What is Partnership Worth?
One of the tricky things in sponsorship selling is determining what the partnership is worth. Often times the fee is driven by some random gathering of operational budget line items the nonprofit wishes to recoup. Or the fee solely consists of expenses incurred in delivering the program or event. Another approach is to apply a standard/across-the-board formula.
There’s an art to understanding the tangible and intangible assets in determining partnership value. It is simply not a black and white calculation.
If you are able to assess the fair market value for standard marketing benefits based on frequency, timing and reach, that’s a great place to start. You can also gather web statistics, share media impressions and provide detailed demographics as supporting evidence for another piece of your partnership valuation efforts.
However, the true value of your partnership should be based on how well this particular partnership delivers the desired marketing benefits that support the corporate partners’ strategic business goals.
There are a number of anticipated outcomes corporations seek from a cause marketing partnership; often the goals are sales related, but not exclusively so. To foster success and deliver significant partnership value, be prepared to offer partnership activation touch points that can:
- Enhance exposure to a particular community
- Increase brand value
- Expand geographic reach
- Target new/desirable customers
- Generate buzz (with tweets, fans & friends)
- Offer accessibility to content
- Create differentiation from competition
While it is your responsibility to understand how a partnership can deliver a measurable return to the corporate partner, it may be helpful to engage a third-party resource with expertise in applying cause marketing industry standards to determine the overall partnership value.
A trusted resource will help you identify and better understand the true value of your tangible and intangible assets and build an attractive return for your corporate partner. Here are a few resources who offer a range of valuation services and advice:
- For Momentum — https://www.formomentum.com/Services.aspx
- IEG — http://www.sponsorship.com/Valuation-Services.aspx
- Power Sponsorship — http://blog.powersponsorship.com/
- SponsorPark — http://www.sponsorpark.com/blog/post/2010/10/19/Why-Sponsorship-Valuation-is-Like-a-Snowflake.aspx
Good luck!
