Santander, the Spanish bank, believes it has hit the jackpot by signing on as a corporate sponsor of the McLaren Mercedes Formula One team this year.
“McLaren have a British driver, Lewis Hamilton, and a Spanish one, Fernando Alonso. Just like Santander and Abbey in the UK. This is what we are,” says Juan Manuel Cendoya, the director of corporate communications at Santander.
Mr Hamilton this week began featuring in a nationwide advertising campaign for Abbey, the UK mortgage lender that Santander acquired in 2004.
The Spanish bank has plunged into corporate sponsorship in a big way. It is spending €55m ($74m) this year on Formula One, the UEFA Cup, a big international advertising campaign, and corporate hospitality events for thousands of clients and shareholders, in a bid to increase Santander’s profile as a global bank.
Santander is the world’s 12th largest bank by market value, but it is a newcomer to the big league. When it acquired Abbey National in 2004, some British newspapers were scathing, and depicted Emilio Botín, Santander’s chairman, as a bullfighter wearing a Mexican hat.
“When we bid for Abbey, we discovered that we were totally unknown in the UK. People had no idea of our international expansion, our track record,” Mr Cendoya says. “We decided this had to change.”
Sponsoring sports is a first for Santander, but a road well-travelled by other big banks, which spend an average of €30m a year on sports events.
But attaching one’s brand to sports celebrities is not a risk-free business, says Jacob Benbunan of Saffron Consultants in Madrid. “Banks like to convey values such as reliability, leadership and financial muscle, or power, and McLaren Mercedes conveys all of this. But if Santander also wants to convey the value of teamwork, then it might have problems. Alonso is complaining publicly that McLaren favours Hamilton. Rivalries can be healthy, but in this case, it could tear the team apart.”
There are also limitations on how far you can stretch sports sponsorships to promote a global brand. Formula One is hugely popular in Brazil and in Europe, but not at all in Mexico, where Santander has a big operation.
“Another problem is that celebrities are human beings, and therefore fallible,” says Mr Benbunan. The world of fashion is very tolerant of pecadillos, but banks, which trade on a reputation for reliability, cannot afford to be so.
Nevertheless, Santander believes its move into sports sponsorship will help it become a household name around the globe.
It is also helping the group internally, Mr Cendoya says. In Germany, where Santander owns a consumer finance operation, the Spanish bank held a draw among 8,000 car dealers and took 200 of them to the German Grand Prix.
In Spain and the UK, the bank has taken thousands of guests to the Formula One races in Barcelona and Silverstone. “Our shareholders love it. Our clients love it. And it is also a way of motivating staff. We are using Formula One in many of our internal incentive schemes,” Mr Cendoya says.
But what most excites Mr Cendoya is the hundreds of millions of viewers who will tune in to watch Formula One races around the world, and see the Santander logo on McLaren cars.