Any time you go to a sporting event, you're surrounded by brands. It might be from the sponsors, owners of the venue or even the businesses of people on the board.
Whatever the reason for that advertisement being there, it's sure to pull you in. Big and colourful is usually the key, and something that looks modern and fresh will almost always win out over something old-fashioned. It's just human nature to opt for the healthier looking company, and advertising is the way that so many businesses go about spreading news of their success.
So, what can be learned from the big businesses that are dominating the advertising game at big sporting events such as the NBA Finals, AFL club sponsorships and even all the way over in the English Premier League? Well, for one thing, these organisations are showing how important brand recognition is to the success and continued growth of a business.
Can you afford to jump on the bandwagon? If the answer is no, it might be time to take a look at invoice finance to shore up your cash flow.
Advertising - being taken to new heights
The whole point of taking out an ad in the paper, showing a new product on a billboard, or even appearing on a radio show to promote an event or new service being offered, is to generate interest in it. This is clearly a popular option for businesses of all sizes too, as IBISWorld reports that advertising agencies in Australia generate $2 billion in annual revenue.
IBISWorld reports that advertising agencies in Australia generate $2 billion in annual revenue.
Take a walk down to your local shopping centre and it's more than likely that you'll pass a bus stop or a billboard that is promoting a business. That has cost them a considerable amount of money to have rights to, all the way back to the design and photography of what is being shown in the final product. The cost of advertising will vary depending on the medium of delivery, but there is always going to be an outlay before a return is seen.
For example, Manchester United, one of the biggest English Premier League football clubs, had a sponsorship deal with Nike for the production of its uniform that was worth almost $50 million every year according to Forbes. That is, until the start of last season, when Adidas took over the responsibility and sponsorship. This cost the premium sporting apparel company a cool $1.5 billion, and it broke the record for the biggest sponsorship deal in world football. Fighting for a place on the kit was Chevrolet, and it has to fork out $110 million each year for the next six years to keep its spot in the middle of the playing shirt.
And that's essentially what these businesses are paying for - a place in an important, and heavily viewed, position. Companies are opting to go for sports teams because of the professional standard and television coverage they can expect.
Mazda is one of the North Melbourne Kangaroos' biggest sponsors in the AFL, and has its logo all over the kit as well as the team website. The idea being that the more people see the branding, the more inclined they'll be to use their services or buy their goods. It must be doing something beneficial for the manufacturer, as Mazda had the third highest number of new vehicle sales in April, with 9.7 per cent of all new vehicles sold, according to the Federal Chamber of Automotive Industries.
In America, the sponsorships are taken to a whole different level. Entire stadiums are owned by a single organisation, such as the Chesapeake Energy Arena that the Oklahoma City Thunder are currently playing their NBA finals games in. The company that bought the rights to the stadium maintains the building, however for every game on television, the name is referenced too many times to count and it's shown in the pictures even more. All of this is working toward building brand recognition.
How can your SME get involved with advertising?
An SME certainly won't be able to afford anything like the sponsorship options that the largest sporting teams in the world command, as the latest Federal Budget outlined a small business' revenue was capped at $10 million to fit into this category. However, brand recognition for an SME can come from much more cost-effective angles, too. A billboard, radio spot or ad in the local newspaper can all help to push your brand name to the top of the market pile. You could even sponsor a local footy team!
It will cost money, however, and if you're waiting for working capital to be freed up by clients who need to pay their invoices, then wait no longer to take control of your finances and use debtor finance.
Earlypay will take your unpaid invoices and give you a percentage of the value owed to you. With that injection to your cash flow, you'll be able to make moves in the advertising world to get your brand name out there and grow to the next level.
Give the team at Earlypay a ring today to discuss the best way forward for your SME.
If you'd like to learn how Earlypay's Invoice Finance & Equipment Finance can help you boost your working capital to fund growth or keep on top of day-to-day operations of your business, contact Earlypay's helpful team today on 1300 760 205, visit our sign-up form or contact [email protected].