Beating The Competition Through Profitable Sponsorship

When it comes to sponsoring sports teams, it’s all about ROI: Return on Investment. Put another way, what’s in it for me?

The marketing essence of sponsorships—-whether you put your money into race teams or the PTA bake sale—-is the endorsement value that the investment gives you. There is, hopefully, a halo effect in which the potential customer’s good feelings about the sponsored entity transfer to your shop or product as well. And if the customer admires and wants to emulate them, all the better. That’s why golf club manufacturers shower golf pros with free clubs, balls, and shoes. But is the halo effect enough?

“It’s essential to show the sponsor that you gave them value for their money,” according to Tony Thacker, VP of Marketing for So-Cal Speed Shop, which is headquartered in Pomona, California. “It’s very difficult to quantify the return on sponsoring somebody else’s race team effort,” he says, “unless you know that they’ve got the wherewithal to give you the return that you need.” So-Cal’s high-profile involvement with racing dates to 1946. Thacker points out putting a decal on the car is just the tip of the iceberg when it comes to giving value to the sponsor. “In our own race effort, we send regular reports out to all of our sponsors and we try real hard to get stories on the race car in different magazines. Typically, other people don’t do that. Professional racers do, but the typical people calling us don’t realize that that’s the more important part of the job."

A productive sponsorship will also generate publicity outside the track environment, with personal appearances, endorsements, and other news-worthy events. That’s what drives the maximum return on investment.

Here are some suggestions of things you can ask for when sponsoring a team:

1. Pictures of the team in action that you can use in your advertising.

2. A letter from the team thanking you for your support that you can post in your business, use in other advertising, and attach to proposals when you give them to potential customers.

3. Personal appearances by the team members—and their equipment—at your shop. You can promote the appearances with direct mail, email, or even newspaper ads as events where fans can “meet the pros” while they inspect your business.

4. Distribution of frequent press releases—identifying your shop as a team sponsor—on event results and team developments.

All of these things will help the team, too. Remember, sports teams depend on fans just like a business depends on customers. The more fans the team attracts, the greater the value of the sponsorships it sells.

Dave Donelson distills the experiences of hundreds of entrepreneurs into practical advice for small business owners and managers in the Dynamic Manager's Guides, a series of how-to books about marketing and advertising, sales techniques, hiring, firing, and motivating personnel, financial management, and business strategy.