Results of the Think!Sponsorship/IMR digital activation survey released
The results of the survey on digital activation jointly undertaken by IMR and Think!Sponsorship have now been collated.
Overall, the findings suggest that the majority of sponsors (92%) activate programmes through digital media platforms. However, the data suggests that rights holders are some way behind with only slightly more than half utilising any form of digital communication.
The overall profile of survey respondents was predominantly European (83%) with just less than half being rights holders, while 43% were either sponsors or agencies and the remainder being ‘other’.
Survey respondent profile
The largest group of respondents among sponsors and agencies was from the financial services sector (52%), with FMCG and telecommunications being the second largest responders.
There was a surprisingly large survey participation from arts and charity organisations among rights holders and a relatively low response from sports organisations given that they are recipients of the majority of sponsorship investment in Europe.
In terms of the age ranges that the respondents target, there were similar profiles for the overall customer target market and those for whom digital media is used to communicate.
For example, 19% of sponsors claim to be targeting under 15s and 17% use digital communications to engage with this group.
However, the survey shows that it is the 21-35 year olds that are of particular relevance to the use of digital communication. This group is no doubt seen as tech savvy, with a medium/high income profile and likely to be using the latest communication devices.
As previously discussed, the overwhelming majority of sponsors / agencies state that they use digital media to activate their sponsorship programmes. This figure in itself is not surprising given the growing importance of sponsorship as part of the marketing mix and the relatively low cost of some forms of digital activation.
In terms of social media, the overwhelming majority of sponsors surveyed (88%) claim to have used social media as an activation tool with 12% saying that they have not.
By far the most popular social media for sponsorship activation are Facebook, Twitter and YouTube with MySpace trailing at just 11%. A surprisingly large number listed the B2B social network LinkedIn. This suggests that B2B objectives in sponsorship are common and that managers are linking with their peers to help drive programmes.
It is, however, difficult to explain how the percentage of respondents claiming to have used Facebook as part of their activation programme is higher than the number claiming to have used some form of digital activation. It is possible that either a small percentage of respondents didn’t consider Facebook to be a form of digital communication or that some respondents misread the question and thought that it had asked if they personally used Facebook. The latter might also explain why LinkedIn also featured highly.
Researching digital sponsorship
Researching the effectiveness of digital activation is relatively high among sponsors with 76% claiming to undertake evaluation that goes beyond the basic monitoring of click-through rates etc.
The figure is much higher than expected given that research companies tend to report informally that many sponsors have yet to come to terms with how to implement and measure their digital programmes. It is, however, likely that the figures are biased in favour of companies that do research. The very fact that they have undertaken the survey suggests that this is important to them.
Despite digital activation becoming increasingly important to the sponsorship industry, the majority of sponsors/agencies report that it still accounts for less than 15% of the overall activation budget. What is perhaps significant though is that 40% claim that they spend between 16-40%.
It should, of course, be borne in mind that digital activation can be relatively low cost. For example, to set up a Facebook page, run a Twitter campaign or even create a bespoke website can be much cheaper than even a fairly low key advertising or sales promotion campaign.
If sponsors are still running conventional marketing communications as part of their sponsorship programme, it is likely that it will take a significant chunk of the overall budget. PR, sales promotion, advertising, hospitality etc require significant investment to be effective, especially when run on a large scale. Put into context, therefore, digital activation looks like a major investment and there is no reason to doubt that it will continue to grow. Its proportion of the overall sponsorship activation budget, however, is likely to depend on the importance of traditional marketing activity to brands.
It is also possible that some brands will reduce the amount spent on rights acquisitions and switch this budget to digital activation. Already several major brands have effectively decided on a strategy of owning the medium of communication. In the UK, for example, lager brand Carling set up a Sunday football social networking site. The investment was made on the back of a long and successful series of sponsorships in football including the Premier League in England, the League Cup (now Carling Cup) and the clubs Celtic and Rangers in Scotland. The brand had established its credibility in football and this allowed its investment in the social networking site to be seen as appropriate among football fans. The site, however, required no formal sponsorship agreement with any rights holder.
As discussed earlier, rights holder comprised slightly less than half the sample and within these respondents there was a fairly even split between arts, charities, sports and ‘other’. Arts accounted for the biggest individual proportion of the sample.
Digital activation strategy for sponsors
With competition for sponsorship income among rights holders growing, especially given government cuts to arts and sports funding, it is increasingly important that such organisations make themselves attractive to potential sponsors.
Despite this, the survey shows that only 53% of respondents claimed to have a digital strategy in place for their sponsorship partners to tap into.
This figure can be interpreted in two ways. On the face of it this might seem like a relatively low proportion. However, given that only 27% of rights holder respondents were from the generally higher spending sports sector, the result overall could be seen as quite high. The big budget sports properties are much more likely to adopt digital strategies to work with their sponsors but these are not reflected in the survey.
On the other hand, given the obvious importance of digital activation to sponsors, and the fact those responding are more likely than average to have an interest in the subject, the figure still looks quite low. To have a digital activation strategy for sponsors doesn’t necessarily require any significant investment. It can be a plan to demonstrate to sponsors how they can tap into a property’s assets digitally to communicate with the audience. Building an opt-in database of emails and mobile numbers might be the most significant outlay for such a strategy and the costs would be proportionate to the size of the organisation.
Rights holder communication with fans / customers
In terms of how rights holders communicate with their audiences, the survey shows that the use of social media is still quite low.
Rights holder communication channels
Only 6%, for example, use Facebook and 9% claim to use ‘other’ social media. Rights holders are, in many respects, better placed to exploit social media than sponsors. Fans/customers have a strong, indeed sometimes passionate, affinity with the rights holder. Many have a thirst for the latest information and are highly likely to opt-in to communication channels. Against that, rights holders would arguably tend to have lower budgets and less creativity than sponsors when it comes to communication. As such, many sponsors have possibly taken the lead role in communicating in conjunction with the rights holder. So long as the content is seen as relevant, informative and entertaining, fans / customers might feel happy to receive content from such third parties and rights holders are perhaps happy to have the task undertaken by those with greater expertise.
What is worrying is that overall communication between rights holders and their target audience appears to be quite low. With figures rounded down, the use of telemarketing is virtually non-existent among the sample and Twitter only runs at 4%.
The research cannot be taken as a definitive analysis of the sponsorship industry and its trends. It was an opt-in survey in which contacts of Think!Sponsorship & IMR were invited to participate.
Given that Think!Sponsorship & IMR have a remit to provide information on the latest developments in sponsorship, the contacts were likely to represent those with high levels of interest in the latest techniques for activation. Those who actually completed the survey could be considered even more so.
That said, the data does reveal some interesting findings. Clearly sponsors and agencies have used digital communication techniques to a far greater degree than rights holders. The use of social media among sponsors is, likewise, much more advanced.
Interesting findings here are that Facebook, Twitter and YouTube appear to be the most popular means of communication with MySpace falling significantly behind. Indeed MySpace fails to match LinkedIn as a sponsorship activation tool.
The budgets being allocated to digital activation are clearly growing with a significant number now declaring that more than 15% of their activation budgets are spent in this area. That amount is likely to grow, especially among those brands targeting a younger age group for whom conventional media such as TV and print is becoming less relevant.
Significantly, the survey sample is reporting a high level of research into evaluating digital communication. This is encouraging news for the sponsorship industry for two reasons.
First, it is now very easy to communicate on a mass level at very low cost. Website and email marketing are relatively cheap to undertake and the temptation among some brand owners must be to cut back on evaluation if the cost of the exercise is actually very low. The perception might be that if the budget is low, there is very little to lose and therefore ROI is relatively easy to achieve. The fact is, it doesn’t matter how cheap a campaign costs to implement, nobody knows how effective it is without measurement. Analytics tools that report the number of email opens or ‘click throughs’ don’t give any information about what recipients thought of the communication or how they reacted as result.
The investment in research also demonstrates a further maturing of the sponsorship industry. New communications channels such as social media effectively mean that activation programmes have become much more complex. They frequently have to work across many different media and target a wide range of recipients. To ensure that the message is delivered, consistent and has impact requires careful planning. That cannot be achieved without constant monitoring. No marketing department would run a major direct mail or telemarketing exercise without testing and the same should apply to all forms of sponsorship activation.
Digital communication clearly presents many new challenges and opportunities for brand marketing. The sponsorship industry is arguably better placed than most to exploit its potential. It is becoming something of a cliché to state the difficulty marketers have in reaching their audience through traditional that traditional media such as print and television.
Consumers and fans can increasingly watch programmes or read the news when they want using the media of their choice. It makes it far more difficult to ensure that adverts are seen. But those same people still have a passion for their favourite sport, art or other interest. Brands that partner with such rights holders should not only remain visible; they should be having stronger conversations with the audience than has ever been possible to date.
Tuesday, September 07, 2010