Financing free festivals | But where is Québec Inc.?

Free festivals are in turmoil. Their costs are increasing, but not the subsidies offered to them. Are the flagships of Québec Inc. sufficiently associating themselves with these major events?

Couche-Tard, Dollarama, CGI, Metro, Saputo… several flagships of Québec Inc. are conspicuous by their absence among the sponsors of free festivals – large and small – while the latter are sounding the alarm about their business model. These events are not among the priorities of the major stock market values.

While the logos of giants like Bell and Videotron (telecommunications) as well as the Mouvement Desjardins and the National Bank (finance) are among the major sponsors of festivals like the Francos, the International Jazz Festival, Montréal en lumière and Igloofest, those of other major local companies are rather rare.

At a time when these events are struggling to find new revenue, there is “no small sponsorship,” underlines Patrick Kearney, president of the Regroupement des festivals régionaux artistiques indépendants (REFRAIN).

“Tomorrow morning, a big company tells me that it is putting up $300,000 and that I can distribute the sum in ten sponsorships of $30,000, I have probably just saved ten festivals,” illustrates the man who represents 110 festivals and events in the province. I have festivals that may close for $30,000.”

The collapse of the Just for Laughs Group, which sought protection from its creditors last March and cancelled its annual comedy festival, highlighted a funding problem in festival financing, particularly for events where you can attend shows without paying a penny. Their organizers are alarmed by an increase in costs of at least 30% since the pandemic and subsidies that are not keeping up with this trend.

Most of the stakeholders interviewed by The Press agree that greater involvement of Quebec’s flagships in sponsoring free festivals could help them weather the current storm without having to solicit more from governments and state-owned companies.

There is no consensus on the means to be taken to convince them.

A call

Year in and year out, private sector sponsorships represent about 30% of the revenues of the 30 members of the Regroupement des évènements majeurs internationales (REMI), according to the most recent study conducted by KPMG for the organization. That’s almost twice as much as subsidies (16%)—excluding those from government corporations such as the Société des alcools du Québec (SAQ), Loto-Québec and Hydro-Québec.

“There are no small sponsorships,” says REMI President and CEO Martin Roy. “I would like to take this opportunity to appeal to the private sector. There is always room.”

How can we convince the major players in Québec Inc. to change their approach? The task is not easy, emphasizes Nathalie Courville, president of ArtExpert and associate professor at the Chair of Arts Management at HEC Montréal.

“These big companies don’t do nothing,” says the expert. “They are present in other ways, such as patronage, a lot in culture, among others. They don’t all make the effort where they could do it.” [en commandite]but they are not absent either.”

Companies contacted by The Press about sponsoring free festivals highlighted their involvement in other sectors (see below). Couche-Tard was the only one that did not respond to questions sent by email.

For some multinationals, such as the convenience store and gas station giant, the Quebec market is far from being its most important, underlines M^me Courville. Others, like CGI, sell their services directly to businesses rather than consumers. So it can be hard for them to see the benefits of partnering with a big free festival in Quebec, she adds.

“We see a lot of financial and telecommunications companies at festivals, but we’re talking about sectors where there’s fierce competition for consumers,” Roy points out. “I can cancel my phone plan today if I find something cheaper from a competitor. We can see the value, for these sectors, in being visible.” [avec les festivals]. For others, I don’t know.”

There are, however, exceptions.

Rio Tinto, which swallowed up flagship Alcan in 2007, has continued to sponsor the Montreal International Jazz Festival. The aluminum giant will co-present the event until 2027.

“Partnerships with festivals are obviously intended to give back to the community, but also to make our activities known to the general public,” says spokesperson Simon Letendre, adding that Rio Tinto supports “several festivals with a social and cultural vocation across Quebec.”

Recovery tool?

Outgoing director of Montréal en lumière, Jacques Primeau also recognizes that several big names from Québec inc. are essential in terms of philanthropy. The artist agent believes that their support for the city’s major festivals would be beneficial in a context where the business community is concerned about the vitality of the city centre.

Founder of the Montreal International Jazz Festival, Francos, Montreal en Lumière and Nuit Blanche à Montréal, Alain Simard is a man of his own. By representing nearly 30% of the revenues from events organized by REMI members, the private sector is present, estimates Mr. Simard.

“For example, Air Canada was not there [aux Francos] when I left, he illustrates. This year, the company is among the sponsors.”

In a telephone interview, Mr. Simard instead deplored the lack of indexation of subsidies offered to free events. The manager believes that the festivals he founded will “seek more in sponsorships than any festival in the world.”

Before the pandemic, festivals like Francos and Montréal en lumière were at the back of the pack in terms of fiscal profitability since they posted deficits, according to calculations made by The PressAt the other end of the spectrum, the International Jazz Festival ranked third with a fiscal surplus of $5.4 million.

“Putting logos everywhere doesn’t work anymore”

Times are changing, and so is sponsorship. Gone are the days of simply plastering sponsors’ logos all over a festival site. There’s still work to be done in the industry, say stakeholders consulted by The Press.

“There are still people who are betting on bronze, silver and gold packages, sending them out thinking, ‘I hope they’ll give me $50,000,’” says Nathalie Courville, president of ArtExpert and associate professor at the Chair of Arts Management at HEC Montréal. “Putting logos everywhere for $50,000 doesn’t work anymore.”

According to the expert, this is “not always well understood.” We adapt, but in some organizations, there is still “magical thinking” when it comes time to convince sponsors, adds M.^me Courville, without going so far as to name specific events.

At the Regroupement des évènements majeurs internationales (REMI), president Martin Roy also believes that “certain organizations” must change direction, taking care to point out that this may be easier said than done.

Activation is how sponsorship is delivered.

“We are talking about something that can be participatory and fun and that can multiply, in terms of influence, on social networks,” illustrates Mr. Roy.

There are many examples: from “participatory” kiosks where festival-goers can occupy themselves during a downtime to a photo booth in the colors of a sponsor.

“People like seeing each other,” emphasizes the president of REMI. “Everything that revolves around sampling [de produits] works well too.”

In other words, sponsorship is increasingly being done “tailor-made”, especially since the emergence of social networks, says M.^me Courville: We sell “interaction with targets”.

“It’s a lot of work,” says the expert. “A lot of people still take it lightly, saying, ‘I’m going to send files and I’m going to wait for money to come in.’ It doesn’t work. Both parties have to talk to each other.”