Posted in: Guest Blogs Tips, Tricks, & Best Practices for Festival Organizers on February 20, 2012 by ronstrand
The following is an excerpt from an article by Ron Strand that originally appeared on hubpages.com. Ron teaches part time with the Faculty of Communications at Mount Royal University in Calgary, Canada. Follow Ron (@RonsIdeas) on Twitter.
This article provides some guidelines for determining the value of a sponsorship, finding prospects, writing a proposal, selling the sponsorship and fulfilling the agreement after the sponsorship is sold. I have broken down this process into the following ten steps:
1. Plan the Event with Sponsors in Mind
When doing your event planning, recognize that corporate sponsorship is a form of brand advertising. The basic intention of sponsorship is to conjure up positive associations between the corporate brand and sports, arts or charity brands (or similar activities) in the mind of the consumer. This is done by naming events or by displaying corporate logos at events or venues and in the media that advertise the event.
Events are often planned and venues are chosen solely based on the needs of the participants and spectators. If possible, chose a venue with the sponsor’s needs in mind. You may even go a step further and plan the event with potential sponsors. Ask them how you can accommodate their needs.
2. Identify Your Assets
Walk through the venue and identify all the potential places that a sponsor might advertise their brand name and/or logo. Typical places are banners over entrances, signs visible by passing traffic, backs of spectator seats, booths erected on the site, programs that are used by participants, t-shirts for participants, etc. The potential for logo placement can be just about anything so use your imagination.
In addition to logo placement, identify other opportunities for your sponsor to meet their marketing needs. These might be opportunities to meet celebrities, access to exclusive areas like backstage passes, places where they can distribute product samples or even take orders. Each of the places a logo can be displayed and each of the other marketing opportunities are known as assets. Make a list of all your assets. Using a spreadsheet can be a handy way to keep track.
3. Count the Impressions
Because corporate sponsorship is a form of advertising, three key things determine its value. Like media advertising, there is value in the number of impressions (people looking at the logos), the demographic of the people looking at the logo and the value of the associated brand.
Use your spreadsheet to keep track of the impressions for each asset you have listed. You will need to know how many people will be attending the event. In addition to this figure, add up how many people will receive programs and other material, like goody bags. Get a count of traffic passing the venue every day (usually these numbers can be obtained from your civic administration).
Measure how many people will see the ads for your event, including posters, billboards, and newspaper and TV ads. Find out how much traffic your website generates and how often your event is mentioned in blogs and other Internet media (use Google alerts).
Once you have statistics for each asset in your inventory, you can begin to evaluate these assets and attach a price to each asset. I have found from past experience and information I have received at conferences and so on, that using a figure of 1 cent per impression is a good rule of thumb for evaluating each asset.
So as an example, if 10,000 people attend the event, each logo they see will be worth about $100. This number can be adjusted depending on the prominence of the logo and the number of times each person sees it. Also, the number may be adjusted depending on the quality of the impressions. This is based on how closely the impressions are to the sponsors target market.
As an example, the value of street traffic may be discounted but the value of attendees from a specific demographic may be higher. The relative prominence (or lack thereof) of the event brand may also discount the evaluation or allow you to price them higher.
5. Package the Assets
Obviously, you don’t want to sell each logo placement for $100. It is better to bundle the assets into packages for sponsors at incremental amounts like $10,000, $25,000, $50,000 and so on. You may wish to bundle according to locations in the venue, parts of the event program, or other natural ways that the event might be segmented.
You may also consider special bundles for naming sponsors and presenting sponsors. A naming sponsor will essentially rename the event and be associated with all advertising. Offering this exclusively to a single sponsor may result in a larger price but may also exclude other sponsors. These are things you just have to work through. If you seek a naming sponsor, do this before going to other potential sponsors with your offer.
Often the best way to make an initial approach to potential sponsors is to write a one page proposal that highlights the impressions, the type of people that will be participating in the event, the marketing opportunities at the event and the potential sponsorship opportunities available. Tailor the proposal to the kind of sponsorships the corporation is likely to be interested in. Your proposal should also provide the prospect with the character or theme of your event. Also, make sure you understand the difference between sponsorships and donations. Donations are also a valid way to seek funding for your event, but the approach should be different and you should use a fundraising proposal.
7. Research Prospects
Before sending off the initial query, research on prospective companies that you think might be interested in sponsoring your event. Usually potential sponsors are companies with large advertising budgets that are doing a lot of local advertising, large public companies, like utilities, that want to maintain good community relations, companies trying to gain market share in a particular market, or new companies that are trying to establish their brand. Research can be done through government directories, company websites, advertising directories and local media.
8. Seek a Discovery Session
Once you have a list of potential sponsors, call each company and find out who is responsible for buying sponsorships. Large companies may have a person dedicated to this task. Medium sized companies will usually have a marketing or advertising manager that makes sponsorship decisions. In small companies, the decision will likely be made by the owner or president. Send these people the one page event evaluation.
Follow-up and request a meeting. During the preliminary meeting or discovery session, find out what the company is looking for when they consider sponsorship opportunities. Ask if they want lots of media attention, a place where they can take clients, access to a specific group of people, association with a popular cause, and that sort of thing.
Sponsorship “activation” is the term marketing people use for the additional benefits they will try to leverage from a sponsorship, such as editorial media coverage. Be prepared to discuss activation opportunities with them.
9. Negotiate Agreement
When you and the sponsor have determined the best package to meet their needs, put this in writing in a more detailed proposal. Add details like terms of payment, logo specifications, payment for logo signage, benefits to attendees from the sponsoring company and so on. Depending on the size of the sponsorship, a countersigned proposal may serve as your sponsorship agreement.
For larger sponsorships, such as the naming sponsor of an event, you should develop a more detailed contract. Legal advice may be necessary to ensure the contract is fair to both parties. A few meetings with the sponsor may be necessary before you agree on what you can provide and what they need for their marketing purposes.
10. Fulfillment and Follow-up
If your sponsors attend your event make sure they are taken care of and given special treatment. After the event, be prepared to supply each of your sponsors with evidence that you fulfilled your commitments to them. This can be done by taking photos or videos of the event, monitoring media coverage, and putting together a “scrapbook” (in quotations because it may be electronic and not actually a book) of the event and any evidence that it was successful and generated the impressions you estimated in your proposal. Meet with the sponsors to review the event fulfillment. This is the first step towards renewing the sponsorship for next year. Be sure to send them formal thank-you letters.
For the complete article including other considerations and a cute comic visit Ron Strand’s Hub at hubpages.com.