponsored.
- That audience perceives there to be a scarcity of content in the subject area relative to their appetite for it.
- The program/event is executed so as to produce a high level of satisfaction with the material by the audience.
When internet users click on a link to a sponsored program, they are intercepted by an invitation screen.
Before they are admitted to the program, they must answer yes or no to a question as to their willingness to answer a few questions “to help us improve the program,” which they will be asked upon leaving the program. They may be offered an incentive ranging from a free magazine to a $15 gift certificate at a popular book chain website, depending on the degree of the advertiser’s willingness to incent respondents.
Users answering “no” are allowed to go to the program and are not contacted again. Users answering “yes” are also allowed to go to the program, and a random half of them are sent to a version of the program where the sponsor is not mentioned (the control group). Everything else about the program is identical across the exposed group and the control group. As respondents leave the program by any means (e.g., click on a banner, hit the back button, etc.), they receive a short onscreen questionnaire, which is the same for both the exposed group and control group. A person’s status (agreed to participate or not, control or exposed group, already responded to questionnaire or not) persists across multiple sessions to prevent duplication of participants or showing sponsorship logos to the control group.
The questionnaire begins with questions about the editorial content, and how it might be improved. It then goes on to questions relevant to measuring sponsorship effectiveness, which are adapted for each sponsor’s studies to reflect communications measures that the advertiser has found to be most predictive of sales, and which are therefore routinely used to assess advertising performance in tracking studies and in commercial pretesting. The difference in these measures is attributed to the effect of sponsorship, as all other variables have been held constant.
SEI’s software can be calibrated so that all users clicking to go to a sponsored program may be intercepted, or a specific percentage of them can be intercepted.
IAB study, 2003
During April–September 2003, the Interactive Advertising Bureau in conjunction with CondéNet, Forbes, Primedia, Register.com, Studio One Networks, Terra Lycos, and Yahoo, under the sponsorship of Volvo through Euro RSCG Circle.com, engaged SEI LLC to conduct a major industry landmark study of the two main types of internet sponsorship, True Sponsorship as defined above versus Common Sponsorship (the latter consisting of all other forms of internet sponsorship, differentiated from true Sponsorship mainly by having more than one advertiser visible on the page).