Chattanooga, Tenn.’s Riverbend Festival has posted a 40 percent increase in sponsorship revenue as a result of a two-year-old consumer rewards program aimed at improving relations with local businesses.

The nine-day June music festival launched Riverbend Rewards in 2010 to build relations with local restaurants, attractions and other businesses, some of which see a decline in traffic during the downtown event.

“Festivals that are located in public locations need to figure out new ways to work with local businesses because we’re dominating the space for a period of time,” said Chip Baker, Riverbend’s executive director.

The festival uses Riverbend Rewards to accomplish four primary objectives:

  • Build relations with local retailers and enhance year-round sales
  • Reward festival-goers with special offers and amenities
  • Generate incremental sponsorship revenue
  • Promote Riverbend
The free, year-long program offers special perks from participating merchants. For example, Country Inn & Suites offers $20 off a night’s stay; the University of Tennessee at Chattanooga dangles a buy-one, get-one-free ticket to a football game; while convenience store chain Kangaroo Express offers a free cup of coffee with product purchase.

Twenty-one companies participated in the program in 2011, up from 10 in 2010, said Karen Shostak, Riverbend’s director of sales. The 2012 program is expected to have roughly the same number of merchants as last year, she said.

“We try to shake them up by keeping the heavily traveled stores and switching up the others.”

Participating businesses tout Riverbend Rewards on door decals and point-of-sale materials. Members must show the card to receive the discount.

Members also can use the card to receive a 10 percent discount on festival merchandise as well as ‘sneak peak’ updates on musical performers and other event information.

In addition to building relations with local merchants, Riverbend also uses the program to access companies that may not be able to afford a traditional sponsorship. Each company pays a low-five-figure sum to participate in the rewards program.

“A company may not be able to afford a $40,000 sponsorship, but this program allows them to be part of the festival,” said Shostak, noting that Riverbend Rewards partners receive official sponsor status.   

Riverbend offers the program to both new and existing sponsors, added Shostak, noting that Kangaroo Express is an existing top-tier sponsor.

Consumers sign up for Riverbend Rewards on The program had roughly 10,000 members in 2011, up from 4,000 in 2010. Half of those members are employees of BlueCross BlueShield of Tennessee, Inc., which uses the program as an employee perk.

“BlueCross is one of the largest purchasers of admission tickets. When they got wind of the program, they told us they want 5,000 employees as members.”