How sponsorships differ from philanthropy.
Philanthropy is an altruistic demonstration of support for the benefit and general welfare of society. It involves a transaction based upon intangibles like faith and trust and is grounded in the mission and values of charitably developed organizations and institutions.
Sponsorships are a form of marketing, which is the promotion of the exchange of goods and/or services for mutually agreed upon benefit. It involves a tangible reciprocal transaction between a buyer and seller or any of the involved parties.
Development is the underpinning of philanthropy
Development focuses on donors
Marketing focuses on money
Understanding Sponsorships
Sponsorship decisions are marketing decisions made from a standpoint of what is best for the business, not the charity. Helping the charity is "value-added" for the business. Business decisions to support a charity are based upon the strength of the organization's name identity and the size of the constituency and who is doing the asking.
Sponsorships are not philanthropic support; they are expenditures from a company's public affairs, marketing or public relations budget. Corporations may view this as a philanthropic gift. It is not. Often only a portion of the cost of sponsorship actually accrues to the not-for-profit organization.
Cause-Related marketing is another form of sponsorships that links the cause of a not-for-profit to the marketing approaches of a corporation. The practice connects charitable partners directly to corporate promotions designed to enhance brand identity and boost product sales.
Be clear about the role of special events as an aspect of your development program.
Special events create visibility for an organization and enhance its image -- they do not create donors. Individuals attending special events are essentially consumers, not donors. Post-event appeals by mail or phone are not generally productive, because few people who attend special events are really engaged with the sponsoring organization's mission and vision.
Clearly assess sponsorship opportunities.
Sponsorships offer an opportunity for a not-for-profit organization to partner with companies that have greater financial resources at their disposal and would not normally provide any purely charitable support.
These companies can offer a substantial source of revenue and increased marketing opportunity. This, in turn, enables your organization to spend less and to leverage its own resources.
When to seek sponsorships / when to seek philanthropy
1. Understand that the difference between philanthropy and sponsorships and be clear about what you are seeking and why.
2. Make sure your fund raising program has a balanced income mix of both charitable dollars and sponsorship.
3. Pursue sponsorships when you are certain your prospect won't make a gift for purely philanthropic reasons.
4. Do not sacrifice your mission integrity or brand identity for short-term gains or for less than they are worth.
Institutional marketing is not a product promotion. Mission integrity forms the basis for an organization's reputation and strengthens its fund raising case. Mission integrity commands contributions at a premium level without lavish promotion and extravagant discounting.
Analyze the True Cost of Sponsorships
Development is cost-effective when you evaluate the cumulative contributions of your organization's donors. Because fund raising is so labor intensive, most of the expenses are front-loaded, including the costs of identifying, researching, cultivating and soliciting.
With sponsorships, you usually have a one-shot relationship and then you have to incur these costs again. With donors, you incur these costs and then reap the investment in repeated support over a period of time. Another issue with sponsorships is that the public may believe your organization is reaping more in actual dollars than you actually end up with.
