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Cause Marketing versus Corporate Sponsorship: The Ultimate Showdown

by | April 22, 2016

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I think this will be an interesting case study for those in the charitable sector as well as my colleagues on the brand side.

Before you dive in, if you are involved with a charity or a non profit looking for sponsorship, check out these titles in our “sponsorship for causes” series:
Sponsorship Cause Marketing Common Mistakes
Definitive Guide to the Sponsorship Proposal
The Biggest Problem with Sponsorship and How You Can Fix It
Three Things Missing From Every Sponsorship Package
Corporate Social Responsibility a Users Guide for Nonprofits
How to Start a Sponsorship Program for Your Nonprofit
3 Most Common Barriers To Good Cause Sponsorship
Things Sponsors Say: “We Don’t do Sponsorship
What I Wish I Knew at the Beginning of My Sponsorship Career

Let me set the stage:

I was working with a fairly small, grassroots organization who were approached by a consumer goods company. The plan? To sell their products at the point of purchase of various stores across the city. The charity would get $5 per sale, the rest going to the consumer goods company.

There were some problems with this at the outset:

  • There was no minimum amount agreed upon between the company and the charity. Why is this a problem? Because it denies the inherent value of the charity brand, regardless of how many units are sold.
  • The consumer goods to be sold were in direct competition with the products of the various retailers who would have to offer said products at the point of purchase in their stores.
  • Distribution would be a real issue as would convincing each retailer to add all of the signage and train each retailer how to make the pitch. In the case of large retailers with chains, it’s fairly easy to train their central staff and have them train the frontline staff…but in this case, there was no such central authority.
  • Related to the first problem, we would have to sell a TON of product to make any real money.
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First, We Solved the Logistics Issues

We confined the cause marketing campaign to a specific period and each retailer cleared this temporary competition with their current contractors. Once we got the all clear, we built ourselves a rocking committee of people with the connections in the community we would need to expand our network of retailers and to set the stage for step two.

Corporate Sponsorship to Save the Day

With no minimum fee to ensure the charity made a reasonable income, we had a problem. As an aside, I entered into this relationship after most of this had been agreed on. Had I been part of the initial conversations, we would have used a different model adhering to industry standards…but, it’s a good thing I wasn’t involved from the beginning because we made a lot more money in the end!

What we realized was that we had a huge network of people who were in a position to make a fairly small sponsorship contribution but who didn’t have retail space to sell our goods. We also realized that we had a huge presence through our signage during the business shopping season of the year.

We did a quick asset valuation and then engaged our committee with the idea of selling sponsorship space on the products, on the website and on the signage in stores. Our committee loved it, we found a price point that they were comfortable with and off they went. No one-pagers, no “Gold, Silver, Bronze” sponsorship packages…just good old fashioned, relationship-based sponsorship sales.

The Verdict?

In the end, we sold four times the sponsorship we thought we would. We had an army of volunteers selling the opportunities, so there was no increase in staff time. Our committee took care of all sponsorship activation and fulfillment and did such a great job that we ran a second campaign to accommodate the demand!

But what about the cause marketing component? Fact is, we sold a reasonable amount of product but it was nowhere near the amount that we brought in through sponsorship.

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Cause Marketing vs Sponsorship: The Ultimate Showdown

So who is the winner on the corporate partnership battleground? Without sponsorship, the campaign would have flopped…but not because it was a bad campaign, more because it was a badly planned campaign.

Sponsorship saved the day, but only because the cause marketing campaign brought out such valuable assets.

In the end, it was a tie. We learned some valuable lessons about the importance of negotiating the right agreement for all those involved but we also learned that blending the different types of corporate partnerships brings more value than any one style on its own.

Oh yeah, our consumer goods vendor was over the moon because the amount of money raised brought in a tremendous amount of press and web traffic for his business.

This post was originally published by the great Joe Waters over at Selfish Giving.