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, according to a new WARC report.

The latest WARC Global Ad Trends report, which focuses on sponsorship, says that brand spend – inclusive of rights but excluding activation – is expected to rise 4.9% to reach $65.8bn worldwide this year.

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

Most of this money is going to sports properties, and 2018 benefited from the FIFA World Cup in Russia, which is thought to have attracted $1.7bn worth of deals.

And despite the spread of streaming into sport (the Russia World Cup was the most-streamed sporting event in history), TV is still king for such events: World Cup matches reach 44% of the global population in-home via television.

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

This spending is principally used to drive brand metrics and reach as sponsorship fits into the ‘upper-funnel’ of a marketing plan.

But only 19% of sponsorship professionals are confident that they can actually measure the business value return of the sponsorships they undertake.

Further, only 37% of practitioners have a standardised process for measuring sponsorship – and these often rely on digital and social media metrics, which, the Association of National Advertisers (ANA) has said, provide a “distracting noise” due to their weak relationship to sales.

Possibly by way of remedy, the share of marketers activating sponsorships through experiential live events has risen to two-thirds (65%) over the past year.

James McDonald, Data Editor, WARC, observed that, in a world of fragmented audiences, sport remains able to “generate an engaged, mass audience which sponsors can reach, before amplifying their campaigns via social media and experiential events”.

And while sponsorships can drive brand awareness and consideration in much the same way as TV, he added that there remains “[a] knowledge gap between brand impact and sales impact”.

Sourced from WARC