Professional Associations in their search for Sponsorship Sterling 1st December, 2010

Sponsorship is growing rapidly in professional associations.  No matter the prime objective of the particular trade body, whether they represent shipping companies or small digital businesses, they all share in common the predicament of shrinking revenue streams from membership fees.

Professional associations used to be key in growing and developing brands.  However, with the ever present flow of information, documents, best practice guides, white papers, and social networks available for free, membership benefits are now less vital to business success.  This puts professional associations in a very difficult situation.  They have less revenue to provide membership value, and yet are faced with current members demanding more value from their membership.  An almost impossible task.

In the past, events tended to be the second main source of revenue for professional associations, with delegate tickets far exceeding the supplementary sponsorship income.  However, in a time where free events are occurring daily and webinars are streamed from around the globe directly into people’s homes, even this ‘secondary’ form of income is finding difficulty in meeting targets.

Furthermore, our current economic climate continues to add strain professional associations are already feeling.  Budgets are being scruitinised and marketing directors are prioritising gauranteed and tangible ROI before writing any marketing expenses.

As a result, professional associations have had to start finding new ways of providing value to their members, which is the reason we are finding an increasing number of sponsorship proposals and opportunities available.  Sponsorship has therefore become a key revenue stream for many professional associations, for it reaches both revenue and engagement objectives.

The changes have also greatly affected the Direct Marketing Association – Europe’s largest trade body in the marketing and communications sector.  Chris Combemale, executive director, claims that sponsorship is now crucial to the mission of the DMA.  He commented, “Through the additional revenue of sponsorship, we can expand the number of professional services we provide, as well as the number of insight and networking events we offer.  These activities are integral to our purpose of promoting the business interests of our members and driving the growth of the direct marketing industry.  Of course, through pairing our sponsor partners with suitably themed platforms we ensure maximum relevance and mutual benefit to their target market.”

Although these sponsorship proposals are on the rise with professional associations, there are nonetheless pros and cons to integrating the two successfully:

Pros

1. Value for the Professional Association: Sponsorship revenue amongst professional associations accounts for a large portion of total sponsorship revenue.  Whilst perhaps not as newsworthy as larger sporting events such as the World Cup, it significantly increases funding for many not-for-profit organisations, enabling them to continue to grow in the future.  Implementing a successful sponsorship department can thus help to create a sustainable organisation.
2. Value for Members: Sponsorship not only provides a new revenue stream, but it also provides values for your current members.  A basic key benefit to membership is the networking opportunities and brand awareness professional associations can provide.  Sponsorship goes beyond this basic benefit and provides engagement with the members through tangible touchpoints, enabled through sponsorship activation.  Providing sponsorship opportunities provides value to your members by helping them to reach their current marketing objectives.
3. Value for the Audience: Sponsors add significant value to the events and programmes that they support.  This is especially true with professional associations as they tend not to be as forward thinking as brand companies due to a lack of resource and funds.  By having a sponsor involved, the professional association has the ability to utilise some of the sponsor’s resources and create a more exciting event for the attendees.

Cons

1. Lack of Resource: Sponsorship is not just a sales pitch.  It requires strategic thinking in developing the programme as well as significant resource in account management.  Successful sponsorship only occurs when there is a partnership built between both the sponsor and the rights owner.  This can only be built through communication and a very solid understanding of the other’s objectives.  Typically, professional associations are under resourced.  This means that while sponsorship may be initiated, it is often unable for it to be sustained.  This can then create bad blood between the professional association and its members, a result of which may be that the rights owner is pressured to refund the sponsorship money in order to maintain goodwill.  In such a situation, it would appear the professional association would have been better off not partaking in the sponsorship deal in the first place.
2. Lack of Understanding by Members: For professionals outside the world of sponsorship, it can be very difficult to understand its benefits.  Particularly in a world where Marketing Directors are under pressure to deliver leads and guaranteed ROI.  Sponsorship can thus seem very intangible – in which case, even the best sponsorship proposal cannot compete against pay-per-click advertising.
3. Lack of Expertise: Sponsorship is complex, and needs to be strategically developed in order to work with all parties successfully.  Professional associations rarely have this experience in-house, making it difficult to manage and develop.  Fortunately, there are blogs, forums and websites dedicated to explaining sponsorship benefits, however none of these can surpass having sponsorship experience at hand.

Some key questions professional associations need to ask themselves before undertaking a significant sponsorship programme would be:

• Find out if sponsorship is right for you.   Do you have the resource and time to dedicate to developing this into your organisation?
• Understand your members and what they want – will members be upset if they are financially unable to take up some of these new sponsorship opportunities?
• Do you have an audience that is large or niche enough to build an asset from?
• Do you have in-house sponsorship experience or do you know of a sponsorship agency that can help?

Sponsorship is a fantastic way to bring additional value to professional associations, particularly in this current economic climate.  However, you need to be very careful in its implementation and development in order to create sponsorship that is sustainable, as well as successful.