FIFA dices with regional risk - Halebury

FIFA dices with regional risk - Halebury


FIFA dices with regional risk

By Matthew Glendinning


own goal with its decision to regionalise

its third tier World Cup sponsorship


In December, Sports Marketing

Frontiers exclusively revealed that FIFA

will offer up to 20 “regional supporter”

berths across five regions from 2015

to replace the six domestic-based

“national supporter” positions with

rights to activate in the FIFA World Cup

host country.

But there are fears that current

global sponsors could trade down to

the regional packages [four per region]

that may better meet their changing

business objectives.

Although FIFA stresses that

commercial affiliates in the top two

tiers of the structure, comprising six

FIFA partners and eight FIFA World Cup

sponsors, will be guaranteed product

category exclusivity on a global scale,

Raj Koria, consultant at the Londonbased

law firm Halebury and former

commercial lawyer for Sportfive and

FIFA, believes the change could create a

less stable partnership structure.

FIFA may find that existing global

sponsors, particularly the tier two FIFA

World Cup sponsors, take the view

that the greatest value for them is in a

specific continent and want to switch

down to a regional sponsor package,”

says Koria.

FIFA will have to make sure it gets

the packages right so that the FIFA

World Cup sponsor package is too

attractive to persuade a truly global

brand, or a brand with aspirations to

become global, to do that.

“There is also the danger that a

larger group of companies associating

themselves with the FIFA World Cup

in more territories will create brand

clutter in those territories reducing the

exposure given to each sponsor.

“Consumers may not appreciate the

finer distinctions between the different

categories of sponsor, which could also

be detrimental to the global sponsors

who have paid more for their rights.

“The global sponsors will have more

rights and more opportunities to

activate their sponsorship. To a certain

extent it is also up to the sponsors

themselves to make sure they fully

utilise those rights to keep their brands

in front of the consumer.”

FIFA’s sponsorship inventory is fully

owned and commercialised by the

governing body, so with no pressure

from the Local Organising Committee,

the decision to change was an internal

one based on revenue generation.

In this respect, it is a bold move

by FIFA to move away from the more

traditional sponsorship model of layers

of global sponsors followed by a

layer of national sponsors in the host


The move has been described by

industry experts as a logical step to

satisfy overflow demand for global

partnerships or, less approvingly, as

a “moving of the goal posts” for

global sponsors, such as Hyundai-Kia

and Anheuser-Busch InBev, which are

already committed beyond 2014.

Koria, however, doubts whether

there was any “significant dissent”

from the existing pool of sponsors, and

acknowledges the potential commercial

gain for FIFA from the sale of a

maximum of four packages per region

in Europe, North/Central America, South

America, Africa/Middle East and Asia.

“Instead of being limited to smaller

companies which may only operate

in one territory, FIFA can now sell

to larger companies operating in

multiple territories which may have

greater budgets for investing in sports

sponsorship across the region,” he says.

“Looking at the mobile industry for

example, previously FIFA would have

been limited to the two or three major

mobile operators in Russia for the 2018

FIFA World Cup, now it can also target

the likes of Vodafone, T-Mobile and

Orange in Europe... without deterring

those Russian companies which would

have been interested in the old national

supporter package.

“The pool to which FIFA can market

has now increased which potentially

means greater competition, again

resulting in improved rights fees.”


The latest content on the Sports

Marketing Frontiers website


Making the case for a Grand

National winner


Pepsi puts fizz into IPL

title deal


CRM secures Arsenal’s

Emirates extension


App opportunities for

Sony Mobile


Badminton’s Axiata Cup breaks

new ground


The marketing power of NASCAR

partnerships Stateside


Airlines take off on national



Paddy Power’s Anthony Wong on all

things sponsorship



The Frontiers newsletter is one strand of the multi-faceted Sports Marketing Frontiers service. Dedicated to the sports

sponsorship industry, Frontiers also comprises the Frontloaded weekly news bulletin; the Locker Room - a comprehensive digital

archive and an interactive 10,000 deals strong database. Designed with the client in mind, Frontiers helps sports marketing

professionals do more and better sponsorship deals. Are you making the most of Sports Marketing Frontiers?


Deal Tracker

Posted in November and December, Frontloaded has the

stories, values and decision makers behind key deals, including:

• HTC joins UEFA as tablet and mobile provider

• NFL’s 49ers teams up with Sony

• Bridgestone title sponsors Copa Libertadores

• Telstra extends with NRL in Australia

• Roger Federer as the new face of Moet & Chandon

• Samsung widens European football roster with Juventus


Courtesy of our partners at Flightdeck, the social media

tracker from Havas Sports & Entertainment, we analyse the

digital footprint of major brands and their sponsorship deals.

Our top graphic this month takes a look at how Irish

bookmakers Paddy Power gained major traction in the digital

space in 2012 as a result of the popularity of some rather

unorthodox marketing tactics.

Paddy Power achieved its biggest spike in digital media

attention following Nicklas Bendtner’s reveal of Paddy Powerbranded

underwear during Euro 2012. The stunt may have

earned the gambling brand a €100,000 fine, but impressive

profits for the year will more than cover it.

Sponsorship Highlights

At the end of a glorious sporting 2012, Frontiers decided

to take a look back at some sponsorship highlights from

the past 12 months.

1. Red Bull proves the power of owned media:

In a year which saw that giant of sports events (the

Olympics) hit arguably sport’s most engaged market at

the most auspicious moment to date in the development

of media, it is perhaps a surprise that the sponsorship

moment of the year came courtesy of an Austrian

daredevil. But, what lessons did Felix Baumgartner’s epic

jump from space teach us about sponsorship?

2. BMW’s Olympic Mini adventure

Despite protests to the contrary from the IOC and LOCOG,

London 2012 was fertile ground for brands seeking to

put their products at the heart of the action. And the

product placement prize for most audacious activation

must go to BMW. The German automotive brand was at

least a partner to the Games but its idea to use radiocontrolled

Minis to carry objects around the field of play

was pure genius.

3. Sponsors vs Lance Armstrong

Even for those who still retained the power to be shocked

by doping scandals in cycling, the demise of Lance

Armstrong surprised only to the extent that it had taken so

long. Yet it was not the demolition of another hero or the

damage done to sport that attracted Frontiers’ microscope.

The jostling and positioning of sponsors in the wake of

the news that Armstrong was to be stripped of his medals

set some warning bells ringing. Would we actually see

sponsors asking for their money back?

For more infographics and the rest of our

weekly Frontloaded content, visit

To read these and the rest of our sponsorship highlights

in full, plus a few of our biggest gripes, visit the Talking

Points section on our website.


Editor: Matthew Glendinning


Analyst: Luke Harman


Publishing Director: Ben Speight


Design & Production

Designer: Nitin Rathod

Production Co-ordinator:


Information Sales Manager: Chris Beadle


Tel: +44 (0)207 954 3403

Registered office: 33-41 Dallington Street,

London, ECV1 0BB, UNited Kingdom

Follow us on Twitter: @SM_Frontiers

Important terms and conditions

All rights in this newsletter are

reserved. No part thereof be

reproduced, stored in a retrieval

system, or transmitted, in any form or

by any means, electronic, mechanical,

photocopying, recording or otherwise,

without the prior permission of





Aintree in hunt for National sponsor

By Luke Harman


a new title sponsor for the Grand

National, the UK’s most famous

horseracing event, for the 2014 race


Incumbent title sponsor John Smith’s,

the ale brand owned by Heineken UK,

will not renew its partnership with the

annual event when its current deal

ends after the 2013 race in April.

John Smith’s informed Aintree

Racecourse, rights owner of the Grand

National, of its decision to end its

association based on sales projections

over the next five years and a need to

revise allocation of its marketing spend.

Aintree is offering the sponsorship

opportunity for only the third time in

the history of the Grand National after

a 20-year association with Seagram

Distillers and Martell Cognac – then a

subsidiary of Seagram – and a nine-year

partnership with John Smith’s.

While there have been numerous

expressions of interest since news

of the opportunity became known,

Aintree will formally begin its search

for a new title sponsor in the New Year.

“We are totally committed to John

Smith’s and making the 2013 Grand

National the biggest and best yet,” says

John Baker, regional Director, North

West, Jockey Club Racecourses. “But as

part of that we want potential partners

to come and experience the event and

get a taste of it for themselves. This is

a very unique opportunity that doesn’t

come around too often.”

John Smith’s last outing as title

sponsor of the Grand National

coincides with the race’s switch to

Channel 4 as host broadcaster in the UK

– part of a wider four-year deal which,

earlier this year, saw Channel 4 acquire

all terrestrial horseracing coverage

from the BBC.

While an immediate drop from

record viewing figures of 11.1 million

Key Grand National Statistics

• Record BBC television viewing of 11.1 million

in 2012

• Over one million unique viewers to Aintree. in 2012

• Live cumulative event audience of over

154,000 racegoers over three days

• 156% increase in brand exposure during live

broadcasts since 2009


The Property:

Aintree Racecourse is recruiting a new

title sponsor for the Grand National

for a minimum term of three years,

beginning in 2014.


£2m - £5m per year


• Official status as title sponsor for all 3

days of the event

• Right to create official event mark to

be used in above the line and below the

line promotions

• Option of naming rights for all 21

races at the meeting

• Opportunity to take all advertising

hoardings on the Grand National course

• Exclusive right to brand the following:

number cloths on horses, owners’ silks,

jockeys’ breeches, attendants’ clothing,

horse winner rugs, big television

screens, presentation backdrop, trophies

& plinths and event clothing

• 18 advertising slots per day on the oncourse

television system, including trackside

big screens

for the 2012 Grand National is

anticipated, Baker suggests the move

to Channel 4, which will broadcast

over 15 hours of coverage across the

race weekend, offers many more

opportunities for the profile of both

the race and a title sponsor alike.

“The Grand National for Channel

4 will be the jewel in their sporting

crown and they’ll be promoting it right

from when their new contract begins

at the start of 2013. It’s their best

opportunity of attracting their biggest

audience,” he says.

“Channel 4 have really exciting plans

around the Grand National and how

they’re going to programme it on the

day itself and in the weeks leading up

to it, which is something a sponsor will

recognise and value.”

• Joint-hosting of PR events in build-up

to the event

• Exclusive right to brand official race

card cover and four additional pages of


• Exclusive rights to award mementoes

and best turned out awards for

sponsored races

• Eexclusive right to produce a new

Grand National trophy

• Opportunity to purchase selected

discounted tickets for the event (subject

to quantity and value)

• Title web presence on or

opportunity to work with course on a

microsite for the event

• Chance to deliver a brand experience

to over 150,000 people at a live event

Media Value (2012):

• UK Television: £14,785,105

• International Television: £946,247

• Print: £3,306,356

• Online: £181,344

• Total: £19,219,052

Coupled with new broadcast

opportunities for a title partner,

Aintree Racecourse has continued to

develop an extensive, exclusive rights

package over the years, delivering a

brand media value which has doubled

to almost £20m in the time John

Smith’s has been involved (see Profile).

While Aintree is looking for a

minimum three-year commitment

from a new title sponsor, based on

the duration of the rolling contract in

place with John Smith’s, a longer-term

deal would also be considered.

“We very much see this as a

partnership. We want to see a win-win

for the sponsor and the racecourse,

and of course for the race itself, so we

would definitely entertain a longerterm

deal,” says Baker.




Pepsi leads the way for IPL

sponsorship growth

By Luke Harman


projected to increase its sponsorship

revenue by more than a third after

securing Pepsi as the new title sponsor

brand of the competition and renewing

a central sponsorship deal with

incumbent partner Vodafone.

One of only two bidders for the title

sponsorship, PepsiCo India will pay the

Board of Control for Cricket in India

(BCCI) – rights holder of the IPL – 396.8

crore ($72.5 million) over a five-year

period, covering the 2013-2017 iterations

of the competition.

Telecommunications company Bharti

Airtel, an existing partner of the BCCI as

a national team Test series sponsor and

title sponsor of Formula One’s Indian

Grand Prix, was the other interested

party in the title rights, tendering a bid

of 316 crore ($57.7m).

Sports Marketing Frontiers

understands that a total of six companies

purchased the tender document from

the BCCI, including Coca-Cola – Pepsi’s

biggest industry rival globally.

Replacing India’s largest real estate

construction company DLF, PepsiCo India

will invest almost double – in Indian

Rupee terms – the amount DLF paid for

title sponsorship rights.

Meanwhile, the IPL‘s renewal with

Vodafone, thought to be worth around

34 crore ($6.21m) per year, represents an

uplift of over 50 per cent, in rupee terms,

having previously agreed a deal in the

region of 20 crore ($3.65m) per year for

the 2008-2012 cycle. This now means a

co-sponsorship deal for the new contract

period is valued at a similar rate to DLF’s

title sponsorship contract.

Vodafone is the first incumbent

central partner of the competition to

extend its association. Should the IPL

secure a further five central partnership

deals, making a total of six co-sponsors

– the same as at the end of the 2008-

2012 period – the tournament will bring

in over $50m per year in sponsorship

revenue, compared to $37.3m in the

final year of the previous cycle.

There had been speculation in some

quarters that the IPL might struggle to

attract lucrative sponsorship contracts

as a result of a drop in domestic viewing

figures for the first time in 2012.

However, speaking exclusively to Sports

Marketing Frontiers, Sundar Raman,

CEO of the IPL, said: “In 2008, the bid

guide for the title sponsorship was set

at roughly 23 crore, which fetched a bid

value of 40 crore from DLF.

“This time, we set the base price at 60

crore and we ended up with an average

of 80 crore per year. I will leave it to

others to work out whether the IPL has

lost its sheen or not.”

The Property

The IPL will now be known as Pepsi

IPL. As title sponsor, Pepsi will receive

significant branding exposure at all

match venues, including perimeter

signage and interview backdrops, as well

as presence on all broadcast platforms,

including television, online and mobile.

As title sponsor, Pepsi, along with

the co-sponsors of the IPL, will have

first refusal for commercial options on

broadcast platforms.

In terms of broadcast coverage,

the IPL is halfway through a tenyear

television rights deal with Multi

Screen Media (MSM), which sees Sony

Entertainment Television as the domestic

broadcast partner.

While much has been made of

the drop in the domestic television

audiences, despite the fact that the IPL

was the top-rated programme in India

on 45 of the 51 match days during the

2012 season, observers point out that

there has been significant growth in

New Partners (2013-2017 cycle)

Then and Now: Sponsors of the IPL

online broadcast audiences globally.

Times Internet Limited – the internet

division of India’s largest media company,

The Times Group – owns the global

internet, mobile and audio rights for

the IPL and will imminently be looking

to commercialise such rights for the

remainder of its current four-year

contract which ends in 2014.

The Deal Makers

Sundar Raman, CEO of the IPL, has

final sign off on all sponsorship deals

and is supported by G Srinivasan as the

league’s head of marketing.

In 2008, the IPL agreed a multifaceted,

10-year deal with the UK arm

of global sports marketing agency

IMG. Among other functions, IMG is

responsible for advising the BCCI on all

commercial sales of the IPL.

Headed up by London-based Matt

Bailey, the IMG team works closely with

the IPL’s commercial team and has been

marketing the new five-year sponsorship

cycle of the league, beginning in 2013,

since April.

On the brand side, Deepika Warrier,

vice-president of beverage marketing

for PepsiCo India, is the central figure

responsible for leading the Pepsi team

throughout the duration of the contract.

How the deal was done

Previous title sponsor DLF opted not to

renew its contract with the BCCI citing

that it had achieved its primary business

Sponsor Duration Value (per year) Sponsor Duration Value (per year)

Title Sponsor

Pepsi 2013-2017 $14.5m DLF 2008-2012 $10m


Vodafone 2013-2017 $6.2m

TBC 2013-2017 $6m (approx)

TBC 2013-2017 $6m (approx)

TBC 2013-2017 $6m (approx)

TBC 2013-2017 $6m (approx)

TBC 2013-2017 $6m (approx)

Title Sponsor


*Based on IPL securing six co-sponsors as per the end of the 2008-2012 cycle.

Previous Partners (2008-2012 cycle)

Vodafone 2008-2012 $4.5m (approx)

Hero 2008-2012 $4.5m (approx)

Citi 2008-2012 $4.5m (approx)

Karbonn Mobiles 2009-2012 $4.5m (approx)

Volkswagen 2011-2012 $4.8m

Royal Challenge 2012 $4.5m (approx)

TOTAL: $50.7m* TOTAL: $37.3m




objective of establishing brand presence

across India as the country’s leading real

estate developer.

As a result, the IPL released an

invitation to tender for the title

sponsorship opportunity.

Pepsi, which had already agreed a

deal to become a co-sponsor for the

forthcoming cycle at a similar financial

commitment to Vodafone, had built into

its contract that it would be allowed to

bid for the title sponsorship.

Pepsi then emerged as the highest

bidder and consequently cancelled its cosponsorship


With the BCCI setting a base value of

60 crore ($10.9m) per year, the entry price

for the title sponsorship precluded many

companies from even considering it.

“If you look at the Indian advertising

market, we do not have too many

companies with even an annual

marketing budget of this kind of money,

so we only expected a select group of

companies to be interested,” said Raman.

Pepsi’s winning bid, which was 25.6

per cent higher than Airtel’s offer, also

helped the IPL in its deal with Vodafone.

Had Airtel secured the title sponsorship,

the IPL would have had to tear up its

agreement with Vodafone as it is a direct

competitor of Airtel in India.

Going Forward

Pepsi’s acquisition of the title sponsorship

and Vodafone’s co-sponsorship renewal

sheds lights on how the IPL will move

forward in signing up additional partners.

The significant increases paid by both

Pepsi and Vodafone will mean the IPL is

able to push for similar increases for its

remaining inventory when negotiating

with new or existing partners.

Also, the value of Pepsi’s title

sponsorship will go some way to dispel

media reports that the IPL is no longer

the powerhouse marketing platform it

once was, as well as quashing criticism of

the league’s ability to attract sustained

levels of investment from sponsors and


“Over the last five years, unique

viewers of the IPL in India have grown

from 100 million in 2008 to 163 million

in 2012, which deliver a cumulative

viewership of 2.35 billion in India alone

each year,” says Raman.

“The league also attracts 2 million

fans at the stadium over the course of

the season, which is comparable to 2.4

million fans at the 2011 Rugby World Cup,

and the official IPL website delivers close

to 80 million page views each year.”

“Commercially, our structure has not

changed,” Raman continues. “We want

to work with brands which value the IPL.

There are lots of conversations happening

and there will be more deals announced

going forward. Now we have finished

the search for a title sponsor we can focus

on the other opportunities.

“But we are happy with the fact that a

brand such as Pepsi, which understands

sport, is a big advertiser and has a strong

seasonal product to match the Indian

summer time of the IPL, emerged as the

winning bidder.

“Pepsi has a strong association to

cricket in India with lots of player

endorsements and has experienced what

sport can deliver in terms of building its

brand and a more

muscular business.”

Board Report by Sukhmani Singh, Marketing Communications Manager,

Commune Sports & Entertainment

Pepsi’s brand communication in Indian

sport has been somewhat ambiguous

in recent years. In 2011, as an ICC global

partner, Pepsi launched an integrated

activation and advertising campaign

around the Cricket World Cup,

highlighting how young professional

cricketers in the Indian subcontinent had

‘changed the game’.

The campaign was reinvented earlier

this year to promote football rather than

cricket. At the time, Pepsi stated that

football was gaining popularity amongst

Indian youth and as a youth-centric

brand, it was keen to be associated with

the sport.

But within six months, Pepsi has

secured title sponsorship of the most

ubiquitous cricket property in India, if

not globally. Pepsi is perhaps guilty

of mixed messaging, but it cannot be

faulted for the marketing motivations

that I believe drove it to strike such a

high-profile partnership.

Execution aside, Pepsi’s core brand

strategy in India has always been youthfocused.

Around 60 per cent of India’s

population (over 700 million people)

is under the age of 30 and T20 cricket

draws in younger audiences that Pepsi

will hope to engage with via the digital

space; an area the IPL has not fully

exploited to date.

Commercially too, the rights fee of

just over $14m per year seems affordable

for Pepsi given the group’s reported $1.7

billion marketing budget for 2012 alone.

The investment and activation spend

could pay for itself simply based on the

economies of scale that India offers.

Though Pepsi has the upper hand in

the flagship cola sector in India, as an

overall brand offering, PepsiCo beverage

products trail Coca-Cola products in

terms of national market share. Pepsi will

be hoping to cover some of that ground

and also preserve its cola dominance

over the next five years by leveraging IPL

effectively in the peak soft drinks season.

Having dabbled in numerous sports

sponsorships in the Indian subcontinent

(including Pakistan), Pepsi has perhaps

decided to consolidate its marketing

spend into one premium property. As

sponsorship in India emerges as an

accepted marketing medium, brands

will need to take strategic ownership of

key areas to break the clutter, as Pepsi

appears to be doing with cricket.

One could argue that the falling

standards of the sport in India may be

a cause for concern for the IPL and by

extension Pepsi, but to discount the

marketing might of cricket in India

would be a rookie mistake. Pepsi is no

rookie in the world of sports marketing.




CRM’s key role in Emirates’ renewal

with Arsenal

By Matthew Glendinning

IN NOVEMBER, the Dubai-based

airline Emirates and English Premier

League club Arsenal FC announced

a five-year extension to their shirt

partnership until the end of the

2018/2019 season and to the stadium

naming rights partnership, which was

set to elapse in 2021, for a further

seven years until 2028.

The deal is worth £150 million with

the vast majority of the new deal

relating to the shirt rights.

The club told Sports Marketing

Frontiers that this is “due to the fact

stadium naming rights have not really

taken off in the UK and with Emirates

as the incumbent there is limited

appeal in the broader market.”

The Property

Emirates first signed its dual

sponsorship agreement with Arsenal

in 2004 in a deal that was worth £90m,

covering 15 years of stadium naming

rights (£42m) and eight years of shirt

sponsorship (£48m).

At around £3m per year, the then

biggest naming rights deal in British

football conferred badging rights on

the stadium and provided an awareness

platform for the Emirates brand across

all media channels.

Under the new deal, the Emirates

brand will continue to appear on the

front of Arsenal’s playing and training

kits and the new agreement contains

a number of marketing rights, which

come into effect immediately, to ensure

Emirates can engage with Arsenal fans

in the UK and abroad.

The Deal Makers

The new agreement was formally

agreed between Arsenal chief

executive, Ivan Gazidis and Emirates

divisional senior vice president,

corporate communications, Boutros

Boutros. Also working on the deal from

the rights holder side was Arsenal’s

chief commercial officer Tom Fox,

marketing director Angus Kinnear

and head of global partnerships Vinai


The Clincher

The agreement extends and deepens

one of the strongest and most

recognisable partnerships in sport,

which has done much for brand

awareness of the airline brand.

The decision for renewal however

was given impetus by the club’s

revamped Customer Relationship

Management (CRM) system, which

Emirates will use to launch more

targeted marketing campaigns.

As Emirates’ Boutros told UK

news sources: “Data on customers

is important to us like it should be

for any business. The price of media

is increasing every year and having

detailed data on customers allows us

to work out where we spend our ad

budgets and who we target as well as

what markets we focus on through the

club’s channels.

Boutros Boutros continues: “We

have a vision of where we want to be

with a business and we want to work

with Arsenal to get there. We know the

club is growing and that’s important for

us as a brand. We work long-term and

need to be associated with a club in the

long-term to achieve scale. For Emirates,

Arsenal is that club.”

What does it mean?

Data is becoming an increasingly

valuable tool in the way football clubs

prove their value to potential partners

with English Premier League clubs

Arsenal, Manchester City, Chelsea and

Manchester United, in the vanguard of


The driver of Arsenal’s current CRM

strategy is Charles Allen, Arsenal’s head

of marketing, who joined the club in

2010 after stints with FMCG and drinks

brands, including Doritos, Coca–Cola

and Johnnie Walker.

“The work and investment in

CRM capability and technology is an

increasingly important part of the

whole story of Arsenal and the kind

of activity that brands are beginning

to expect from an organisation like

ourselves,“ says Allen.

“We were very keen to look beyond

football when benchmarking against

other organisations. As a football club

we think we do things pretty well, but

we look at Amazon, John Lewis and

Sky Sports and how they operate across

CRM, ecommerce and membership

subscriptions for our CRM benchmarks.”

The activation of the club’s CRM

upgrade has been two-pronged.

Not long after Allen’s arrival, the club

embarked on its biggest ever customer

research programme, which was carried

out by the market research agency

Flamingo. “We want to change our

conversation internally from ‘we think

we know what our club stands for and

what our fans and customers think’ to

‘we know this about our club and what

our fans and customers think’”, Allen


This research prefigured a complete

overhaul of the CRM system by the

club’s in-house consultant on the

project, IBM. “We could have looked

at the CRM operators active in football,

but said ‘no, if we want to be truly

world class, we have to get in the best,’.

IBM has helped transform the club’s

CRM capability and infrastructure and

we’re in the process of overlaying the

marketing suite and call centre.”

What will this capability do for the

club and sponsor brands?

Allen says that the club has thus

far tapped into a limited section of its

fan base comprising the “whole sports

organisation” including the stadium

goers and the membership scheme of

which there are 200,000 members and

where the club has seen double-digit

growth on an annual basis.

But the real opportunity, he says,

is “how we tap into Arsenal fans

worldwide and get them to interact

with the club based on their individual


As proof of this, Allen points to

the 12 million Facebook likes; the

two million followers on Twitter; the

60 million unique page views on the

official website,, and the

34 million unique users of the online TV

channel, Arsenal Player.

“These are all people who are

leaning into the club but we haven’t

had the CRM infrastructure. That’s

not good enough. Once we go live [in

the New Year], we will suddenly have

a relationship with a high number of

fans, personalised and offering Arsenal


While Allen doesn’t claim credit for

the Emirates’ renewal, he says that he




Naming rights - recent renewals

has presented the club’s CRM strategy

to commercial partners and in person

with Emirates’ Boutros.

Access to the customer data for

Emirates as Arsenal’s principal partner

will clearly be greater than for secondtier

partners, but there should be value

with partners across the board due to

the CRM systems ability to segment fans.

“We need to cluster fans in bespoke

groups based on their interests and

behaviour and anticipate what the next

offer should be,“ says Allen. “Events

dictate the fans’ journey – from child

dependency on parents, to university,

start of career, first mortgage, children

and so on.

“At the moment there is not a

massive correlation between affinity

and transaction, but as we get to

know our fans better we will be able

to better influence behaviour in this

direction... leading to higher rates of


Signal Iduna Park

In May 2012, Bundesliga champions Borussia Dortmund signed a naming rights

renewal that gives Signal Iduna, a local insurance company, brand association

with Germany’s largest stadium through 2021. The partnership which began at

the end of 2005 and the contract extension will see the deal through to 2021.

Signal Iduna has also increased its annual payment from €4m to between

€4.5m and €5m after the deal extension.

Edward Jones Dome

In March 2012, the St. Louis-based financial services firm Edward Jones

announced the renewal of it naming rights agreement with the NFL’s St. Louis

Rams, extending for 11 more years. The facility will continue to be called the

Edward Jones Dome and will see Edward Jones pay the Rams $42.3m over the

course of the agreement which extends from April 1, 2014, through March 31,

2025. The original contract term was 12 years at $32.7m.

Bridgestone Arena

In December 2011, Bridgestone Americas extended its naming rights deal for

the Bridgestone Arena, home of the NHL’s Nashville Predators. The five-year

extension, which takes the partnership through to 2019, comes less than two

years into the current five-year contract between the two parties. Although

financial details have not been released, reports valued the initial sponsorship

agreement at around $2.5m a year

Board Report by Matt Rogan, Managing Director, Two Circles

This is an interesting deal on a number

of levels. There is no doubt that

Premier League clubs can trot out

some initially compelling statistics

around the size of their fan bases.

The global power of the Premier

League has enabled individual clubs

to develop fan bases that run into

millions - Arsenal are reported to

have over 12 million Facebook fans

and 2 million Twitter followers. These

fans tend to be extremely loyal and

receptive potential customers.

Only now are football clubs

realising that they have much more to

offer sponsors than in previous years,

in particular with regards to fan loyalty.

Increasing use of technology and

corporate best practice in this space

has enabled rights holders to develop

significant, data-driven marketing

programmes, for example our work

with Manchester City. Recently this has

also started to spread beyond football,

as showcased by our partnership with

Harlequins Rugby Union.

It is high time that rights holders

realise the opportunities presented

here, as sponsors are becoming

increasingly demanding of the value

that rights holders provide to them.

They are insisting on more value

than the traditional awareness and

exposure from major sponsorship

agreements, but demand the ability

to use their sponsorship programmes

to actively drive new business.

Sponsorships become business

partnerships – built from the bottom

up, with a focus on understanding and

monetising key areas of the fan base

for the benefit of club and sponsor.

The truth is that many sponsors are

often initially savvier than the rights

holders at using data and technology

to drive customer engagement. Data

and customer management has been

part of daily life for most corporate

branded businesses for ten years or

more. All credit to Arsenal for catching

onto this area relatively quickly.

Customer insight, loyalty and retention

are at the heart of Emirates’ business

strategy as a premium airline, and so

it must be at the heart of Arsenal’s to

grow this commercial relationship.

Well executed, a data-driven approach

should also offer Arsenal more

inventory to manage. The more the

club is able to understand and engage

with each customer at an individual

level, the more it will be able to ensure

the right message goes to the right

fans at the right time. Those customer

bases of less use to Emirates may be

of more interest to additional partners.

This is more akin to the role of a

planner at a TV station – managing

the available inventory to maximise

commercial return. Increasingly rights

holders are also looking to datadriven

marketing technology to target

customers for both their own benefit

– selling more tickets, hospitality,

merchandise – and to develop

significantly better opportunities

and benefits for their commercial

partners. Those same techniques can

even be used to drive participation for

governing bodies. Arsenal’s deal with

Emirates is a sign of things to come.

In three years time, the data driven

nature of this relationship will be the

norm rather than the exception.




Sony Mobile sets

app standard

By Matthew Glendinning

THE BETA RELEASE of the Xperia Lounge

application (app) by Sony Mobile

Communications promises to set a new

benchmark in the use of sports and

entertainment content by sponsor brands.

The Android app is a destination

for accessing new content from Sony’s

portfolio of partners and sponsors,

including exclusive content from its FIFA,

WTA and Billabong partnerships, on a


Xperia Lounge is designed for all

Android users, but only owners of Xperia

smartphones will have access to the full

range of content including exclusive

VIP experiences and streaming mobile


Says Giancarlo Bernini, head of

sponsorship at Sony Mobile: “We’re using

the Xperia lounge to drive consumer

engagement - bringing together and

harnessing all our sponsorship and inhouse

assets on one platform.

“Xperia Lounge gives consumers access

to unique entertainment experiences

which only Sony can deliver. It is part

of our wider mission to engage with

consumers in a more intimate way by

creating immersive experiences on their

Xperia smartphone wherever they are.”

In addition to content from Sony’s

sponsorship portfolio around the world,

Sony is well-positioned in film, music and

gaming, adds Bernini.

The app, for example, launched with

exclusive content from Coldplay, the

chance to win tickets to see Swedish

House Mafia on their farewell worldwide

tour and an opportunity to attend FIFA

events such as the recent FIFA Club World

Cup 2012 as well the FIFA Confederations

Cup Brazil 2013 and the FIFA Interactive

World Cup 2013.

Given this spread of content and

how it touches consumer passion points,

Bernini says that Xperia Lounge is not just

a marketing tool for Sony Mobile, but is

“a Sony unifier”, which in time will bring

together assets from across the entire


“Smartphones are becoming more of

a media channel in which you can do it

all, 24/7, enabling you to gather insights

into consumer behaviour that can allow

you to connect more effectively with your

target audience,” Bernini explains.

Content that works for one brand

however may not work for another and

Bernini suggests that rights holders

should differentiate content rights

associated with sponsor-led mobile

apps according to the goals of each

commercial partner.

“If I was a rights holder, I would ask

myself which brand is going to activate

the sponsorship in the best possible

way and not simply share out the same

content. The rights should be relevant to

each individual sponsor based on their

objectives,” he says.

“For example, the behind the scenes

access to women’s tennis we offered as

part of the Xperia Hot Shots activation

in 2011 received over 5 million views on

YouTube. This is good for the rights holder

too as it offered a fresh perspective on

the sport.”

The type of content typically used by

brand-sponsored mobile apps - action,

interviews, behind the scenes access,

gaming, social media engagement - are

not exclusive to mobile handset brands,

but handset makers have more reason

than most to create app platforms.

Recently, the Taiwanese handset

maker HTC became the official mobile

phone and tablet computer of both

the Champions League and the Europa

League football competitions so that

it can offer unique content, access and

experiences on its mobile devices.

For the Champions League, HTC will

join adidas as an official supplier, which

is effectively a tier two sponsorship

below the six official partners. In regard

to the Europa League, HTC will serve as

an official partner of the competition

alongside Hankook.

But both properties will facilitate HTC’s

plans to deliver experiences to football

fans on their mobiles through creative

content and using the latest technologies

in the lead up to, during and after


Mobile brands are forcing the pace

in sponsor app development, but

the smartphone revolution is driving

change for sponsors from all sectors.

As MediaCom’s global head of sport,

Marcus John, sums up: “The technology

is driving the speed of change. The first

digital Olympic Games were in London,

but in Sochi and Rio there will be a very

different use of apps by sponsors.”

News in brief


The National Rugby League (NRL) in

Australia has agreed a multi-faceted

extension to its title partnership with

telecommunications firm Telstra. Along

with extending naming rights for the

Telstra Premiership into a record 17th

season, Telstra will form NRL Digital

Media, a unit dedicated to providing

fans unprecedented online, mobile and

tablet access to the sport.

For the first time, Australian rugby

league fans will be able to watch

Premiership, State of Origin and Test

matches live to-air on mobile phones

and tablets via the official NRL app,

regardless of their network operator.

Fans will also have access to extensive

highlights packages during and after

games, access to an alternative camera

angle during the broadcast and to

exclusive post-game features and press

conferences on their mobile and tablet

devices. “Australians have embraced

smartphones and tablet devices and this

partnership provides for us to make the

app and its live coverage available to all

NRL fans where and when they want

it,” said Telstra chief executive officer,

David Thodey.

Under the terms of the five-year

renewal, Telstra has reportedly doubled

the A$90 million ($95m) it is thought

to have paid for the previous five-year

contract signed in 2007.


Euroleague Basketball sponsor bwin

has announced the launch of ’10

Minute Madness’ a new interactive

digital game.

Created by ideas and innovation

company AKQA, the second screen

social gaming platform challenges

sports fans to predict the outcome of

the game as it unfolds in real-time.

Available across multiple platforms the

‘free play’ game has been optimised

for both iOS and Android tablets and

smartphones as well as traditional

browsers. Game players will be

rewarded with points for each and

every quarter by anticipating winning

teams, scorers, scores and more.

Correct predictions are then converted

into points for the chance to win

exclusive prizes including VIP Courtside

tickets for the Euroleague final in

London, signed jerseys, merchandise

and game tickets. Users can also

connect socially via 10 Minute Madness

using the hashtag #makeyourplay.



Axiata Cup innovates

with virtual advertising

By Matthew Glendinning


behind the award-winning Axiata Cup

badminton tournament in Southeast

Asia will continue to develop its groundbreaking

activation programme for the

event’s second series in March-April 2013.

Total Sports Asia’s (TSA) brief for the

team event was to create a compelling

and high-profile marketing vehicle for its

title sponsor, Axiata, one of Asia’s largest

telecommunication companies, with

controlling interests in mobile operators

across Asia.

Assigned as title sponsor in a threeyear

deal beginning 2012, the telco’s two

main objectives in sponsoring the Axiata

Cup were to create awareness of Axiata

as a company, while establishing stronger

links with its operating company

subsidiaries; and to create revenuegenerating

opportunities through an

event which would provide marketworthy


To that end, TSA developed a

competition which was hosted in two

countries – Indonesia and Malaysia, both

hotbeds for badminton – using a home

and away team format to create greater

traction with local fans and provide

more live coverage.

The four-week event featured

eight teams from Indonesia, Malaysia

(Malaysia and Indonesia fielded two

teams each due to their strength in

badminton), Singapore, Thailand,

Vietnam and the Philippines.

The event offered the world’s largest

team prize money in the sport with

a total purse of $1 million, ensuring

that the Axiata Cup would also attract

international stars from China, Denmark

and other strong badminton nations to

play for the nationally-based teams.

The format clearly worked both

at the promotional stage in terms of

international TV distribution and in

the engagement from fans during the


For the first series, the Axiata Cup

was distributed to 25 countries across

Asia and the United States with over 150

hours of live broadcast coverage for the

preliminary rounds alone.

In addition, over 270,000 videos were

viewed on YouTube.

Despite healthy figures on written

press reporting worldwide (738 articles),

broadcasts provided the lion’s share of

awareness value.

In all, the title sponsor received over

328 hours of exposure on TV with 3,000

promotional spots along with 3,000

verbal mentions during coverage.

The media story was further enhanced

by an activation strategy that saw

the first use of virtual advertising on

perimeter boards in badminton.

This involved introducing sponsor

logos and messages on the upstream

of the live TV feed, thereby reducing

distraction for players on court, and

creating new opportunities for

sponsor brands with the flexibility to

change messaging according to the

circumstances of a particular game.

With TSA’s Media Distribution team

selling Axiata Cup TV content around

the globe – from Canada, USA, China

and India to its core region of Southeast

Asia – the virtual advertising tool offered

additional benefits for both Axiata and

external sponsors.

For the title sponsor, it allowed

Axiata’s local subsidiaries to promote

specific initiatives.

Axiata’s mobile subsidiaries and

associates operate under different

brand names per country - ‘Celcom’ in

Malaysia, ‘XL’ in Indonesia, ‘Dialog’ in

Sri Lanka, ‘Robi’ in Bangladesh, ‘HELLO’

in Cambodia, ‘Idea’ in India and ‘M1’ in


Using virtual advertising, each

local operating company brand

could associate with the event, while

additional revenues were generated

through event-related SMS quizzes

which involved grand prizes like Nissan

cars from a regional dealership.

The use of virtual advertising also

provided more value to local brands

which supported the Axiata Cup via

associate partnerships which either

provided financial or in-kind support

such as hotel nights, beverages and


TSA won the Event Marketing

award for the Axiata Cup at the 2012

International Sports Event Management

(ISEM) Awards – and will highlight plans

for the 2013 activation programme in

the Sports Marketing Frontiers digital

weekly news service, Frontloaded, in the

coming weeks.

News in brief


GMR Marketing

GMR Marketing, the global sports,

entertainment and lifestyle marketing

agency, has announced an expansion

into Russia ahead of the Sochi 2014

Winter Games after revealing plans to

launch a new office in Moscow.

With Russia set to stage the 2014 Sochi

Winter Games and the 2018 FIFA World

Cup, GMR has launched the new office

to capitalise on the growing demand

for sports sponsorship strategy in

the region. “Russia is fast becoming

a crucial market in this space,”said

Cameron Parsons, GMR’s international

managing director. “First and

foremost, we’re entering the market

as the trusted partner of our global

clients who see a rich opportunity

in a key growth market. We expect

local relationships to grow from the

experience and counsel we bring to



BMW Group UK has appointed Synergy

Sponsorship as strategic agency partner

for its four-year sponsorship of the

Rugby Football Union (RFU). BMW

selected Synergy after a competitive

pitch to advise on the sponsorship,

which was announced in April 2012.

As the Official Vehicle Partner of

England Rugby, BMW Group UK

will invest in England’s elite agegrade

development programme. In

addition, BMW Group UK will engage

rugby supporters and BMW and

MINI customers through the RFU’s

digital channels and at Twickenham

Stadium on international match days.

The appointment builds on Synergy’s

existing relationship with BMW.

In 2010 Synergy were appointed in a

similar role to advise on the strategy

and activation of the BMW Group UK

London 2012 Tier One partnership.


FIFA World Cup sponsor Continental is

ramping up its association with football

in the UK ahead of the 2014 World Cup

by becoming a sponsor of commercial

broadcaster ITV’s coverage of the

England football team in 2013.

The tyre maker says it signed up to a

seven-figure deal that also includes

headline sponsorship of Dancing

On Ice. Both sponsorship deals were

negotiated by Initiative. The idents will

be made by Palmer Hargreaves.




Brands connect with

NASCAR fan loyalty

By Jared Melzer

UNLIKE FORMULA ONE, the foundation

of NASCAR doesn’t lie in glamour. In a

world where sports stars are put on the

highest pedestal, NASCAR has remained

true to its roots as one of the most fan

friendly and accessible sports in the


Credit to NASCAR that when times

got a little tough a few years back,

NASCAR kept its foundation, while

continuing to evolve and adapt to the

always changing market – and this was

reflected in the sponsorship landscape

in 2012.

NASCAR: Review of the Year

Probably the biggest moment for both

NASCAR and all brands involved in

the sport in 2012 was the renewal of

the broadcast deal with Fox Sports

Media Group in October. The long-term

commitment of eight-years at $2.4

billion – a 33 per cent increase from the

current deal – indicates that NASCAR is

back on the rise and demand is strong.

Major brands like National Guard,

Napa Autoparts, AARP and BestBuy

have all renewed with their respective

teams. Against that, Tony Stewart’s

major sponsor Office Depot bowed out

after restructuring brand and business

priorities. In its place however comes

Bass Pro Shops, an outdoor recreation

equipment brand that fits well with the

NASCAR demographics.

Also new to the Sprint Cup Series is

5 Hour Energy, a company which raced

in the mid-tier level starting in 2008.

Why switch to the top-tier? According

to Scott Henderson, President and

COO, the decision was made based

on NASCAR’s credibility (top of the

top), media exposure, hospitality and

better drive and leverage for retail


Long-term partners continue to

meet their business objectives though

NASCAR. Mars, a 23-year partner of

NASCAR, has impressed with a fully

integrated strategy that brings a lighthearted

spirit to the sport. The company

was awarded the 2012 NASCAR

Marketing Achievement Award for its

success in engaging race fans, customers

and associates. Mars pioneered a TV

panel programme, which places the

logo of key Mars retailers on screen.

Since then, many brands have leveraged

B2B relationships to drive B2C goals.

Another example of longevity in the

sport is Lowe’s Home Improvement.

Lowe’s took something of a risk by

sponsoring a relatively unknown driver

in Jimmie Johnson in 2001.

Today, with five Sprint Cup

Championships to his name, Johnson

and Lowe’s are synonymous. Over that

tenure, Lowe’s has gone from $18.8bn

in annual sales and 576 stores to a 2011

total of $47bn in sales and 1,725 stores.

Johnson has also been instrumental in

promoting the company’s own line of

tools, Kobalt.

What can we expect in 2013?

The sport will continue to evolve while

staying true to its roots.

The New Year ushers in new cars from

the three manufacturers - Chevrolet,

Toyota and Ford – providing a strong

connection between what’s being raced

on the track and what’s being driven

on the streets. Ironically, Dodge, which

Brad Keselowski drove to his first ever

Sprint Cup Championship in 2012, leaves

the sport in 2013, although many are

hopeful that Dodge will return to the

sport as they did in 2001.

2013 will also see NASCAR back in

full control of its digital assets. After

numerous years in which Turner Digital

Sports managed content and sales on, the keys are back with

NASCAR. Turner will still be involved on

the sales side, however the new website

NASCAR Market Metrics

is scheduled to launch in the first week

of January. It will be interesting to see

how well sponsors will be integrated

into the new digital platforms.

What could NASCAR do better in 2013?

Better communication between

NASCAR, tracks, teams and sponsors

– like many complex organisational

matrixes, the flow of information

can always be refined. NASCAR has

an industry services team to improve

communications among the groups.

Connectivity at the track – in every

sport, smartphones can enhance

live viewing, however a smartphone

without a data source or Wi-Fi has little

value to the fan.

Sprint, being the league’s title

sponsor, has the best coverage at

the tracks, leaving the avid NASCAR

attendee little choice but to switch.

Whether this is a smart sponsorship

strategy or frustrating fan experience is

open to debate.

Diversity – in a country where the

white male is quickly becoming the

minority, NASCAR needs to cultivate a

more diverse generation of drivers and

fans. The first ever Spanish language

broadcast of the Daytona 500 on Fox

Deportes in 2013 is a step in the right


Business solutions – the cookie-cutter,

asset-provider approach is a philosophy

of the past. Sponsors must find ways to

enhance the fans’ experiences within

the sport, while at the same time, tying

back to strategic components that align

with business objectives.

• 50 per cent of NASCAR fans agree, “I always buy products or services from companies that

sponsor NASCAR” and “I always participate in NASCAR sponsors’ promotions.” (Experian

Consumer Research)

• NASCAR is the #1 sport among youth viewership between ages 2-17 with 351,000 viewers

(Experian Consumer Research)

• 86 per cent of avid NASCAR fans recognise sponsor brands, outscoring Major League Baseball

and National Football League. (Wall Street Journal).

• NASCAR fans are more than twice as likely to own a motorcycle, recreational vehicle and allterrain

vehicle than non-fans (Experian Consumer Research).

• The total exposure value for all TV-visible sponsor brands in the NASCAR Sprint Cup Series in 2012

increased by seven per cent over 2011, totaling over $1.2 billion across the 10-month season.


• 20 per cent of Fortune 500 companies are involved in some capacity with NASCAR.




Airlines rise up to meet

national ambitions

By Phil Savage and Matthew Glendinning

IN MANY WAYS some airlines are like

armies: they carry a country’s flag,

take it into new territories and the

impression they leave lasts long in the

memory around the world.

Using a national flag carrier has

the advantage of being considerably

cheaper, with less collateral damage

than actually invading, which is perhaps

why states looking to put themselves

on the map invest in their airline.

It is this branding benefit that often

keeps the planes flying despite there

being no other economic rationale and

one among a number of reasons to be

positive about airline sponsorship.

The Middle East is home to three

of the most brash and shiny of the

emerging flag carriers with Emirates,

Etihad and Qatar Airways spending

big on their fleets and on sports

marketing to establish themselves as a

regional hub and stopover destination

for flights from North American and

Europe to Asia.

Emirates recently signed a major

shirt and naming rights deal at

Arsenal (see pages 6-7), Etihad has

part bankrolled the renaissance of

Manchester City and Qatar Airways has

just replaced the Qatar Foundation on

the shirts of FC Barcelona.

These are not the only ambitious

examples however, with Turkish

Airlines bound up with that country’s

international strategy and spending

big to achieve it on golf, football

and motorsports as well as backing

Istanbul’s bid to host the Olympic

Games in 2020.

Small wonder then that expenditure

from the airline industry went beyond

the half-billion dollar mark in 2012,

reaching $515m, according to a report

from Sponsorship Today – and that’s

before FC Barcelona’s switch from the

Qatar Foundation to Qatar Airways.

Two carriers, Emirates and Etihad,

accounted for almost half the entire

amount spent globally on sponsorship.

Sponsorship Today editor, Simon

Rines, agrees that the sponsorship

investments are part of a strategy to

create a global airline superpower.

“Emirates is driving a strategy to

develop Dubai as the world’s leading

aviation hub. The Gulf state is in a

prime position to link the Americas and

Europe to Asia. To achieve this, massive

investment has been made in airport

facilities in Dubai, and Emirates has

spent more than $80bn on a modern

fleet of aircraft.

“But without developing the brand

and communicating the route network,

the growth plan cannot succeed.

Emirates has used sponsorship as a key

tool in both building brand image and

informing potential customers about

its route network. The annual $182m

rights spend could be argued to be a

very small investment compared to that

spent on infrastructure.”

In contrast, US carriers, the report

says, continue to invest around $100m

in sport between them annually,

although this is almost exclusively for

domestic sports rights with Delta and

United leading the way.

Delta, for example, has a long history

of service with baseball, including

partnerships with its hometown Atlanta

Braves as well as six other MLB clubs,

while United is naming rights partner

to the United Center in its hometown

Chicago, as well as the United States

Olympic Committee and the PGA Tour.

Low cost carrier JetBlue is also using

sponsorship as a major marketing

weapon and now outspends its bigger

rival Southwest.

The New York-based airline recently

become the official domestic airline

of the Barclays Center in Brooklyn in

a bid to consolidate its position in its

northeastern heartlands, where it is

also the Official Airline of the Boston


As low-cost carriers in the United

States increasingly targeting new routes

to the Caribbean, Mexico and further

south, more sponsorship opportunities

will arise.

Southwest, for example, has

expanded overseas by buying AirTran

Airways, which flies to Mexico and

half a dozen Caribbean countries –

and every new route or re-brand will

require marketing.

The report however shows that

Europe’s ‘legacy’ carriers have generally

cut back on sponsorship spend under

the pressure of big losses and increased

competition. Aeroflot is now the

continent’s biggest spender having

taken rights to both Sochi 2014 and

CSKA Moscow, with British Airways and

Turkish Airlines the only other carriers

to make the top 20 in sports investment.

For legacy carriers, one could argue,

the prognosis can look weak but that

reckons without often their most

attractive asset: takeoff and landing

slots. Carriers like Iberia, AirFrance, BA,

Lufthansa and others will always have a

value whilst they retain a stranglehold

over slots on prime routes.

News that Virgin Atlantic is close

to selling a 49 per cent stake to Delta

Airlines seems to be being driven by

this logic and even here there are some

useful opportunities.

Sponsorship remains a tried and

tested way to keep these legacy

carriers front of mind with consumers,

particularly if the company can show

it has some high profile sports stars on


Turning awareness and preference

into ticket sales is a challenge

particularly when low-cost carriers are

constantly evolving their operations

and snapping at the heels of the big


Ultimately though, their cost

advantage is fragile and there is already

evidence that some are starting to

compete on service as well as on price

alone. Communicating that is another

job that sports marketing might do.

Beyond the Middle East, Europe and

America, spend among East-Asian based

carriers is relatively low, with Korean

Air and AirAsia the most serious players,

although in Australia both Qantas and

Virgin Australia have invested in high

value sponsorship rights.

The Sponsorship Today report

predicts that airline sponsorship will

continue to grow and suggests that

the desire to create global hubs and

the emergence of Chinese and Indian

airlines as increasingly important

international carriers will drive

increased spending.




Anthony Wong, Affiliate Manager,

Paddy Power

By Luke Harman

LOVE THEM OR hate them, one thing

about Paddy Power cannot be denied.

The Irish bookmaker has dominated

sports marketing headlines in 2012 as a

result of its unashamed ambush activity

at some of the world’s most high-profile

sporting events.

Instantly memorable was “Sky

Tweet”, the skywriting stunt which saw

motivational messages for Team Europe

displayed above the greens at the

Medinah Country Club in Chicago at this

year’s Ryder Cup.

Less memorable but no less brazen

was the brand’s poster campaign during

the London 2012 Olympic Games,

including a giant billboard at London

Bridge train station which read: “Official

sponsor of the largest athletics event in

London this year! There you go, we said

it. (Ahem, London France that is).”

Despite LOCOG’s best efforts to have

the campaign removed, Paddy Power

successfully defended the promotion

which was allowed to run its course.

Perhaps the brand’s least

sophisticated marketing ploy of 2012

was Nicklas Bendtner’s Paddy Pants

reveal at the European Championships

in Ukraine. The stunt landed the Danish

striker with a one match ban and a

€100,000 fine, which the bookmaker

duly paid and gratefully wrote off as

a small price to pay for what Anthony

Wong, affiliate manager at Paddy Power,

describes as “one of the funniest things

we have ever done”.

“Because of where it happened, the

amount of interest and the amount of

eyeballs that saw it, it was massive,” he

says. “As a story and because of the fine

that came along afterwards, it had an

impact for a significant period of time.

And I can assure you, right now that

impact is still going.”

The stunt had its biggest impact for

the Paddy Power brand in Denmark,

Bendtner’s home nation.

“People have told us that the pants

have become so popular over there that

we could sell them in shops,” says Wong.

“Unfortunately, we only operate in

regulated markets and Denmark is not a

target market for us.”

Despite not being able to maximise

the brand’s popularity in Denmark and

other unregulated gambling markets

by expanding its customer base, Paddy

Power attributes Euro 2012, and Nicklas

Bendtner’s role in particular, to a

substantial lift in revenues and pre-tax

profit in the first half of 2012 to June 30.

During the tournament, Paddy

Power took bets worth €78m and

further benefitted from “the increased

distinction of the Paddy Power brand

and the 50 per cent increase in online

customer acquisition in the period”,

according to an official statement

released by the company after the

event. Not bad considering Paddy Power

operates only in Ireland, the UK and, as

of September, Italy.

While Paddy Power appears as the

brand which causes sports marketing

mischief and laughs in the face of official

sponsorship and brand guidelines at

some of the world’s leading sports

events, there is much more to the

company’s marketing and sponsorship

operation than meets the eye.

Official sporting partnerships are

just as important for the company’s

wider marketing strategy, and with the

largest marketing budget of the major

gambling brands – according to Paddy

Power – the brand retains an impressive

portfolio of partners past and present.

Just this year, Paddy Power became

the official betting partner of Everton,

Liverpool and Manchester City in the

Premier League, agreed a two-year

deal with Six Nations rugby champions

Wales and enhanced its wide-ranging

sponsorship agreement with The Jockey

Club which sees the brand maintain an

extensive presence in British horseracing.

“We have had a lot of experiences

with major football clubs, rugby clubs

and racecourses,” says Wong.

“We’re lucky in the sense that

because we have partnered with so

many different clubs and sports across

the board, we can use past data to

evaluate prospective deals which gives us

an edge when we go into meetings with

potential partners.”

Continues Wong: “From the start,

before any negotiations take place, we

work with potential partners on what is

needed from our side because it’s very

important to establish ROI objectives

early. I then instruct our analytical team

and the commercial team to come up

with an estimate of what the deal would

bring us in terms of an ROI.

“In the past two years we have

developed our own analytical tools,

which we are very proud of because

they are very accurate in reflecting the

market and our ROI expectations, which

enables us to constantly review what’s

going on and how we can optimise our

activity throughout a campaign.”

Such an approach affords Paddy

Power a strong position when

approaching negotiations; the company

will not pay more for rights fees than

what it believes available assets to be

worth. Nevertheless, Wong is a strong

advocate that a sponsorship-based

partnership, negotiated and executed in

the right way, can bring many benefits

for brand, property and fans alike.

“Our mission is to try and bring

entertainment into gambling,” he says.

“We’re not just about taking fans’

money away from them; we will provide

value back to the audience that engages

sports’ fan bases, which is what the

clubs want. Sponsorship is for long-term.

Therefore, constant evaluation and the

exchange of ideas between two parties

is extremely valuable, but the fan always

has to come first – it’s very important for

the fans to have a great experience.”

For all of the meticulous preparation

behind a Paddy Power sponsorship,

there seems a risk that its unauthorised

ambush activity has the power to tarnish

positive brand perception as built by

official partnerships.

Wong says not: “Our marketing

strategy places us on that fine line and

we’re aware of what we can and can’t

do, we have the balance just right. We’re

at the edge and we do it very, very well.

If we went the extra step people would

be angry, but people are still laughing.”



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