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When 'sponsorship' isn't sponsorship at all
By Kim Harrison,
Consultant, Author and Principal of www.cuttingedgepr.com
Sponsorship can be the most effective form of marketing and marketing communication when handled well. It can become a nightmare when handled badly! The public relations literature hardly mentions sponsorship, partly because it may be considered more of a marketing responsibility than PR. However, many sponsorships are based largely on corporate communication objectives and are therefore a public relations responsibility. In fact, sponsorship is often one of the largest budget items in annual public relations plans.
Many people have only a vague idea of the meaning of the term ‘sponsorship’ in its commercial sense. They may have previously come across the generic meaning of a sponsor as a person who vouches for or is responsible for another person or thing. The word sponsor is derived from exactly the same word in Latin (sponsor), which means a person who guarantees the good faith of another person and who may act as surety on their behalf, ie they agree to be responsible for the debt or obligation of another person. The modern commercial use of the term requires both the sponsorship giver as well as the receiver to treat the sponsorship as a business activity with measurable value in marketing or communication terms.
Three alternative definitions of sponsorship:
Sponsorship is the purchase of the right to associate the sponsor’s name, products or services with the sponsored organization’s service, product or activity in return for negotiated benefits.
Sponsorship is an investment in sport, the arts, a community event, individual, venue, broadcast, institution, program or cause, which yields a commercial return for the sponsor.
Sponsorship is the relationship between a sponsor and a property, in which the sponsor pays a cash or in-kind fee in return for access to the exploitable commercial potential associated with the property. (A ‘property’ is defined as a unique, commercially exploitable entity – typically in sports, arts, events, entertainment or in the activities of worthy causes.)
Three main types of sponsorships
What isn’t sponsorship
Where the benefit offered does not provide genuine marketing or communication value, the activity is not sponsorship in a commercial sense. In other words, the ‘sponsorship’ that is entered into merely as a token of support or goodwill, but which could not be justified in terms of genuine marketing or communication results, is really a donation rather than a sponsorship.
Sponsorships are often confused with donations. A donation is a gift of product or cash with little or no expected return. It is ‘free money’ with no strings attached, and no return benefits or favors expected. Organizations are often asked to advertise in the program, catalogue or other printed publication as a form of ‘sponsorship’. These types of advertisements provide no commercial return and therefore are actually donations.
The sponsorship has to provide a measurable dollar value to the sponsor – a measurable return on investment just like any other financial commitment. The sought-after outcomes of sponsorships may also be enhanced relationships with key stakeholders – these need to be measurable as well, although they may be difficult to quantify if the expectation is of a tangible future return.
Cases become a grey area where there is a limited commercial return expected from the sponsorship – there is limited genuine marketing value – but the gesture may at least be providing some degree of commercial return. Probably a compromise is the best way to view these cases. The commercial return to the sponsor could be quantified as one component while the other component could comprise an agreed proportion of the sponsor’s financial commitment, which is written off as a donation. The sponsorship therefore offers a lower financial return than the amount invested by the sponsor.
These activities don’t comprise sponsorship
Each of the following activities is not sponsorship because there is no reciprocal marketing or communication benefit to the sponsor, or because the activities require more than mere association between sponsor and the sponsored organization:
Hospitality is the provision of entertainment, food and beverages for existing and potential clients in expectation of a closer relationship and a future commercial return. This does not involve the purchase of the right of association as defined in the term ‘sponsorship’.
To complicate matters, some of the above activities may be included as part of an overall sponsorship package in which other direct sponsorship benefits are provided.
Where sponsorship is inappropriate
There are circumstances in which sponsorship dealings are not recommended for ethical or other reasons. If you intend to seek sponsorship in any of the areas listed below, the final decision should be made only at the highest level – by your executive committee or board of directors (in the private sector) or Minister (in government), where:
This article is an extract from the forthcoming e-book, The secrets of successfully seeking sponsorship, available during August from the www.cuttingedgepr.com
About the Author
Kim Harrison is a recognized authority in the public relations field. His website, www.cuttingedgepr.com, provides a wealth of informative articles and resources on public relations techniques and management.
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