The most common question I get in my sponsorship workshops and consulting practice is “how do we determine the value of our sponsorship assets?”. I wish there was an easy answer, but it’s not that black and white as there are many elements that need to be considered. For this post, I’d like to touch on some of the more subjective elements that need to be considered in the “value mix”.
Let’s start with the big picture. One definition describes value as “an amount, as of goods, services, or money, considered to be a fair and suitable equivalent for something else; a fair price or return”. From a marketing perspective, value may be conceptualized “as the relationship between the consumer’s perceived benefits in relation to the perceived costs of receiving these benefits”. In both of these cases, value is very much in the eyes of the beholder and your ability to satisfy someone’s needs at any particular point in time. This is why you can put any value on a sponsorship (or any other product or service for that matter) that you want, but if what you have to offer is not perceived as important to the prospect at that time, it is of little value (just think of the last time someone tried to sell you something you didn’t need). This is why presenting a customized proposal to a prospect is so important because it allows you to package benefits that are of the most value to your prospect, based on their unique interests and business objectives.
Having stated the above, we do need to establish benchmark values for our sponsorship offerings in order to have a reference point for discussions. Besides the quantitative elements such as exposures or impressions, there are several other factors that you need to consider when determining the intangible elements of your sponsorship offerings. In my experience, the three most important ongoing elements are:
- The type of audience you reach / serve and your relationship with that audience (i.e. are you a trusted source of information?)
- Your brand and competitive position (i.e. are you respected and have a distinct market position?)
- Your ability to provide a sponsor an opportunity to creatively engage with your audience in a way that makes the brand a welcome part of the “audience experience”(in other words, to offer something that the prospect sees as unique or exciting).
The bottom line is that to generate the maximum value, you need to respond to the needs of potential sponsors. The simple premise here is that if you’re responding to their needs, you can command the value you expect for your sponsorship offerings. The first challenge is identifying prospects that represent the right fit for what you can realistically offer; the second is understanding the needs of your current sponsors or prospects and realizing that those needs are constantly changing, so what may be valuable one year, may not be, the next. Therefore, in order to maintain or grow your value proposition, you need to constantly adapt your offerings to ensure they are aligned with the needs of your sponsors.
I’ll be discussing these concepts in much more detail at my upcoming Designing and Selling Your Sponsorship Program Workshops in Toronto (November 16-17) and Ottawa (December 7-8). I’d welcome your comments on this post.