Episode 28: 7 Steps to Get Ready for Sponsorship Sales
Sponsorship sales is one of the most important, yet most daunting, tasks for your fundraising event. It’s not just something you can dive into. There’s a lot of prep work that needs to happen behind the scenes before you can begin. I break it the prep work down into 7 steps.
In this episode I share:
Why you should have a clear definition of your target audience
How to break down creating a budget and set your sponsorship goals into easy steps.
The importance of having realistic and measurable sponsor goals and benefits
The best place to start when creating a sponsor prospect list
For a full transcript, see below.
LISTENER ACTION ITEM
In this episode, each step is an action item. Head to the show notes to view the transcript and the 7 steps. Block time on your calendar to take care of each step. Go to the Show Notes to find examples of an event budget and sponsor grid.
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LINKS & RESOURCES
Ep. 1_Are you planning your event backwards?
Ep. 3_Why you shouldn’t call your gala a gala
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Episode 28 Full Transcript
Hello and welcome back to That. Sounds Like a Plan, the podcast where we talk about all things related to nonprofit fundraising events. I'm your host, Alicia Baraga. I am the owner of Ripple Event Marketing, and I've been planning successful nonprofit events since 2010. No matter what time of year your event falls, the earlier in the year you start sponsorship sales the better. But before you dive in, there are some things you need to do to prepare.
In today's episode, we're going to talk about the seven steps to get ready for sponsorship. Early in the calendar year is when you want to start sponsorship sales. Even if your event is in the fall, this is the time to start reaching out to prospective sponsors. Most companies have already allotted their marketing budgets early in the calendar year, so the sooner you get on their radar, the better.
But before you do that, there are a number of things you need to do to get ready. I've broken it down into seven steps. Prepping for sponsor sales will take some time, so make sure you block time on your calendar to get all of this stuff done. There's a lot of information in this episode, so you might want to get out a pen and paper or pull up a Word doc and take some notes. If you're on a walk or driving in your car, don't worry. You can get more information in the show notes.
Step #1: The first and most important thing you need to do before you begin sponsorship sales or before you start planning any event, is to determine your target audience. I talk about this in the very first episode of this podcast. That's how important it is. From a sponsorship sales standpoint, it's important to know who your event audience is because you want to find companies who have a similar target market. There's a misconception that companies sponsor events because they love or support your cause or mission. Hopefully they do, but that's not the function of sponsorship. For companies, sponsorship is a marketing tool.
If a company simply loved your cause, they would write you a check and they'd be a donor. A sponsor gets their name and company logo promoted in association with your event. That company builds brand awareness and recognition and hopefully some goodwill by having their organization associated with yours.
Companies also know that your supporters are going to be a heck of a lot more likely to do business with them because of that association. The more target audience data that you have, the better you're going to be able to find sponsors that align with that audience and to pitch sponsorship to those companies.
Not many nonprofits approach potential sponsors with any data points. So even if you have a couple, you're doing better than most of your competition. If you're planning a brand-new event or you don't have any historical audience data, you can let your sponsor prospects know the demographics and psychographics of the audience that you are building your event around. And if you need a refresher on target audience, go back and listen to episode number one: Are you planning your event backwards?
Step #2. Once you've outlined your target audience, the next step is to create your budget and to set your sponsorship goals. The goal with any event is to get enough sponsorship dollars to cover all your costs; venue, catering, entertainment, auction games, whatever it is, you want to get enough sponsor dollars to cover your costs so that your ticket sales and your ask, and if you're not making an ask, you should be, so all of that money from ticket sales and your ask, all that profit that goes right to the organization. In order to figure out how much you need in sponsorship dollars, you first have to create your budget. I have an acronym that I hope is going to help you when it comes to creating a budget, and that acronym is BITES.
So think about creating your budget in little bites so it isn't so overwhelming. The B just simply stands for break it down. You need to create line items for each area of your budget, so income and expenses. You need line items under each of those categories. So think through everything that you plan to do for this event that's either going to generate money or cost you money.
I is for income, we're going to start with one area. Think about all the ways that your event can and will bring in income or revenue. For a gala type event, this typically includes sponsorship dollars, which we're going to talk aboutmore about in a bit, ticket sales, table sales, games, if you have an auction or a raffle, those types of things. If you're planning a golf tournament, your income line items might include foursome fees, golf scratch off games, hole in one contests, merchandise sales, and of course sponsorship sales. So think through all of the possible revenue generators for your event. For sponsorship dollars, you can start with just an overall lump sum total. but when we get to the S in bites, that's when we're going to break it down.
The T is just a reminder to Temper your income expectations. In other words, be realistic. I'd rather have you be conservative on your income projections and blow that number out of the water than to aim too high and fall short. So be realistic.
The E is for expenses. So you broke down your all of your income categories, into line items. Now you're going to do the same for expenses. If this is an annual event and you have historic information, you can simply take last year's expenses and add a cost-of-living increase to each line item. But if this is a brand-new event and you don't know the approximate cost for things in your area, you're going to have to do a little research.
For instance, if you are hosting a gala-type event and you're going to have a meal and you don't know an approximate average cost per head in your area, you're going to have to call some caterers. Call three to five caterers and find out what is that average cost in your area.
Do some research and make the best guesses you can. For the most part, budgets are educated guesses. But the key word there is educated. So do your research. Don't forget to include in your expenses a contingency line item for unexpected expense. I simply call that line item miscellaneous, and I usually drop in $500 for that line item, but you can call it whatever you want and you can put whatever dollar amount you think is realistic for your miscellaneous costs.
The bottom line is that you need to be thorough and realistic with your budget numbers.
And lastly, the S is for sponsor levels. I'm not a huge fan of this practice, but after years of trying to talk people out of this method of sponsorship sales, I've sort of resigned myself to the fact that it's ingrained in the nonprofit industry. So while I'm not trying to promote this method, I know that you probably want to hear about it.
So what the heck am I talking about? The most common sponsorship practice is to have sponsorship levels, and those levels can be named whatever. Usually it's a metal or a gem of some kind, like platinum, gold, silver, bronze. Diamond Ruby, Emerald. It doesn't matter what the name is, you can call your levels whatever you want, but this method uses a tiered system where the top is the most expensive and gets the most benefits and then each subsequent level decreases in price point and the list of benefits. Now, if you already went through your budget and put one large lump sum number for your sponsorship dollars, this is where you're going to break it down into sponsorship levels. For the majority of my small non-profit clients, the highest level is usually $10,000 or less, and then it decreases from there. There are some non-profits that have higher top tier sponsored levels, but as I said, $10K or less is the most common.
Unfortunately, it's a call you're going to have to make what that top level is. There is a formula where you can take what benefits you offer and figure out the value of those and come up with what those sponsor levels are. But it's really complicated and really, it's so much more work than you would get out of it. So unfortunately, for that top tier, you're just going to have to sort of make a gut call on what that top level is of what you could realistically get from a sponsor and then tier it down from there.
For now, all you're doing is coming up with the monetary sponsor levels and how many sponsors you think you can get at each level. So keep in mind that both the value of the sponsorship is being tiered down, but also so is the number of sponsors. So for your budget, you want to add a line item for each sponsorship level. So let's say your top tier is 10,000 and the next is 5,000. The $10,000 sponsorship level is a line item. The $5,000 sponsorship is a line item and so on. Not only are those being tiered down, but so are the numbers of sponsors at that level because you want to have some exclusivity for that top level.
Typically you have one sponsor at that highest level, then maybe two or three at the next level. When you're creating your budget, you're going to add a line item for the sponsor level, and then how many of each sponsor at that level, if that makes sense.
This probably sounds confusing, but it's going to make more sense once you see the sample budget that I include in the show notes. And then, that's all you're doing for now. We're going to talk about the benefits in a little bit.
As I mentioned, I'm not a huge fan of this method and so you may be wondering, well, what do you recommend for sponsorship sales instead of the tiered levels? And I'm going to talk about that in the next podcast episode. So stay tuned.
Now, BITES is just a silly little acronym that I came up with to help you remember what you need to do in your budget as sort of a reminder to take it. little by little so you don't get overwhelmed. But you don't have to go in that order. You can start with your expenses and then figure out how much you need to raise in sponsorship dollars to cover those expenses.
And if you're new to creating budgets, I would actually recommend starting with that. But BITES is easier to remember. So, as I said, I'll put a sample budget and a sponsor document in the show notes. Go to that sounds like a plan.net and find episode 28. What I'm going to be sharing with you in the show notes is it's not going to be a download that you can edit, but at least you can see examples of what they look.
The budgeting process can take a while because your budget and your sponsor levels go hand in hand as does your, expenses and your total sponsorship amount. There's going to be a lot of back and forth to get your budget where you need it to. So, make sure you block out some time to to create your budget.
Step #3 is your event brand. You want to include your event logo on all of your sponsor materials. Your sponsor materials need to match your event and your organizational branding. Now, if this is a new event, you're going to need your need to create your event brand and graphics. And again, this can take time and it's why I'm putting it as step three, rather than leaving it until later.
I talk more about event branding in Ep. 3_Why You Shouldn't Call Your Gala a Gala. So, if this is a new event, go back and listen to that episode. I highly recommend using a graphic designer to create your event logo and your branding. It's going to save you a lot of headache and hassle and potential expense down the road if you need to redo it.
Step #4 is sponsor benefits. In step number two, you outlined your goals and your budget, including that handful of sponsor levels. Now, step number four is to take those monetary levels and determine what benefits the sponsors will get at each of those levels. You can just go and Google sponsor benefits and you're going to see a whole bunch of examples.
But there are two things you want to keep in mind when you outline your sponsor benefits. One is, if you're doing that tiered method, your sponsor benefits should progressively decrease. Your top tier sponsor should have the most benefits, and your lowest level should have the least. Number two, sponsor benefits should be realistic and measurable whenever possible. For instance, if you are giving your sponsors a social media shout out some kind of a sponsor mention like, “Hey, thanks to such and such bank for sponsoring this event”, you want to specify at each level how many social media mentions they're going to get. You don't want them thinking you're going to give them 10 social media mentions and you're going to only give them five.
The way to get rid of any of that ambiguity is to be very, very clear and very specific. If the sponsor gets an ad in your program, they should know exactly what size ad they're getting. Is it a full page? Is it a half page? If you have the specs of what size ad that is, include those. If you're offering a table for the event, let them know how many seats are available at that table. Is it an eight-person table or six person? Whatever benefits you offer, make sure you have the capacity to fulfill them. No matter how many sponsors you get, you may think, we're going to have this huge list of benefits that we're going to offer in order to draw in more sponsors. Well then, uh, oh, you actually get all those sponsors because you promised the world to them. But you have a staff of four people and can't, keep up, and can't fulfill those benefits. So, make sure that it's realistic.
At the end of your event, you should provide a fulfillment report or a recap of the event to all of your sponsors that outlines how you came through on what was promised versus what was delivered, and that report should include as many measurable stats as possible.
Now, why would you do this? One big reason is, whoever your sponsor contact is, they may not be the sole decision maker or the decision maker at all on whether or not to sponsor your event next year. So, if you have a nice pretty report that you can give to your contact that they can take to their superior or a committee or whoever it is that makes that decision.
And they can say, “Look at how successful the sponsorship was”. Not only is that a nice thing to provide, but it is hugely beneficial to you, to provide that report so that they're going to sponsor again next year.
Coming up with the list of benefits can be challenging, so start by just sitting down and brainstorming a big list of options. As with any brainstorming activity, don't limit yourself initially. Just do a big old brain dump. List anything and everything that comes to mind, no matter how outrageous, whether you can do it or not, just make that list. After that, you can go back and edit and, narrow that list to what you can realistically provide.
Step #5, the sponsor grid. Once you've outlined all your sponsor levels and benefits, you want to put all of this information into a one to two page document, two pages max, that you can email to someone or print out and bring to an in-person meeting. This is called your sponsor grid, and the reason it's called a grid is because it's laid out in a way where your sponsor prospects can see all of the levels and all of the benefits available to them in a side-by-side comparison.
This is, again, something that I highly recommend that you use a graphic designer to create for you. If you're an absolute pro in Canva, you could potentially create it yourself, but it's going to take you a lot of time. Just save yourself the hassle and get a graphic designer to create it for you. As I said, I'll put a link to an example of a sponsor grid in the show notes.
Step #6 is to create your sponsor prospect list. So the first step you want to do is just start by creating a spreadsheet to track those asks. You want a place to put all the potential sponsors that you're going to contact.
Creating your prospect list is where knowing your target audience is key. You need to look for organizations that have a similar target. Now, the best place to start with coming up with your list of prospects is with your board of directors. One of the expectations that you should have for all of your board members is that they share their networks and open doors for your organization.
This includes event sponsorship and knowing your target audience is going to make your ask to the board so much easier. Rather than going to your board and saying, “Hey, we need some companies to sponsor our event”. It's better to say, “We are looking for companies who want to expand their reach with___ and then insert your audience data.
So, for instance, you could go to your board and say, “Hey, we're looking for some companies that want to expand their reach with female executives from the metro area who are highly competitive runners. Now, I don't know about you, but when I hear, hey, we need some companies to sponsor our event, versus, hey, we are looking for companies that want to expand their reach with female executives from the metro area who are highly competitive runners, a whole different list of companies come up in my brain
So having a detailed description of your target audience is going to help you. It's going to help your board, it's going to help you find that really great targeted prospect list for sponsors. Next for your sponsor prospects are vendors that your organization uses. Any company that benefits from your organization's existence should be asked to sponsor your event or to give back to the organization in some way, whether it's an in-kind donation or a monetary one. This is the one exception to the target audience rule. Your vendors don't necessarily have to have the same target audience as your event. They should simply want to support you because they do business with you.
There's no magic number to the size of your prospect list. I'm not going to tell you to go sit down and create a list of five companies because you might have 10, you might have 50. It just depends on the size of your organization, your board, and the number of connections you and they have.
Lastly, number seven is to create the process from the moment a sponsor says yes until all of their benefits have been fulfilled. That could be the day of the event, that could be the week after the event.
It just depends on what it is you've promised them. What I like to do for a next step is to have a form for that sponsor to fill out. So, they've gone from being a prospect to now they're a yes. Please fill out this form. And that form is going to keep all of your sponsor information nice and handy in one place.
And it should include the company name, the contact’s name, their email, their phone number, and then if you are doing those tiered sponsorship levels, a check box next to which sponsor level they're choosing. And then, make sure you include instructions for how to pay.
If you prefer to be paid by check, let them know who to make the check out to and where to mail it. if you have an online payment system, give them a link or a button to make it super easy to pay. Once they're confirmed and paid, then starts the next process to follow up with them. And typically, what I do then is I'll create a template for each sponsorship level. So, there's a gold level email template, a silver level email template. And in that email, it includes all of the benefits that they receive at that level, along with deadlines for things that they need to get back to me. The most common one is their logo. “Thank you so much for your support. As a gold sponsor of this event, here are the benefits you'll receive along with the stuff I need from you along with the deadlines. So that could be when they need to get back to you with a logo.
If they have an ad in your program, they need to have it back to you by such and such date so it can go to the printer to get printed and so on. If you want them to fill out a table, include the link to your registration site where they can fill in the names of the table guests.
You want to make it as easy and seamless as possible for the sponsor and provide the best communication, the most amount of information, for them in a clear, concise way, if that makes sense. And by doing that, not only do you look more professional, if you make their life easier, they're going to be so much more likely to sponsor you again next year.
So make sure you have a clear process for onboarding your sponsor and then for fulfilling those benefits.
I told you there's going to be a lot of information in this episode, and honestly, I could've gone way deeper. There's so much more information I could've given you. But I want to start with the basics here. As I mentioned, if you weren't able to take notes, you can go to, that sounds like a plan.net, and go to episode 28 for a transcript of the podcast. In the show notes, I'll also include links to the sample budget, the sponsor grid, and links to the other podcast episodes that I mentioned.
At the end of every episode, I like to give you an action item, and the idea behind the action item is that it's something that's going to give you a quick win for your day and hopefully help build and drive that momentum as you're planning your event. Today's episode was full of information and includes lots of steps, and that's why I did it that way because I don't want you to get overwhelmed.
I wanted to break it down so you could take it step by step. So, for today's action item, I want you to go back and review the seven steps that I've outlined to get ready for sponsorship sales. You might look at that list and go, well, I've already done steps one and two. Awesome. Go back and look at step number three, estimate what you think you're going to need for time to complete step number three and block that time on your calendar.
Or block multiple spots on your calendar if you need to. And, as I said, the reason I broke it down into steps is to make it feel less overwhelming. So, take it step by step, block time on your calendar and just get these things done.
In the next episode, we're going to talk about unique opportunities you can offer sponsors to increase sponsor engagement and retention.
As I said, I'm not a huge fan of the tiered levels. And I'm not knocking it because honestly, I've done the tiered levels since 2010, since I started in this career. But I've learned what I think is a better way. It takes a little more work, but there's a fancy word in the event world called Activations. Sponsor activations give the sponsor an opportunity to engage with your audience. And if you've done your sponsorship sales correctly, that should also be their audience. The most successful sponsor activations create a great experience for your guests while helping the sponsor fulfill their marketing goals andhelp you secure higher sponsor dollars than just those tiered levels. So, it's just, it's a win-win, win. I'm going to talk more about activations in the next episode.
Now that sounds like a plan. Thank you so much for listening today. If you're enjoying the content on my podcast, please like, share and review it on Apple Podcasts, as that will help me come up higher in the search rankings. Thank you so much. I'll see you next time.