New York City is a lot of things, but inexpensive is not one of them.
That left the National Speakers Association, which is holding its 2008 annual convention in the Big Apple, in a bit of a bind. “You don't want to do less of a meeting because you can't afford it,” says Stacy Tetschner, executive vice president of Tempe, Ariz.-based NSA. But, he adds, you also don't want to let the added expense cut into profits. The answer: Find new ways to generate revenue, which NSA did by adopting an annual sponsorship model that has resulted in a significant boost in revenues.
NSA's situation is not unusual these days. A lot of planners are looking for — and finding — ways to offset higher expenses with additional revenue sources. According to the Chicago-based sponsorship consultancy IEG Advisory Services' “IEG Sponsorship Report,” association sponsorship will jump 4.6 percent in 2008, which translates to $482 million more sponsorship dollars going into association coffers this year. While associations still get only a 3 percent slice of the overall sponsorship pie — the vast majority of those dollars goes to sports — sponsorship spending on associations has increased 85 percent since 2002. It's outpaced overall sponsorship spending, which has increased 72 percent in the past six years, says IEG senior VP Emily Rogers.
Here are 10 creative strategies planners such as Tetschner are using to rev up their revenues.
Provide Year-Round Packages
Rogers attributes much of the growth in association sponsorships to associations providing year-round opportunities, in addition to the more traditional types of event sponsorships.
For its meeting in New York, NSA switched from selling sponsorships for individual meeting expenses — lunches, cocktail parties, lanyards, bags, etc. — to selling annual sponsorship packages that offer varying degrees of exposure at all NSA meetings held that year. NSA also added a single title sponsor, which is the most expensive but provides the greatest exposure as the title sponsor's name is branded alongside NSA on all promotional materials and at all events throughout the year. The title sponsorship provided NSA with about $40,000 that they didn't have the previous year. While they still sell some one-off sponsorships, the annual packages are now driving the majority of NSA's revenues.
Rogers says that associations don't have to limit sponsorship options to events. “You automatically drive more value for sponsors when you look at all the assets an association has to offer a company to engage them on a higher level.”
Steven Hacker, CAE, president and CEO, International Association of Exhibitions and Events, Dallas, adds, “The key to success is putting together a total plan that in every way supports sponsors' objectives. Sit down with them at the beginning of each year, assess what their plans are for the year, and create a package of opportunities.”
The package might include multiple elements of exposure, such as exhibiting, sponsoring a cocktail party, sponsoring a webinar or a local educational forum, advertising in a magazine, or sponsoring other meeting activities. By customizing it to fit their needs, sponsors get more value and more chances to reach customers. In turn, sponsors are willing to pay more for the added value. It's working for IAEE, which has doubled its revenue since making the switch to integrated annual sponsorships two years ago.
Rogers adds that associations should be sure to really understand the value of what they have to offer to their corporate partners. Many organizations, she says, “are leaving money on the table and selling packages for less than their fair market value.”
By finding new ways to bundle their assets to reward partners who spend the most with them, the Golf Course Superintendents Association of America, Lawrence, Kan., is projecting that its revenues will be up $1 million this year. ASAE and The Center for Association Leadership cut its number of sponsors by 85 percent and increased its revenues by 100 percent within a year of adopting the integrated strategy, says Rogers. By moving from the traditional model to long-term strategic partnerships, the Professional Convention Management Association, another IEG client, has tripled its income. (For more on this sponsorship model, go to meetingsnet.com and search for “integrated sponsorship.”)
Create More Sponsorship Opportunities
One of ASAE and The Center's main concerns when changing its sponsorship model was its 200 or so $5,000 to $10,000 sponsors for which the $50,000 to $350,000 integrated packages would be out of reach, says Rogers. While ASAE reserved the most valuable opportunities for the big sponsors, they created value-add advertising, exhibits, and hospitality items for the smaller spenders.
For those who don't want to make the switch, or who just want to increase those traditional options, check out what the American Academy of Ophthalmology has done. Eight years ago, San Francisco-based AAO relied mostly on a handful of companies that sponsored the entire event. But when Debra Rosencrance, CAE, CMP, was hired as vice president, meeting and exhibits, she found new sponsorship opportunities and increased revenues five-fold to $1.5 million.
Sure, they offer the typical sponsorships — bags, lanyards, pens, pads, lunches, cocktail parties, etc. — but what about offering companies the opportunity to advertise their logos on the sides of the escalators in the convention center lobby? The ideas that don't work out, they discontinue — but they are always on the lookout for the next great idea. (See sidebar on the opposite page for some ideas.)
Washington, D.C.-based National Association of Broadcasters is also aggressive when it comes to creating sponsorships for its annual meeting, says Chris Brown, executive vice president, convention and business operations, NAB. While NAB uses sponsorships just to cover costs for necessary functions — like meals, keynote speakers, and entertainment, which tend to be expensive — they also have sponsorships or advertising opportunities that exist specifically to generate revenue. Things like banners and three-sided standing signs in the lobby are profitable because they don't cost much to produce. In terms of sponsorships, cocktail parties can provide higher profit margins than meal or entertainment functions.
Rent Out Meeting Rooms
One of the highest profit margins for NAB comes from leasing meeting space at the annual meeting to exhibitors, who use the rooms to close deals, meet clients privately, and provide more in-depth product demonstrations than attendees could get at the booth. “We do very well on the rooms because we're paying a per-square-foot rate to the hall, which is generally pretty good,” says Brown.
These are always sold out, Brown says, adding, “We saw the demand for those grow and grow, and in certain cases, we've even allowed nonexhibiting companies who feel that a straight-up exhibit presence isn't appropriate for them to reserve a block of meeting rooms.”
Demand is so high that they have started to build makeshift rooms in the hall to rent out. For the private rooms they build, profit margins aren't as high because of the costs associated with constructing the temporary spaces.
For its 2008 annual meeting, the American Pharmacists Association, Washington, D.C., is rolling out a new feature to boost revenue and exposure for exhibitors: exhibit theaters. They will set up five separate stages in the exhibit hall, each with a microphone, podium, the necessary audiovisual equipment, and room for about 100 chairs. Exhibitors who buy them stage hour-long product demonstrations. The five theater sponsorships sold out in two days, netting about $30,000, says Windy Christner, APhA's director, meetings and expositions. “We may expand it next year,” says Christner. “If the chairs are filled, we've got something we can continue, but if three people show up, then we'll have to consider that next year.”
Meeting Within a Meeting
A trend that David Weil, senior director, conventions and trade shows at SmithBucklin, a Chicago-based AMC, is seeing among clients is the “conferences within a conference,” which are stand-alone meetings within the annual meeting for a certain segment of the population. The association can get sponsorship for the event because companies are keen to reach a targeted audience; and participants can be charged an additional fee.
The International Carwash Association, a SmithBucklin client based in Chicago, holds a half-day new-investor seminar for those looking to get into the business. Other clients have executive forums within their meeting, which provide opportunities for C-level executives to network and learn.
Lounges, Displays, and Press Conferences
Association planners can create lounges for certain membership groups and get sponsorship. IAEE has three lounges: a “Summit Lounge,” created for attendees who are longtime members and regular meeting-goers; a “C Club,” for chief executives; and the CEM lounge for those who have earned the Certified Exhibit Manager designation. All are very popular with sponsors who want access to targeted, high-profile segments of the membership, says Hacker.
Also, to help draw attention to the exhibit floor and generate additional revenue, the National Association of Realtors has a new product showcase outside the exhibit floor in the main lobby, so attendees can see what's new before heading to the expo floor.
Another idea is to allow sponsors to hold a press conference at the meeting. IAEE did it this year with one of its sponsors, SMG, which announced that it won ato market a convention center in Beijing. In this case, there was no dollar exchange because it was part of SMG's sponsorship package, but in other cases, a separate fee could be charged, says Hacker. The press event not only generates revenue but also creates buzz and raises the profile of the association.
You also can open up a new revenue stream by creating a virtualto supplement your live event; or a stand-alone virtual event.
The Specialty Graphic Imaging Association, Fairfax, Va., makes about $250,000 on its virtual trade show each year. It launched the online show in 2001 after its annual meeting was canceled because of the September 11 terrorist attacks. It was initially done as a service to exhibitors, who rely on the annual meeting to promote their products, but it was successful enough that SGIA decided to make it an annual event, says Michael Robertson, president and CEO, SGIA.
At first, exhibiting in the online event was optional, with a fee assessed for participation. But when 95 percent of the live-event exhibitors also signed up for the virtual event, SGIA officials decided to combine the two into one package and charge a higher rate. The additional fee generated by the virtual show results in about $250,000 of revenue annually, says Robertson. The number of exhibitors climbed from 400 in 2002 to 600 currently.
The Boston-based Real Estate Cyberspace Society's National Real Estate CyberSpace Convention, held every February, offers “a place to see new products, hear stimulating speakers, and network,” states Jack Peckham, president of the society.
Like the bricks-and-mortar variety, the online event features speakers (33 this year), booths (more than 200), and networking areas (a message board). Each booth has product information and video and audio features. And by clicking a button and inputting a phone number, attendees can talk to booth personnel, who will immediately contact them.
The society has put more than $1 million into developing the weeklong event, which attracts about 40,000 visitors. Now that it is developed, it's basically all profit with little maintenance overhead, says Peckham.
The society is also licensing the model to regional real estate societies, a division of the National Association of Realtors, and other associations outside of the industry. It is pursuing licensing agreements that will allow associations to use its model as a stand-alone event or in conjunction with a live event.
Sell Meeting Content
To provide an overview of what it takes to make it as a professional, NSA last year developed a seminar about public speaking essentials, charging a fee to attend. From that seminar, they took the recorded information, edited it, and transcribed it into a workbook and audio package. “The whole idea was to come up with something that we could sell that extended way beyond the meeting,” says Tetschner.
The revenue generated by the live meeting paid for the recording and production of a package that includes four CDs of recorded instruction and a workbook. The packages are sold to anyone who calls the NSA office looking for information on the profession, which numbers between 60 and 80 calls a month. In the first year, they've already sold about 400 units for a nifty profit.
In addition, they also record and sell sessions from each year's annual meeting, giving a percentage of profits to the company that records the sessions. They also let presenters sell their books at the annual meeting bookstore, provided the speakers bring them and take away any that are unsold. As part of the deal, NSA gets 25 percent of revenue from each book sold.
New Meetings in New Markets
Overseas markets are the next frontier for U.S. associations, where new meetings in largely untapped and developing regions have the potential to become major revenue sources. But associations need to plan carefully before going. “As with the launch of any business, I don't think you plan to make a net profit in your first two or three years because of the investment required,” says Karen Malone, vice president, meeting services, Healthcare Information and Management Systems Society, who knows something about going global.
Two years ago, Chicago-based HIMSS launched a Europe/Middle East/Africa meeting and last year added another in the Asia-Pacific region. Both meetings have exceeded expectations, but have not yet broken even. But in the long term they are expected to be solid revenue generators for the association, possibly as soon as year three. If the meetings weren't filling local needs, growing, and generating revenues, HIMSS wouldn't have launched overseas in the first place, Malone says. She advises any association executive contemplating an international meeting to look at the demand in the region, the competition, the strength of the industry, and whether the resources are available to launch and maintain the meeting.
HIMSS is also exploring another revenue-generating option: selling educational content to government agencies in other countries. Several ministries of health from various countries became familiar with HIMSS's content and educational package when their local delegates attended HIMSS's annual meeting. These ministries now are discussing the idea of acquiring educational content from the association. The local ministries would then use the content to train local healthcare workers. Malone adds that HIMSS is creating a model that includes some programming the ministries will be able to support. “We think there's some opportunity there,” says Malone
Sponsoring educational content is a touchy subject, but there are some tracks or programs that are appropriate for sponsorship. The National Association of Realtors gets sponsors for its Technology Learning Center, a track that runs throughout the course of the four-day annual meeting where participants get hands-on technology training on the latest products.
NAR also gets sponsorships for an “entrepreneurial excellence series,” where high-profile business and motivational speakers talk about aspects of running a business. The speakers then sign books in the sponsors' booth, providing additional exposure for the sponsors, according to Sue Gourley, vice president of conventions, NAR.
But planners must walk a fine line when seeking sponsorship for educational content, explains Gourley. “We're very careful about differentiating between education that is pure and content that is sponsored,” she says. Associations don't want to be in a position where they lose control over educational content.
Here are 34 sponsorship and advertising ideas, culled from planners. As one planner joked: “If we can get a logo on it, we offer it.”
- Message centers/computer stations
- WiFi lounge/cafe
- Banners at the airport baggage claim
- Lobby banners/signs
- Street banners
- Building banners
- 3-D signs
- Standing signs
- Escalator/stairway decals and logos
- Water stations/logos on water bottles
- Coffee stations
- Room key cards
- City maps
- “You are here” convention center maps
- Relaxation station
- International lounge
- Shuttle buses
- Seat headrests
- Advertising in conference programs
- Sponsoring conference programs (hard copy and electronic) and audio CDs
- Room drops
- Selling ads on closed-circuit television channels in the convention center or hotel rooms
- Registration desk
- Information counters
- Business centers
- Logo pillows
- Screens at registration kiosks, and room monitors in breakout sessions
- Any USB items that contain show materials
- Floor and carpet logos
- Coffee cup wraps
- Sections of online community dedicated to the conference
- Shoeshine lounge