Sponsorship - The business of sponsorship

For many smaller arts organisations, securing sponsorship deals seem like a lottery, with a few lucky winners. However, adopting an approach founded on the principle of partnership can yield dividends. Lydia Penke and Tania Noble explain. Before attempting to secure sponsorship it is vital to have a clear understanding of what sponsorship is and how it differs from other sources of income available to your organisation. Arts & Business defines sponsorship as: The payment of money by a business to an arts organisation with the explicit objective of promoting the businesss name, its products, services or image. Sponsorship is part of a businesss general promotional spending and may encompass staff development as well as a sense of corporate or social responsibility. Sponsors will expect a return on their investment. When you approach a business for sponsorship, you are selling something that provides substantial benefits for the business. Other sources of income available to an arts organisation include: Earned income money an organisation earns through sales of goods or products Subsidy money from bodies whose duty it is to support the arts financially Grants as opposed to a subsidy (which is the statutory responsibility of a government body) a grant is a discretionary decision to fund as part of a wider set of objectives, where the funds will usually be tied to very specific outcomes Donation a gift for which no return is asked or given. When looking to raise sponsorship, you need to start between six and eighteen months in advance of the project. Establishing business relationships takes time, but the more you work at it, the easier it becomes. Remember that you are aiming for sustainability so you should try to hold onto your sponsors once you have them. It is also important to remember that VAT must be charged on in-kind and cash sponsorship, unless you are not VAT registered. There are five key steps that arts organisations should take in planning and running a sponsorship campaign: Assessing your organisation: What do you require? Check that you have the resources, people, database systems, and an agreed ethical policy (so you are clear about who you can and cant approach). Use your board and trustees to help provide you with business contacts. Be clear about how much youre prepared to offer the business. Developing sponsorship packages: Do some research into your audience members so that you can develop a profile of them. Identify projects your organisation is planning that are sponsorable whether its a season, a performance or even a crèche. Think creatively about what you can offer a business in terms of sponsorship opportunities and corresponding sponsor benefits. Have an idea of how much your packages are worth its the value to the business rather than the cost to you, so theres no need to provide a budget. Tailor the proposal and covering letter to each specific business you approach and understand each of the businesss motivations. Explain why the sponsorship makes sense to them. Identifying companies: Develop your own database and select target businesses in the local area. Find out who sponsors similar arts organisations, or advertises to the same audience. When researching sponsors, think why do they want to sponsor us? Its always best to first try those businesses who have supported you before. Making a successful approach: When writing the initial proposal, make it short (two to three sides). Use bullet points, make it clear and easy to read, and avoid acronyms and arts jargon. The benefits section needs to be given as much attention as the description of your organisation and project. The business will probably want to see a sponsorship fee before you meet them. Have a strategy for follow-up (dont expect them to call you). If they say no, find out why and try to negotiate another package. Ideally, invite a prospective sponsor to a cultivation event. Developing a lasting relationship: Its a good idea to sign a letter of agreement with your sponsor at the start of the partnership, to ensure both parties are clear about each others objectives and responsibilities. Also think about monitoring, evaluating and media coverage tracking. Keep in touch with your sponsor, and keep them involved and engaged in the partnership. At the end of the project, arrange a meeting to feed back the findings of your evaluation and talk about their next sponsorship, whilst their partnership with you is still fresh in their minds. Remember, holding onto a sponsor is much easier than finding a new one! Lydia Penke is PR & Events Assistant Manager and Tania Noble is Arts Manager at Arts & Business. e: alexandra.wright@aandb.org.uk; t: 020 7940 6436. Arts & Business is offering its Sponsorship Manual at a special, discounted rate for ArtsProfessional readers of £10 from http://www.aandb.org.uk For help with research, visit Arts & Business resource centre, or e: lynette.shanbury@aandb.org.uk Top Ten Tips 1 Communicate clearly with your potential sponsor 2 Manage expectations 3 Be clear about objectives on both sides 4 Its all about relationship building and networking 5 Encourage your sponsor to invest in making the most of their sponsorship 6 Be flexible to a sponsors demands, but retain your artistic integrity and be true to your organisations vision 7 Try to involve a number of people from the sponsoring business in the partnership with your organisation, so it doesnt rely on just one person 8 Evaluate the project well. For a downloadable evaluation guide, visit the Research section of Arts & Business website 9 Keep in touch with your sponsor 10 Contact Arts & Business for advice and support!