Sponsorship, donationsThree questions to ask when considering a sales sponsorship proposal

Business operators often ask me for my opinion when considering investing their funds in a particular sponsorship. There is something about evaluating a sponsorship proposal that prompts many business operators to drop many of their usual marketing evaluation techniques.

Should Business Operators Make Donations?

There are numerous important and fulfilling causes to which we can pledge our money.  At a personal level you may favour causes that assist the young, the sick, the disadvantaged, the environment and also furry and/or endangered animals (or other important causes).

I believe that pure donations are not the domain of small to medium business entities.  Pure donations should come out of your own retained earnings.

This way you have no commercial restrictions on how you choose to select worthwhile recipients for your own private donations.

My main point is that a business should not decide to just ‘give’ money away on behalf of its stakeholders.  Rather, giving and donating is something that an individual does with their own personal resources.

Instead, a business should identify useful and profitable causes in which to invest its funds in a sponsorship or other marketing partnership related capacity.

When is a Sponsorship a Sponsorship?

Naturally there are a whole bunch of reasons why you would channel that donation expenditure back through your business in terms of where the cheque is actually drawn from (You do all remember the humble cheque, don’t you?).

A Sponsorship is a true sponsorship when the primary reason for the business making the investment is to further its own sales and marketing objectives.

How to Evaluate Sponsorship Opportunities

Sponsorships come in all shapes and sizes ranging from the Oona Woop Woop Soft Cheese Lovers Association to major causes (including health, poverty and other disadvantaged groups, the environment and animal welfare etc.) and the multitude of sporting bodies.

To me there are three basic questions to consider when evaluating a potential sponsorship opportunity, namely:

  1. What Brand Value or Awareness benefits will be gained?
  2. What Direct Sales Benefits will be gained?
  3. Are there any other ‘Political’ reasons to proceed?

My plan is to walk you through these three questions so that the next time you have a sponsorship opportunity presented to you, you will find the evaluation process to be clear and straightforward.

What Brand Value or Awareness benefits will be gained?

This question can be broken down into two related but different questions.

Firstly, will your involvement in a particular sponsorship increase your ‘Brand Value’?

To create an increase in your ‘Brand Value’ the sponsorship needs to be in keeping with your desired brand positioning values.

An example could include a health food brand sponsoring research into the prevention of a particular illness.

Secondly, will your involvement in a particular sponsorship increase your ‘Brand Awareness?

For increased ‘Brand Awareness’ to happen the sponsorship needs to be targeting and gaining exposure to your Primary and Secondary Target Markets.

An example could include an Accounting firm sponsoring a major accounting conference.

What Direct Sales Benefits will be gained?

This question requires you to quantify the sales volume that will be generated specifically from your involvement in the sponsorship.  Many sponsorship arrangements in the food and beverage industry are tied to particular products having exclusive sales rights at events associated with the sponsorship.

An example of a sponsorship delivering direct sales volume benefits would be the brands of pies, pasties and iced coffees available next time you go to the football.

Are there any other ‘Political’ reasons to proceed?

Sometimes there are no brand value or brand awareness benefits and no immediate sales to be generated from a particular sponsorship but yet there are additional good reasons for proceeding.

These additional non-brand and non-sales related good reasons for proceeding are what I refer to as ‘Political’ reasons.

They often include the personal passions and interests of major customers.  They can also include industry organisations that your business needs to forge close relationships with or at the very least not get off side.

An example of this would be the Platinum sponsorship of the Vladivostok under fourteen boys outdoor chess club.  The ‘Political’ reason and thus primary motivator being that the nephew of one of your major customers plays ‘Lead Pawn’ in the much anticipated grand finale. Vladivostok’s lovely scenery and sea romance atmosphere are merely side benefits.

Go Forth and Sponsor

I hope that the above information is useful for you in evaluating sponsorships.  I have found that a less than commercial and marketing savvy approach is often used when evaluating sponsorships.  This non-commercial approach to sponsorship evaluation seems to rub off on the implementation phase as well.  The end result being that many business operators do not optimise their ‘bang for buck’ when it comes to their sponsorship involvement.

The net result is that because of this less commercial approach many business operators miss out on some of the true benefits that can be gained from many of the numerous smaller and highly beneficial sponsorship opportunities that exist.

So my recommendation is to take a planned and commercial marketing approach to both the evaluation and implementation of your next sponsorship opportunity.

 

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