Sponsorship Brands: Hold Out, Don’t Drop-Out!
By Paula Beadle
At Caravel we are actively engaged in providing support and solutions to our clients, brand partners, and the event community as a whole. We are shoulder to shoulder with the properties we represent, a few which have been canceled. We are having long, hard conversations about potential contingency plans and we’re having the tough conversations with sponsors. My message to brand partners: please carefully consider the implications of asking for a refund, invoking the force majeure clause or ending a contract negotiation. There were solid reasons why you decided to partner with the events. Now, more than ever, both events and brands need to come together to be true partners to one another – and that extends beyond the event itself. Now is the time to hold out, double down, not drop out.
In what would have been its 34th year, SXSW’s annual cultural festival was among the first of a string of large-scale events to cancel due to COVID-19 concerns. Other events, from team sports to charity fundraisers, quickly followed suit, which left brands wondering what it meant for them. Brand marketers plan for how they work with events months (and even years) in advance, so cancellations can have a big impact on the success of their efforts.
In a recent blog post, “Five Strategies for Retaining Sponsors After an Event Has Been Cancelled,” Caravel shared advice for properties and events during times of uncertainty and event cancellations. This advice is also relevant for brands: First and foremost, put people and relationships first. Know what your contracts say and honor them. Work together to come up with solutions.
Here are some additional thoughts about what brands can do after a partner cancels an event:
Hold out, don’t drop out. Several brands dropped out of events immediately after learning about COVID-19, even before the cancellations were announced. Others waited to see what kind of impact the virus would have on the industry. Either way—whether you pull out or wait for an official cancellation—you and your event partner will be significantly impacted. In the long run, holding out is better for your brand than dropping out. You retain your rights and opportunity to align with a key audience, and you keep your good standing with the event or property. Keep in mind, most events rely heavily on your partnership investment, so carefully consider pulling your financial commitment and explore how the event could support you in other ways. We predict there will be a surge in people attending events in the future so consider protecting the investment you have made. Imagine the goodwill created by delivering on your financial commitment even if the event was forced to cancel.
Make lemonade from lemons. Most brands are working on how to redirect initiatives that were developed with specific events and timelines in mind and now they are shifting into problem-solving mode. We want to encourage you to focus on how you can work with event partners in other ways. Many are hosting virtual events and executing social media promotions. There has never been a better time to deliver meaningful content and build genuine connections online. Consider how you are going to respond when the recovery begins. You are in a position to take a leadership role in supporting community events that will bring people together to celebrate. From a social good perspective, your continued partnership with the event has the opportunity to promote a large amount of goodwill with your brand loyalists. As a sponsor who stays with the event, you could actually be saving an event that’s loved by the very consumers you work on connecting to.
Play the Long Game. Sponsorship is not a “one and done” marketing strategy. It’s about building relationships and cultivating lasting partnerships. As you think about invoking the force majeure clause, ending a final contract negotiation, or asking for a refund seriously consider the best option for your brand and the long-term implications of doing so. You may decide that immediate budget relief is your top priority, but don’t be shortsighted about how your decision may affect future marketing initiatives, your community support and your event partners. Most importantly consider that you partnered with the event because your audiences aligned. What is the message you send to the audience if you pull your support during a crisis? Consider what is the impact on the audience you worked hard to connect with? When events win, so do corporate partners. Sticking with your partners during the good and bad times will serve you well.
There is sunshine after the rain. As a Seattle-based company, we know all too well that the rain doesn’t last forever. We believe we’ll get through these tumultuous times. We hope the world will take the lessons learned from this experience and plan for a better future. We know that everyone will come together again, for listening and learning and experiencing all that life has to offer. And brands are sure to be there, enhancing experiences and adding value as we navigate the “new normal.” We’re betting the impact of events and experiences will be greater. The event industry is on-hold, it’s not done. Your partners and audience will remember your response to this crisis.
If you’re a brand navigating these challenges for the first time, or a seasoned pro, we’d love to hear how your approaching event cancellations. Drop us a line. As you continue to assess your current situation, determine the best course of action, make decisions for the future of your organization, and deliver information to your team and partners, the Caravel Marketing team is here to help. We’ll continue to provide resources as you navigate the ins and outs of sponsorship and business development and support you along the way.
About the author: Paula Beadle is the CEO of Caravel Marketing, a national consulting company specializing in sponsorship marketing, and the founder of Sponsorship Mastery, an annual summit and programming dedicated to improving individual and organizational sponsorship performance. She is a results-driven trailblazer with a proven record of developing smart strategies and creatively connecting the right partners. Paula has helped iconic events and major brands achieve their goals through innovative sponsorship initiatives, generating incremental revenue and successfully coaching thriving teams, executives and boards.