kim skildum-reid's
corporate sponsorship blog

I hear that phrase with alarming regularity, and it takes every fibre of self-control I have not to just tell those sponsors to put it back in their pants. Come to think of it, I probably have said that to sponsors once or twice.

Don’t get me wrong, I’m not knocking naming rights sponsorship – in the right circumstances, and for the right reasons. But as a blanket strategy, you’ve lost me.

If you find naming rights to be the default position, or the position that your company is focussed on far too often, there are some strategies that can put naming rights back in the category of “option”.

Create a sponsorship group

Much of this thinking emanates from corporate ego, and much of that comes from the top. Rather than risking your job telling c-levels they’ve got their priorities wrong, I suggest you take a more strategic approach.

Create a sponsorship think tank, comprising decision-makers from across your company. Meet monthly on the following topics:

• Developing leverage plans.
• Developing measurement plans.
• Making decisions on (vetted and shortlisted) sponsorship investments.
• Creating negotiation strategies.

If the group can’t make the decisions, they should be making recommendations to your senior executives.

The thing is, if you discuss what those decision-makers really need, and how they’ll use those benefits, chances are they won’t put “naming rights” at the top of the list – at least not very often. And if the senior executives see a well thought-out recommendation and plan from those decision-makers, chances are, they’ll back the recommendation.

Negotiate only for what you need

Following on from the above, my strong recommendation is to plan your leverage before you negotiate the sponsorship That way, your focus will be on getting the specific benefits you need to support that plan, not the biggest, flashiest benefits you can afford. Forego benefits you really don’t need, even if you’ve always had them in the past. Do you really need 100 tickets to every performance? Or do you only need tickets to the opening? Think hard before you say yes to a package that includes a bunch of benefits that have little strategic value to you.

Ambush up

A technique that I often advocate is that of ambushing up – that is, taking the smallest sponsorship that will provide the benefits you need, and using ambush marketing techniques to make the sponsorship deliver (and appear) like a much larger sponsorship.

For more on this technique, check out my blog, “In Praise of Ambushing Up” or my book, The Ambush Marketing Toolkit. You don’t have to be an ambusher to learn from ambushers.

Think of the money

Naming rights comes at a premium – often a big premium. Before you commit, just think of what you could do with the money you’d save if you dropped even just one level. And what if you adopted an ambushing-up strategy?

You could invest in some leverage infrastructure – a micro-site, online game, or some such. You could invest in some related sponsorships, embarking on a vertically integrated or umbrella strategy (see “How to Structure a Sponsorship Portfolio” for more on these). There are so many options.

…which brings me back to options. That’s what naming rights should be, not a default position.

Need help?

If you need help getting your sponsorship leverage or portfolio structure right, I am available for consulting and strategy sessions. Just drop me a line and we can discuss your needs and what I can do for you.

Kim Skildum-Reid
kim@powersponsorship.com
AU: +61 2 9559 6444
US: +1 612 326 5265

When I first got into the business, sponsorship servicing was limited to delivering the contracted benefits and possible buying lunch or inviting a sponsor to the sky box, with maybe a fruit basket during the holidays.

A decade or so ago found the advent of the “sponsor summit”, and that’s been ticking away as the pinnacle of sponsor servicing ever since. Don’t get me wrong, I love the idea of getting sponsors together and doing something productive, but given that sponsor summits tend to be one long, boring presentation after another, punctuated by a couple of long, messy nights on the grog, I’m not sure this qualifies.

Seriously, do you really need to fly all your sponsors to the Gold Coast so they can listen to some intellectual property lawyer drone on for 90 minutes about the proper use of your logo? Do you think your sponsors really need you to spend two hours going over your marketing plan, after which you hand them a document that has everything you just said in it, word-for-word? Do you think those sponsors are really going to keep and cherish that customised lanyard? And my favourite aspect: The sponsors think they’re networking with each other, but they’re really only in the same room. As soon as there is any chance of sponsors actually comparing notes over a coffee, your staff disperses and keeps all of the big sponsors away from each other.

It is with great delight that I can report there is a trend away from the sponsor junket… er, I mean “summit” and toward a far more sophisticated and refreshing manner of sponsor servicing.

Sponsorship awards – presented by the sponsee!

Last week, the Arizona Diamondbacks announced that they are going to host a gala awards night, recognising excellence in sponsorship among their corporate sponsors. (You can see their press release here.)

I think this is a great idea, not because it elevates corporate arse-kissing to never before seen levels, but because in doing this, the Diamondbacks are showcasing and championing innovation, creativity, and sponsor commitment to leveraging well.

That is in stark contrast to many large sporting organisations, who seem to do everything they can to stifle creativity. You know the ones – they request sponsor leverage plans months in advance, and then anything that looks too innovative gets the kibosh. (Or they steal the sponsor’s leverage ideas for their own marketing plans, but that’s a whole different story!) And don’t get me started on how smaller sponsors who develop fantastic leverage plans are told to get back in their box, because there’s no way the organisation will let them be more relevant or creative than their bigger, lazier, older-school sponsors.

No, the Diamondbacks have got it right, and kudos to them. Plus, the arse-kissing aspect is pretty good, too.

Sponsor education

I’ve had a box seat for this trend for the past few years, and can say with total conviction that it works really well.

The basic idea is that the sponsee hosts a leverage and measurement workshop for all of their sponsors, providing new skills and ideas for making the most of their investment. When I conduct these, I do two things:

• I tell the sponsee to let the sponsors bring along as many of their team as they like. The rationale for this is that they will get broader involvement and buy-in if more people are involved. It also acts as a major added value, providing quality sponsorship training to their staff at no charge. Many of my clients field calls from their sponsors asking when the next sponsor workshop will be, because they’ve got a couple of new hires to train!
• I run the workshop as a mix of theory and hands-on, live, plan-building. Those sponsors build leverage and measurement plans for their sponsorships on the spot. They leave with messy workbooks and piles of butcher paper, but the plans are there, and it only took a few hours, not months of trying to get the right people into a meeting room.

However you approach it, educating your sponsors is a very, very high leverage investment.

If you’re going to do this, be sure to hire someone who really understands best practice and has done this kind of thing before. As skilled as you may be, it says something about your commitment to your sponsors if you pay a bit of cash to get someone good. Then at the end, your facilitator can say that you are open to talking to any/all of them about the great ideas they’ve come up with, and how you can help them make that happen.

I’m sure most of you uttered, “oh crap” under your breath at that last sentence, but don’t panic. Yes, educating your sponsors so they’re more creative means a bit more work for you in the short term. It also means better results for them, more measurable results for them, they will see your organisation as having much more value to them, they will be more likely to renew at a higher level, and they will advocate your organisation to other sponsors. The upshot is, it’s totally worth it.

Bring the kids!

In the area of sponsor hospitality, an area that has exploded is around quality family time. Let’s face it, people are having kids later in life, and a lot of major decision-makers have school-age kids. (As a 47-year old with a 7-year old daughter, I can totally relate.) For many of them, spending time with their kids on a weekend is far more appealing than spending time at your sponsor function.

So, take that on board. Create ways that they can involve their kids (or grandkids) in what-money-can’t-buy experiences. It doesn’t have to be on game day, or whatever. One of my corporate clients shifted much of a major arts hospitality program into inviting their VIPs and their kids/grandkids for a behind-the-scenes tour of the opera. The kids ran the lights, tried on costumes, stood on the stage, and had a grand time, and it was a HUGE hit. Yes, that was a hospitality program run by a sponsor, but there is no reason a sponsorship seeker can’t take a page from that book and create fantastic family experiences for your sponsors.

In the end, I hope all sponsorship seekers can think about what their sponsors really need – what their priorities really are – rather than delivering the same old blah, blah, blah, just because you always have.

Interested in training your sponsors?

If you’re interested in chatting with me about doing a leverage and measurement session with your sponsors, by all means drop me a line on kim@powersponsorship.com. You can get more information on sponsorship training right here.

I was recently involved in a debate about whether multi-year contracts are preferable to year-to-year deals. I make no bones about my preference for multi-year deals (in most cases), but there was a compromise suggestion put forward that had me, frankly, gobsmacked.

One sponsorship seeker said that their standard contract was for three years, with an annual review, where the sponsor could opt out of the rest of the contract. Several others chimed in saying that either sounded like a great idea or that they were doing that now.

Ummm… not to put too fine a point on it, but how is that any different than a year-to-year contract, functionally? If a sponsor can just say, “our needs have changed” or “our budget has been reduced” and cut the contract short, why bother even negotiating for multi-years in the first place? How is this a good thing for a sponsorship seeker??

From a sponsor’s point of view, they don’t see multi-year deals with easy exit options as true multi-year deals In fact, I have corporate clients who, upon reviewing their portfolios with me prior to an audit, say, “that’s technically a three-year deal, but we can opt out at any time, so consider it in play”. Well, alrighty then. I guess that contract isn’t worth the cost of the paper it’s printed on.

The annual review

On one hand, I don’t think a sponsor should be able to get out of a sponsorship contract without very good reason (see below). On the other, contracts aren’t written in stone, either.

I do think having an annual review of a sponsorship is a very good idea. It allows both parties to get any issues, grievances, or opportunities out on the table. It provides a forum for sponsors to discuss any changes in strategic direction. And it allows for fine-tuning of benefits provided, so they are appropriate to any changing needs.

What shouldn’t be changed during an annual review are the basics: Contract length and the rights fee.

When should a sponsor be able to get out of a contract?

The standard sponsorship contract has exit clauses, covering things like disrepute, non-delivery of contracted benefits, cancellation, and other events that will substantially reduce the ability of the sponsor to derive a marketing return from the investment. Sponsorship seekers have similar rights, and would not be expected to continue providing sponsorship rights if, say, the fee hadn’t been paid.

I tend to be pretty steadfast on exit clauses. If the sponsee has done the wrong thing and isn’t taking heroic steps to fix the situation, it’s time to go. There are a lot of other options.

There is no middle ground

To quote Yoda (holy dooley… I am such a nerd), “there is only do or do not”. Either you have a multi-year deal or you don’t, and if you are offering a sponsor an easy-out on an annual basis, you don’t have a multi-year deal.

The holidays are over, and I’m now booking in a lot of corporate sponsorship training and strategy sessions. The first half of 2012 looks like it’s going to be busy, so if you’re interested in booking a session, it might be worthwhile having a chat to me about your needs sooner, rather than later.

There are a number of options available for groups on both sides of the sponsorship equation. I’ve listed them, below, along with what you can expect to achieve through the various types of sessions.

Training for frontline sponsorship staff

This training is a balance of the best practice approach and practical skills to put it into place. It runs from half- to two-days and can be partly or fully customised.

After this training, sponsors can expect a closer relationship between sponsorship and overall marketing goals, a much more strategic and creative approach, lower leverage costs, more fruitful and responsive relationships with partners, and a measurement strategy that will stand up to the closest scrutiny.

Sponsorship seekers can expect a stronger value proposition, higher sponsorship “strike rate”, offers that are substantially differentiated from what sponsors usually receive, and much stronger relationships with existing sponsors.

Training for a stakeholder group

This training is aimed at the larger group of stakeholders that may be involved in, or benefitting from, sponsorship, but who are not managing it on a daily basis. The training is more focussed on creating an understanding of, and buy-in for, a best practice sponsorship approach.

After this training, sponsors can expect their investments to be much more thoroughly leveraged, the leverage costs to drop significantly, and measurement to be thorough and reflective of real results.

Sponsorship seekers can expect a better understanding of the value and commercial opportunities around sponsorship, and how they can participate and benefit.

Partner training

Training your partners can be one of the highest leverage things you do with your sponsorship portfolio. I have many clients, on both sides, who swear that this simple process has transformed their results. This training is generally a half- to full-day.

Sponsors, you can expect that your partners will have a much better understanding of what you’re trying to accomplish, their role in your marketing plan, your expectations as a partner, and simple things they can do to improve your results (and make you more likely to renew). The skills will be a mix of specific and general, improving their capacity as a partner to all of their sponsors.

Sponsorship seekers, you can expect your sponsors to have a stronger vision of what can be accomplished through their investment in your property, a far more creative, strategic approach to developing leverage plans that get them the result they need, and they will learn to do their own measurement. This is also an added-value to your relationship that has a very high perceived value and differentiates you from the competition.

Strategy session

Do you have a strategy to write? A challenge to overcome? Change to manage? A strategy session may be exactly what you need. This fully customised session can run from half- to two-days, is built around the specific challenge at hand, and works well in conjunction with training.

Sponsors, I can help you refine or reinvent your strategy, build a portfolio audit framework, develop leverage plans for one or more key sponsorships, create a (re)negotiation strategy, or anything else you want to address.

Sponsorship seekers, I can help you develop a property, create a hit list, develop sponsorship offers, nut out a marketing plan, restructure your portfolio, and much more.

If you have any questions on this, or you’d like to discuss training and/or a strategy session, drop me a line. I’d be delighted to discuss the options with you and create a proposal. I can also put you in touch with any of my many very happy training clients. I’m based in Sydney, Australia, but have clients on six continents, so don’t let location stop you!

Kim Skildum-Reid
kim@powersponsorship.com
AU: +61 2 9559 6444
US: +1 612 326 5265

I love umbrella portfolios. I make no bones about it. They featured heavily in my previous post, “How to Structure a Sponsorship Portfolio”, but I think they’re an important enough element – for both strategic and workflow reasons – that it warranted addressing this portfolio management technique specifically.

1. You only have so much time

It is unrealistic to think that one or two people are going to be able to negotiate, manage relationships, leverage, and measure two hundred, or even one hundred, individual sponsorships. That’s not to mention dealing with all of the unsolicited proposals and voicemails. Streamlining the workload is the only way this is going to work. Well, either that or a wand.

One of the biggest efficiencies you will be able to create is to bundle related sponsorships into an umbrella portfolio and leverage them as if they were one, huge sponsorship. You’ll still have to negotiate and manage the relationship, but developing and implementing leverage and measurement plans is very time-intensive, and with an umbrella portfolio, you only have to do it once.

(Another big streamlining tip: Create and use a set of Sponsorship Guidelines. It will cut the number of proposal you get significantly, and the quality of those that do get to you will be a lot higher. You can download a Sponsorship Guidelines Template here.)

2. No one investment has to be perfect

Have you got a few legacy sponsorships that really don’t work, but for political reasons, you can’t drop? Maybe some senior executive pet projects? Or a couple of badly negotiated deals, where the partner doesn’t give a crap whether the benefits really work for you or not? Or maybe you’ve got a few dozen (or a few hundred) tiny little rats-and-mice sponsorships – those sub-$1000, local sponsorships that you have to do, for whatever reason, but that don’t have the critical mass to be leveraged properly on their own?

Umbrella portfolio to the rescue!

With an umbrella portfolio, you are essentially creating one, large sponsorship around a theme, rather than an individual sponsorship. The whole thing has to work, but the individual components can be a mix of strategic and tactical, national and local, and of varying sizes and shapes. Even sponsorships that are ridiculously wrong can work as part of a larger umbrella, if they fit the theme.

3. Creates consistency over time

When I refer to “picking a theme”, what you’re really doing is basically creating a new brand, and partnering with that. So, instead of partnering with the brand, Byron Bay Blues and Roots Festival, you’re partnering with the brand, “blues music” or “music festivals”, and that particular festival fits into that brand.

The number one strategy you can take to create that consistency is to create a micro-site around the chosen theme. That way, you can rotate through, and showcase, a lot of interesting and varied content and promotion, while never veering off strategy. Your micro-site could be part of your normal website, a stand-alone website, or could live on social media, such as Facebook. It could include content such as:

• Themed brand and product promotions, special offers, launches, etc
• Aggregated content around your theme (tour dates, list of local hotlines, etc)
• Exclusive content provided by your partners
• Content created by your brand
• Content created by your staff
• User-generated content (created and submitted by your target markets)
• Embedded other social media content (Twitter, Flickr, YouTube, etc)
• Interactive elements – games, polls, contests, webcasts, web chats, etc
• Newsletter, alerts, invitations, memberships

As your micro-site evolves, the bank of still-pertinent, legacy content will have target market relevance for years to come.

4. Allows you to create national/global results from local/regional sponsorships

Your brand may need grassroots opportunities. Positioning your brand as having local understanding and relevance could be very important to you. And, frankly, sponsoring a national organisation can be daunting. Don’t get me wrong, they can also be great partners, but some struggle to provide valuable benefits, or administer them, on a local level. And a few national organisations are so big, that they have fallen into the category of extremely self-important and inflexible.

There are lots of reasons you may favour localised sponsorships, but if your brand is national or global, how you reflect that can be a challenge. Again, an umbrella sponsorship can be a strong answer.

Imagine you created an umbrella themed around helping teens in crisis, and put that umbrella over the top of a whole group of charities and projects assisting teens. If there is good, credible content that is useful to a national audience, it doesn’t matter if it came from a teen crisis hotline serving only Cleveland. If one of the organisations you sponsor has a ground-breaking program to deal with bullying, and they’re willing to share advice with your larger audience, it doesn’t matter if the program currently runs only in Reno. If your home office employees participate in a teen homelessness “sleep out” charity event run by your local homeless mission, wouldn’t it be great to feature that to your larger audience?

Using an umbrella program, you don’t have to look for the one or two major, national teen crisis charities, who may or may not be doing anything particularly interesting. You could, instead, make a point of seeking out innovators and outliers who are seeing success.

There is a ton of marketing opportunity with local and grassroots investments. By leveraging them under an umbrella, you not only have the opportunity to create much larger returns for your brand, you are also elevating their organisation to a national stage, which is a big win for many of them.

5. Offers unparalleled flexibility

The upshot from all of this is that your big portfolio of imperfect sponsorships offers you more flexibility than any other single sponsorship you have:

• You can create leverage programs for staff, customers, potential customers, intermediary markets, or whoever you’re targeting.
• You can have different marketing, brand, geographic, or promotional focal points from year-to-year, or even at different times of the year. You could even create co-promotions with different retailers at different times of the year.
• If you have specific strategic, tactical, or regional needs, there is nothing stopping you from leveraging the whole umbrella and selected partnerships under that umbrella.
• You could give your staff or customers some control over what you sponsor – earmarking a dollar figure and putting it out for nominations and voting.

If you need any assistance reworking your sponsorship portfolio, I am available for consulting and strategy sessions. Just drop me a line and we can discuss your needs and what I can do for you.

Kim Skildum-Reid
kim@powersponsorship.com
AU: +61 2 9559 6444
US: +1 612 326 5265