Protecting your brand. Tips for your sponsorship agreements.

May 12, 2020

What happens when your brand ambassador goes rogue?

Sponsorship arrangements can increase brand awareness and deliver a great return on investment for corporate sponsors. However, unsavoury behaviour by a brand ambassador can quickly tarnish the reputations of the brands they represent.

We’ve all read the headlines.  A brand ambassador engages in scandalous behaviour and the corporate sponsors they represent are quick to terminate their Sponsorship Agreements.  But how do they do it?  And what do you need to include in your Branding and Sponsorship Agreements to ensure that your brand is protected?

Here are our top three tips:

  1. Social behaviour clauses are important

While you likely don’t want the right to regulate your ambassador’s private conduct, it’s important that you are able to quickly terminate the Agreement, without penalty, in the event that your ambassador engages in any behaviour that’s illegal, or which you consider could damage the reputation of your business, your brand, your products (or the ambassador themselves!).

  1. Protect the legitimacy of your message

Depending on the types of goods and services you require an ambassador to represent, you should consider whether your Agreement needs to restrict the ambassador from publically using or promoting the products or services of a competing brand.

  1. Payments

You should be cautious of Agreements which require you to make payment to the ambassador up front and in full.

Part payments during the term of the Sponsorship Agreement mean that if your relationship with a brand ambassador breaks down, or if the ambassador fails to perform their obligations under the Agreement, you won’t need to pay the full sponsorship amount.  You should also consider including claw back provisions in your Sponsorship Agreement, which allow you to recover some (or all) the fees that you have already paid to the ambassador, if the Agreement is terminated for poor behaviour.

Need assistance with a branding or sponsorship agreement?  Kalus Kenny Intelex can help.