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WARC’s critique on ROI spurs sponsorship industry backlash

Sponsorship industry figures have responded strongly on social media against a headline on the CNBC website that said: “Sponsorship spending to hit $66bn worldwide, but most firms don’t know if it really works”

The article based on the latest ‘WARC Global Ad Trends’ report – which focuses on sponsorship – referred to the WARC press release which said: “Advertisers are expected to spend a combined $66bn globally on sponsorship this year, though fewer than one in five are confident that they can actually measure the business value return of the sponsorships they undertake.”

Industry figures took issue with the CNBC report, asserting that it took no account of measurements based on the industry-standard ‘return on objectives’.

The London-based motorsports agency Sidhu & Simon‏ tweeted: “Misleading piece based on a blurred methodology and no insights into what the specific sponsorship objectives were for the research sample. BTW, WARC is an online service offering advertising best practice, not sponsorship expertise.”

Sally Hancock, managing partner, Y Sport and former director, Olympic and Paralympic Marketing, Lloyds Banking Group, said: “[The piece] takes no account of innovation, in partnership strategy, activation or measurement, of which there are plenty of great case studies!”

Murray Barnett, head of global sponsorship & commercial partnerships, focused the counter argument on the need for clear sponsorship objectives: “Important there are clear objectives,” he tweeted. “Not always the case. Easy to complain about lack of ROI when objectives weren’t clear.”

Beyond the controversy, WARC estimated that brand spend – inclusive of rights but excluding activation – is expected to rise 4.9 per cent to reach $65.8bn worldwide in 2018, with the World Cup in Russia thought to have contributed $1.7bn worth of deals.

“When compared to paid media, sponsorship is the second-fastest growing advertising channel behind internet formats,” the report noted.

Overall, the Global Ad Trends report says that North America makes up the greatest share of sponsorship spend (36.8 per cent, or $23.1bn), followed by Europe (26.6 per cent or $16.7bn), Asia-Pacific (25.0 per cent or $15.7bn), Latin America (7.2 per cent or $4.5bn), and then the Middle East & Africa (4.3 per cent or $2.7bn).