Learning Center

Best practices for corporate sponsorship

Corporate sponsorship means your business supports some worthwhile entity or event in your community in exchange for promotion by the entity or event. Many businesses view corporate sponsorship as a form of charity – a way to be a responsible corporate citizen. That’s a big part of it, but corporate sponsorship is also an important and underutilized form of advertising. Today we’ll discuss how you can best use corporate sponsorship to your advantage.

What kinds of corporate sponsorship opportunities exist?

Virtually all non-profit organizations need corporate money in order to continue their work. Organizations that seek donations and sponsorships include but are not limited to:

  • Cultural organizations: Museums, historic preservation organizations, performing arts organizations of all types
  • Youth organizations: Sports leagues, Scouting, school organizations and the like
  • Civic organizations: Chambers of Commerce, community development organizations, beautification groups, civic booster groups or clubs
  • Social service organizations: Food banks, women’s shelters, organizations that serve the underprivileged, United Way

Corporate donations are generally acknowledged in annual reports etc., and are less of a promotional opportunity. By contrast, a corporate sponsorship implies that the sponsored organization is going to provide promotion to the sponsors in a tangible way. Some non-profit organizations are better-positioned to provide bona fide sponsorship opportunities than others for a variety of factors, including the type of work they do.

That said, non-profit organizations of all types often seek sponsors for events. Event sponsorships are often a good opportunity for your business to get positive exposure, because the event will be actively promoted by the organization and will attract an audience.

There are countless events you can sponsor, including but not limited to:

  • Performing arts presentations: Dance, theatre, symphony, concerts, touring productions of all kinds
  • Festivals: Street fairs, music festivals, food festivals, ethnicity festivals, outdoor recreation festivals, block parties, motorcycle rallies, film festivals, etc. Parades, classic car shows, antique fairs, community days and similar events also fall in this general category.
  • Holiday celebrations: community celebrations of July 4, New Year’s Eve, etc.
  • Fundraising events: Dinners, auctions, galas, dances, Hall of Fame inductions, charity sports events
  • Openings of museum exhibits: meet-and-greet with artists, grand openings of exhibits

What does my organization get for sponsoring?

What you get for your sponsorship varies widely, depending on what you’re sponsoring, and the dollar amount you commit.

You might receive:

  • A logo in a prominent place (at the event, on the league’s sports uniforms, on a display, at the entrance to the exhibit, on the stage, etc. etc.)
  • Acknowledgment on the website, in social media, in print ads (in the media or in a program distributed at the event), or in other collateral such as posters
  • Acknowledgment in press releases and other materials given to the media (this does not guarantee that the sponsor’s name will appear in the media, however)
  • Acknowledgment from the stage or the opportunity to emcee or say a few words on behalf of your company
  • Tickets to an event or exhibit you’re sponsoring, to be distributed to clients or employees; or discounted tickets
  • The ability to distribute collateral (in a booth, or in a goody bag) or at a manned or unmanned display at an event

It’s important to get your sponsorship deal in writing. The bigger the investment, the more important this is.

What should my business sponsor?

Good question. People have a tendency to sponsor whatever’s important to them personally – such as, say, their kids’ sports teams. There’s nothing wrong with that, but for larger investments in particular you should consider:

  • What is the sponsored entity? Educate yourself a little bit about who they are and what they do.
  • What is the audience for the sponsored event or organization? Consider all demographics – age, gender, socio-economic status. Larger organizations will be able to give you demographic information on who they reach. Does their audience line up with yours?
  • How big is the audience? How many people will attend the event/see the exhibit/be exposed to your sponsorship message? Where are they located?
  • How does the organization treat its sponsors/donors? A scroll through the website/social media should give you a pretty good idea. Do you like what you see?
  • What are the tax benefits for my business? Whether donations or sponsorships that support a non-profit are tax-deductible varies depending on the type of corporation your business is, and what you are provided in return (which determines whether it’s considered a business expense or a donation. Generally, a sponsorship where you receive promotional value is more likely to be considered a business expense). But tax laws are complicated, and you should consult with your accountant to see what, if any, tax benefits might be available to your business by sponsoring or donating. Be sure you know what kind of documentation must be provided for your sponsorship or donation to qualify, including if you are making an in-kind donation.

Creative forms of sponsorship: in-kind

In-kind sponsorship can be an opportunity worth exploring for many kinds of businesses. If your business offers a product or service needed by the organization you want to support, you might be able to arrange a situation where you become a sponsor by contributing in-kind. Depending on what your business does and what the sponsored entity or event needs, you might be able to provide:

  • Free or discounted professional services (this could be virtually anything — accounting, printing, design are a few that come to mind)
  • Free or discounted products (packaged or prepared food, beverages, supplies of any kind, use of rental equipment, hotel rooms)
  • Free or discounted media placement (such as billboard space, broadcast PSAs, print ads)

Is there an entity you’d like to support for whom you think an in-kind sponsorship would be a good match? In-kind sponsorships are often negotiated one-on-one, because they are a unique match between the sponsor and the sponsored entity’s needs. Does the sponsored entity have a need you can fulfill? Is there something the sponsored entity can offer that you’d like to have? Approach them with your idea!

Creative forms of sponsorship: co-op

In some industries, there are opportunities to leverage national sponsorship dollars to support local events. In other words, if a local distributor of a national brand wishes to sponsor a local event that makes sense for that brand, the local sponsor can sometimes invest a certain dollar figure in order to leverage national sponsorship funding, thus increasing the overall dollar amount provided to the sponsored entity.

Stay abreast of any such opportunities that might exist in your industry — you’ll get a bigger bang for your sponsorship dollars, while channeling more money into your community.

Creative forms of sponsorship: tax programs

This is not sponsorship, per se. But there are programs in the Commonwealth of Pennsylvania that encourage giving to certain types of organizations in lieu of tax liability. A couple of these include:

  • Educational Improvement Tax Credit Program (EITC): Through this program, eligible businesses can contribute to an approved scholarship organization, an educational improvement organization, or pre-K scholarship organization and receive tax credits equal of up to 75 percent of the contribution.
  • Neighborhood Assistance Program (NAP Tax): Through this program, non-profit organizations with projects that benefit low-income individuals receive contributions from for-profit companies. The companies receive a tax credit (exactly how much depends on the type of project the contribution will support).

What should I do after I sponsor something?

Your business should activate your sponsorship by taking full advantage of whatever opportunities the sponsorship might include, and promoting your involvement through every avenue available to you.

Many times, businesses sponsor something and then sit back and wait for the sponsored organization to do all the work. But to get the most out of it, you should activate your sponsorship by taking full advantage of whatever opportunities the sponsorship might include, and promoting your involvement through every avenue available to you. Here are some suggestions:

  • Be sure you provide the sponsored entity what they need to promote you. The sponsored entity cannot make you look good if you don’t help them.You will need to provide a logo, and maybe a program ad and so on. Many times logo banners are hung at events – it can be a good idea to have one made that you can use over and over.
  • Consider your message. If your sponsorship includes an ad, your ad should resonate with the sponsored entity’s audience. Maybe your ad should make it clear that you’re a sponsor, and if applicable point out your in-kind contribution. Your ad will likely be one of many – what would make yours stand out?
  • Consider giveaways. If you can do giveaways, you might get creative – branded helium balloons at a children’s event, maybe, or printed fans at a summer festival.
  • Label your in-kind contribution. If your business provides, say, rental equipment to the event, make sure you place a sign on the equipment that says so (magnetic or cling signs are easy and inexpensive to produce)! Or if you provided tableware or food for a special event, make sure there are tent cards on the table explaining where it came from.
  • Actively promote the sponsored entity and your involvement. You should promote that you’re being a good corporate citizen to your audience — while the sponsored entity is promoting you to their audience! You can, for example, make social media posts that say things like, “Prime Design Solutions is proud to support ORGANIZATION through the in-kind donation of a logo for their SPECIAL EVENT.” Use your e-newsletter, social media, blog and so on. This helps promote the sponsored entity or event while making you look good to anyone who sees the information.
  • Take full advantage of promotional opportunities afforded by the sponsorship. Make sure you take advantage of opportunities to distribute literature or information. Would it make sense to offer attendees a coupon, discount code for online shopping, or some other type of special deal?
  • Go to the event and network. Make full use of any comp tickets your sponsorship provides, and network with all the movers and shakers who are there. But if you’re not able to fill that table of 10 you bought, you should let the sponsored entity know how many will actually attend so they don’t pay for wasted meals — that extra money will increase their bottom line, and they can revise the seating chart accordingly. But again, it is much better to actually go to the event and network! If it’s a festival rather than a fundraising dinner or gala, can employees or staff volunteer, wearing company T-shirts or polos?
  • Make sure the sponsor is holding up their end of the deal. Watch to see that they provide everything they said they would.
  • Evaluate the sponsorship afterward. What did you get out of it? How did it go? Would you do that sponsorship again? What did you learn from it?