Funds for and revenue from events come in different forms – sponsorships, charitable contributions, corporate philanthropy, ticket sales, etc. it is therefore, essential for both the event organizers and the fund providers to understand their objectives to be achieved through the event.
The event organizers should know which corporate form of funding they are looking at. A proposal for sponsorship relationship is very different from a request for a donation. Similarly, corporate too should be very clear in what way to relate to the event. This is so because of the widely differing goals of the welfare division and the product I brand management group.
If such a confusion regarding differences between charity and sponsorship is allowed to occur, then the biggest loss that could happen to the corporate would be the loss of opportunity for leverage.
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Also, as discussed earlier in the types of events, partial risk or medium risk events eventually involve sponsors, charitable institutions as well as ticket sales, and therefore are hybrid forms of funding. As large sums or complex funding requirements are involved, hybrid forms of funding are predominant.
The following comparison as detailed in Exhibit 10.1 tries to breakdown the concepts of sponsorship and charitable contribution. It is envisaged that this will benefit both event organizers as well as corporate in understanding where and how to draw the line between the two.
Failure to distinguish between the two could be a potential risk to the event company and may lead to fatal errors in planning and goal setting.
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A further element of risk depends on the position of the chosen event category in the popularity-share matrix in the prevailing environment.