Getting the Most Out of Sponsorships

September 8, 2011

101 Sponsorships

By Lisa Lance

According to the IEG Sponsorship Report,
North American companies spent
$17.2 billion on sponsorships in 2010,
a 3.9 percent increase over the previous
year. Your own organization may have
participated in this trend as a sponsor of
an association meeting, a sporting event
or a charity fundraiser. But as companies
continue to spend more on sponsorships,
how can they ensure they are getting the
most out of these opportunities?

To start, a company should make sure
it chooses the right sponsorship. Scott
Graham, president of Excellent Meetings
in Chillicothe, Ohio, offers meeting planning,
sponsorship management and procurement
services to professional associations,
nonprofits and corporations across
the country. He said there are five factors
to consider when evaluating a sponsorship
opportunity. First, is the organization’s
message in line with your brand?
Second, is the audience of the organization
the same audience you want to reach?
Third, does the sponsorship fit within
your budget? Fourth, is the timing good?
And, finally, does the geographic location
make sense – is it within your scope?

Setting goals is also important. “Before
signing an agreement, a company
should ask, ‘What do we hope to accomplish,
and how will we determine if it is
a success?’” said William Chipps, senior
editor of the IEG Sponsorship Report.
Chicago-based IEG provides consulting,
valuation, research and training services
regarding sponsorships to companies
nationwide. IEG works mainly with
large companies, and its clients include
Adidas, Pfizer, General Motors, Subway,
Volkswagen and AT&T.

Charlotte McCoy, marketing director
for the Discovery Center in Springfield,
said because her organization is a private
nonprofit and has limited advertising
funds, she specifically looks for
opportunities to partner with other organizations
in trade.

The Springfield Cardinals are one
organization with which she has partnered.
She said the Discovery Center
gets a lot of traffic on game days because
of its proximity to Hammons Field, so
she worked with the team to sponsor a
game this summer. The result was the
“Great Minds at Play Day” on July 26.
“It wasn’t a money sponsorship,” she
said. “It was a trade as far as adding
value to their game and also helping us.
It was a win-win for everyone.”

The Discovery Center produced a
25-minute interactive assembly at the
field before the game, with the theme
“Science Behind Magic.” The center’s
name was displayed on the scoreboard
and a representative from the Discovery
Center threw out the first pitch.

Both the Discovery Center and the
baseball team promoted the event to their
customers, and McCoy said some people
on her list attended who had never been
to a Cardinals game before. “We’re adding
value to their events, and reaching a
whole new crowd,” she said.

Going the Extra Mile
“When we talk about sponsorships,
buzz words in the industry are activation
or leverage,” said Chipps. “To gain
the biggest bang for the buck, you need
to be prepared to activate a sponsorship.”
He explained that activation is how a
company brings a sponsorship to life. For
example, a sponsor of an athletic tournament
may run a promotion to give away
tickets to the event or may have a booth at
the event to let attendees sample its product.
“Activation is a critical component to
a sponsorship,” Chipps said. “If you don’t
activate it, it’s like buying a toy without
buying the batteries.” But he cautioned
there might be an additional cost to add
activation opportunities.

How can a company get more mileage
out of a sponsorship? “They usually
get the right to use the name of the event
in the company’s marketing collateral,
and they can do an ad campaign that
mentions they are a sponsor of
the event,” said Chipps. “If the
package doesn’t include this, ask
for it.”

“In life, everything is negotiable,”
said Graham. “If a company
thinks XYZ organization fits with its
message and the audience fits, then
it needs to negotiate to get what it
wants.” He said this depends on whether
you want to be highly involved in the
event – for example, if a company wants
its CEO to speak – or if you are looking
for a more subtle involvement, such as
just having your logo displayed.

The benefit of a sponsorship may simply
be receiving a contact list from the
sponsorship organizer. After the event is
over, Graham said following up with the
audience is just as important. You may
want to send out an e-mail, a direct mail
piece or other communication. “Obviously,
a sponsor wants to communicate to
that audience or they wouldn’t have sponsored
that event,” he said.

“In this age of social media, where you
have a lot of friends and followers online,
it’s rare to actually meet face to face,” said
Ron Ameln, president of Small Business
Monthly magazine in St. Louis. “It’s really
about making that first connection with
customers.” Sponsors of his publication’s
events, which include the St. Louis Business
Expo, receive a mailing list of attendees
so they can follow up after the event.

Measuring Success
“Ten or so years ago, a lot of companies
used sponsorships to gain signage
at a sports venue and hoped to reach as
many people as possible,” said Chipps.
“And over the last five years, companies
are starting to focus on return on investment,
or ROI.”

Graham agreed. “When a company
is evaluating whether a sponsorship was
valuable, they’re going to be looking at
their return on investment,” he said, adding
that some measurements are salesrelated,
but others could be non-sales focused,
like increased brand awareness or
enhanced loyalty from customers.

“It all ties back to a sponsor’s marketing
objective,” said Chipps. On the most
basic level, a company will use a sponsorship
to build visibility. For example, if a
sponsorship includes a banner with your
logo on the sideline of a tennis tournament,
you can measure pure impressions
in how many people see it.

Moving beyond that, Chipps suggested
that if a company wants to measure
a change in perceptions of its brand, it
can send out consumer surveys after the
event. But, he added, “The ultimate goal
for many companies is driving sales.”
Joe Capitanelli, marketing manager
for Global Spectrum at the St. Charles
Convention Center, said his company
offers the ability to print coupons on the
back of event tickets so companies can
have a trackable measure of ROI. He also
said it’s important to look at the demographics
of the event to make sure you
are reaching the right groups of people
for your business. “Any time a company
is going to sponsor an event, it has to fit
their demo,” he said.

McCoy was happy with the exposure
the Springfield Cardinals partnership provided.
“We got some great PR that day at
the game,” she said. But she added that
if she does a similar event next year, she
plans to add a coupon to measure how
many people come back as a result.

Adding Sponsorships to Your Own Events
Graham said many of his clients are
looking for help setting up sponsorship
opportunities for their own meetings and
events. “Sponsorship management is not
a huge demand, but sponsorship procurement
— helping organizations find
sponsorship dollars — is becoming a bigger
piece of our business,” he said.

“Having sponsors that people know
builds a lot of legitimacy into the event,”
said Ameln. “If you see a really good, recognizable,
highly respected brand, guests
are more likely to show up.”

Sponsorships not only have the benefit
of demonstrating partnerships with other
companies, they can also provide an important
source of funding. “The number
one benefit to having sponsorships is increased
revenue,” said Graham. “If you’re
trying to include the revenue in the registration
[fee for an event], the price will
be so exorbitant, the attendees won’t be
able to come. But adding sponsorships
gives you a whole other revenue stream.”
He added that in some cases, such as an
annual meeting for an association, the
financial goals include raising enough
money to fund a large percentage of the
group’s yearly budget. “They are looking
for a revenue stream to stay alive.”

But managing outside sponsorships
also has its challenges. “As in everything,
when you’re selling something you need
to deliver on your promises,” said Graham.
If you promise sponsors exposure
in a certain way, you need to make sure
they get it. “That’s why the sponsor is
giving you the extra dollars.”

Ameln said when Small Business
Monthly began searching for sponsors for
its award lunches, he invited potential
sponsors to attend the events first to let
them see how it all worked. As important
as sponsorships can be in producing revenue,
the sponsoring companies need to
find value in it, as well. “It’s got to be a
win-win for both,” he said.

The Bottom Line
Ultimately, sponsorships can be an
effective way of reaching new audiences
and strengthening your company’s image.
“The bigger picture is, companies
sponsor sports events to tap into the passion
fans have for a particular team,” said
Chipps. “It’s a deeper relationship, theoretically.
It’s more than just buying an ad
in a newspaper, or a TV spot.” MM&E

(Lisa Lance is a contributor from
Towson, Md.)

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