The power of sponsorship for advertising

31 Oct

Many large corporates will choose the power of sponsorship as a means of advertising.    There are many reasons why a company might want to enter into a sponsorship agreement.   Mainly companies will use sponsorship as a way to create public awareness of their brand and as way of reaching an audience who may be interested in purchasing its products or services.

High profile sponsorship is often linked to sporting events or figures – like McDonalds sponsoring the 2012 Olympics.   This is hardly surprising because such sponsorship can catch the attention of millions and millions of people.  For example, sponsoring a premier league football team reaches millions – Not only those in the stadium will see the sponsoring brand but also those watching games on the television anywhere in the world.   Premier league football in the UK is followed by people of all nationalities worldwide.

Sponsoring a football team (or any other high profile person or athlete) is a wise marketing move because it allows people to repeatedly see your brand.   The first time someone sees a new brand they may not notice it.  Seeing a name over and over means that people are more likely to remember the brand when they need to use the product or service offered by it.   Repeat advertising also makes a brand reputable and trustworthy because it is known to the customer.    It is not surprising that sponsorship can cost millions and millions of pounds.

One corporate who has recently signed a sponsorship deal with a premier football club is Wonga.  Wonga is a pay day loan company set up by two South Africans.   Wonga is now not only operating from the UK but is operating in the South African pay day loan market via its website www.wonga.co.za.   The sponsorship move seems to be an excellent one for Wonga.    First, this is because at a recent meeting, debt charities, consumer groups and officials from the financial regulator and some pay day lenders in the UK suggested banning television advertisements for payday loans.  As a result of this the marketing of Wonga and other pay day loan companies is likely to be hit if there is a crackdown on payday loan advertising as threatened.    The sponsorship deal will therefore keep Wonga brand alive should limits be placed on its TV advertising.  Secondly, football is the most popular sport in South Africa.  The football team’s sponsorship will get the brand recognised swiftly in Wonga’s new, football loving, market.

The £24 million deal which Wonga entered into to replace Virgin Money as Newcastle’s main sponsors will last four-years and will start next season.  Wonga branding however is likely to be seen very soon with pre-season training in the new strip about to commence. Of course, fans of the Club are also likely to buy the new seasons strip so Wonga will have many, many individuals advertising their brand both in and outside the stadium. Sponsorship can certainly be  a very powerful marketing tool.

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