Managing the Sports Sponsorship Process

Abstract

In all business sectors, communications plays a critical role in attracting customers and subsequently building brand loyalty. In the context of the sports sector, the same applies. In this chapter we focus on a number of communications tools such as stadium naming rights, sports celebrity endorsement and brand ambassadors.

We focus in particular on the concept of sports sponsorship and examine the different facets of managing this process. We note that above all, (with the notable exception of some philanthropic initiatives) sports sponsorship is an investment by sponsors. This means that there is an explicit expectation that any such investment should generate a return to the sponsor.

We assess the different objectives behind sports sponsorship deals and the process by which both sponsors and sports property holders identify suitable partners. We examine the importance of activating the deal, which usually involves more financial and non-financial commitment than just the initial payment.

In the latter stages of this chapter, we evaluate the real threat that ambush marketing poses to the key stakeholders. Although legislation has tightened up the regulations, ambush marketers, through a combination of creativity and humour can still get around the legal restrictions.

Appendix

Discussion Questions

• 1. Assess the motivations and reasons why Jim Radcliffe committed his company to sponsor the old Team Sky. In particular, address the issue that the decision was based on sentiment and ego as opposed to a hard and objective reason.

• 2. If you were a senior marketing administrator with a smaller, less financially endowed team, develop a list of points that you would use to make a pitch to prospective sponsors.

• 3. Evaluate the view that the approach used by Brailsford is likely to lead to problems in the relationship with Ineos, as the sponsorship deal develops in the coming seasons.

• 4. Identify the business model that is used by professional teams competing on the World Tour series. Do you believe that it is sustainable in the longer term?

• 5. Examine why the sport attracts countries and independently wealthy individuals as opposed to well-known brands such as Nike and Coca Cola.

Discussion Questions

• 1. Do you see any potential weaknesses with this ongoing partnership between Siemens and Bayern Munich? Carry out a search on the Internet to see if there are any other comparable sponsorship arrangements.

• 2. What, in your view, are the likely elements that have made this partnership appear to work over the past number of years?

• 3. Does this approach by Siemens challenge any of the conventional theories of sponsorship?

Discussion Questions

• 1. To what extent would you agree or disagree with the decision found in favour of Telstra?

• 2. Some commentators argue that this legal decision has serious implications for the ability to protect official partners and sponsors in the sports sector. Is this an accurate perception in your view?

• 3. What advice would you give to a potential sponsor about the problem of ambush marketing?

Discussion Questions

• 1. The case generates a perception that women’s sport has enjoyed strong periods of growth in terms of popularity, audience and viewing increases, media interest and increases in sponsorship. What in your view are the obstacles that may prevent further levels of growth in the future decade?

• 2. You have been asked to address a conference on the following topic. “Women’s sport: the only way forward”. Detail the issues that you would cover in your presentation on this topic.

• 3. Assume you have been recruited as a “sponsorship development manager” with your national federation for Women’s tennis. Detail the issues that you would cover in your proposal seeking sponsorship for the federation.

10.1 Pie in the Sky: Anatomy of a Sponsorship Deal

10.1 Introduction

The Union Cycliste Internationale (UCI) governs the World Tour series in the sport of cycling. This tour comprises thirty-eight road-racing events and runs from January through to October. It begins with the Tour Down Under in February and ends with the Tour of Guangxi in China.

Currently, eighteen teams compete across the range of events. They represent all parts of the globe, ranging from Bahrain, Kazakhstan and the United Arab Emirates, through to more established “cycling” countries such as France, Spain, Switzerland and the Netherlands. The 2019 season witnessed the emergence of a team from Poland.

Sponsorship deals are at the heart of this sport.

Consider this point. It is perhaps the only elite sport out there that is almost totally dependent on sponsorship for its revenue. For instance, the road-races across the globe are free: people who watch the event as the cyclists pass by, do not pay any entry free for the privilege. Apart from prize money and fees for appearing in events, sponsorship funds the costs associated with each of the competing teams.

For the past decade or so, Team Sky has dominated proceedings by winning many of the events on the World Tour, in particular the “Big Three” events: Tour de France, Giro d’Italia and the Vuelta (Spanish).

Throughout this period, Sky Television (owned by the Murdock Media organisation) initiated funding of this team in 2010. Spurred on by the success of British Cycling since the Beijing 2008 Olympics and the level of interest generated in the UK, it saw the opportunity to put Great Britain “on the map” by establishing a team that could compete and win the major cycling events. It recruited the “brains” behind the success of British Cycling, David Brailsford, to lead the team. He developed and implemented the strategy in subsequent years.

10.1 End of the Deal

At the end of 2018, Sky decided to terminate the sponsorship of Team Sky at the end of the 2019 season. Some commentators expressed shock at this sudden announcement. After all, the relationship appeared to run successfully and seamlessly for the best part of a decade. Similar sponsorship deals lasted between 3 and 5 years. Why should they end the “perfect relationship”?

The US media company, Comcast, acquired Sky for around £30 billion and it’s CEO, James Murdoch stepped down. He was an enthusiastic fan of cycling and was seen as the “Product Champion” for the ongoing investment in Team Sky over the years.

Over the decade of Team Sky, it dominated the sport of cycling. Prior to the emergence of Team Sky, Brailsford generated much hilarity when he posited the view that they would win one of the “Big Three” events within a couple of years. No British rider had every won any of these events. By 2018, Team Sky had won every one of these “majors” and produced the winner of six of the last seven Tour de France events. They also dominated the other events on the World Tour.

Cynical observers argued that recent scandals associated with the sport of cycling and the team, such as doping and accusations that Team Sky made use of questionable drugs to boost performance, led to this decision to withdraw sponsorship.

Sky put forward the view that there was nothing mysterious or sinister about the decision. It simply represented the culmination of a detailed, strategic review of its range of commercial partnerships - a logical step in the acquisition process.

Whatever the reason, Brailsford and his team faced the challenge of replacing the title sponsor by August 2019. They had one year to achieve this task.

10.1 Financing Professional Cycling Teams

For the casual spectator of cycling events, it is difficult to relate to the actual costs of “putting a team on the road”.

The average annual World Tour team budget is around £15 million. However, this figure hides the disparity in funding available to teams. Team Sky has skewed the picture over the last decade. In 2017 the cost of running the team was estimated to be just under £35 million. Competing teams such as the Russian-owned Katusha, were not far behind (£32 million). Others, such as BMC (£28 million), Tinkoff (£25 million), and Astana (£20 million) also generated high costs.

At the other end of the spectrum, teams such as Fortunes-Vital Concept operated on a budget of £3 million.

This reinforces the principle of success in elite sports. The strong get stronger and the weak get weaker.

Typically, around eighty to ninety per cent of the costs revolved around salaries and contracts. The top teams operated with a “vast army” of experts such as coaches, nutritionists, psychologists and so on. Much of the wages were paid to the “talent”: the top cyclists that anchored the team. The remaining costs centred on travel and transport.

Sponsorship generated around ninety per cent of the revenue coming into the teams.

In the case of Team Sky, the Sky Corporation invested £21.3 million in 2017. It owned eighty-five per cent of the team. Twenty-First Century Fox (which owned the remaining fifteen per cent) put £3.8 million into the venture. These sums reflected the levels of ownership. The cycling industry referred to this as the investment needed to claim the Title Sponsorship of a team.

Performance sponsorship referred to income derived from companies such as Pinarello, Castalli, Ford and Kask. These organisations were suppliers to the team of various pieces of equipment. They paid Team Sky for this privilege.

Value-in-kind related to the value of items provided to the teams such as bicycle frames and cars.

◘ Table 10.4 identifies the cost of running Team Sky over a period of 8 years.

Table 10.4 Team Sky budget

The figures reflect a small decrease for 2015. Currency fluctuations caused this change because the sterling currency was strong at that time. Teams pay their staff in Euros. For Team Sky this generated some savings. Signing new talent and adjusting salaries of existing cyclists caused any other spikes in these figures.

10.1 Motivations for Sponsoring Cycling Teams

Cycling does not conform to many other sports, in terms of how it is run and also with respect to sponsorship.

We have argued in this chapter that the nature of sponsorship has changed dramatically over recent years. It has moved away from the concept of “handing over money” to a demand for a proper return on investment, on the part of existing and potential sponsors.

However, cycling would appear to deviate away from this practice.

Powerful (in terms of financial influence) individuals and institutions are a common feature of the typical sponsor of a professional World Tour cycling team.

Countries such as Bahrain, established their own cycling team. This was partly to enhance the image of Bahrain as a tourist destination. Cynical commentators argue that it is an attempt to deflect the media away from charges that it infringes human rights.

Oligarchs and multi-billionaires also feature prominently in the ownership of many teams.

In such cases, it is difficult to see how such vast outlays of money on teams could reasonably be expected to generate realistic returns on such expenditure. A combination of personal egos and treating the sponsorship as a “play thing”, are probably the main drivers for such initiatives. Cycling captures much media attention in key markets, most notably Europe. Independently wealthy individuals and oil-rich countries see this sport as an opportunity to keep their respective profiles in the public eye.

This suggests that the days of philanthropy are not over. In many ways, it reflects the traditional concept of royalty and wealthy individuals providing patronage to talented artists, poets and composers in past centuries.

Such patronage, while providing much needed finance to support the large costs of running professional cycling teams, is not without potential dangers.

If a team becomes a “play thing” of an individual, it runs the risk of suffering from sudden changes in mood or attitude. A team called Tinkoff experienced this issue when its owner suddenly withdrew sponsorship.

This also threatens the long-term sustainability of the business model. If a team is dependent on the mood swings of such individuals, it makes it difficult to plan strategically.

Ever-increasing salaries and contracts ensure that budget requirements will only rise in the longer-term.

For smaller, less financially endowed teams, the pressure is on to attract such individuals. Alternatively, they have to allocate a higher proportion of their budget to salaries as they attempt to sign young, emerging talent, in the hope that success on the road will follow. This takes them into the “high-risk” end of the spectrum.

It also extends the gulf in standards between the “have’s” and the “have-not’s”. It replicates what has happened in many other high profile sports globally.

10.1 Enter Jim Radcliffe

When Sky announced the termination of the sponsorship arrangement at the end of 2018, commentators held different views about how easy or difficult it would be to acquire a similar sponsorship deal going forward.

Notionally, Brailsford and his team had a year to identify and sign up a new sponsor. However, in practical terms, many people argued that the longer it took to do so, the more likely existing talent would seek contracts from other teams.

In March 2019, Brailsford announced that they indeed had identified a new sponsor and signed a new sponsorship deal with Jim Radcliffe.

Who he?

Jim Radcliffe is reputed to be the richest businessperson in the United Kingdom and among the top thirty richest people in the world. He owns a company called Ineos, which is one of the largest plastic manufacturers in the world and is reputed to be worth over £21 billion. Commentators attribute his business success to a combination of innovation and a hard-driven desire to succeed.

He is a controversial figure and has been accused of deserting the UK by moving his headquarters to Switzerland in order to benefit from tax allowances. He is a committed and enthusiastic cyclist and holds a high level of interest in many sports.

He expressed an interest in acquiring Chelsea football clubs but baulked at the value of £2 billion placed on it by their owners. In 2017, he purchased the Swiss team called FC Lausanne-Sport. Sadly, for him, they were relegated from the Swiss Super League in 2018.

Radcliffe invested over £10 million in Sir Ben Ainslie, an Olympian sailor, in his quest to win the Americas Cup in 2021. Interestingly, he insisted, as part of the deal, that Ainslie cancel all other sponsorship contracts and focus on winning the Americas Cup. Ratcliffe argued that other deals would deflect Ainslie away from enhancing his performance.

Radcliffe stated that he was attracted to cycling because of its associations with positive issues such as fitness and health. He also felt that it provided a “clean” option to cars, as a form of transport, in heavily polluted cities and regions in the world.

10.1 David Brailsford

David Brailsford competed in professional cycling but only with modest success. He moved into the area of coaching. He also studied for an MBA and some of the concepts learned on that course developed his skills in the areas of innovation and strategy development.

He revolutionised British cycling, perceived by many people as a peripheral sport in the UK. In 2008, British Cycling finally registered on the global stage by winning numerous medals.

Part of his theory revolved around the concept of seeking “marginal gains”. This promoted the idea that if you can identify a number of very small incremental improvements in a number of different areas, then overall, this will drive improvement in performance and lead to success. In a precision sport, such as cycling, where success in measured in “Nano seconds”, such improvement, in theory, should lead to success. Subsequent success in the London 2012 Olympics further reinforced this concept.

When Sky set up Team Sky, they identified David Brailsford as the obvious person to lead the charge to global success in cycling.

Brailsford stated that Team Sky would produce a winner of the Tour de France by 2015. Many commentators laughed at this notion. He easily achieved this target.

Brailsford attracted criticism from various quarters about his methods. These included allegations of bullying and pushing the use of performance enhancing drugs to the limits of what was deemed to be legal by the authorities. Despite such claims, his team generated a great deal of success.

In 2017, a member of the team and Tour de France multiple winner, Chris Froome, failed a dope test. This generated negative publicity. Six months later, the authorities declared that Froome was innocent. However, commentators still questioned the ethics and attitude of Brailsford and his team.

He never compromised on the desire to drive improvement. Over the past couple of years, he has invested much time investigating how improvements could be driven from smart clothing technology. He visited companies in Silicon Valley to explore such developments. He has also examined experiments in cranial stimulation and how it can override the brain to enhance the capacity for endurance and pain tolerance in athletes.

He still appears to be on a quest for continuous improvement in order to cement existing success. He resolutely denies any accusations of impropriety and abuse of power. Specifically, he refuses to believe that he has “crossed the line” with respect to any of his decisions.

10.1 Team Ineos

Prior to the start of the 2019 season, the new sponsorship deal led to a change in the name of the team. From now on it would become known as Team Ineos.

Information about the precise financial nature of the deal are not available in the public domain. However, it is reasonable to assume that Radcliffe, through his company, will continue to match the existing budget and incrementally increase it, in order to maintain the position of Team Ineos at the top of professional cycling.

Ineos became the sole owner of the team. It agreed to honour all existing commitments to its riders, staff and partners. It formally took over ownership on 1st May 2019.

By the middle of September 2019, it has won numerous stages in the World Tour events. More importantly, it won eight overall events, including the flagship event: Tour de France. Success continued apace.

The future for Team Ineos: as of the end of the 2019 season, Jim Radcliffe committed to the provision of funding for the foreseeable future in the sponsorship deal. The emergence of the young Colombian cyclist, Egan Bernal, who won the Tour de France, and Geraint Thomas (2018 winner) who finished second, ensured that there were replacements available to supersede established members such as Chris Froome.

Since its creation in 2010, the team captured around 330 wins and 9 Grand Tours - a testimony to its success. The 2019 season proved to be a successful one, further cementing this view.

A new chapter had begun.

However, clouds still gathered overhead. Brailsford still received much criticism from the media about his relentless pursuit of success, to the extent of pushing (or going over) the boundaries. Further enquiries ran with respect to the behaviour of its medical team. One in particular had been accused of ordering banned drugs, without any clarity as to how they might (or might not) be used.

In the sport of cycling, many teams expressed concern about the dominance of Team Ineos. Some claimed that they were unable to compete on a “level playing field”. Some found it difficult to attract sponsors due to a lack of success in winning events on the World Tour Series.

Despite the doping scandals of the 1980s and 1990s, and the exposure of Lance Armstrong as a drugs cheat, it would appear, superficially at any rate, that the authorities have got a grip on the issue. Very few cyclists failed drug tests on the World Tour series in 2018.

More encouragingly, TV viewing figures appear to be stronger than ever. In 2017, Eurosport reported that the figures were up by ten per cent in 2017. Tour de France authorities claimed that around 3.5 billion viewers in 190 countries tuned into the 2017 Tour de France. It was the most watched Tour since the 2009 version.

In terms of spectators, Tour de France officials estimated that around 12 million people turned up on the mountain and roads to watch the cyclists.

This suggests that professional cycling has regained the initiative and trust of fans and has re-established itself as one of the most popular sports in key geographic territories such as Europe.

It would appear that a second “perfect marriage” took place with the union of Ineos (Radcliffe) and Team Ineos (Brailsford).

Happy days!

Source: Developed by the author from sources available on the Internet

Adapted from ► http://inrng.com/2018/09/team-sky-budget-2017/

10.1 Siemens: Knowing Me, Knowing You

10.1 Introduction

Siemens is one of the world’s largest companies. Founded in the mid-nineteenth century by Werner von Siemens, it has evolved into a German multinational conglomerate company with global operations. In 2018, it generated over eighty-three billion Euros in income, spending around five billion euros on research and development.

Its tentacles spread across many industry sectors. These range from gas and power, smart infrastructure technology and financial services, through to energy management, building technologies and real estate services - to name but a few.

In the 1990s it entered the consumer goods domain by launching a range of mobile phones; most notably the “slider” phone in 1999. It sponsored Real Madrid and also became involved the sport of Formula One. In the early part of this century, it encountered major losses in the mobile phone sector and eventually withdrew. Senior management made the decision on the basis that Siemen’s DNA was based on its capabilities and expertise in the heavy engineering sector and that, in the longer term, this provided the future direction for the company. Quite simply, it lacked the wherewithal to operate in the consumer goods sector.

10.1 Change in Focus

Originally perceived as a strong engineering company with a penchant for innovation and invention, it re-orientated its business as a B2B brand.

Its mantra of “ingenuity for life” captures the ethos and mission of Siemens. This sets the standard for all of its subsequent investments and developments. Ingenuity refers to its focus on innovation and its engineering capabilities. For life refers to the company’s role in and commitment to society.

Siemens had already established a strong position in the B2B sector. Its future sponsorship activities reflected this perception: it did not have to focus on the building of brand awareness. Instead, it focused on cementing its relationships with key stakeholders such as existing and potential customers, opinion formers and employees.

Any future sponsorship engagements would reflect this mission. For example “showcasing” its innovative technologies and applications would reinforce its image as being innovative and capable of differentiating itself from competitors.

10.1 Partnering

As part of the reorientation process, Siemens reshaped the traditional approach to sponsorship. Instead of basing any deal solely on financial sponsorship fees (payments) it would, in the future, include the sharing of mutual business assets between both parties to the partnership agreement.

Siemens operates through its headquarters in the city of Munich in Germany.

In the context of sport, one of the most successful football teams in Europe, FC Bayern Munchen, bases its stadium in this city. Over the past decades, FC Bayern Munchen, has consistently dominated the domestic league and has won the European Champions (or its equivalent competition in the past) five times. In the 1970s it won this competition on three consecutive occasions - a rare feat.

Since the 2005–06 season, it has staged its games in the Allianz stadium in Munich. This is one of the most modern stadia in the world.

Siemens forged a number of initiatives with Bayern Munich since 2008. Senior management saw this relationship as a significant opportunity to address its strategic direction going forward. Both organisations exhibited similar values. Siemens, as an innovative and forward-thinking organisation, focusing on “solutions provision” for customers. Bayern Munich, as a successful club, playing in one of the most technologically advanced stadia in the world. Customers and fans perceive the respective organisations as being leaders in their sectors. Thus, there is a strong alignment across their attributes and core values.

From the perspective of Siemens, they saw a number of opportunities. Firstly, to use the partnership to demonstrate their latest technologies and innovations in a live setting. They provided solutions for Bayern Munich in areas such as lighting, ticketing, heating and air conditioning.

From the perspective of Bayern Munich, such initiatives continued to place the Allianz stadium as a leader in innovation with respect to stadium design and infrastructure.

Siemens could develop relationships with customers by using the corporate hospitality part of the deal. On match-days, they could entertain clients in their corporate box (the Sky Box). By becoming the “official Technology Partner” with Bayern Munich, it gained the exclusive worldwide communications rights to all language and media channels. In essence, both parties blended their respective assets to leverage a strong synergy: access to technological solutions for Bayern Munich, showcasing to clients for Siemens, access to players and management for Siemens, ongoing technological developments for Bayern Munich and so on.

Perhaps the most important benefit accruing to Siemens lay in the “credibility” factor. Siemens can demonstrate in a “live” and high profile setting, the latest innovations and solutions.

This relationship has evolved over the years. Creating an unforgettable fan experience in the stadium has been the driver for both organisations in the past couple of years. For instance, in 2018, Siemens teamed up with the Economist Group and Bayern Munich to study the impact of sound data to assess its impact. Siemens provided the acoustic sound technology for this initiative.

The data will then be mapped onto a 3D model and used to bring to life the story of the fans, and their emotions, through visual data, and will also track the relationship between fan energy and its interplay with on-pitch performance. (► https://www.thedrum.com/news/2018/08/30/siemens-sound-maps-fan-energy-bayern-munich-games-explore-12th-man-effect)

This ongoing partnership between Siemens and Bayern Munich provides a good example of a sponsorship deal that is not predicated on the traditional model of transferring money from one party to another. It is based instead on the principle of mutual benefits to both parties (a win–win situation).

For Bayern Munich, it allows them to play in a state-of-the-art stadium. For Siemens it “opens the door” to future clients from many of the key sectors from which it operates. It also operates on the principle of both parties knowing the strengths and weaknesses of their respective value propositions and assets. As governments and policy-makers place an increasing importance on general areas, such as the environment and social responsibility, there would appear to be plenty of areas that both parties can explore in the future.

Sources: Compiled by the author from various sources on the Internet

► https://www.thedrum.com/news/2018/08/30/siemens-sound-maps-fan-energy-bayern-munich-games-explore-12th-man-effect.

10.1 Telstra and Its Loose Connections

10.1 Introduction

Telstra is an Australian telecommunications company and is the leading provider of phones, devices and broadband in that country. It has been very active in the area of sports sponsorship for the past 15 years and, indeed, was a long-term sponsor of the Australian Olympic Committee (AOC). It has also been involved with companies such as Channel 9 and Foxtel in earlier Olympic Games such as Beijing 2008 and London 2012.

The specific relationship with the AOC took the form of a 10-year partnership. The partnership ended in late 2015 when the AOC signed a new deal with Optus, one of Telstra’s main competitors. This partnership made Optus the official telecoms partner of the AOC. Optus paid a multi-million dollar sum to achieve this position.

10.1 What Happened Next?

Telstra, keen to maintain its involvement in the area of sports sponsorship, clearly viewed the up-coming Rio Olympic Games in 2016 as an opportunity to keep its brand fresh and live in the minds of Australian sports fans.

To this end, it entered into a sponsorship deal with Channel 7, one of the main Australian TV broadcasters. Under this arrangement Telstra became the official technology partner of Channel 7.

As part of its campaign, to capitalise on the Rio games, Telstra launched a number of activities largely built around TV, online and social media. Telstra ran an advertising campaign in the lead-up to the Games featuring footage of sports enthusiasts set to the sounds of Peter Allen’s “I Go To Rio” and the phrase “Get free premium access to the ‘Olympics on 7’ App”. This infuriated the AOC who saw this campaign as a naked attempt to latch on to the Olympics and in so doing, deliberately mislead viewers and sports fans to believe that Telstra was an official partner of the AOC.

In response to the complaint made by the AOC, Telstra decided to make a modification to its advertising. Originally it tagged all of the advertisements with the slogan “Official Technology Partner of 7’s Olympic Games Coverage”.

It amended this to include the following message which revolved around the issue that it was not an official sponsor of the Olympic Games, the Australian Olympics Committee or the International Olympic Games Committee.

This did not mollify the AOC. It sought immediate recourse to the law courts. In view of the proximity of the Games, the Federal Court of Australia fast-forwarded the case and ultimately found that Telstra had no case to answer. The failure to gain an injunction to prevent the campaign meant that Telstra was cleared to run its “I Go To Rio” campaign leading up to and during the games.

The AOC was shocked by this legal decision and decided to take the case to the Full Federal Court by way of appeal. It based its case on the following arguments.

• 1. It was a clear case of deception - based on misleading viewers.

• 2. It played on the fact that many people generally have poor recall of official sponsors and previous research in this area demonstrated that many people associated non-partners (ambushers) as being the official sponsors.

• 3. The AOC had a clear duty to protect the investments made by its official sponsors. If Telstra was allowed to get away with this campaign it would discourage other companies to become official sponsors/partners in the future. They emphasised the importance of this because they do not receive any funding from the Government and rely totally on sponsorship from companies.

• 4. The AOC argued that the campaign implied that Telstra was a partner with them.

Telstra argued that

• 1. It had every right to use the Olympic Games in its campaign provided it did not make any false claims about being an official sponsor to the event, the organisers or the AOC. It argued that it did not infringe any of the existing legislation with respect to the protection of official sponsors and partners.

• 2. It was reinforcing its new official partnership with Channel 7 and the main objective was to emphasise this connection.

10.1 End Game

Over a year later, in late-October 2017 the Full Court of the Federal Court ruled in favour of Telstra. This was encapsulated in the following statement:

Telstra had entered into an agreement with Channel Seven, the exclusive Australian broadcaster of the 2016 Rio Olympic Games and Telstra’s conduct was held to be permissible in that context. The Court viewed Telstra’s ads as suggesting sponsorship of Seven’s Olympic broadcast rather than of the Rio Games.

Telstra responded in the following manner.

Responding to today’s ruling, a Telstra spokesman pointed to the fact the company had updated its television commercial with a disclaimer that it was not a partner of the International Olympic Committee or any national association or team.

“We’re delighted the appeal court today confirmed the original decision that our advertising did no more than promote our relationship with Seven and did not suggest an affiliation with the Olympics”, the spokesman told Australian news agency AAP.

“We have always maintained that our advertising complied with the law and today’s decision has again confirmed that. We were disappointed that this dispute even made its way to court, especially after we proactively changed our advertising to make it even clearer that we were not an official sponsor of the Olympic Games”. (► https://sponsorship.sportbusiness.com/news/australian-olympic-committee-loses-out-in-ambush-marketing-case/)

The AOC’s view is captured in the following statement:

The AOC receives no government funding and relies entirely on sponsorship to send our Olympic teams to the Games. It will continue to prioritise protection of the investment our sponsors make and to take action against those seeking to capitalise on the Olympic movement without authority. (► https://sponsorship.sportbusiness.com/news/australian-olympic-committee-loses-out-in-ambush-marketing-case/)

The AOC in December 2015 entered into a 10-year partnership with Telstra’s rival operator Optus. The deal, which named Optus as the official telecommunications partner of the AOC, was hailed as one of the body’s “biggest ever”. The agreement became effective last year and runs until 2026.

Further quotes from the judgement of the Full Court are captured in this note.

10.1 Full Federal Court Decision

The Full Court upheld the Federal Court’s finding that a hypothetical reasonable person viewing the advertisements would not necessarily know about or recollect Telstra’s previous sponsorship of the Australian Olympic team, let alone turn his or her mind to that fact when viewing the advertising. Furthermore, it found that: ‘As to Seven’s advertisements, he (Justice Wigney) found that they simply confirm that Telstra’s sponsorship arrangement is with Seven. Those findings of fact were open to the primary judge. ► https://www.minterellison.com/articles/aoc-loses-full-federal-court-appeal-for-telstra-i-go-to-rio-advertisements

Justices Greenwood, Nicholas and Burley also agreed with Federal Court and the comments of Justice Wigney who, in regards to the data plan advertisement found that “the only hint that the advertisements related in any way to the Rio Olympic Games is the ‘I go to Rio’ soundtrack” Their Honors found no error in Justice Wigney’s conclusion that the Peter Allen soundtrack reference did not make the advertisement misleading or deceptive under the Australian Consumer Act.

Sources: Compiled by the author from various sources on the Internet, including the following:

► https://sponsorship.sportbusiness.com/news/australian-olympic-committee-loses-out-in-ambush-marketing-case/

► https://www.zdnet.com/article/aoc-loses-court-battle-over-telstra-olympics-ads/

► https://www.minterellison.com/articles/aoc-loses-full-federal-court-appeal-for-telstra-i-go-to-rio-advertisements

10.1 Women’s Sport: Catching The Eye

Women’s sport has traditionally fallen well short of the coverage and general interest in male sports. Media coverage, until recently has been very low. Commentators estimate that sponsorship of female sports has been as low as 0.4 per cent of the overall spend on sponsorship. It has risen to around eight per cent of spend in the United Kingdom by 2017.

On a more positive note, we have witnessed the emergence of women’s leagues in many traditionally male sports such as football, cricket, rugby and Australian Rules (to name but a few).

Gender equality has risen to the forefront in many countries. Governments and policy makers increasingly introduce appropriate legislation to redress imbalances that have existed for many years. However, more than half of the sports organisations and bodies in the UK fail to meet the target of thirty per cent female representation on their boards. Some still contain no female representation at all.

On the other hand, the sport of tennis has, for a number of years agreed to pay equal prize money to male and female players at the four “Grand Slam” events.

As sports channels grow, the sports industries have shown a tendency to fragment. Channels such as Eurosport and Sky increasingly widen the sports portfolio. This creates greater opportunities for coverage of niche and women’s sport. The BBC (UK publicly funded channel) has found that it can no longer bid for the high profile sports events and competitions, due to its relative lack of financial resources. This encouraged them to seek opportunities in other areas. Women’s sports such as football and rugby received extended attention.

In addition, women’s sport administrators and marketers seek creative ways to “get their sport” out there to the world. Some stream live games and competitions on social media frameworks such as YouTube and Facebook.

This has created a virtuous circle. Coverage, particularly on channels such as the BBC, have the effect of creating a larger audience. This in turn stimulates interest with brands. They sponsor such sport properties and this creates a “win-win” situation for all of the stakeholders.

The Women’s World Cup 2019 was staged in France and generated record-breaking TV viewing figures and attendances. Arguably, this was the pinnacle of success with respect to women’s sport so far.

Over 200 broadcasters covered the competition. FIFA reckoned that it attracted over one billion viewers for the first time. Similar viewing records for women’s football were registered in the USA, Germany, France and China. The UK recorded the highest viewing figures ever with 11.7 million people tuning in to the semi-final between England and the USA.

The prize money doubled from $15 million to $30 million for this tournament. While this is impressive, it is still small, compared to the $400 million that was available for male players in the 2018 Men’s World Cup.

Recent studies show that almost sixty per cent of the UK population express an interest in at least one women’s sport while eighty-seven per cent claim an interest in both men’s and women’s sport.

Consumers see women’s sport on the following dimensions:

• Competitive (48%)

• Inspiring (36%)

• Successful (33%)

• Progressive (30%)

• Clean (21%).

Interestingly only eight per cent perceive sportswomen as money-driven, compared to thirty-nine per cent for sportsmen. ► https://www.bbc.co.uk/sport/45737718

Other positive indicators reveal that the number of sports sponsorship deals increased by forty-seven per cent from 2013–17 in the female sports category. The average size of the deal also increased by thirt-eight per cent.

A number of key brands have invested in different areas of women’s sport. These include SSE (Women’s World Cup), O2 (England’s Red Roses - rugby), Tyrells (Premier 15s Women’s rugby premiership in the UK).

Women’s hockey has built on the success of the Great Britain team winning the Gold Medal at the 2016 Olympics in Brazil. As well as stimulating participation in the sport, brands such as Vitality and Investec committed to the sport. The latter has been a main sponsor of women’s hockey since 2011. Vitality became the headline sponsor for the Women’s Hockey World Cup.

In a further show of confidence and trust, BT sport signed a 4-year deal with the International Hockey Federation (FIH) to cover all major World Cup and Pro League matches.

Similar developments have taken place in netball. Vitality is the title sponsor for the 2019 World Cup, staged in the UK. In July 2019, organisers announced the involvement of Betfred as a sponsor.

Sky sport provided coverage of the event and developed a partnership with WSJ called #showup. This was a social media campaign encouraging British people to support women’s sport by watching, attending or playing in a sport. It generated 92 million impressions in the first week.

Other trends also work well in support of a growing interest in women’s sport. In many countries, we can see a growth in the area of fitness and health. This resulted in many females taking up a sport or making use of gym memberships. The fashion and leisure clothing sectors have come together to create growth in sports apparel that are worn at work or at exercise.

Women’s sport has grown significantly in the last decade or so. Arguably, it still has a long way to go to attract sponsors to make significant investments in respective sports properties.

Source: Developed by the author from various sources on the Internet

► https://www.bbc.co.uk/sport/45737718