Sponsors: 4 Renewal Strategies for Reinventing Your Sponsorship

You’ve been sponsoring a property for a while and renewal time is coming up. Sometimes, what you need to do is a no-brainer; the experience was either so great or so bad, you know whether to renew or walk away. Not this time, though. You value the opportunity, and may have even achieved great results, but the experience of being a sponsor hasn’t been great. Some of the typical scenarios include:

• They promised the world and failed to deliver.
• They played fast and loose with the contract or hit you with extra fees whenever they could.
• Their lack of flexibility or vision made it difficult to mount a leverage strategy that would have been good for everyone.
• They had no idea what they were doing, what sponsorship is about, and that you were actually expecting them to work for your investment.
• The broker that sold you the sponsorship misrepresented the ability of the rightsholder to effectively deliver what was promised.
• They were surly, uncooperative, or unresponsive to your requests.

(For all of you rightsholders reading this and yelling at the screen, “What about all of the crap sponsors?”, that’s a different blog.)

If you can see real potential for the sponsorship to help you achieve marketing objectives, and the experience in dealing with the rightsholder hasn’t destroyed your internal buy-in, it may be worthwhile renewing. If so, you need to employ some strategies to ensure you’re not signing up for the same again.

Be straight with them

Prior to doing any negotiations, you need to be absolutely straight about what was lacking in your experience as a sponsor. Make it clear that you are ready to make the effort to work with them to ensure that doesn’t happen again. Also make it clear that if at any time during the negotiations, you have any reservations about whether the sponsorship can be put on a more positive track, you will not be renewing. Say it and mean it.

After the above discussion, some rightsholders may have pooped their pants, while others will realise that you’re no longer going to be one of those sponsors that lets them skate along with minimal effort or care. Either way, they are likely to be ready for the next step…

Tell them exactly what you are trying to accomplish

Many sponsors assume their partners understand what they are trying to accomplish. My experience has been, however, that most rightsholders have no idea what their sponsors are trying to achieve or with whom. Whether you’ve never spelled it out clearly, or you have, but they haven’t taken it on board, you need to outline the following:

• Who you are targeting with this sponsorship – not just “women 24-39” or “potential customers” or “art lovers”. You need to be specific about the market segments you’re targeting, their relationship to your brand, and your understanding of their relationship to the rightsholder. Those segments could be end-users (consumers, business customers), intermediary markets (retailers, resellers, brokers), or internal markets (staff). Outline them all in as much detail as you can.
• What perceptions and behaviours you are trying to change or reinforce with those markets? In other words, your overall marketing objectives for your brand. These may be similar across markets or they may be different.
• What points of alignment are you trying to demonstrate to your target markets?
• How you will be measuring the results of your involvement against those objectives.

Reinvent

Your next step is to tell them that your intent is to reinvent this sponsorship in a way that meets your brand needs and is good for everyone, including their fans and organisation. You have two options.

Option #1: Present your leverage plan

If the rightsholder is less skilled or very stuck in their way of doing things, this is probably your best option.

Go through the sponsorship leverage process with your team, creating a draft leverage plan outlining how you are going to use the sponsorship to achieve your marketing objectives and align with fans. Then, present these ideas, along with a list of the benefits you will need to make those ideas happen, and a list of current benefits that you would be happy to forego. Keep in mind that if you can forego some benefits that are in short supply (eg, part of your ticket, signage, or celebrity appearance allocation), you can put yourself in a very strong position to get the more flexible and creative benefits you will probably need.

At this point, outline out all of the ways your leverage plan benefits the rightsholder and their audience, making it clear that working with you in this way is about way more than cash. You should then indicate your cost expectations, given that you’re basically swapping benefits (not asking for extra), as well as providing marketing value for your partner, and a better fan experience for their audience. After doing all of this, don’t be a jerk on pricing. Unless you are obviously stepping down in the sponsorship hierarchy, put the price point in the realm of what they would want for a straight renewal.

With this process, you have essentially taken control of the relationship and put together a proposal for them. They can always counter-offer, and you can always turn it down.

Option #2: Offer to collaborate

If you’ve got a partner that knows the relationship hasn’t gone well and is as keen as you are to reinvent, this is a very good option.

With this, you will invite your partner to participate in the leverage planning process with your team. They will be in the room as creative ideas are developed and vetted, and can provide insight on what is and isn’t feasible, and probably some opportunities you hadn’t thought of, live on the spot. They are also likely to get as excited about the potential for the sponsorship for their brand and audience as you are for yours.

Once you’ve culled a whiteboard full of ideas into a strategic leverage plan, work out with your partner what benefits you’ll need from them, then ask them to come back to you with a proposal.

Again, be clear that you are a) very willing to forego some current benefits for the right ones; and, b) expecting them to be realistic about the pricing of the package.

Make your management expectations clear

At this point, you will probably have better benefits to work with, but you still haven’t addressed any issues with your ongoing working relationship. Work with them to create a plan – which you both agree to stick to – that includes:

• Meetings – How often do you expect to meet to discuss the progress of the sponsorship?
• Reports – How often do you want written reports? What do you want included? Even better, provide them with a template. Note: Don’t expect them to report on the progress of your leverage activities, just on the sponsorship benefits they’re delivering and any upcoming dates or milestones.
• Renewals – When are you going to start discussing the next renewal?
• Specifics – Outline any specific issues or challenges that need to be addressed. For instance, if you have been missing opportunities because they take so long to approve use of their IP, work together to improve the process.

With these four steps, you should net a much more strategic set of benefits and a partner that understands what you need and what you expect from them. Together, that will provide you with better raw materials for you to leverage into a far better result.

Need more assistance?

You may be interested in my white papers,  “Last Generation Sponsorship Redux” and “Disruptive Sponsorship: Like Disruptive Marketing, Only Better“. I’ve also got self-paced, online sponsorship training courses for both sponsors and rightsholders. Get the details and links to course outlines and reviews here.

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 Systems Design service for large, diverse, and decentralised 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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