Sponsorship – Where to Start!

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There is No Such Thing as a Free Lunch!

Motorsport lore often holds that there was a time when companies would fall over themselves to give money to racing teams for no more than putting their logo on the car. If this was indeed ever the case, as you may well have already discovered this most certainly no longer holds true.

Finding sponsors is difficult, time consuming and frustrating. It will, however, be made (relatively) easier if you approach it in a professional manner.

Your potential sponsors, or partners as the modern ethos goes, will almost certainly be in business to make money. For them to give some of it to you so that you can have fun on the weekend you must provide a solid business grounding for the transaction. Simply put your proposal must add value to their own business model. This does not necessarily have to be financial in nature, but it must be tangible.

Who to Approach

Essentially any company in existence is a potential sponsor! With this said you will soon find that gaining engagement and progressing to an actual agreement is far from easy. You can save a lot of wasted time and effort by doing some homework first and approaching companies with whom there is a genuine chance of interest. You are going to have to sell your brand, and this can be a very hard task!

To begin with you must be realistic in your expectations, and tailor your strategy to match. If you are a club competitor it is highly unlikely that you are going to strike a multi million pound deal with a multi-national. Equally, if you are mounting an attack on Le Mans it is equally unlikely that Jones the Butcher on the high street will be in a position to capitalize your needs.

You should also be aware that any sponsorship deal may not actually involve the transfer of funds. If you are getting decals made for your car the vendor may be prepared to offer a reduced price or even a free service for incorporating his logo into the design (but DO NOT let them do this for free!) You should remember that everyone is a potential sponsor! Equally you may make a deal with your local auto factor to buy spares at a discounted rate. If it is reducing costs or increasing assets this is the same from a financial point of view to getting cash in the bank. Do not be blind to this fact when you are deciding what a potential sponsor can offer you!

Geography also plays a role. Again, if you are a club or regional competitor it is unlikely that you will find much success with a small business from the other end of the country, and even if you did it may not be cost effective should your deal involve travel there to do promotional work for your sponsor.

As mentioned earlier your strategy statements may help you to further winnow the field. If you are a family run team this may resonate with a family run business. If you are the up and coming young star then perhaps you should approach a company whose main customers are also young and vibrant, possibly selling goods such as computer games or skateboards.

You should spend some time doing research and come up with a list of around a dozen ‘targets’ who you believe offer the best chance of being seriously interested in your proposal. If none of these are successful move on to the next dozen and so on!

How to approach potential sponsors is a difficult question. You should aim to get your business plan and guide to sponsors to someone high enough in the organisation who is at least able to commence discussion and negotiations.

Emails are of course fast and easy, but are equally easy to delete. Hard copies in the post cost more and are equally easy to dispose of. If possible it will be best to visit the prospective partner with your paperwork to hand. If may be preferable to book an appointment, especially for a larger company rather than just turning up unannounced, although you may think this will work best for a very small local business.

A vital element of this first contact is that you will probably never get this opportunity again. The impression that you make, good or bad, will last way beyond the meeting. It is of prime importance that you come across as a credible entity or your submission will not get far. Make sure that you are ready! Dress appropriately. For a small local business, a team polo shirt and jeans may be acceptable. For a larger business you may need to put on more formal attire. It is a small price to pay for success!

Be prepared to discuss what your team is, what it wants to do and how it is going to do it. You have to sell your brand and show that there is a valid business case for supporting you in competition. Your strategy statements and budgets will help here. Have a sensible level of commitment in mind. If you ask for too much then the door will close quickly. Equally if you ask for too little it is difficult to then up the ante without losing credibility. It is a fine line to walk and you must tread carefully. Remember that everything you say reflects directly on your brand and team. To sell the deal you will also need to discuss critically what you can do for the sponsor….

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Adding Value to Your Team

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Running your team will require that you undertake a number of activities. These may be primary in nature such as actual competition, or support such as improving your car. One thing remains true in either case – every activity should add value to your team as collectively they will form your competitive advantage.

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The complexity of activity will obviously depend upon which level you are competing at and the resources that you have available.

The support activities are your bedrock. Technical development will include preparing your car. At club level this may mean an oil change and checking the tires. In Formula 1 a slightly different level of preparation and innovation may be appropriate! Human resource management involves having the right people doing the right things at the right time, again in relation to your team size. Team infrastructure brings together the technical management side of your team, which is what we are discussing today.

With these in place you can look at the more hands on Primary Activities which directly lead to your success. Marketing your team is the search for sponsorship. Providing service relates to keeping stakeholders such as sponsors and stewards happy, and then there is the rationale behind it all, putting your car on the grid and looking for the podium!

What all these elements have in common is that they build to your success, and each should add a potential advantage. You should strive to bring differentiation to your team. Look for something that stakeholders can perceive as unique that will encourage brand loyalty. To achieve this the product/services that you offer will have surpass their expectations in comparison to other teams.

All of which will take some time and effort, and perhaps just a little bit of help….

Digital Media – #Help or #Hindrance

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In the modern world if your website is your shop window, then social media is the street that people travel down past it. In marketing circles social media is regarded as the biggest innovation, biggest opportunity, least well understood and most dangerous phenomenon in the current market. It is believed that its use can make, or break, an enterprise in record time. What you cannot do is ignore it!

There are a plethora of available social media platforms, each having its own strengths, weaknesses and target audience. You should evaluate these carefully and decide which provide the best vehicle to get your message across. If you use social media yourself, perhaps you have a Facebook account, then this may be a good place to start, although you should start a new account for your team rather than use your personal one.

Beware! Having a bad social media presence may be worse than having none at all. Not being talked about is probably preferable to being discussed negatively! With this in mind it may be better to use one platform well, rather than half a dozen poorly. Once you start down the social media road you will have to keep your content current, which can take a surprising amount of time. As time goes on you can grow your social presence organically with your team and add further platforms as they become relevant.

The big dangers with social media (from a marketing stance) are ironically the same as its strengths. It is widely (perhaps universally) available and it is immediate. Twenty years ago, if Mr Jones bought your product and it was of poor quality then this was not a great concern as, unless he was a national journalist, Mr Jones had very little reach. He could raise his concerns with friends and family, but this was of little consequence for a major national or international advertising campaign. These days Mr Jones can immediately vent his displeasure in the digital world and possibly reach millions of potential customers. This is why managing your social media presence is so important, and that you have a strategy to do it well. If you ignore or are dismissive of his concerns then you do not care about customers. If you issue an overly contrite apology then you can be seen as weak or insincere. It can be a very fine line to walk.

The thing to remember is that every word that you write, or is written, about your team (and therefore your brand) is out there, and it is out there forever. Take your time and compose your posts carefully. Make sure that they reflect your teams brand values. For your team’s posts keep things professional. Don’t use texting slang (unless of course you are the hot new kid on the block and this is part of your branding!). Think about who the posts are aimed at. In personal posts you are talking to friends and family. In Team posts you are communicating with stakeholders with whom you may wish to do business. They are very different things!

Does Your Motorsport Team Need a Budget?

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In a word…. Absolutely!

Budgeting is vital to any enterprise, and it is likely that you already undertake this at some level, even if it is only on the back of an envelope!

What is certain is that careful budgeting can help structure your season. With this said your budgets will only be as good as the information that you put into them.

Taking some lessons from business, it is generally accepted that project management is based on three legs, namely budget, time, and quality. Equally it is also generally accepted that you can succeed with any two of these, but not all three. A case in point is Formula One. Here innovation and specification are the main driving force (quality), and generally these aspects will be required within days (time). Achieving these directly lead to the astronomical costs associated with this branch of motorsport (budget).

Cost overrun is one of the most common failings in projects. When looking at your season it is human nature to be as optimistic as possible – you want the season to go well. With this being the case it is also human nature to underestimate, or even totally ignore, the real cost of competition. Do NOT do it!

When compiling the budget for the season you should very candidly assess how much you can really afford to put into your team. Set your limit and unless there is a clear change of circumstances, such as a new sponsor, stick to it.

Having decided how much there is to spend you should also list ALL the expenses that you foresee for the year. Some of these are quite black and white such as club membership, race entrance fees and your competition license. It is the slightly greyer areas that can cause problems: travel costs, hotels, meals, it is very easy to overlook or understate these, but the net result of this could be catastrophic. In simple terms the more accurate your budgeting is the fewer headaches you will endure over the course of the year.

This may also help you to assess your goals… It may be that buying a better car seems like a wonderful plan, but this falls a bit flat if there is no money left to actually enter a race!

Do Clubmen Need Management?

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Okay… So, you compete in Motorsport at Club level. It’s a bit of fun at the weekend. You go out and do your best and of course you are in it to win it if you can. But you don’t actually need to manage your team. It’s too much effort. Or is it….?

Lets think about it logically. In your search for success, at whichever level, it is likely that you will find the time to prepare your car for competition. You may take some driver training at some point to improve your skills. You may coerce friends and family to help out, or at least come and support your efforts.

So, You have a training program, you have processes in place for your organisation and you have stakeholders, BUT you lack anything that links it all together in a coherent way. There is little doubt that this will affect your chances of success.

Even if you have never given management of your team a second thought you will, on some level, have engaged in it. You will have to have made decisions – which competition or events to enter, how much you can afford to spend on your sport and so on. With this being the case, why not take that little extra step and turn a corner in your season?

The benefits of actively managing your team are clear:

  • You will be able to set goals to reach what you consider success
  • This means that you will be able to set a strategy for your season
  • This means that you will be able to plan what you are going to do
  • This means that you will have preparation and finances in place so there are no nasty surprises
  • This means that you can go out and concentrate on the fun part of racing your car!

Think about other amateur sports. You would be surprised if your village football team didn’t have a Manager, a Committee and a Treasurer to keep it all ticking over. Why should Motorsport be any different?

Delving into the world of management does not have to be too onerous. You can take little steps towards leading your team well, but the time spent will pay dividends.

Remember that you do not have to be a professional to act professionally. If you take your management skills seriously and your competition do not then you already have a competitive advantage over them.

Who knows – Potential sponsors may be very impressed by this….!

Marketing Your Team as a Brand

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If you are part of a small motorsport team it may seem to be overkill to take time to consider how best to brand your endeavour. This, however, is very far from the case.

Any motorsport team has stakeholders and it is inevitable that at some point you will need something from someone to assist your season or brand. More often than not these stakeholders, be they the bank, sponsors or whomever, will be engaged in business. To be comfortable in dealing with you they will need to be assured that you will bring added value or return on their investment to their own organisation.

It is generally true that customers, irrespective if they are spending five pounds or five million, prefer a consistent, reliable and dependable brand to work with. Think of your own experience. Perhaps you always use a certain brand of Petrol. Perhaps you choose washing powder ‘A’ over washing powder ‘B’, even though it is more expensive as you believe it is a better product. This is branding at work and if you will look you will find that it exists everywhere.

To sum up: the more professional that you and you team appear to be then equally the more comfortable stakeholders will be to work with you!

What is your Team?

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If you look at the website or literature of any major company, you will quickly find four main statements that distil its very essence and strategy into words.

In managing your team, the first step that you should take is to step back and formulate similar statements to explain to your stakeholders exactly what your team is. You need to consider:

The Mission: Why does you team exist? What do you want to achieve?

The Vision: What does the future hold? What are your hopes and dreams for the team?

The Values: What does you team stand for? How does it act? What does it hold dear?

The Aims: How will you do it? This is at the strategic level and outlines your plans to achieve your mission and vision. Later there will be tactical goals set to outline the short-term plan for success.

On the face of it formulating these statements should be quite simple. All of these should be short and sweet, no longer than two or three sentences, but it can be surprisingly difficult to summarise your thoughts into so few words.

Committing these to paper may seem like overkill for a small racing team, but they are absolutely vital for managerial success. If nothing else it will lead you to consider in depth what you want to get out of your motorsport, however large or small these desires may be. On a more practical level it explains very clearly to stakeholders what your team is about. This may have many applications. When looking for sponsors it may be beneficial to start with those who have similar values and vision to your own which produces a natural affinity. Your team ethos may be ‘win at all costs’ or conversely ‘fair play’. In either case, or any shade of grey in-between, your values statement will tell drivers, mechanics or other members of the team what is, or is not acceptable. Equally they will be aware of what is the common goal, what are you going to do and how are you going to do it.

Perhaps the most vital aspect of these strategic statements is that they accurately reflect the team. They must be more than just words on a piece of paper, which is a major factor in the difficulty producing them well. Perhaps you can think of major companies who stated that they would act in a certain manner but did not live up to this expectation. Would you wish to be involved with or use the services of such an organisation?

As with many aspects of management self-reflection, brutal honesty and integrity will pay dividends!