Sponsorship Pricing

I have successfully avoided blogging on the topic of sponsor pricing for years…until now.

The reason why I didn’t opine on the topic was because setting sponsorship price is an art, not a science. However, the right combination of hard numbers and marketplace awareness may put you in a good place.

A cost based model is flawed, but can provide a base to start. THERE IS NOT A FAILSAFE MODEL.

Begin by adding your direct and indirect costs of sales and delivery…plus profit margin.

Direct cost of sponsorship – signage, development of app, food or beverage underwriting

+

Marketing and sales costs – commission, promotion

+

Cost of delivery – staff cost for implementation meetings, servicing on-site

+

100% profit

These are fairly firm cost estimates help avoid revenue loss.

Now, consider “sponsor premiums,” or deductions. Here are a few to think about.

+/- 5% based on other sponsorships in your space – market comparison

+/- 5% based on previous sponsorship popularity

+/ 5% based on other alignment w sponsor business objectives

+/ 5% based on target market value to sponsors

+/ 5% based on unique offering – hottest speaker in industry or a lanyard?

+/ 5% based on program track record. Associations often believe the shiny new program is where “we’re going to charge what we should for a change.” The problem for sponsors is there is no track record of participation, attendance, competition for interest – all considerations for your prospective sponsor.

OK…lets go to work and get those offerings out the door!

For more discussions about sponsorships attend MoeryLAI’s Sponsorship Trends Luncheon, October 30th at our HQ. Call me for information at 202/955-1030.

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