Marketing and selling in tough economic conditions:

FAQs in sponsorships

Prasanna Perera, Marketing and Management Consultant, Chartered Marketeer, CIM U.K.

With an increased number of organizations moving to below-the-line (BTL) promotions, sponsorships of various events are gathering momentum. Hence, this brief article addresses FAQs relating to sponsorships, that have been posed to the writer.

Prasanna Perera

* Is sponsorships ATL (Above-the-line) or BTL (Below-the-line)?

Actually it is a combination of both. Sponsorships need to be communicated - hence there is a ATL component.

Other activities related to sponsorships are BTL, such as brand activations, sampling etc.,

*What exactly is a sponsorship?

A sponsorship relates to making a financial payment, in return to be associated with an event. This event can be sports, music, exhibitions, street carnivals, conferences etc., There are different categories of sponsorships, i.e. Main / Principal Sponsor, Co-sponsor, Associate Sponsor, Media Sponsor, Print Sponsor etc.,

* Why are there many categories of sponsorships?

Basically, the reason is financial. An event organizer attempts to cover all costs if possible through sponsorships. Further, there is also heavy demand for certain events from prospective sponsors. This could also lead to a certain dilution effect.

* Should you sponsor an event that has been sponsored by another organization for an extended period of time (say over five years?)

My advice is not to do so, unless there is a very strong reason. The longer an entity associates themselves with an event, the event becomes synonymous with the sponsoring organization. Hence, another sponsor will take longer to establish their brand with the event and to gain the required mileage.

* Can you create events to sponsor?

Yes, this is one of the best strategies to pursue. Rather than sponsoring an “off-the-shelf” event why not create a customized event that is compatible with the Corporate and Product Brand personality of the sponsoring organization.

* What is the “most” important factor to consider in a sponsorship?

The compatibility factor is key to sponsorships

In my view, it is the compatibility of the sponsoring organization and brand, with the envisaged sponsoring event. Whatever the financial consideration, the compatibility factor is key. Do not destroy your corporate reputation / brand reputation by engaging in undesirable sponsorships. (For whatever reason).

* Any other factors to consider in selecting an event to sponsor?

The financial consideration is important, since a ROI is required. A staggered payment plan would be ideal for control and cash flow purposes. The credibility of the event organizer and the status of the event are also important factors to consider. Also consider the value-added benefits that will be provided. For example, media advertising opportunities and brand visibility.

* Should you get involved in events that attract several types of sponsors?

Yes and No. Yes, since if several sponsors are attracted, the event is popular and in demand. No, since many sponsors result in clutter and hence, a great deal of effort has to be made to stand-out. Use common sense in making a judgement!

* Besides the sponsorship fee, should you invest money to associate your brand with the event?

Absolutely Yes. In fact as a “rule-of-thumb” be prepared to invest at least twice the sponsorship fee, to associate your brand / organization with the event. This must be factored when sponsorships are considered. For example say you are the co-sponsor of a cricket match. Besides the free publicity that is given, you need to advertise your involvement with the match separately. (To gain the maximum mileage from the sponsorship)

* Any other advice in considering sponsorships?

Take a long term view. Do not expect sales increases in the short term. If this is the objective, then sponsorships are not the solution.

Another factor to take care is engaging brand ambassadors. (sponsorships). Certain brand ambassadors due to their personal actions can damage your corporate brand equity. E.g. The Tiger Woods episode.

Finally, ensure that your target customer is interested in whatever you sponsor. If this not fulfilled, sponsorship fees will be wasted.

“Sponsorships is your brand in action.”

(The Writer)

“Integrate sponsorship together with your Corporate and Marketing Communication Strategies.”