SBJ/September 20 - 26, 2004/SBJ In Depth
Software touted to manage sponsorship flow
Published September 20, 2004
Brendan Kelly’s responsibilities as a national media specialist with Ace Hardware center on advertising, but he also coordinates event marketing for the 4,800-location retailer. Until a few years ago, when someone in the company asked what sponsorships were available, “I’d go diving to the bottom of my office floor, which is where they were usually stacked up,” Kelly said.
While the emphasis on value and return on investment in sponsorship marketing has increased to unprecedented levels, the industry is still coming to terms with one of its most elemental problems — the sheer volume of proposals that flood potential sponsors’ offices.
“We’re buried,” said Scott Russell, senior vice president at BBDO, Detroit, which handles Dodge as an ad client, along with many of the sponsorship proposals submitted to DaimlerChrysler. “It’s a heavy crush, and most of it isn’t tailored to our needs, so we also spend a lot of time getting the information we need to really analyze the opportunity.”
Every sizable company wants to respond to sponsorship proposals, even if it’s just to issue a polite “no.” Still, dealing with all those proposals means less time to leverage sponsorships and measure their effectiveness — which is what sponsorship marketers get paid to do.
A handful of companies are attempting to solve this dilemma. They sell software designed to streamline the proposal process. Sponsor Direct, Sponsorwise and Sponsorium all make software they claim will allow marketers to market more and shuffle paper less.
Ace Hardware’s Kelly has used Sponsorwise’s system about two years. “It’s kind of an electronic version of ‘talk to the hand,’” Kelly said, “but now I only have to look at one proposal a week and that’s been through a filter, so I know it’s something that will fit our needs.”
A survey of 100 sponsorship professionals by Montreal-based Sponsorium found that respondents spend an average of 576 hours a year dealing with unsolicited proposals — the vast majority of which will be declined.
“Typically, proposals come from a million places and inside they may be handled by the sponsorship or the advertising department, public relations or all of the above,” said Mark Rockefeller, founder/CEO of Sponsor Direct, of Tarrytown, N.Y. “We establish a consistent point of entry.”
Companies like Sponsor Direct, Sponsorwise and Sponsorium build sponsorship portals where the many and varied sponsorship requests can be directed. Aside from easing proposal overload, that means proposals can be routed to the appropriate brand group or region. By setting specific criteria on the Web site, proposals can be tailored to the potential sponsor’s needs before they reach a decision-maker.
Kraft Foods uses a portal on its Web site to cull through the many sponsorship pitches.
“Every sponsorship department is short on time, short on staff and short on ideas,” said Sponsorium founder Paul Pednault, whose clients include Bell Canada and The Home Depot. “We try to give them more of all three.”
Sponsorium’s Performind product, first introduced in 1997, offers an array of evaluation and tools useful during renewal negotiations and for everyday management of a sponsorship portfolio. As relatively younger companies, both Sponsorwise and Sponsor Direct (founded in 1999 as a partnership with IEG offering a Web-based property marketplace) offer some of these capabilities, but the vast majority of their business is from clients looking to streamline their proposal process.
All three companies claim their product will pay for itself within a year. Cost varies greatly depending on the size of the installation.
Sponsorwise, whose motto is “It’s About Time,” charges from $10,000 to $100,000 annually for its product, depending on the size of the installation. Sponsor Direct typically charges $20,000 to $50,000 in startup costs, with monthly maintenance fees of $2,500. Sponsorium is the low-cost provider — Pednault says his fees range from $270 to $820 a month.
The software can also be used to streamline other marketing programs. For example, Nestlé Waters of North America, an amalgamation of brands including Poland Springs, Deer Park, Ice Mountain, Arrowhead, Perrier and San Pellegrino, uses Sponsor Direct’s Sponsorport system to coordinate product placement and product donation requests, along with sponsorship proposals.
Convincing large companies to adopt new technology is never easy; it’s no different for these companies.
“We’ve had prospects tell us ‘I can’t do that because we’re too busy dealing with proposals,’” said Mike Munson, founder/CEO of Sponsorwise, a 4-year-old Fremont, Calif., firm that counts Verizon Wireless, Hyundai America and Kraft Foods among its clients. “I want to bang my head against the wall when I hear that.”
Another factor working against the adoption of sponsorship software is the vital role sports marketing agencies play in corporate sponsorship, especially when it comes to brands with extensive sponsorship portfolios. Most agencies naturally see sifting through and evaluating sponsorships as their domain.
“Agencies are naturally protective and many clients will do whatever their agency tells them,” said Pednault. “That’s the greatest obstacle we’ve had.”
“I don’t see much of a need,” said Wally Hayward, CEO of Relay Sports and Event Marketing in Chicago. “I just think it’s something an agency can do better.”
You’d expect anything that depersonalizes what is perhaps the ultimate who-you-know business is going to be met with resistance. If sponsorship software is to become a standard tool, the industry must be convinced that transitioning from paper to digital will be beneficial. For an industry long in search of a definitive metric, an industry standard of digital management might be the first step to a sponsorship version of Nielsen ratings.
“We’re not taking the human element out,” said Rockefeller, whose optimism is partially fueled by the fact that grant and proposal applications are now largely electronic. “We’re allowing greater efficiency, so humans can handle the parts of the process that really matter.”
For Ace Hardware’s Kelly, that efficiency was a welcome relief. “When I stopped seeing all those proposals clogging my mail, I knew it was worth the money,” he said.