ROI Starts With the Objective: Agree on the Scoreboard First

Racers ask me all the time how sponsors calculate ROI, as if there were one formula hidden in a drawer at every marketing department. There isn't. Return on investment is a measurement, and you can't measure anything until you know what you're measuring. A brand that wants sales counts one thing. A brand that wants trial counts another. A brand that wants long-term affection may not count anything for years.

That's why the smartest marketing people I've interviewed at my Sponsorship Summits talk about objectives before they talk about numbers. Some people call it ROO, return on objective. Whatever you call it, the order matters: first the goal, then the scoreboard, then the report.

Ask what the priority is before you promise a number

Al Rondon, who leads sports marketing at Coca-Cola, was asked on the Why Brands Sponsor & ROI panel whether a sponsorship's effectiveness can be measured. He answered with a question of his own. "What's the priority? Is the priority exposure? Then those things can be measured," he said. If the goal is sales, "we try our best to try to identify sales lift that the sponsorship has created."

Then he described a third kind of goal, the one racers tend to forget. "Is it about brand love? ... That's a very long-term play," Rondon said, and "that's going to be something that the brands understand may take a lot more time and have to look at ROI maybe in a different manner." ▶ Watch Al Rondon on measuring ROI

Three goals, three ways of keeping score. If you hand a brand-love sponsor a spreadsheet of impressions, or a sales-lift sponsor a highlight reel, you're answering a question nobody asked.

Rondon's advice for finding the right goal is plain homework: "Do the homework, find out what that company is looking to do. What are their needs? And how can you help them solve their needs? That's going to take a lot of work." He pointed out that much of it is public. "Companies put out, you know, a lot of their reports," he said. "Find out what it is that they're trying to achieve." ▶ See the full panel

Fit the brand's plan, don't build one around yourself

Tony Yorkman, senior partnership manager at K&N Engineering, learned a rule from an old boss when he took over K&N's sports marketing group, and he uses it to sort every deck that lands on his desk: "Never build a plan around your opportunities. Always find opportunities to fit your plan."

For a racer, that means the pitch has to start from K&N's goals, not from the race schedule. Yorkman wants someone who knows what the plan is "and then shows me how their opportunity fits that plan, because without it, I have no interest. It has to fit my agenda." ▶ Watch Tony Yorkman explain this

He admitted that figuring out a brand's agenda is hard from the outside. But a racer who gets even part of the way there stands out, because most proposals never try.

The audience defines the return

The objective also decides who you need to reach. Kyle Kietzmann, president of BELL Racing and OMP, explained that his brands judge each racing segment on its own terms. In World of Outlaws, BELL has backed Donny Schatz for more than 20 years "because we recognize that those athletes influence buying decisions within the winged sprint car market, where they're not necessarily paying attention to someone that's at a NASCAR level or an F1 level, but they're heroes of the people that are running World of Outlaws."

For a helmet company, the customer is often the person in the next pit. "Our consumers are racers," Kietzmann said. "That's who we're targeting." ▶ Watch Kyle Kietzmann on sponsorships

So the return BELL looks for in a sprint car deal is influence over the people who buy sprint car helmets. A huge TV audience in some other series won't help with that. A short-track champion the local racers look up to will.

Know where the buyer is in the journey

Ben Dolan, vice president of marketing at VP Racing Fuels, put the objective in buyer-journey terms. VP has been in racing for decades, and recognition isn't its problem. "It's no longer about brand recognition for us," he said on the Why Brands Sponsor & How to Calculate ROI panel. "We talk a lot about the buyer journey, and what we're looking for is not awareness-level content in certain markets. We're looking for consideration, decision-level content."

He was careful to say it depends on the market. "In the case of some emerging markets, we still have some awareness to do," Dolan said. The point is that VP knows which stage it's trying to influence in each market, and it judges sponsorships against that stage. ▶ See Ben Dolan's answer

For a racer selling to VP, that changes the deliverables. Explainer videos, testimonials and content showing what the lubricants and additives actually do serve a consideration goal. Another photo of a decal doesn't.

Even sister brands want different results

You can see how much objectives matter when two brands from the same parent company sit on the same panel. Sarah Henning, who runs marketing for Fast Orange and Spray Nine at ITW, described her goal as trial. "Having people test the product, use them and actually see the results from using our products on their cars, on their hands when they're working in the shop and getting dirty, that's really the key for those kinds of products," she said. New items like a walnut-based cleaner need people to try them: "Driving people to try those new products that we've released and grow the brand that way is really key." ▶ Watch the session

On the same panel, her colleague from Permatex described his brand's goals as retail traffic, awareness of new products and showing the product working at the track. Same company, same racing audience, different scoreboards. A racer who sends both brands the same proposal is going to miss at least one of them.

The takeaway

• Before you quote a price, ask the brand what this program is supposed to do: exposure, sales lift, trial, influence over a specific buyer, or long-term brand love.
• Read what the company publishes about itself (new products, new markets, annual reports) and tie your pitch to one stated goal.
• Agree in writing on how success will be measured, so the report you deliver at season's end answers the question the brand actually asked.
• Match deliverables to the stage of the buyer journey the brand cares about. Awareness content is the easiest to make and often the least wanted.
• Treat every brand in a corporate family as its own customer with its own objective.