Nonprofit Sponsorships Build Trust and Customers
Research shows that companies that show heart also show a profit. There’s an emerging match-making industry for companies of all sizes to partner with pro-social issues.
It’s called Corporate Social Responsibility (CSR). Good corporate citizens are rewarded by an increasingly concerned public that chooses businesses with a conscience. According to the 19th Annual Global CEO survey, 64% of CEOs are increasing investment in CSR-related activities. These high-powered executives want to build trust with consumers, partners, governments and employees.
CSR typically focuses on:
- Environmentally-friendly practices
- Ethical labour practices
In addition to becoming a budgeted line item, CSR is quickly becoming a smart branding strategy — and not just for corporate behemoths. Local businesses are looking for partnerships that help them fulfil their promises to be more supportive of employee welfare, community development, sustainability, and basic human rights. Corporate leaders realize they need to conduct business above board if they expect to thrive in the long term.
A high-profile example of CSR is Microsoft. The company’ annual Employee Giving Campaign in which employees attend fundraising events for nonprofit organizations results in more than $1 billion in contribution to more than 31,000 companies since 1983.
How do corporate sponsorships work?
CSR is a business deal, not a donation.
There’s responsibility on both ends so that the nonprofit and business reap mutual benefits. This requires some consideration on both ends. Organizational cultures and identities become all -important in these kinds of partnerships because the relationship is built to be long-lasting (hopefully!).
It’s a good idea to formulate an exit plan should the relationship sour or interests change. In the world of athletic sponsorships, for instance, it’s not unheard of for companies to pull their endorsements amid headline-grabbing scandals. Think Tiger Woods and his sponsors with Gillette and Gatorade or Papa John’s Pizza and the NFL.
When it comes to people, there is always the possibility for controversy. Save the Children backed off support for a soda tax when Coca-Cola and Pepsi tempted them with multi-million dollar grants.
Susan G. Komen came under fire after they partnered with fried food giant KFC for a “Buckets for the Cure” campaign. Concerned fans and national media critics baulked at the sponsorship because obesity is a risk factor for breast cancer.
Corporate sponsorships allow your business to be on the receiving end of positive public relations — effective exposure to target your market audience. By giving back, you build trust in the community and earn recognition with a visible and compatible organization. Landing a plum partnership sets companies apart from competitors, humanizes the brand, develops roots in local communities and even attracts new talent.
Spell. It. Out.
There should be a specific plan in place that includes expectations, responsibilities, deliverables and deadlines. Your team should know exactly what you hope to accomplish and how you intend to do it through corporate sponsorships. If you’re planning to hold a fundraising event, be prepared to discuss demographics, attendance, and media coverage.
Here’s an example of an outline to spark partnership discussions:
- Where you agree: how you both want to make the world a better place
- What do you want?
- Donating percentages of sales
- Help pay for an event in return for signage or other exposure
- Logos or names featured in communications
- What both parties will be responsible for:
- Posting a video announcing our partnership
- Logo: We’ll place your logo prominently on each others’ home pages
- Description: We’ll feature a brief description of your organization.
- Link: We’ll link back to your organization’s homepage URL.
- Social Media: We’ll conduct a month-long campaign highlighting our partnership on Facebook, Instagram and Twitter.
- Email Marketing: Your information will be featured in one of our monthly email marketing campaigns. Your logo, a brief description of your organization and a link to your website will be the top story.
- When? How long will the partnership remain in force before being evaluated for mutual benefit?
- Specific Goals- How much, how many, how long, etc. Give percentages, deadlines, dollar amounts — as much detail as is appropriate for a business deal.
Remember Your Limits — What You WON’T Do in a Partnership
As a business, you’re most likely familiar with any boundaries set by tax liabilities. Make sure there’s no private benefit from any partnership, and understand the possible penalties for “Unrelated Business Income.”
Last, of all, enjoy the process of the relationship with your nonprofit stronger while becoming better citizens in the process!