11 Good Reasons to Exit a Sponsorship (and 5 Bad Ones)

Farewell - smallI was inspired by a great question I got today, and am writing a couple of blogs on exiting sponsorships. This one is about why you should and shouldn’t exit, the next one is about how to do it well.

11 good reasons to exit a sponsorship…

  1. It was never a good brand or target market fit.
  2. It was a good fit, but your target market or objectives have changed, and it isn’t anymore.
  3. It was a senior executive pet project (and nothing more) and that senior executive has either moved on, or is facing more accountability for sponsorship investments.
  4. The sponsorship has been under-used for so long, you no longer have any internal buy-in.
  5. You have leveraged the sponsorship in the same way for so long that it is too stale even to reinvent.
  6. It is a less-good duplicate of something else in your portfolio.
  7. You are restructuring your sponsorship portfolio and it is inconsistent with your new approach (typically, this would be streamlining a portfolio and concentrating on only one or two focal points)
  8. The rightsholder didn’t deliver the contracted sponsorship benefits.
  9. The rightsholder contravened the contract (ie, breached exclusivity or behaviour rules).
  10. The rightsholder wants a significant fee increase at renewal, and you can’t justify the expenditure at that level.
  11. You don’t have the human resources to do it justice.

And 5 bad reasons for exiting a sponsorship…

  1. You didn’t get a return – Getting a return on your investment is all about whether you leveraged it well. You’re buying opportunity, it’s up to you to turn that into a result. It’s unfair to exit a sponsorship just because you didn’t do your job.
  2. The returns aren’t measurable – Rubbish. You just need to fit the measurement strategy to the objectives you’re measuring against.
  3. You need to cut the budget and that sponsorship is on renewal – Rationalising a portfolio to reduce the spend is fair enough, but indiscriminately cutting sponsorships because they happen to be on renewal is folly. Determine their strategic worth to your brand, then decide what to renew.
  4. You’re new in the job and want to put your own personal stamp on the portfolio – You know how you put your own stamp on a portfolio? You leverage it strategically, creatively, and comprehensively, then measure it thoroughly. That will make you look like a star – someone with talent and vision. What you don’t do is embark on change for the sake of change.
  5. They increased the fee by more than expected at renewal and that ticked you off – If the offer is better and more creative, and the fee is commensurate with that, then assess it’s value based on what it can do for your brand. It is either worth it or not, but do the sums. I’ve seen too many sponsors exit great sponsorships, simply on principle, because the fee went up by a deserved 20%.

The upshot of all of this is that, just like committing to a new sponsorship, exiting should be based on strategy – your target markets, objectives, resources, and internal buy-in.

Need more assistance?

You may also be interested in my white papers,  “Last Generation Sponsorship Redux” and “Disruptive Sponsorship: Like Disruptive Marketing, Only Better“.

If you need additional assistance with your sponsorship portfolio, I offer sponsorship consulting and strategy sessions, sponsorship training, and sponsorship coaching. I also offer a comprehensive sponsorship capacity-building service for large and/or diverse organisations. Please feel free to drop me a line to discuss.

© Kim Skildum-Reid. All rights reserved. To enquire about republishing or distribution, please see the blog and white paper reprints page.

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