Beyond sponsorship: A better approach to corporate funding for nonprofits.
Nonprofit Management and Leadership May 18, 2017 By Ed Lord
Editor's Note: Ed's article on sponsorship has been hugely successly, so we've revised it and updated it. We also recently asked Ed what his best advice is for organizations looking to turn their corporate sponsors into more valuable corporate partners.
When an organization lands a meeting with a potential corporate sponsor, they often throw that opportunity away. Here’s what I mean: If you walk into a company and sheepishly ask them to sponsor your walk, there's a good chance you’ll be told that they already sponsor a walk. Meeting over.
Though you’re asking for a large donation in the form of a sponsorship, you’re actually thinking very small when you consider all the dollars a company has available. In the example above, it’s obvious that the organization walked away with no money, but worse: they walked out with no relationship. Traditionally organizations use that first meeting to sell their needs. That’s a little like going into a job interview and only talking about what the company can do for you. The opposite has to happen: Tell the company what your nonprofit can do for them. Tell them what marketing opportunities you bring to the table, how you’ll advertise their gift, how many consumers you touch and how aligning with your organization positions them as a good corporate citizen. These will really catch their attention.
"Companies aren’t looking to sponsor events, they're looking for marketing opportunities."
Your cause is worth a larger investment.
The revenue opportunities in a partnership between your organization and their company isn’t limited to asking for a bigger sponsorship. We typically think in terms of corporate philanthropy and sponsoring your event, but these can be the smallest part of a company’s giving power. There’s also:
- Cause marketing This isn’t a charitable contribution, but a marketing program from the company that your organization is the highlight of and beneficiary of. A good example is all the products you see with a pink ribbon. Your nonprofit gains awareness and a percentage of sales. The company typically attracts new customers that want to support your cause.
- Matching gifts These are especially lucrative when you have a large number of advocates for your cause on a company’s payroll.
- Non-cash gifts A company can provide needed expertise or products to further the mission of your nonprofit.
- Workplace giving With payroll giving programs you may have the opportunity to present your mission face to face with every person in a company. While $2 or $5 monthly from an individual may not seem like much, it really adds up if half the staff is giving. If the corporation already has a giving program with another organization, ask them to consider your organization as an alternative nonprofit to give to.
- Customer giving Businesses with retail locations present new opportunities to get their customers involved in giving to your organization at their cash registers. Children’s Miracle Network Hospitals’ Balloons that you may have seen at Walmart or Sam’s Club are a good example. These programs can be a big win for the company, since they look like a great corporate citizen, but haven’t had to invest money: All the donations come from their customers.
- Volunteerism Generally an alliance with a company means they’ll supply you with teams and participants who will fundraise for events, day-of-event volunteers, executive volunteers for boards or committees and program volunteers. If the company does the recruitment, you get back some precious staff hours that you can apply elsewhere.
What's good for business.
Companies aren’t looking to sponsor events, they’re looking for marketing opportunities. What they need are vehicles to market their programs, services and products. Whenever you go in to talk to a corporation you should be prepared to tell them what they get out of the deal. Always remember that they’re not involved out of the goodness of their heart. They’re sponsoring you because they want a marketing opportunity. They’re investing in your organization and expect a return on that investment. As a nonprofit, you have to ask yourself: How can we help them do that by aligning our organization with their business?
A solid plan for building a corporate relationship.
Proposing a partnership is not that much more work than proposing a series of sponsorships, but can generate a lot more dollars for your organization. I’ve divided up this plan into four sections:
A) Choose your partners.
B) Land the deal.
C) Grow the relationship.
D) Perpetuate the relationship.
A) Choose your partners.
This is an important part of the process that shouldn’t be overlooked, especially if you have a company that approaches you first.
- Target your partners Carefully research corporate candidates. The About page on their site can give you insight into what their leadership believes in. Connecting with their executives on LinkedIn will help you learn their personal causes and find out who might have the most sympathetic ear.
- Careful who you get into bed with It’s vital that you ally with a company that’s genuinely aligned with your mission. For instance, a company with a lousy environmental record may want to marry into an environmental cause for some good PR. But if they’re in the news for new environmental violations, your organization could get dragged down with them. Seek out corporate partners that you’re on the same page with.
- Match your supporters with their customers Aligning demographics can show who’s a great fit. Say you have an event where the majority of your participants are women 25-45 and you go and look at a grocery store chain with customers who are women 25-45. That’s a great match. They benefit from meeting your supporters and you benefit from meeting their customers. When you align precisely, you may land a bigger partner than you think you can get.
B) Land the deal.
When you’ve found the company you’d most like to partner with, don’t be afraid to invest your time in getting them. Ultimately it will pay off.
- Rally existing employee support If you already have people within a company who support your organization, you have a foot in the door. Use those existing relationships to show management you're a good fit. Executives may be surprised to find that 20 of their employees are already participating in your walk as a corporate team.
- Talk big A simple sponsorship is a drop in the bucket. Corporations have a lot more dollars available when they find the right organization to partner with. What you should do when you come to the table is talk about your whole organization, not just your event. That gives you a better chance to interact with a corporation and find something they want to be part of.
- Discover their needs Really take some time to listen and hear what they’re looking for from you. It may not be what you expect. You should talk to a corporation and ask what’s the best way that you can reward them for helping you. I’ve gone into corporations and found sometimes the reason they want to sponsor an event is internal marketing. They want something their employees can be proud of and get involved in. Maybe they don’t want to be called on stage and speak about their corporation’s participation at your event. It could be that they want you to come in for an employee meeting and give an award to staff or to the company there.
- Meet with Marketing While there may be an executive charged with corporate giving, they’re not necessarily your best bet for starting the relationship. The Marketing department usually has discretion over the dollars they spend and can just as easily apply that money to your organization as buying TV spots for their product. It’s a very different and bigger pie than the company’s budget for corporate giving. This pie is typically 5-10% of a company’s annual revenue, so if you can figure a way to get a slice, it could be huge for your organization. As a bonus, the Marketing department can generate more awareness for your organization than you ever thought possible.
- Invite management to your event It may seem like a small thing, but it can give companies proof that their staff is already involved and that your supporters are their potential customers.
C) Grow the relationship.
The corporate relationship is not at all like the write-us-a-check-see-you-next-year sponsorship. It has to be a growing commitment on your part to involve the company more on their part.
- Dig deeper Many corporations are comprised of divisions. Rather than treat them as one corporation you could market to each division and get the divisions to compete against each other. That's going to improve your fundraising as well.
- Train a liaison At the American Cancer Society, we would also train someone within the corporation to act on our behalf as an employee point-of-contact on a day-to-day basis. This person gives your organization a daily visible presence, a volunteer coordinator, a participant cheerleader, a liaison for employees to obtain needed services from your organization and an ear to the ground inside the company. It’s like you’re getting a free employee there.
- Give meetings you both benefit from Don’t use meetings as only sales opportunities. You’ll bore management and find they won’t want to meet anymore. Make meetings an opportunity to deepen the relationship. Invite new faces on both sides (when appropriate) so everyone gets to know everyone. On your agenda, ask for new ideas on how you can help them. The real goal for any meeting should be to continue the conversation.
- Provide services It's not always applicable, but providing your services to their employees gives their staff first-hand experience with what your organization does. At American Cancer Society we offered wellness programs to sponsoring companies. A free service like this is a nice extra when it's something a company might pay for otherwise.
D) Perpetuate the relationship.
The goal with any corporate relationship is to keep it going as long as both sides are seeing a benefit. Perpetuating is not just about showing that benefit, but also about them feeling that benefit.
- Take care of their employees I was in charge of a major Making Strides Against Cancer event when I was with the American Cancer Society and we had a bank as corporate sponsor. The problem was that they wanted to sponsor our event one year and sponsor another event alternate years. That wreaked havoc with our budget. We really took care of their employees, so when they told us they’d skip us the next year, I said fine, but would you survey your employees and see what they want to do? And because we did such a great job with their employees we were overwhelmingly the choice. So they started sponsoring our event every year.
- Become part of the woodwork At the bank that switched to us every year, we used to take a team photo for them. They had about 300 people on staff helping us out every year. We hired a photographer, lined them up and took a photo of them in the lobby of the bank’s corporate headquarters. If you have 11 pictures in a row in that lobby, chances are you’re going to get the 12th.
- Report results Regularly show the corporation the impact their investment has. Instead of presenting the dollar totals, present them with impact amounts: Their support this year improved the lives of 150 babies with the 10 incubators they funded in the local NICU. Highlighting a company’s overall investment in this way gives concrete results that every employee can state with pride.
- Show results in human terms Present a video or bring someone your cause helps to a meeting. Personal and heartfelt thanks can really make the whole company feel good about what they’re doing.
- Recognize your corporate partners Support from a company is more likely to continue if they feel they’re getting more than they bargained for. Involve them in your media opportunities, mention them at board meetings, make them stars at your events and put their logo everywhere yours is on event materials. You can generate an overwhelming amount of affection by asking your staff and supporters to thank the company over social channels like Facebook, Twitter and LinkedIn. The corporation is looking for public recognition, so when you overdeliver on these things, it goes a long way in building a long lasting relationship and costs you only a little extra time.
- Create Giving Levels Extraordinary and long-term support needs to be recognized for all it brings to your organization. Award levels that recognize your support base on overall corporate giving, whether it is from the corporation itself, its employees or customers are one way to distinguish their commitment. These are especially useful when you have numerous corporate sponsors. A good way to break it up is to make them a member of distinguished groups. Examples are: Corporate Circle (if they give $250,000 in a year), Corporate Partner (if they give $1 million in a year) and Hall of Fame (if they give $5 million total over the years). These achievements stimulate giving by creating targets for them to hit and maintain. Also create a badge that shows their club membership that they can put on their site and advertising.
To understand the value of the relationship versus a sponsorship, let’s look at real dollars: I could have gone to that bank I mentioned earlier, received a $20,000 sponsorship and been fine with it. But we got their employees involved and the employees raised over $250,000 for us. You should go in and talk about everything your organization is doing and not just ask for a check. When you genuinely partner with a corporation, they can play a much larger role in your revenue stream.
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