Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Teaming with Sponsors Sports Event Management and Marketing Playbook Play 7

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Teaming with Sponsors: Overview Organizers must spend time researching the best sponsor fits for his/her event The right sponsor program must present value to the prospective sponsor and meet budgetary expectations of the event

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Teaming with Sponsors: Overview Two basic varieties of sponsor benefits: –Those that generate expenses against the event budget –Those that do not require additional out-of- pocket expenses Be sure to account for “cost of goods sold” when budgeting for sponsorship

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Key Terms Development costs Fulfillment costs Sponsorship scaling Return on investment (ROI)

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Development and Fulfillment Costs Among the most overlooked calculations by event organizers during the budgeting process Development costs do not provide any value to the sponsor and should be factored in as “cost of goods sold” for the organizer Fulfillment costs represent the actual out-of- pocket expenses that an event organizer will incur to provide the benefits to which the sponsor is entitled

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Development Costs Sales commissions Sales expenses –Travel and accommodations –Business meals –Business entertainment (event tickets and hospitality during sales process) –Gifts, merchandise, premiums –Presentation materials (printing, binders/folders, videos, web pages) Market research

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Fulfillment Costs Complimentary tickets Event signage and displays Printed and digital event guide and program advertising Pre-event advertising VIP hospitality Sponsor gifts Sampling and giveaways Discounting and couponing

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. The Sponsorship Sales Process © John Wiley & Sons, Inc.

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Step 1: Qualify Research to identify a well-defined demographic in which to target sponsorship packages for the event –“Rifle shot” instead of “shotgun” approach Ideal prospects should share common or similar target markets with the event –Find synergy between sponsor brands and event Tailor the package, both sponsor benefits and financial expectations, to each potential sponsor

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Step 2: Design Scale the sponsorship categories in price and availability based on the event budget Packages will vary in exclusivity, ownership, and benefits, based on the budgetary needs and organizer’s discretion –Sponsorship Pyramid (Figure 7.4) provides a scaling example –Each level of the pyramid represents ascending sponsor benefits, responsibilities, and prices

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Step 2: Design © John Wiley & Sons, Inc.

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Step 2: Design Customizing packages to fit the sponsors’ needs may increase sales and diversify the returned value to the event organizer Evaluate the value of a package based on factors such as cost to the organizer, budgetary needs, and how many people are engaged, for how long, and how deeply

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Step 3: Test Research does not tell the whole story on a sponsorship package’s effectiveness Testing the sponsor package on potential sponsors allows organizers to prepare a final pitch for potential sponsors Be concise when testing a package with targets –Stick strictly to trial assumptions and prepared questions

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Step 4: Revise Use all collected intelligence to adjust to pitch for maximum success A proposal customized to the needs of the target sponsors will have the greatest chance for acceptance Revise budget for changes in development and fulfillment costs

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Step 5: Present Every presentation has two elements: personal, verbal demonstration and physical leave behind –Verbal must be compelling and engaging –Sponsorship deck should contain comprehensive information that supports the promoter’s arguments in a logical, easy-to- digest format The presentation should always be delivered in person

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Step 5: Present Basic components of a winning proposal: 1. Overview—Capture the tone and significance of the event. Establish the legitimacy of the event and the credentials of the organizer. 2. Introduction—Summarize the opportunities presented by the event and objectives of the presentation. 3. The Event—Present a more complete (but concise) description of the property. 4. The Opportunity—Provide details on how the company can get involved. 5. Next Steps—Conclude with a call to action.

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Step 6: Close Present the newly fashioned opportunity and, again, ask for questions, comments, and areas of concern Be prepared to negotiate on the spot if further revisions are requested or required Respond immediately with solutions to the company’s challenges

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Sponsor Perspective Always consider the prospective sponsor’s point-of-view Return on investment (ROI) is the key factor, but it is not always strictly financial Other factors include: –Target audience alignment –Mass appeal and reach –Brand fit –Pass-through rights

Copyright © 2014 by John Wiley & Sons, Inc. All rights reserved. Summary Meet the objectives of prospective sponsors by designing a program of benefits that suits their business wants and needs Organizers must account for the fulfillment costs of delivering each benefit to ensure their net sponsor revenue goals Formalize the deal with a contract or letter agreement that outlines the obligations of each party, sponsor benefits, and all financial and legal commitments