The Problem with Sponsorship Levels

golden podiumI’ve spent the past few weeks touring around doing workshops. They have all gone very well – great reviews, lots of “thank you” emails, etc. I will say, though, that there is one part of the workshop that I don’t think people like very much. It definitely elicits a moment of shock, bordering on panic. That’s the part where I tell them to ditch sponsorship levels. (Cue expression akin to the Psycho shower scene.)

The basic idea behind levels is that 1) the sponsor can right-size their own sponsorship; and 2) you just need to create the set packages without customising. They are generally based on varying numbers of logos on things, tickets to things, some kind of hospitality, and some kind of official designation. I actually saw a conference proposal once that had 14 levels pre-printed – no customisation there! – into the glossy presentation folder. They spanned every precious metal and a lot of precious stones!

I can see the appeal: Levels are less work for you. But honestly, sponsorship levels are Commoditisation 101. Why would you want to do that to yourselves? They are NOT going to help you to sell more sponsorship. In fact, most sponsors will gravitate toward the lower end of the spectrum. Only sponsors with a major corporate ego will gravitate higher.

Best practice now requires all significant sponsorship offers to be highly customised to your sponsors’ specific needs. You should do the investigation – both in the marketplace and with the sponsor – to know what their needs are and who they are targeting, and then create one offer for them. It will be specific and powerful, and if they need to negotiate the price down or up, you can always rework the package to reflect their needs. You’ll send far fewer proposals with a much higher strike rate.

Rather than levels, I recommend bands. Realistically, there is a sponsor hierarchy and you need some way to refer to them. Creating broad bands of sponsors allows for both that hierarchy and a lot of flexibility. As an example, your bands could look like those outlined below. Note, these numbers are arbitrary and used as examples only – you’ll have to set your own.

  • Principal – Premium level sponsors of our entire organisation or biggest events. Generally valued at over $400,000 pa in cash and/or contra.
  • Major – Major partners using the sponsorship to achieve a wide range of marketing and business objectives. Generally falling in the range of $100-400,000 pa in cash and/or contra.
  • Supporting – Lower level sponsors usually using the sponsorship to achieve a more limited number of marketing and business objectives. Generally valued at sub-$100,000 pa in cash and/or contra.

This gives you a lot of flexibility, but still some strata.

You don’t need to worry about sponsors comparing notes, as you will have moved right away from the commoditisation approach that invites comparison to an approach that is focused on the individual needs and goals of your sponsors.

The other thing to keep in mind is that the sponsorship category that you confer is a benefit that is part of the offer, not the definition of a certain dollar level.

If you want more on what you can offer, including a rundown on many of the common designations that can be part of that offer, you are welcome to download the Generic Inventory, an MS Word template that will give you a huge, running start on all the things you can possibly offer a sponsor as part of a customised sponsorship package.

The whole offer development process – including targeting, pricing, proposals, and sales – is also outlined in detail in The Sponsorship Seeker’s Toolkit 3rd Edition.

Need more assistance?

If you could use some additional support, I provide sponsorship coaching, sponsorship consulting, sponsorship training, and if you need a fast, cost-effective start, the Jump Start program. If you’re interested in any of these services, please review the materials and drop me a line to discuss:

Kim Skildum-Reid
admin@powersponsorship.com
AU: +61 2 9559 6444
US: +1 612 326 5265

 

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