When most people think of a sponsor, they think of someone who will hand them huge wads of cash. While it’s true that that’s one definition of sponsorship, it’s not the only one.
In today’s guide, I’ll walk you through the four types of sponsorship and explain when each is best depending on what your company or nonprofit goals are.
Let’s dive right in!
Sponsorship Type #1 – In-Kind/Contra Sponsorship
Starting this list is in-kind sponsorship, which is also referred to as contra sponsorship.
It’s been a while since I’ve discussed in-kind sponsorship here on the blog, so allow me to present a definition now.
Contra sponsorship is when a sponsor gives you in-kind gifts. Those gifts can include goods or services. That all depends on what the sponsor specializes in.
For example, if your sponsor was a printing company, they could print t-shirts or hoodies and distribute them during your event.
Your attendees get some awesome free swag, and you didn’t have to pay a cent to find a printer.
In-kind sponsorship can include lighting and other electronics for your event, catering services, policing services, prizes for giveaways and contests, and even covering travel expenses and accommodations.
Of all the types of sponsorship, in-kind sponsorship probably strays the furthest from the definition of sponsorship that most sponsorship seekers follow, which is money, money, money.
This can cause those same sponsorship seekers to prematurely dismiss the value of contra sponsorship, which is only to their detriment.
In-kind sponsorship is probably not the only sponsorship deal you’ll have ongoing at the time of your event, program, or opportunity. If it is, then you have the rest of your event on lock, which is awesome.
Even still, contra sponsorship certainly has its place, and it’s quite a valuable spot at that.
I do want to make one thing very clear. Despite what it might sound like, contra sponsorship is not a donation.
The sponsor company is not giving you freebies out of the kindness of their hearts. They’re not doing it for exposure either.
They’re doing it in exchange for assets and activations that solve their problems, just the same as any other sponsor.
Who Is It Best For?
In-kind sponsorship is suitable for a variety of sponsorship seekers.
If you’re hosting an event for the first time and you don’t know the first thing about doing so, a contra sponsor can be extremely useful.
As I said before, they can take care of things like hiring technicians for lighting and sound, or they can find you a catering service.
They can hire a venue for your event, take care of the policing and security, and even staff the event with volunteers to scan tickets, provide directions, and answer any other questions.
Nonprofits and contra sponsorship are a natural match. Just don’t treat them like your donors and you should be fine.
A sponsorship seeker who needs a lot of extra help with their event should consider an in-kind sponsor.
I would also recommend contra sponsorship for the sponsorship seeker who doesn’t have the most high-value assets and activations right out of the gate.
A sponsorship deal with an in-kind sponsor is not going to be as lucrative as a cash sponsor, so smaller assets and activations are okay.
Sponsorship Type #2 – Cash Sponsorship
Next, we’ve got what is everyone’s favorite type of sponsorship and what I’m sure is the most commonly-sought one.
You know what I’m talking about. It’s cash sponsorship.
A cash sponsorship deal goes as follows: you provide high-value assets and activations to the sponsor, and in exchange, you receive X amount of money.
How much money that will be, I can’t say. It depends on a myriad of factors, many of which are in your control.
For instance, have you surveyed your audience recently? If so, have you used that data to segment your audience?
How segmented are we talking here? Do you have vague groups that do a sponsor no favors, or do you have highly segmented, ultra-specific niched-down data that comprises your audience?
The latter is the most valuable to a sponsor.
Sponsor companies are always trying to build their audience. They know what their ultimate target audience looks like, and when they see you have several audience segments that slot into that target audience, that raises the value of your sponsorship deal significantly.
So too does the quality of your assets and activations. More so than just randomly selecting high-profile assets and activations, how well those solutions fix a sponsor company’s problem is another factor that determines the value of your deal.
Let me tell you – six-figure and even seven-figure sponsorship is not reserved solely for sports sponsors.
If you’re putting the right things on the table and you have an audience the sponsor is interested in, you can sign a ridiculously lucrative deal.
Of course, I should note that what you can earn from a cash sponsorship deal is also dependent on the sponsor’s budget.
A small business, no matter how much they want to, probably can’t pay the entire $50,000 you need to host your event or opportunity.
Even a large company might not be able to do it alone if they have other companies they’ve agreed to sponsor for the quarter or the year.
That helps you decide very quickly if you need more than one sponsor to meet your cash sponsorship goals.
In the end, it doesn’t matter if you need to get three sponsors to give you $50,000 or just one. If you have the money you need for your event, that’s what matters.
Who Is It Best For?
Cash sponsorship is good for literally any type of sponsorship seeker, which is why it’s the most popular type of sponsorship.
I think it’s synonymous with the word sponsorship at this point. If you tell someone you’re seeking sponsorship, they assume you want money.
Whether you’re a nonprofit, a startup, or an SMB, money makes the world go ‘round. You can always use it for your event, program, or opportunity in some way, shape, or form.
Sponsorship Type #3 – Promotional Sponsorship
The third type of sponsorship is the promotional sponsor.
A promotional sponsor can get the word out about your company or organization in ways that you might have struggled with before.
More so, they can promote your event, program, or opportunity, amplifying its reach by announcing your event to a huge audience.
Some people refer to promotional sponsors as advertising sponsors, but I think that just barely scratches the surface.
You see, a promotional sponsor can offer you promotions of all kinds.
They can use their website–which surely generates healthy traffic from month to month–as a vehicle to get people interested in your event.
They can talk about you on social media to their huge audience of thousands or tens of thousands.
Yes, a promotional sponsor can advertise for you as well, be that online or offline.
Your business or organization can benefit in so many ways from working with a promotional sponsor.
You’ll notice an influx of traffic to your website and social media pages ahead of the event.
If you’re prepared for this and your site has opt-in forms and lead magnets ready to capture a lead’s contact information, then you could just end up with more ticket sales.
You’ll have more social media mentions, and more people may begin searching for you as well. With all the buzz your event is generating, that too can translate to an increase in sold tickets.
You’ll also strengthen your brand by working with a promotional sponsor.
Who Is It Best For?
If you feel like the little fish in the big pond, then a promotional sponsor could be exactly what you’re looking for.
As a nonprofit or startup, you only have a limited advertising and marketing budget. Your efforts thus far to get the word out about your event have not exactly delivered the results you were hoping for.
If you’re not selling enough tickets to your event to offset the costs, then you have a difficult question to answer.
Is your event even worth holding at that point? If you’ll lose more money than you’ll gain, then the answer may be no.
Rather than sink tens of thousands of dollars into marketing and advertising, you’re entrusting a promotional sponsor to do the bulk of the legwork when it comes to promoting you.
Of course, a promotional sponsor doesn’t come for free, as you still need to provide them with assets, activations, and audience data to make the deal worthwhile. I just want that to be clear.
Sponsorship Type #4 – Media Sponsorship
The fourth and final type of sponsor we’ll look at today is the media sponsor.
Now, I’m sure you’re wondering, what in the world is the difference between a media sponsor and a promotional sponsor?
The answer – quite a bit!
A media sponsor isn’t so much a sponsor in the traditional sense. They’re an employee of a media company who can help you out by getting your company or organization airtime ahead of your event.
They still do promotions for you, but the nature of those promotions varies.
A media sponsor can get you a radio or television spot, for instance, more so than they would post about you online on their social media page.
Can the services of a media sponsor and promotional sponsor sometimes intersect? Indeed, sometimes, that can happen.
Many of the aforementioned benefits of working with a promotional sponsor thus apply to working with a media sponsor as well.
Determining what kinds of solutions to offer to a media sponsor in the form of your assets and activations is admittedly tricky but never impossible. Don’t discount the value of the discovery session, after all!
Who Is It Best For?
A media sponsor is another great type of sponsor to work with if you continually have that feeling of being the little fish in the big pond.
Although finding a media sponsor isn’t necessarily easy, especially if you are at a startup level, the superstardom that you can quickly taste if you get the right kinds of promotions makes all your effort worth it.
Sponsorship is not all about cash sponsorship, as you can always seek in-kind, promotional, and media sponsorship as well.
My recommendation? Don’t limit yourself to one type of sponsor only. Try a combination and see how successful your future events are!
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Chris Baylis is the Founder and Editor-in-Chief of The Sponsorship Collective.
After spending several years in the field as a sponsorship professional and consultant, Chris now spends his time working with clients to help them understand their audiences, build activations that sponsors want, apply market values to their assets and build strategies that drive sales.
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