In a sign of how tough things have got in the sponsor market, even our premium sports brand, the All Blacks, is struggling to attract new backers. There is good news, and bad.
Rugby Union chief executive Steve Tew says his organisation is in advanced talks with a company that will replace Philips as sponsor of the TriNations: “While we don’t have any ink on paper yet, I’m very confident a new agreement will be signed.”
On September 17 last year, NBR broke the story that Philips was pulling its 15-year-old All Blacks sponsorship, effective from January 31 this year. The move came on the back of Philips’ decision to no longer sell its TVs in New Zealand.
Philips had sponsored the New Zealand leg of the Tri-nations and was the All Blacks’ official consumer brand.
Now, Mr Tew delivers the news that Ford, previously reported as placing its Super 14 and All Blacks deals under review, will be a non-starter for 2010. “It’s fair to say our discussions with Ford are at an end,” says Mr Tew, who pins the blame on the auto-maker’s “well-documented international troubles.”
One of the provisions of the deal, which will now expire at the end of this year, is that every All Black and every local Super 14 player gets a Ford vehicle. The NZRU may replace Ford with one sponsor, but there is no need to necessarily link the All Blacks' official car brand with the Super 14. The sponsorship could be split, Mr Tew says.
The NZRU chief executive emphasises he is confident Ford’s dual sponsorships will be filled, and that Philips’ replacement will be announced well before the first TriNations game kicks off July 18. “Discussions are at an advanced stage ... It’s not all doom and gloom,” he says.
Grim up north
However, neither does he shirk from acknowledging the current environment.
“This is a recession as bad as most of us have seen in our lifetime,” Mr Tew says.
“And we’re dealing with companies that make decisions in the northern hemisphere, where things are considerably worse.”
As a measure of the northern climate, Mr Tew notes that another All Black sponsor, Italian truck maker Iveco, currently has its staff working two weeks on, two weeks off (the Fiat subsidiary signed a four-year deal to have its name associated with the All Blacks in 2007. The deal was a breakthrough because it involved an international brand that, unlike the team’s marquee sponsor, Adidas, comes from outside sports). Other sports are in trouble, with Vodafone pulling the stumps on the English cricket team ahead of Christmas, and Honda abandoning Formula One.
New game plan
Mr Tew rejects the notion that his organisation has been shopping the All Blacks’ sponsorship all over town. He says the NZRU is being selective in whom it approaches. However, the recession has coincided with change in the union’s world view. “We’ll now sit down with a sponsor and ask what we can do for them, and what they could get out of the relationship,” Mr Tew says.
More money possible, even amid recession
Historically, every new All Black sponsor has thrown more money into the pot than the last.
Mr Tew says the NZRU can maintain this precedent, even given the meltdown.
The soon-to-sign sponsors may pay more than their predecessors, or they may pay less, due to the union’s ability to turn the tap on (or off) on key elements like signage, the number of tickets thrown in to a deal, and access to players for marketing and corporate events.
For Air New Zealand, the tap was turned downed down, a little. The national carrier renewed its deal with the NZRU in late January signing a three-year contract that saw its commitment to the All Blacks and the Super 14 unchanged, but a downgrade to its sponsorship of the provincial championship. The airline’s new deal runs through until the end of 2011, but from 2010 it will lose naming rights to the Air NZ Cup. Similarly, while the company remains a Sevens sponsor, it lost its T-shirt signage from last month.
Looking ahead, however, it's likely deals will see the tap turned in the other direction. The recession may well be bottoming out, and budding sponsors’ know that every brand associated with the All Blacks will get a lift from the 2011 World Cup.