7 elements of a sponsorship deal

April 29, 2014       The NonProfit Times      

Landing a sponsorship can look like a dream come true for many nonprofits, and there are organizations that have done extremely well because of sponsorships.

Regardless of mutual benefit, however, sponsorships are business deals, and they must be viewed as such from the very beginning.

Speaking during the Association of Fundraising Professionals (AFP) International Conference on Fundraising, Shaun G. Lynch of Adventum Philanthropic Marketing reminded nonprofit leaders that sponsorships must be negotiated as business deals. With that in mind, Lynch emphasized the key negotiating points of a sponsorship deal:

  • Don’t allow the sponsor to cap its commitment on a cause-related marketing tie-in.
  • Retain the right to use the sponsorship income as the organization sees fit.
  • Specify up front how in-kind payments will be valued. Remember that products and services cost the sponsor less than the price paid by customers. Avoid dollar-for-dollar evaluation.
  • Define sponsor categories narrowly. For example, instead of one financial services sponsor, seek a bank, a credit card, an investment advisor, an insurance company.
  • Control the mailing list.
  • Define costs the sponsor must bear.
  • Specify the sponsor’s fulfillment responsibilities. These could include supplying artwork on time and within specifications, delivering samples to the event, sending inserts to go into promotional packages, setting up tables or audiovisual equipment, staffing the sponsor’s booth.
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