How Corporate Sponsorship Can Unlock New Sources of Income for Your Ministry

Ron Frey
This article provided by the Engstrom Institute

The proliferation of non-profit organizations, combined with a slow economy, has created stiff competition for charitable donations. Many charities are wondering how to find new sources of income.

While secular non-profits have tapped into corporate funding for years, most Christian ministries have overlooked this opportunity. However, some have figured out how to make it work. If you find it hard to imagine that a company would be interested in a sponsorship agreement with a religious organization whose purpose is to preach the gospel to the unsaved, you are probably not alone. Yet in March of 2003, Luis Palau's Beachfest event in Ft. Lauderdale raised more than $800,000 through corporate sponsorships from such recognized companies as Alamo Rent-a-Car ®, Pepsi®, Hill-York®, Anderson Hardwood Floors® and the Miami Dolphins®. And the benefits to the sponsors were well worth it. The event drew 300,000 people and generated significant local publicity, even in the midst of the first weekend of Iraqi war coverage.

Although many companies have policies prohibiting support of religious causes, there are plenty of Christian-owned and "faith-friendly" businesses that may consider a sponsorship of your event or program. A sponsorship program opens doors to major gifts from individuals, private business owners and even public companies. And the money comes from a different "checkbook" than their charitable gift account. The money is found in their advertising budget! This article will explain what sponsorship is and how to get started.

Last year corporations spent an estimated $9.57 billion on corporate sponsorship of events, sports, music festivals and community activities. More than $878 million was spent on causes linking the sales of products and services to the benefit of charitable interests. If your ministry can demonstrate an important contribution to the community and an outstanding advertising value for the sponsor, you may be able to find thousands of dollars in new money from corporate sponsorships.

What is Corporate Sponsorship?

The IEG Group of Chicago defines sponsorship as "a cash and/or gift in kind fee paid to a property (typically in sports, arts, entertainment or causes) in exchange for access to the exploitable commercial potential associated with that property." A "property" is any unique event, program, location or promotion that has commercial value to an advertiser. The Luis Palau Evangelistic Association property is a major, city-wide festival attended by thousands of people, and supported by hundreds of churches. Promise Keepers property is a stadium event attended by thousands of men in dozens of cities across the country.

Sponsorship differs from philanthropy in that it is commercially motivated. Although some sponsors have a genuine desire to help your organization accomplish its good work, sponsorship is used to target new customers, advertise their product or service and build brands. While some sponsorships are done for the pure "public relations" value, most of today's sponsors expect to see measurable results in terms of how many people were reached and motivated to buy.

A Successful Corporate Sponsorship program includes six key steps:

Step One: Package your Property for Sponsorship

What is your "property"? If your church, school or ministry has an event or project with the potential to build the brand image or deliver customers to a commercial business, you are in a position to offer sponsorships. For example, Portland Christian School combines advertising benefits at all sports games, performing arts events, and printed visibility in school publications for one annual sponsorship fee. Their sponsorship package offers a year's worth of advertising including signage, logo presence, annual passes to games and many other benefits. The sponsor gains access to the constituency of the school for commercial purposes and the school receives substantial gifts that it would otherwise not receive.

Community Church of Joy in Phoenix, AZ has obtained sponsorships of cash and gifts in kind worth $25,000 to $50,000 from such companies as Qwest ®, McDonalds ®, and the Arizona Republic. These sponsorships have supported everything from church events to their children's play structure facility. According to Associate Pastor Paul Sorenson, an important part of their packaging is the creation of The Joy Company, a separate, non-religious 501.(c) 3 organization that supports the community outreach of the church. "This gives us credibility in the marketplace and allows companies to give to the activities of the church indirectly, without violating their own policies."

Your sponsorship package may include such benefits as logo presence in your printed materials, placement of an advertisement in your program, mention of the company name on your radio spot, a banner hung on the stage, links on your website or verbal mention from the stage. The Christian Management Association (CMA) offers more than sixty different sponsorship opportunities at the annual conference. For example, sponsors of a keynote speaker session may distribute company literature to each chair and are given four minutes to make their pitch to the audience.The $750 to $1,500 sponsorship fee may be well worth it to reach a captive audience of prospective buyers.

To succeed, be creative in the design of your benefit package. Include hospitality benefits such as an invitation to a special reception with hors d'oeuvres, or special seating at an event. The social aspects of sponsorship can be extremely important to the sponsor if their goal is to network with other business decision makers or to provide their customers with a valued entertainment opportunity.

Step Two: Target your Best Sponsor Prospects

Your best prospect is the company that has a natural fit between their target customer and your constituency. When you make this connection, your property can deliver a solid advertising value for the sponsor and likely be met with enthusiasm from your audience.

Once you have determined the target companies, it is vital to make your presentation to the person who has the authority to make the decision. This person may be the owner, CEO, General Manager or the Vice President of Marketing. Once the key person is identified, you will need to determine your point of entry. Ask around to see who has the "in" to set up an appointment and make the presentation. This could be through a referral from a business partner, friend or an employee. It is not necessary that the decision maker be a Christian or even sympathizes with your cause. If you can offer a great advertising value, and your service to the community is evident, you may find support.

Step Three: Create a winning proposal

Most companies today want more than just the good publicity. They want prospective customers to sign up, use a coupon, call for more information, or visit their website. A winning proposal will show how sponsorship can deliver these results. "It's got to be a win-win for both organizations. If it's not mutually beneficial, we just don't want to do it" says Jeff Wilson, National Development Director for Promise Keepers.

Effective proposals are visually exciting—filled with photos of past events. Endorsements from community and business leaders provide credibility. Marketing research that provides hard data on the audience demographics and purchasing behaviors of your audience is also very helpful.

Another high value is exclusivity. No sponsor wants to go into an event venue and find their logo and banner next to their competition. For example, you would never see Adidas® listed as a co-sponsor of an event presented by Nike ®. Of course, exclusivity is worth something so charge more for it.

Avoid clutter. Companies do not want to see their logo included with two dozen others. They want to be noticed as the only sponsor, or one of just a few. So let your prospects know how many other companies will be included at each sponsorship level.

While I favor custom-made proposals, offering a standard menu of benefits for each level of sponsorship is a common practice, especially for the lower end. However, "title" or "presenting" sponsor will probably demand a custom package of benefits finely tuned to meet their marketing objectives.

Step Four: Price your sponsorship package to sell

Typical sponsorship packages include several levels of opportunity. "Title" or "Presenting" level sponsors are at the top and should receive a major package of benefits including the right to use the company name in the title of the event. You should offer several sponsorship levels priced in a range that will be comparable with other events or opportunities in your community. Festivals with Luis Palau offer sponsorships from $2,500 to $50,000 and sometimes more. Sponsorship of a Promise Keepers event ranges from $1,300 to $7,500 per event.

Because there are no guarantees in sponsorship agreements (the event could be rained out), a good rule of thumb is to give sponsors about 1.5 times more in advertising value than the sponsorship fee. For example, a $5,000 sponsorship would deliver about $7,500 in advertising value. Be generous in your benefits and win the sponsor for the long haul. It is much easier to reactivate a satisfied sponsor year after year than to find new ones.

If you can deliver what a company values the most, then the price they are willing to pay for it may be higher than you think. Remember, they can go buy their own radio spots, newspaper advertising or print ads. But what they are buying from you is access to the intangible benefit of being associated with your unique event such as audience loyalty, goodwill, and recognition. Those intangibles have real monetary value to the sponsor because they cannot buy it anywhere else.

Your loyal donors or customers will have a good feeling about any company that supports your organization. This transfer of goodwill, produces customers for the sponsor. After sponsoring a Luis Palau Festival, Brad Parker, owner of La Z Boy Furniture stores in Portland, Oregon said, "I've never had such a positive response from anything we've ever done, including sponsoring the Portland Trail Blazers." The reason is that Christians do pay attention to who is supporting their causes. It is gratifying to see a company step up to the plate and publicly show their support for a Christian cause.

Step Five: Close the Deal

Be prepared to have them sign a written sponsorship agreement. This agreement will outline the benefits that each party will deliver to the other, the responsibilities of each party and the payment terms and deadlines.

Step Six: Service your sponsors and renew the deal

Once the deal is signed, give your sponsors frequent updates on your project. Keep them informed of your progress with other sponsoring companies. Keep your eye out for public relations opportunities and let your sponsor know how they can take advantage of them. Once the event is over, give your sponsors hard data on event attendance and buying behavior. Back up your data with marketing research if at all possible. Make sure that your sponsor knows that you fulfilled your side of the agreement. Provide photos of their logo or banner and samples of all printed materials where their logo or advertisement appeared. It is a good idea to pay a personal visit to say "Thank you," provide the follow-up materials and ask them if they will consider supporting your next project. Always keep the door open for next time and never be afraid to ask for their support again and again. Ask them what they think you can do to make their sponsorship better next time. If you have an annual event, these reports are critical to getting a second year commitment.

Conclusion:

Among the many benefits of a sponsorship program is the referral network to new major donor prospects. Christian business owners tend to know one another through their supplier networks, vendors and customers. Or they may be connected through a workplace ministry group or professional association. Once your ministry offers a sponsorship for your event, you will be able to network to others by asking for referrals.

If you are willing to offer an outstanding advertising value to sponsors, you may find a significant new source of long term support.

Ron Frey is a veteran fundraising executive with 20 years of leadership experience in non-profit management, marketing, planning, and resource development. Formerly the Director of Corporate Sponsorship/Estate Planning for the Luis Palau Evangelistic Association, he now serves as Vice President and Senior Consultant with The Envoy Group.