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February 23, 2012 3:07 pm
It says something about the resilience of rugby and the power of the England brand that the Rugby Football Union can renew its sponsorship deal with 02 after such a shocking and humiliating 12 months of off-field farce and on-pitch failure.
The mobile operator’s renewal for a further four years, announced in February, may have more to do with the 2015 World Cup taking place in England than any belief that things really are about to get better at RFU headquarters in Twickenham when it comes to the politics of the boardroom and the performance of the national team.
They could hardly get any worse. A year that witnessed three chief executives at the RFU, internecine war in the boardroom on a very public scale and a sorry England team imploding in New Zealand through indiscipline and late-night pranks, caused more than the occasional call to Twickenham from sponsors demanding to know what on earth was going on.
Sophie Goldschmidt fielded several such calls. “What I was trying to emphasise was there is a difference between perception and reality,” says Goldschmidt, RFU’s chief commercial officer.
She talks about the RFU learning from experience, remembering the positives, changes in the running of the governing body in recent months, and looking ahead at “the opportunity 2015 presents”.
Renewal talks are taking place with other sponsors. But with 02 staying on board and GlaxoSmithKline, the pharmaceuticals group, signing up in January to a four-year deal, there is some optimism at Twickenham that these talks will reach a satisfactory conclusion.
While the 2015 World Cup is one factor keeping sponsors interested, others include the values of sportsmanship and the game’s demographic profile. “The connection with rugby and business is increasingly resilient,” says Goldschmidt.
“We have some very loyal partners, and the new partnership with GSK shows that the future is very promising, but we are not resting on our laurels. The demographic is very strong. The ABC1 [wealthier] audience makes rugby very appealing, and the values that rugby stands for is very powerful.”
Giles Morgan, group head of sponsorship at HSBC, the bank that sponsors the Sevens World Series, the Hong Kong Sevens and the British Lions, recognises the “highs and lows” in professional rugby.
“The key is the product. If people want to associate the company with certain audiences, then by definition it will survive and stay resilient,” says Morgan.
“Rugby has a very, very strong demographic to certain organisations, a high affluent middle class. For various companies it is a very, very good association to have.”
Such a demographic base makes financial services companies perfect bedfellows for rugby – though not exclusively so. One of the more recent big sponsors is Aviva. The life assurance group has sponsored athletics since 1999 and Premiership football club Norwich City since 2008, but it signed up to rugby for the first time in 2010 by becoming title sponsor of Premiership Rugby, the English game’s top domestic league.
“There is no doubt that it fits very neatly our core target audiences,” says Louisa Cheetham, senior sponsorship manager at Aviva. “It has a fantastic geographic spread that matches our business.”
She points to a 10 per cent rise in attendances on last year in the period since the end of last year’s World Cup as evidence of a sport that can grow even in tough economic conditions.
Premiership Rugby also has QBE, MBNA and JPMorgan Asset Management to count on as financial services sponsors. “That breadth of financial sector partnership gives us a good platform,” says Adrian Alli, Premiership Rugby’s finance director.
Still in rugby is Royal Bank of Scotland, which has quietly maintained its £20m sponsorship of the Six Nations tournament despite pressures on the state-owned bank to cut costs.
RBS is in the third year of its four-year deal with the Six Nations, and it would be brave of the bank to convince ministers that it is in their interests to renew the agreement.
Financial services companies invest in every major sport, points out Tim Crow, chief executive of Synergy, the sports sponsorship agency. “What is interesting, is the number of new categories coming into rugby,” he says.
Companies such as Powerade, the sports drink maker, and Guinness, the brewing company, were familiar advertisers at rugby matches, but are now stepping up their involvement with sponsorship. Sponsors from other sectors include Hilton, Gatorade and Land Rover.
For the International Rugby Board, the game’s governing body and organisers of the quadrennial World Cup, the right sponsorship formula is less about the range of sectors from which to draw sponsors and more about ensuring there is not a plethora of them.
“We have always had an approach that a small number of [World Cup] sponsors is better than myriad sponsors,” says Robert Brophy, IRB’s acting chief executive. “We had six for 2011 and we are aiming for six worldwide in 2015.”
Three 2011 sponsors, Heineken, the Dutch brewer, Land Rover, the car maker, and Société Générale, the French bank, are signed up for the 2015 tournament in England. “We don’t like enormous clutter at the venues,” Brophy says.”Sponsors like their relative exclusivity in the venue.”
Rugby’s commercial opportunities look more promising than some other large team sports, thanks to the increasing profile of sevens, the short format of the game.
For HSBC, the beauty of the sevens format, which becomes an Olympic sport in 2016, is that it takes the game to new international audiences. “The IRB has a wonderful opportunity to create a far bigger sport,” Morgan says. “Sevens presents rugby with the opportunity to go global.”
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