I came across an article entitled, “Sponsorship is Dead! Long Live Corporate Cultural Responsibility” a couple of months ago. It’s a massive disservice to cultural sponsorship, and it irritated me that much that it’s taken me until now to compose myself enough to blog about it.
According to this article, cultural sponsorship is about “publicity, the over-simplistic marketing principle that underlies any sponsorship agreement”, which it’s 100% not. It then goes on to contend that the sponsorship market is shrinking, which it’s also not. Then there’s this bit about how if companies support something that is trustworthy (the arts), people will see the company as more trustworthy. Given that image transfer – the idea that an organisation can transfer some attribute onto a sponsor that it doesn’t already genuinely have – has been thoroughly debunked, I think I’m safe to call “bull” on this assertion, too.
The upshot of all of this, the author contends, is that cultural sponsorship has stagnated and that the answer to that is to put some guilt trip on sponsors that it is their “responsibility” to give back to the arts. This is justified by some convoluted logic that culture is part of the balance of civilised society and civilised society is more likely to support corporate endeavours, so drawing a very, very long bow, supporting culture is intrinsically profitable.
Why cultural institutions are doing it tough
I actually don’t disagree that many cultural institutions are struggling for sponsorship. My take on why this is happening and what can be done about it is very different.
Historically, cultural institutions have…
- Provided primarily commodity benefits – logos on things, tickets to things, hospitality, and official designation – with the predictable outcome that it commoditised the offer
- Been inflexible with more creative, higher value benefits (which tend to be more work to deliver)
- Made a focal point of the sponsorship about hospitality, while delivering hospitality that is virtually indistinguishable from one sponsor, or one cultural institution, to another
- Anchored the offer on the prestige of the organisation and how much sponsors should want to align with that, ignoring entirely that who sponsors really want to align with is the fans
- Referred to sponsorship as “support”, or some other term that diminishes the commercial reality that this is an investment of marketing money
- Considered the best sponsors to be the ones who don’t expect much for their money
- Relied largely on the personal interest of a senior executive to gain sponsorship
- Equated meeting more sophisticated sponsor expectations to “selling out”
Please note, I’m not saying all cultural institutions do these things now, but most have in the past, and many still do.
Sponsors don’t want partners like that anymore. They just don’t. This kind of investment has been rationalised right out of many sponsorship portfolios, and those sponsors are unlikely to want to go another round of same-old-same-old.
So if that’s what you’re offering, you’re going to keep on struggling. And even if you’ve raised your organisation’s game, your colleagues in the industry have burned a lot of bridges, and you may well be categorised right along with them. When sponsors have so much choice, it will take a very compelling offer to overcome that history.
None of that means that there isn’t enormous sponsorship potential, because there absolutely is. So, from here on, I’m going to stop harping on about the negatives and that ridiculous article, and give you some direction on how to turn the tide on sponsorship for your organisation.
What sponsors need
The Global Financial Crisis changed the sponsorship game for everyone. Sponsors are spending plenty on sponsorship, but their accountability has skyrocketed, so they have to spend it wisely and achieve measurable returns.
Sponsors are now looking for properties that understand their businesses and what benefits have the most value to them. They want properties that understand that sponsorship isn’t about their alignment with the sponsee, but about their alignment to the fans. And they want properties that understand that, to justify a major investment, the sponsorship must have credible broader relevance. It can’t just be about the people who rock up to the museum or the six-week run of the opera or a month-long symphony tour.
For more on all of these, you should read:
- Sponsorship Benefits Every Sponsor Should Want
- It’s Not the Size of the Sponsorship, It’s What You Do with It
- The One Critical Skill Most Sponsorship Professionals Lack
Some cultural organisations see sponsorship as a necessary evil – something the wish they didn’t have to do, because it’s a lot of work and their strike-rate is low.
Then there are cultural boards, where the members can be so passionate about what you do that they can’t believe sponsors aren’t lining up to hand you money. They think sponsorship should be easy money, and any hole in the budget creates a new sponsorship target, whether there’s strong commercial value or enough lead time or not.
Instead, you want to put a more realistic and positive frame about what sponsorship means for your organisation, including:
- Sponsorship revenue, in the form of unallocated funds
- Fundraising revenue, via cause-related marketing and other sponsorship leverage activities having an aspect of donations
- Access to sponsor product, services, expertise, resources, mentoring, venues, spokespeople, and more
- Access to, and creating relevance with, new markets for your events and programs (via sponsor leverage activities)
- Extending your marketing plan (via sponsor leverage activities)
- Advocacy to other potential sponsors
- Case studies you can use to increase your appeal to other potential sponsors
All of this should be right at the start of your sponsorship policy, making it clear that sponsorship is about way more than just money and totally worth all of that work. (Don’t have a sponsorship policy? All of the instructions and a template can be found in The Sponsorship Seeker’s Toolkit 4th Edition.)
Overhaul your whole approach
If your sponsorship success has stagnated, it’s no time for fine-tuning; you need a full overhaul. As an organisation, you need to be able to accept that you’ve done the best you could with the approach you had, that’s not going to do it anymore, and that you need to be prepared to change everything.
In some organisations, this process can be very political, in which case, it might be smart to get a good consultant on board to help you create an effective sponsorship strategy, build your capacity for doing sponsorship well, or both. If you go down this track, be sure you get someone who has sponsorship expertise across sectors, not a fundraiser or someone specialised solely in cultural sponsorship. I’m not knocking that expertise, but if you need big change, you should be open to proven strategies that may come from well outside of your sector.
Along that same line of thinking, look at books, bloggers, associations, and social media from across the spectrum. Follow #sponsorship, #sportsbiz, and #eventprofs on Twitter. Be open to ideas from all manner of credible resources. You may want to start with the many industry resources lists on this site, but certainly don’t limit yourself.
Identify your most commercially-attractive assets
First, you need to identify the events or programs that have the most commercial appeal for sponsorship. These will tend to have one or more of the following:
- The most passionate fans
- The largest fan base
- Relevance that genuinely extends to non-attendees
- Relevance that genuinely extends for at least several months (even if the event or program itself is shorter)
- Ability to deliver the type of sponsorship benefits that sponsors really want
- Multiple facets and angles in how sponsors can get involved
The idea is to find your most commercial assets and concentrate efforts on selling as much sponsorship as possible for those events and programs. As sponsorship is always unallocated funds, you can then shift any income to whatever event or program has the most need, so long as you deliver the marketing benefits promised.
Then, you need to figure out exactly what benefits you can include in your offers. The best way to do this is to take inventory. Start with the Generic Inventory (downloadable template) and undertake these two strategies:
- Set a timer and aim to go through the whole thing twice in thirty minutes, removing anything you absolutely can’t do and fine-tuning the rest. The time limit will keep you from overthinking it, as will…
- When in doubt, use the Million Dollar Rule: If the perfect sponsor rocked up with a million dollars, would you at least consider providing that benefit? If so, leave it on the list.
The idea behind taking inventory is so you understand the scope of the options you could offer a sponsor, as well as highlighting that you may well have been needlessly limiting yourself.
Build a proper business case
Sponsorship proposals from cultural institutions are often the prettiest ones I see. They are also some of the worst, getting the focal point – what is going to actually sell the sponsorship – wrong almost every time.
You won’t want to hear this, but ten pages about how great, needy, or prestigious your organisation is will not sell sponsorship. Sponsors want to know that you’re credible, professional, and know your markets, but beyond that, it’s just not about you.
What sells sponsorship is making it all about the sponsor and, in particular, making it crystal clear how they can leverage the benefits you provide to…
- Align with their target markets
- Build trial, intent, preference, loyalty, and advocacy among their target markets
- Add value to their relationships with target markets
- Underpin their corporate culture
Your proposal needs to be anchored on those leverage ideas and fully customised for each potential sponsor. Anything less is going to reduce your value to potential sponsors.
There is quite a lot to the process of offer development. These two resources will give you a good running start:
- 25+ Proposal Development Resources for Sponsorship Seekers – A “best of” blog roundup
- The Sponsorship Seeker’s Toolkit 4th Edition – Outlines the whole process, step-by-step, including a proposal template
Put the focus on the fans
The biggest difference between old-school sponsorship and best practice sponsorship is that best practice puts the fans first. This means several major things to you:
- The focal point of your sponsor discussions, offers, and renewals should not be about how the sponsor can connect with you, but about how your organisation serves as a conduit for connecting that brand with the fans.
- The primary leverage strategy for sponsors – and the kind of leverage ideas you should be pitching to them – are about adding value to the fan experience, whether those fans attend or not.
- If you build an offer that’s based around the fan experience and fan needs, you’ll make a very compelling case that’s worth far more than some set package of commodity benefits.
- Taking this fan-centric approach means that the sponsors will be appreciated by fans, protecting your organisation from any perception of selling out.
And a word about Corporate Social Responsibility
This article equates cultural responsibility to Corporate Social Responsibility, and appears to assume that a company can be socially responsible by paying money to organisations that serve the community. Wrong.
Corporate Social Responsibility is not about how a company spends its money. It has nothing to do with sponsorship, donations, or any other investment in outside entities serving the community. Instead, it’s about how a company makes its money. Does it make money in an ethically sound, environmentally sustainable way? If so, they have ticked the CSR box. If not, they haven’t. There is no amount of money a company can invest in community initiatives that will genuinely counterbalance manufacturing with child labour or causing a huge and preventable environmental disaster. People see right through that kind of whitewashing (or greenwashing).
The exception to this rule is where sponsorship of an external organisation – cause, community, or cultural – effects a positive change in the ethics and/or sustainability of how they make money. An example would be sponsorship of an environmental charity, which then provides credible expertise that allows a company to operate in a more environmentally sustainable way.
I’m not for a second saying that corporate sponsorship of charitable, community, or cultural organisations isn’t a great thing to do. This kind of investment can be an absolute powerhouse for a company or a brand, if selected, negotiated, and leveraged well. It can not only build brands, but market and stakeholder relationships, and corporate culture. I’m also not for a second knocking the support of corporate foundations. What I’m saying is that neither of these constitutes Corporate Social Responsibility.
You can buy into to guilt tripping sponsors because you can’t be arsed changing your approach. Or you can buy into it because you’ve simply given up, and hey… it might work. (It won’t.) Or you can take on board that sponsors are spending plenty and maybe it’s your approach that’s the problem, and then undertake to fix it.
Realistically, this will take time. And realistically, there are some cultural institutions for which corporate sponsorship will never make up a large percentage of revenues. But for most, raising your game will significantly improve your sponsorship prospects. You’ll see more revenue and have better, more engaged sponsors, which is a damned sight better than you’ll ever do with guilt.
Need more assistance?
For all you need to know about sponsorship sales and servicing, you may want to get a copy of The Sponsorship Seeker’s Toolkit 4th Edition.
If you could use some additional support, I provide sponsorship coaching, sponsorship consulting, sponsorship training, and if you need a fast, cost-effective start, you might look into the Jump Start program. If you’re interested in any of these services, please review the materials and drop me a line to discuss:
AU: +61 2 9559 6444
US: +1 612 326 5265
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