I think this industry has definitely arrived at the point where sponsors know it is their responsibility – not the sponsee’s – to leverage their investments. Sponsors, for the most part, understand that when they invest in sponsorship, they are investing in opportunity, not results, and that they need to leverage the opportunity to get result
So, what is with so many sponsorship seekers – big sponsorship seekers who should be sophisticated enough to know better – charging “leverage fees” or “activation fees” on top of the cost of sponsorship? What exactly is that for? And how is it not just a way to inflate the fee while deluding the sponsor into thinking they’re getting something extra? How is this not, essentially, a bait and switch? “Yes, the sponsorship fee is $750,000, but you also need to pay a leverage fee of $150,000 as part of the contract.”s. Check. Check. Check.
It is greed, pure and simple.
For all you sponsors out there, do three things:
There is no downside from bluntly calling this the money grab it is. They’ll either come back with the real, final figure, or they won’t and you’ll know exactly the type of organisation you’re dealing with. Either way, the charade will be over.
For all of you sponsorship seekers who charge these leverage or activation fees, it’s time to knock it off. Sponsors see right through what you’re doing, and most are offended that you seem to think they’re stupid. Price your offer to include all of the costs for delivery, put one figure on it, and give it your best shot. Act like a professional.
You may be interested in my latest white paper, “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.