Ken Ungar is President and Founder of Charge, a sponsorship consulting agency that strives to help sponsors and properties supercharge their sponsorship results.
Ken describes sponsorship as “a B2B or B2C relationship where two parties promote each other, but one party, the sponsor, pays the property for the right to use their logo, their name, their image.” “Property” may be real assets, such as a public venue, a sports team, an athlete . . . or it may be digital or virtual, as in the case where one organization sponsors another party’s email campaign.
In this interview, Ken lists the things an organization has to know about its audience –demographics, psychographics, age, gender, where they live, household income – everything! Only then will the organization be able to find a sponsor whose customers “match” the people in the organization’s audience.
Sponsorship can be powerful. When a brand sponsors an organization that is highly thought of by its target customers, those target customers tend to think more highly of the sponsoring business – a process called “image transfer.” Ken says, “Consumers are 86% more likely to spend their money with a company that supports their values than one that doesn’t.”
Ken provides an example of a “perfect sponsorship fit.” Bombardier Aerospace sells private jets. Where could it find that small customer base of people who buy jets – and lots of them? The match? Motorsports. Racing teams have demanding schedules and long distances between events. Bombadier posted their logo and signage at racing events, hosted hospitality suites, and because they found the right audience, sparked a 32:1 return on promotional dollar investment. Sponsorship at the Indycar series provided Bombadier with direct access to the racecar drivers, to the racing series . . . and to other racetracks through the credibility gained by their Indycar association.
Budgeting for sponsorship is in two parts: the rights fee which is what the sponsor pays the property for the right to use their name and image, and what is spent to activate or leverage investment in that sponsorship – using that logo across a wide variety of promotional platforms and applications. Ken says it is critical to measure everything to verify that marketing results justify the expense. With sponsorships, he recommends creating such things as consumer surveys “that ask before, during, and after their sponsorship, ‘Has your perception of the sponsor’s image changed as a result of their sponsorship of X?’ “
However, not all sponsorships are effective. As opposed to a custom-fit sponsorship, the “chairperson’s choice,” where the chief officer of a company sponsors something “because they like it,” does not address an “audience match,” so has “little or no impact.” Note to agencies: Match your sponsorship to your target audience.
Ken credits a consultant, David Baker, with teaching the agency “a lot about positioning,” – that, “If you’re not in a defendable niche, you’re just another fill-in-the-blank agency.” From the standpoint of scale, Ken notes that a general marketing services agency with a small-business clientele will have “tens of thousands of competitors” and need to “provide services for a very general, broad range of service levels” – a very inefficient business model.
Ken recently published Sponsorship Strategy: Practical Approaches to Powerful Sponsorships. He can be reached on his agency’s website at: chargesponsorship.com, with free resources, e.g.; a sponsorship template, a directory of free sponsorship resources, at: chargesponsorship.com/freestuff.
ROB: Welcome to the Marketing Agency Leadership Podcast. I’m your host, Rob Kischuk, and I am joined today by Ken Ungar, President and Founder at Charge, based in Indianapolis, Indiana. Welcome to the podcast, Ken.
KEN: Thanks, Rob. It’s great to be here.
ROB: It’s excellent to have you here. Why don’t you start off by introducing us to Charge? What are you known for?
KEN: We are a sponsorship consulting agency. We help sponsors and properties make the most out of sponsorship by helping supercharge their results.
ROB: When we say sponsorship, a lot of things come to mind. What does sponsorship mean to you and to Charge?
KEN: It’s a relationship where two parties are promoting each other, but one party, the sponsor, is paying the property for the right to use their logo, their name, their image. That’s basically the sponsorship in a nutshell.
ROB: We’ll pull back the layers here. Property – I imagine there’s a digital footprint, there’s a physical footprint, there’s real estate in emails and all sorts of other things. Where is the property here? Where do we go?
KEN: Property could be anything on that side. If it’s sports, a property could be a sports team, an athlete, a league. If it’s in entertainment, it could be a concert or it could be a performance venue. It could also be a nonprofit. Nonprofits receive corporate sponsorship. In that sense, when they have a sponsor, they are the property. But you’ve nailed it; it could be real assets. It could be sponsoring a facility. Or it could be digital or virtual. You could sponsor this podcast, or you could sponsor an email campaign.
ROB: There are a lot of different sponsorships to consider. It sounds like you’re in a guide and sherpa role in helping people find the right place, because as with many forms of advertising, there’s certainly a wrong sponsorship for every business – something they definitely should not do. How do you help people think through the right way or even if it’s the right time for a sponsorship in the life of a business?
KEN: You’re exactly right. I love the term “sherpa.” That’s awesome. That’s exactly what we do. Hopefully, they’re not going to get in the wrong relationship, but we’ll show them the ABCs of sponsorship. It all starts with audience. If you are looking for a sponsor, you have to know your audience – their demographics, their psychographics, their age, their gender, where they live, household income, everything about who your audience is.
Then that gets matched up with the sponsor’s customer base. The sponsor is looking for its customers in your audience, so there’s got to be a match between the sponsor’s customers and your audience. That’s always the place to start, and when we find that sponsorship is not working, it’s because that part was given short shrift at the start of the relationship.
ROB: Dig in a little bit. Is there an example of a client you’ve worked with and the different avenues of sponsorship that they pursued and why it made sense for them, why there was alignment there?
KEN: It’s really interesting. You find sponsorship in both B2B and B2C. My favorite story is the relationship that Bombardier Aerospace had with the IndyCar Series and the Indianapolis Motor Speedway. This is an aerospace company; they sell private jets, the Learjet brand, the Challenger brand, fantastic airplanes. They’re looking for customers who could buy. That’s a pretty small customer base of people who buy jets, especially if you want to move them in volume.
They came to auto racing or motorsports because race teams, racing series, drivers – because of their schedules and the distance between events, jet travel is basically their only choice, and private jet travel is obviously the best. This is an example of a B2B sponsorship relationship. What I love about it is their return on investment was 32:1. For every million dollars they spent on that sponsorship, they got back $32 million in terms of aircraft sales.
I love that story because they found the right audience, people who need jet travel, who can afford to buy private jets, and they made magic happen through a sponsorship relationship.
ROB: What did the sponsorship look like? Was it something that was provided to teams? Was it on cars? Was it more holistic and all over the place?
KEN: It’s a great question. In that particular case, they had signage at racing events. For example, they had their logo on the control tower, called the Pagoda, at the Indianapolis Motor Speedway, a gigantic sign at the Indy 500, which is the largest single-day sporting event in the world. They had this dominant presence. They had a suite inside that building so they could entertain clients or prospects during the race events.
And most importantly – and this is true – sponsorship allows the sponsor to get what I call behind the velvet rope and provides that access that a business or a partner wouldn’t ordinarily have. In this case, they had direct access because of their sponsorship to the racecar drivers, to the racing series, to other racetracks, because they came in on the back, so to speak, of their property, the IndyCar Series. That’s an example of all those elements – the signage, the hospitality suite, the access – that really made for a complete sponsorship relationship.
ROB: That’s a little bit of unexpected inception. When I see sponsorships at a sports event, I don’t think they’re advertising to the participants. That’s all sorts of interesting.
Certainly, when I think about sponsorships, and I think when a lot of people think about the role of sponsorship in the marketing mix, a lot of times it can get put into the branding level. But you’re talking about a directly trackable ROI.
ROB: Which is very interesting. How do you think about tracking that kind of relationship? In that case, is it just because of the proximity and when an IndyCar driver buys a jet, you know that was an IndyCar driver that bought a jet? How do they follow it through?
KEN: This is so important, and this is a little bit of thinking that’s involved, especially with all the recessions we’ve had and marketing budgets being cut. There is more reliance than ever on measurement. We advise clients, measure, measure, measure.
For example, in a B2B relationship, sales – lifting sales, whether you sell jets or whether you sell soda – if sales lift is important, you measure the sales lift. You measure prospects. If you’re entertaining clients, again in a B2B example, you measure how many people entertained and whether, downstream, sales were made as a result of their participation in your sponsored event. All of that is measured.
Even on the brand side, where you want to improve the perception of your brand through sponsorship – that’s what I love about sponsorship. There’s this process called image transfer where, for example, if Charge, the sponsorship agency, is going to sponsor the Chicago Cubs, you’re going to think more highly of my image because you think highly of the Cubs’ image. That’s image transfer. Cubs fans are going to think more highly of my agency if I sponsor the Cubs.
How do you measure that? We advise clients you have to measure that; otherwise you’re just guessing whether all that money you’ve spent has improved your brand image. What you do is, if you know that up front, you create things like consumer surveys that ask before, during, and after the sponsorship, “Has your perception of the sponsor’s image changed as a result of their sponsorship of X?” So you’re measuring that and understanding that, and as a result, you can go, “Listen, I sponsored Rob’s podcast. It’s fantastic. As a result, here’s a change in perception of my brand image among Rob’s audience.”
ROB: You mentioned this a little bit with Charge; a lot of our guests, a lot of our audience, are people running some sort of marketing services firm. If you’re giving someone like that loose advice on where they should consider investing in sponsorship, what should we be thinking of? What’s effective?
KEN: I think, again, it’s audience. I see two types of sponsorship. One is far less effective than the other. I call the first one “chairperson’s choice.” The chairperson of a company or the CEO will sponsor something because they like it, whether it’s golf or a particular music performer or whatever. In that case, because it gave short shrift to audience – remember, before we talked about the importance of audience match – little or no impact.
If you’re a marketing agency and you’re thinking about sponsoring something, whether sponsoring a radio show or a news broadcast like NPR, where I often hear a lot of marketing agencies advertising and sponsoring, you have to give consideration to audience. So, marketing agency, what’s your customer base? What’s your audience? And where are they hanging out? Those are the places that you invest your sponsorship money.
ROB: What kind of budget should somebody be thinking about? A starting good investment to give it a real chance of success. Duration as well as per month.
KEN: Great question. Let’s start with one premise. It is not one size fits all. It runs the gamut. There are $1,000 sponsorships and there are $100 million sponsorships. First of all, no matter what size you are as a property or a sponsor, there is the right match. It isn’t about these big sponsorship relationships. Like we’ll see the naming rights of a stadium and the big dollars associated. Not the case. It is not one size fits all.
Second, there’s two elements to what you’re going to spend on a sponsorship. The first is what’s called a rights fee. A rights fee is simply the sponsor is paying the property the right to use their name and image. Again, in that example where I’m sponsoring the Cubs, I pay them a rights fee so I can use the Cubs logo on my website.
But even more important than paying for the right to have the sponsorship is what we call activation or leverage. What happens in that case is I don’t just have the rights to use that logo; I’m going to activate that investment. I’m going to use that logo in my advertising, on my website, in email campaigns. I’m going to set up a display at a Cubs game that displayed my services or products. I’m going to spend all this money to activate my investment in that sponsorship; that’s where rubber hits the road. People who just sit back and slap a logo on their website are not getting the full benefit of the investment, so their ROI is going to suffer.
So, you add up the rights fee. You set aside somewhere between zero-point-5:1 and 1:1. If I spend $1,000 on the rights, I’m going to spend somewhere between $500 and $1,000 to activate those rights. I put that budget together and that is my sponsorship budget.
ROB: Got it. Very, very interesting and helpful. Ken, if we rewind the clock a little bit, how did this whole thing start in the first place? What led you to start Charge as a firm?
KEN: It was kind of an accident. [laughs] I had always wanted to start my own business. I’ve been in sports marketing and sponsorship for about 25 years. But about 16 years ago, I was actually approached by what became our first client, and is still a client today, that was seeking help in sports marketing with sponsorship. They asked for my help and were wondering if I was available as a consultant. I told them, “I don’t want to be your employee and I don’t want you to be my only client, but if you’ll be part of an agency that I’ll create, I’d love to have you as Client #1.” That was 16 years ago. We started as a sports marketing agency, currently a sponsorship agency. But we’ve been in business continuously since then.
ROB: What have been some of the key inflection points on the journey? You start, you spitball it together, you’re gluing clients together. You have a business that exists. But over the time, over the journey, you have to learn what it takes to level up the business. What have some of those touchpoints been for you?
KEN: Oh, Rob, let me tell you. My next book is going to be “The 5,000 Mistakes I’ve Made in the Agency Business.” [laughs]
ROB: 5,000 different ones? [laughs]
KEN: Yeah, 5,000 different ones. This podcast is for a lot of agency owners like me and people who are leaders in agencies. I think two issues – one is not scaling properly, but more importantly – and this is so ironic. As a marketing agency, the biggest mistake I made is not marketing enough. It almost feels like “Physician, heal thyself” or “Doctors make the worst patients.” I think marketing agencies are the worst at marketing themselves. That was one thing. I didn’t work fast enough and hard enough on the branding, the perception of our agency.
Again, what happens is when you get so busy doing client work – and there were times we were working seven days a week, especially doing a lot of business in sports, working every weekend at sporting events. We didn’t market the agency. So, if I had advice to people who want to scale and who really want to build their agency, it’s “Pay attention to that side of the business.” As we advise our clients, it really matters.
ROB: That does beg the question: what do you sponsor?
KEN: [laughs] That might be like physicians are the worst patients. Sponsorship consultants are the worst sponsorers. I can tell you legitimately, the only thing that I have sponsored as a company is my sons’ football team when they played tackle football growing up. [laughs] That was a bit of a branding exercise, but it was mostly because I love my sons. That would be an example of chairperson’s choice, a lousy decision.
ROB: There you go.
KEN: But from a marketing perspective, we run the gamut. And I do recommend this to virtually all professional services agencies. I’m in a mastermind group with a bunch of other creative agency owners, and it’s the same recipe. It’s content marketing and digital and SEO and being relevant with fresh content. It’s getting out there with your brand message. It is pretty much the standard menu.
What I love – like this podcast, for example. This podcast didn’t exist 10-15 years ago. There are so many ways for us to get our message out that are super affordable. There’s no excuse except your time not to do it.
ROB: Right. Clearly, with this podcast – we actually have had sponsorship conversations before. It’s very interesting and relevant. Maybe that’s a whole topic in and of itself, podcast sponsorship, sometime. But you are certainly distinct. I don’t recall a previous conversation in probably 150+, maybe 200 episodes, of a very sponsorship-focused agency. It’s very relevant. People will hear this here. They don’t know what you know; you may not know something they know. Good partnerships happen from that sort of thing.
You mentioned a little bit about scaling. Scaling is always one of those things that hangs in a bit of tension. Sometimes the nudge to do something that helps you scale is, as you mentioned, a mistake. It’s something that went wrong. Some things can be done too soon. You can plan for a little too much scale too soon, like putting on your dad’s jacket when you’re a kid. How do you think about that tension? A mistake sometimes tells you that you did something too late. How do you think about adding scale that’s not prompted by and in response to a specific problem?
KEN: That’s super interesting. I think embedded in that is positioning. I’m very influenced by the teachings and writings of David Baker, who is a phenomenal consultant. He taught us a lot about positioning. The issue with positioning and scale is, from a positioning perspective, if you’re not in a defendable niche, you’re just another fill-in-the-blank agency. If I’m a general marketing services agency and my clientele is all small businesses, I have tens of thousands of competitors. Also, I have to provide services for a very general, broad range of service levels.
That was kind of the mistake that we made, because from a scale perspective, when we first started out we were consulting and we were doing PR and we were doing digital – all in the sports marketing / sponsorship area – but I couldn’t hire enough people to do enough work and scale it correctly because I was doing so much. I wasn’t in a defendable niche, first of all, so we were spending a lot of our resources on business development. Should’ve been inbound, and it was a lot of outbound sales calls type of arrangement.
Then once we had the business, I’m not a PR agency; I’m a general services agency, so I have to hire PR people and I have to hire digital marketers and I have to hire all these different disciplines, which was inefficient from an hourly perspective and a utilization perspective. So, my first mistake, which then bred other mistakes, was being not properly positioned. That’s what David teaches agencies. I’m really a big fan of that concept.
ROB: David was fortunately a guest in the first year of the podcast. I don’t think I knew what a privilege it was to have him on until he was on, and then I said, “Who else should we have on?” and he said, “You should have my friend Blair Enns on.” It was a good thing, and I think it was right around the time – Blair famously has I believe a $300 book, which is a whole other exercise in positioning.
KEN: I bought it. [laughs]
ROB: We need to hold that up on picture sometime. But David had his book out at the time on expertise, and it recalls to me that you have a book that is recently out in the marketplace as well. Tell us about the book, why you wrote it. What’s going on there?
KEN: The book was a passion project for me. I wanted to share with people stories about sponsorship from a strategy perspective, because I think basically in all things marketing, you start with strategy and you go to tactics next. So many people default to tactics, like “I need a new website, so let me just start building a website.” Why?
With strategy in mind, I wanted to create something in sponsorship so that people can use this to avoid mistakes that others have made, and also learn about best practices so they can level up their sponsorship game with just a book instead of having to go through really expensive relationships and make those mistakes.
It started pre-pandemic. Obviously, the pandemic, with work from home and all those other things, gave me a lot of computer time because there was no Delta Airlines and no flying around the country, which is my normal state of affairs. It gave me a chance to really sit down, focus my thoughts, do the research that’s necessary – I found some fantastic research which practitioners can apply to their everyday sponsorship. And so Sponsorship Strategy: Practical Approaches to Powerful Sponsorships was born from that. It’s a relatively short book, meant to read on a flight. Now that people are flying again, if you go from New York to LA, hopefully you could be a little more schooled up on sponsorship than when you started your journey.
ROB: Ken, as you think about what’s next for Charge, what’s coming up in marketing and particularly in sponsorship, what are you excited about? Where’s it going?
KEN: That’s a great question. I am totally stoked about purpose-driven sponsorship. To unwrap that a little bit, two trends in society are converging. One is social responsibility for for-profit companies. What we’ve seen over the last 10 years, especially as governments abdicate their responsibility for certain causes, consumers are saying, “Private companies, you need to battle climate change. You need to work towards diversity. You need to do all those things. All these social causes from a health perspective, from a societal perspective, you need to engage in true, profound social responsibility. CSR (corporate social responsibility) is not just a term; you need to live it.”
Consumers are 86% more likely to spend their money with a company that supports their values than one that doesn’t. That’s a big incentive for companies to do the right thing. Well, they’re looking for a place to promote the fact that they’re doing the right thing so that those consumers who are looking for companies that support their values have a place to buy products. Sponsorship is fantastic, and who’s going to be the beneficiary of that? Not-for-profits.
If, for example, recycling is something that’s important, a company that engages in recycling is going to align with a not-for-profit that’s dedicated to recycling because they’re looking for a way to promote each other’s cause in an authentic way. What’ll happen, then, is that instead of companies donating in nonprofit fundraising, companies are now going to push part of their marketing budget towards nonprofits. That’s going to change the game for nonprofits.
Right now, about $22 billion is spent by for-profit companies on donations. They spend in the U.S. about $22 billion. Marketing budgets are 10 times that amount, so about $250 billion. If just 1% of a marketing budget is now pushed towards a nonprofit in a sponsorship because the marketing department is responsible for sponsorships, not donations, now all of a sudden revenue for the nonprofit is a game-changer. So, both on the nonprofit side and the for-profit side, we’re saying, “Hey, listen, this trend is going to benefit you if you’re ready to engage in purpose-driven sponsorship.”
ROB: One thing that maybe I’ve seen, but I’m not sure how much of a trend it is – I’m the outsider in the sponsorship world – it seems like there’s a rise in different digital inventories of sponsorship. I’m in Atlanta. We watched the World Series, the Braves, that’s what we’re all about – and, for instance, the pitcher’s mound now has a digitally applied sponsorship on it. As these sponsorships start to go digital, do any of them start to get personalized and fractionalized in different ways to different audiences, the way we’re used to seeing normal advertisements? Or is the trend still going to be toward selling the big brand sponsorship, somebody who needs to get their brand in front of all consumers? Are they still going to own some of those prime real estate digitally applied sponsorships?
KEN: That’s a fantastic issue, Rob. I’m glad you mentioned that. What we’re seeing now is a new frontier in sponsorship inventory because of AI, because of AR (augmented reality) and VR (virtual reality). You’re going to see both virtual inventory, like you mentioned on the pitcher’s mound, but once you combine that with things like geotargeting, on that pitcher mound you’re going to see a sponsor logo based on where you live. It gives the property or that baseball team or that network the opportunity to sell sponsorship on a geotargeted basis. Instead of one sponsor, like a credit card company, you could sell endless numbers of different sponsorships as long as there isn’t conflict.
But again, all this didn’t exist, because the technologies didn’t exist, just 10 years ago. There’s one amusement park that was not only selling sponsorship to its amusement park, but it was selling to the virtual rides that it has, kind of Web 3.0 or in this metaverse. They’re selling sponsorships outside of their amusement park to virtual rides. This is going to raise the game on everybody’s sponsorship and create some fantastic promotional and revenue opportunities.
ROB: Absolutely. If you follow through the logic – and I hadn’t thought about it this way before – all of the data that your Facebook, your Google, everyone wires in, what it ends up meaning is that the CPM that a brand will pay increases with the effectiveness of the targeting.
So, I suppose it would, to an extent, stand to reason that if I can take – I think about even a soccer game. You have that screen on the back of the field. There’s no commercials in a soccer game, so you have sponsors there all the time. If that’s digital, you could almost have a complete projection up and down the field of different things that are relevant to your life and potentially increase what a sponsor is willing to pay because it can be more effective, it can be the right person, it can even be targeted brand reinforcement for someone who’s deeper in the funnel.
KEN: Yeah, you’ve nailed it. Absolutely nailed it. As you see more of that and as you see the targeting increase in effectiveness, the CPM is going to go up and the opportunities for sponsors also to hit the right audience will increase dramatically.
ROB: That’ll be fascinating. Ken, when people want to connect with you, when they want to connect with Charge, how should they seek you out?
KEN: The best way to do it is to check out our website at chargesponsorship.com. If you go there and type in chargesponsorship.com/freestuff, we have all kinds of free resources for your audience, Rob, where they can get a sponsorship template or a directory about free sponsorship resources. We try to make our website user-friendly, good user experience. So if they check out chargesponsorship.com, we think there’s something of value for everyone.
ROB: Good. It sounds like everyone should hop over there, check out the resources. It seems like the best place to start is to try it. Try one, see what you think. Try a sponsorship.
KEN: Absolutely. Every journey begins with a first step.
ROB: I think we can learn something, probably make some mistakes, and make some good bets as well.
ROB: Ken, thank you so much for coming on the podcast, for sharing deeply from your expertise. We’ll get that link into the show notes. We’ll get some details on the book as well. I don’t think we’ll put a link that’ll get us a commission, but we’ll just put a link so that people can buy a book.
KEN: [laughs] Thanks, Rob. I appreciate it.
ROB: Thanks so much, Ken. Be well and talk soon. Thanks. Bye.
ROB: Thank you for listening. The Marketing Agency Leadership Podcast is presented by Converge. Converge helps digital marketing agencies and brands automate their reporting so they can be more profitable, accurate, and responsive. To learn more about how Converge can automate your marketing reporting, email firstname.lastname@example.org, or visit us on the web at convergehq.com.