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Develop your approach to business partnerships
A business partnership is an exchange of value. Before you start connecting with businesses, you need to understand:
- what you have to offer
- the value of what you have to offer
- how it can be brought together for potential partners.
It gives you a clear starting point. You can then tailor your offer to potential business partners.
Step 1. Identify your business partnership properties
A business partnership property is the tangible thing a business partner can be associated with.
A property could be:
- your organisation as a whole
- a venue
- a festival or season
- a production or exhibition
- an event
- a program or project
- an education or community program
- a digital platform or content series.
Your organisation may have many properties. Start by identifying the properties you could offer to business partners. Think about what makes each one different, including its audience, profile, reach and purpose.
For example, you might offer a partnership with your organisation as a whole, as well as with each exhibition, program or event.
Step 2. Identify the rights and benefits you can offer
When a business partners with you, they’ll receive rights and benefits. They’re the value you provide.
What are rights?
A right gives a business permissions, recognition or access agreed to in the partnership.
Rights could include:
- naming or presenting
- recognition as an official partner
- permission to use your organisation’s name or logo in agreed ways
- the right to promote its association with you or your organisation
- exclusivity within an agreed business category.
Use exclusivity carefully
Exclusivity is a valuable right. Offer it carefully. The broader the exclusivity you grant, the more future opportunities you remove.
To keep future partnership opportunities open, you could restrict exclusivity to:
- a particular property, such as a venue or event
- a geographic area, such as a city or region
- a time period, such as a financial year or exhibition period
- business categories.
How business category exclusivity works
Business category exclusivity means you don’t give broad exclusive rights to only one partner. Instead, you grant exclusivity to one partner in different industry categories. For example, you might have one airline partner, one banking partner and one accommodation partner. This provides value for your partners as it excludes their direct competitors.
Use exclusivity carefully
Exclusivity is a valuable right. Offer it carefully. The broader the exclusivity you grant, the more future opportunities you remove.
To keep future partnership opportunities open, you could restrict exclusivity to:
- a particular property, such as a venue or event
- a geographic area, such as a city or region
- a time period, such as a financial year or exhibition period
- business categories.
How business category exclusivity works
Business category exclusivity means you don’t give broad exclusive rights to only one partner. Instead, you grant exclusivity to one partner in different industry categories. For example, you might have one airline partner, one banking partner and one accommodation partner. This provides value for your partners as it excludes their direct competitors.
A category like ‘financial services’ is very broad. You could secure a partnership with a bank but unintentionally prevent future partnerships with other finance-related businesses. For example, insurers, superannuation funds and payment providers.
What are benefits?
A benefit is something tangible the business receives through the partnership. Following are some examples.
Client or employee entertainment
For example:
- tickets and premium seating
- hospitality
- invitations to opening nights, premieres, special events or experiences
- ticket discounts
- behind-the-scenes experiences
- access to venue spaces.
Marketing and brand awareness
For example:
- recognition in marketing and communications
- logo placement
- advertising opportunities
- social media recognition
- digital content placement
- acknowledgement in reports, publication or event materials
- access to existing content, images or stories for agreed promotional use.
Networking opportunities
For example:
- speaking or networking opportunities at existing events
- invites to industry, donor or stakeholder events.
Consider bespoke activations
Not every right or benefit needs to already exist. You can create new value by designing or tailoring something around a partner and its goals. It’s called a bespoke activation.
A bespoke activation can be a right, a benefit, or both. Examples include:
- a special event for clients or customers
- a performance at a client or staff event
- a tailored staff experience or workshop
- a partner-specific content series
- an audience competition or promotion
- a new activity connected to a program or event.
Be clear about the cost
Because bespoke activations involve creating something new, they may require extra time or cost to deliver. Be clear about what’s included, who is responsible for delivery and who covers additional costs.
They’re most suitable for higher-value partnerships. The level of contribution from these business partners can justify the time and costs to create and deliver something bespoke.
Group your rights and benefits into pillars
To make it easier for potential partners to understand how you can support their goals, it can help to group your rights and benefits into pillars.
Pillars are categories that show the different ways you can create value for a business. For example:
- marketing and brand: partner recognition, advertising, content and brand visibility
- client entertainment: tickets, events, premium experiences and hospitality
- employee engagement: staff events, workshops, volunteering or creative experiences
- bespoke activations: tailored experiences, activities or content created specifically for the partner and its goals.
Tailor what you call your pillars to reflect the kinds of value you or your organisation can genuinely offer.
An example of grouping rights and benefits into pillars
Step 3. Build your business partnership offer
Bring together the properties, rights and benefits you’ve identified to build your business partnership offer. The aim is to understand, for each property, the different combinations you could offer potential business partners.
Example of a partnership offer
Property
An orchestral concert series within your annual performance program.
Rights and benefits you will offer
Production partner recognition, brand visibility, tickets, hospitality, digital content and advertising.
Use your initial offer as a discussion starter
You don’t need to include every right and benefit for each property. Once you start discussing a potential partnership, you can select and adapt the rights and benefits to meet the business’s goals. This gives you structure without becoming a fixed package. The final offer can be tailored to the needs of the partner.
Take a solutions-focused approach
Take a solutions-focused approach to move beyond generic partnership packages.
Partnerships are more likely to succeed when they’re tailored to the needs, challenges and opportunities of the business partner.
To create a more relevant offer, ask potential partners:
- What is your business trying to achieve?
- Who are you trying to reach?
- What challenges or opportunities are you responding to?
- What does success look like to you?
- How could our organisation or work help?
Use what you learn to select, adapt, or create the rights and benefits that are most relevant to the business.
A solutions-focused approach to business partnerships
Step 4. Value and price your business partnership offer
When pricing a business partnership offer, you need to understand:
- what the offer will cost to deliver
- what the offer may be worth to a business
- what you will ask a business to contribute
- the net financial return.
Know your costs
Start by working out how much it will cost to deliver your business partnership offer.
Costs might include:
- staff time
- tickets and hospitality
- production or event costs
- marketing and design
- bespoke activations
- partnership management and reporting.
This helps you understand whether your offer is financially worthwhile.
Assess the value of your offer
Next, consider what the property, rights and benefits together may be worth to a business.
Think about:
- the audience and reach of the property
- its profile and reputation
- the strength of the association with your organisation or work
- the rights and benefits included
- whether any rights are limited or exclusive
- what similar partnerships are worth and where to find this information.
Value is not the same as cost. Something may cost you or your organisation relatively little to provide but still be valuable to a business.
Set an asking price
Use your assessment of value to decide what you will ask a business to contribute.
Your asking price should reflect the overall value of the partnership offer. It shouldn’t simply be based on what the partnership costs you to deliver or how much money you want to raise.
There’s no single formula for pricing a business partnership offer. Set a reasonable starting price that you can explain and support.
Work out your net financial return
Once you’ve set an asking price, work out how much income would remain after the costs of delivering the partnership offer. This is your net financial return.
Asking price − delivery costs = net financial return
Use this calculation to decide whether the offer gives you a worthwhile financial return. If it doesn’t, reconsider the price, the rights and benefits included, or the costs of delivering them.
Example of valuing and pricing a business partnership offer
An arts organisation is preparing a major partnership for its annual festival.
Property
The annual festival.
The rights and benefits
The offer includes major partner recognition, agreed brand use, tickets and hospitality, digital promotion, opportunities to engage with festival audiences, and the right to run an onsite brand activation at the festival.
Costs
The organisation estimates that delivering the partnership will cost $7,000. This includes staff time, hospitality, marketing and partnership management.
Value
The arts organisation considers the festival’s audience, reach and profile, the rights and benefits included, and the value of similar partnerships.
Asking price
Based on the assessment of cost and value, the organisation sets an asking price of $15,000.
Net financial return
If the partnership is agreed at $15,000:
$15,000 asking price − $7,000 delivery costs = $8,000 net financial return
The arts organisation uses this price as a starting point to discus and tailor the offer to potential business partners.
