How does corporate sponsorship work?

Written by angela stringfellow
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Corporate sponsorship can take many forms, but generally involves a company or organisation attaching its name to a charity, event, or other promotion in exchange for providing funds or paying a sponsorship fee. Corporate sponsorship is an effective means of advertising for many organisations, because it promotes goodwill. Companies are more likely to spend large amounts of money sponsoring highly publicised events due to the amount of publicity that can be generated and the opportunity to be affiliated with a good cause or popular event.

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Making the Contact

Typically a director of development from a charitable organisation initiates the contact. They begin by approaching marketing directors of different companies to solicit funding. Rather than solicit straight donations, the charity makes the offer sweeter for the company by offering sponsorship opportunities in exchange for monetary donations. The company is more likely to donate money to a charitable cause when they have the ability to gain publicity as a result.

Outlining the Terms

The specific terms of the agreement are then outlined in a written contract. For example, a company is sponsoring a charity golf tournament. The terms of the agreement state that the company's name and logo will be used on all marketing and promotional materials leading up to and on the day of the event. The company will be credited as the headline sponsor for the event in all radio and television advertising leading up to the event, and the company's logo will appear on event T-shirts.

Representation

The company making the donation typically becomes actively involved in the charity after the relationship has been established. For example, the president or other representative of the sponsoring company may sit on the board of directors for the charitable organisation, or a representative from the sponsoring company takes an active role in helping to plan and organise the charitable event. For events, it is very common for the sponsoring organisation to participate in the event itself. This is seen most frequently with charity walks to support a cause such as Alzheimer's disease. A company sponsoring this event will most likely form a team and participate on the day of the walk.

Ongoing Relationships

Often these agreements can lead to ongoing relationships, where a company pledges to donate an agreed upon sum of monetary support each year. In exchange, the company receives recognition of some sort, in the form of press releases announcing the sponsorship, an engraved plaque that hangs proudly on the wall of the office, and the ability of the company to announce in its marketing messages that it proudly supports the event or charity.

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