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Barter as Part of the Sponsorship Mix

by Sylvia Allen


Editor's note: This is the ninth article in a 10-part article series on SPONSORSHIP DEVELOPMENT, contributed by Sylvia Allen, President of Allen Consulting, Inc., Holmdel, NJ.


When considering sponsorship, the focus is on dollars - what can be generated and what value the sponsor will receive. Barter, however, is an important element in the sponsorship mix and a good way to offset expenses, particularly in the areas of promotion and media.

Years ago, neighbors bargained over backyard fences -- swapping quilts for homemade preserves, child care for slipcovers. Manhattan was part of a barter deal of land for beads. Today, barter is big business, with more than $1 billion in goods and services exchanged last year in North America alone. Barter can be an important element in your sponsorship mix.

According to Webster's dictionary, barter is "to trade (e.g., goods, services) without the exchange of money." In sponsorship, barter can be an effective way of offsetting bottom-line expenses and enhancing your event with value added elements. The first step in determining barter should be to look at your event budget, line by line, to see which elements are "barter-able." Two of the most common areas in barter are media and promotion. Here's how it works.

A barter relationship is approached like any other sponsorship agreement. The property sales representative approaches a potential sponsor with a benefits package (it's the same package they would present to a sponsor if looking for a cash commitment). Depending upon the level of sponsorship and the desired participation, the sale is negotiated like any other sponsorship except that no cash changes hands. For example, if doing a barter deal with a radio station, the station would receive all the sponsor benefits associated with their sponsorship level. Then, the value of that sponsorship would be paid in air time - radio spots. Now, as the event, you have not only offset the advertising expense in your budget, you have valuable media time that can be incorporated into your sponsorship packages.

In addition to bartering the tangibles - line items that are actual event expenses - you can also barter for intangibles, items that are "nice to have" and enhance your event but were not part of the initial budgeting process.

Barter dollars should be exchanged at retail. Don't ask your barter partner to "cut prices" or "sell it to me wholesale." Be prepared, as with any other sponsor, to demonstrate the retail value of your sponsorship package and how the benefits of your event have intrinsic value, whether the relationship is cash or barter.

Another good barter relationship can be with a supermarket or drug store chain. You can generate positive exposure for your event, the retailer's media and in-store marketing efforts, and you'll also have a retail outlet for other sponsorships. For example, if your sponsorship is with XYZ drug chain and you have a sponsorship opportunity with Polaroid, the retail relationship enhances your sponsorship package by giving Polaroid a retail outlet that is already involved with your event. The synergies of the event, the retailer and the individual brands enhance the sponsorship participation for everyone.

Keep in mind, too, that some sponsorships can be part barter and part cash. For example, some media partners are willing to give part cash with the balance in trade. Or vendors, such as tent suppliers and other on-site facilities providers, might be willing to barter for 20% of their total billing to the event. Food and beverage people are also viable barter partners.

Other elements to consider? Treat your barter partner as you would any other sponsor. Enter into a contractual relationship with sponsorship benefits and responsibilities clearly spelled out. Maintain the confidentiality of the sponsorship relationship and follow through on all promised benefits. Provide your barter sponsors with the same post-event analysis you would provide to cash sponsors. Demonstrate the value of their sponsorship participation in audience exposure and media impact. Acknowledge them in the same manner as sponsors. The reality is they have helped you either offset a line item expense or enhanced the value of your event with value-added products and/or services. In either case, the relationship has had value. And, you may want to have the same relationship again.

As more event organizers become experienced in barter arrangements, they will enjoy the positive results of these relationships, including decreased expenses and value-added products and services.

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About the Author:

Sylvia Allen offers a wealth of public relations, event marketing, and sponsorship experience to her clients.

She has published several books and is the author of HOW TO BE SUCCESSFUL AT SPONSORSHIP SALES, publishes The Sponsorship Newsletter, has just finished a 60 minute video on sponsorship, and lectures all over the country on sponsorship (IFEA, National Main Street, etc.) as well as teaching at New York University.

She has sold everything from $25 to $4,000,000 sponsorships; she can be reached at 732-946-2711 or at sylvia@allenconsulting.com



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