Determining the value of your sponsorship inventory and defining your own sponsorship valuation formula is without a doubt the thing that strikes fear into the hearts of even the toughest sponsorship sales pro. I get more questions about this subject than any other topic on sponsorship.

This post is meant to outline the steps involved in the valuation process and I’ve also included an infographic to help you move through the steps like a sponsorship pro!

Here is a process, in order of priority, that will help you find your unique value:

Step One: Define your sponsorship properties

First things first, you need to know what you are selling sponsorship for!

Examples of sponsorship properties:

• A networking event (or series)
• Naming rights for a physical building or room (or on jerseys for major sports teams)
• Naming rights of a program (charitable programs, education programs)
• Galas
• Golf tournaments
• Races and “athon” events
• Concert series, a production in a theatre
• VIP events and donor recognition functions
• Skilled volunteer training events
• Fan appreciation days

Once you have identified your properties, then you can move on to assets which leads to your own sponsorship price list!

Step two: Define your assets

Using Excel or a big white board, bring together your entire team. Not just sponsorship salespeople, but those in other departments (marketing, programs, ticket sales, communications, volunteers and board members).

List each property on its own page or spreadsheet and start to define every single thing you can sell to a sponsor.

Here are few common assets:

• Naming rights
• Signage
• Product giveaways and samples
• Exhibiting opportunities
• Speaking opportunities
• Webpage
• Social media
• Newsletters and mailings
• Traditional media 

Step 3: Identify your audience segments

You have your properties and now you have your assets…but you can’t do a sponsorship valuation until you understand your audience.

Here are some examples of audience segments that don’t work and are very low value:

• All of Canada, the US or North America
• “Everyone should care about what we do” so they do (this is the first point in disguise)
• The “general public”
• Women aged 30-50
• Professionals
• People who enjoy XYZ activity
• People who care about XYZ activity

Here are some examples of good audience segments:

• 40 year old, high net worth moms, who live in suburban Chicago, with 2 or more kids who play baseball
• 55 year old, partner track, corporate lawyers, who are responsible for bringing in new business and making purchasing decisions for their law firm

Once you know your audience segments, you need to know their preferred brands and what purchases they intend to make. How do you do that? Simple! You ask them.

Step Four: Identify your values

The name of the game for sponsorship valuations is to ask yourself “where else can a sponsor get the same outcome?” If they were to go around us to target our audience. List every asset you have and ask yourself this question for each. Look to media, social media, events and ads that target the same audience for market rates.

Step Five: Find your brand value 

Brand value is the additional benefit that your sponsors receive by reaching your audience through your property as opposed to other forms of media & marketing.

Here is a simple way to calculate your brand value (followed by why you should care about this step).

Make a list of all of the things that your sponsors value in a partner, such as:

• How well you know your audience
• How loyal your audience is to your brand
• Your activation opportunities
• Direct sales opportunities
• Organizational capacity

Then you assign a percentage-based value to each of the things you offer, typically from 10% – 30%. For every one of the things that you offer, you get to add that to your values.

Step Six: Prospecting

Simply look at your audience data, the results from your sponsorship survey questions and look at all of the things they are likely to purchase. Then look to all other properties that cater to that audience and see who they are working with. You should have no trouble finding 100+ prospects in no time flat. Ask yourself which companies care about your audience and add them to the list as well. 

Now…reach out to those companies!

Putting it Into action

First, print this infographic and pin it up at your desk, then follow this process step by step without skipping steps! Each step in the process depends on the last.

Chris Baylis is an expert in sponsorship valuation and sponsorship strategy. Chris works with brands and properties to define their goals, determine market value of their assets and create strategies that work.

Chris is the President and CEO of The Sponsorship Collective, a board member of the Association of Fundraising Professionals.