Premier League scores spectacular own goal with new Barclays sponsorship deal

July 3, 2012

The Premier League just doesn’t get it, does it? The world is crashing around Barclays ears: its chief executive Bob Diamond has just been forced to step down by the Governor of the Bank of England; its chief operating officer Jerry del Missier has quit; its chairman Marcus Agius will be exiting in the coming months; and Bob’s top team of investment bankers face a mass clear-out (if, that is, they had anything to do with BarCap between 2005 and 2008, which is highly likely).

And what does the Premier League do? It inks another sponsorship deal with Barclays Bank, this time for a whopping £35m a year over 3 years (or so Brand Republic tells us).

Granted, when scandal strikes, the boot is usually on the other foot: it’s the sponsor that  assesses the collateral brand damage and, if necessary, does the firing. For instance: Coca-Cola repudiating its association with Wayne Rooney, after the latter consorted with a prostitute while his wife was pregnant; everyone junking Tiger Woods once his elaborate sexual gymnastics came to light; Vodafone shaking a big stick at McLaren Mercedes (but not much else) over cheating on the F1 track; and Emirates Airline threatening to drop its World Cup sponsorship because of FIFA chief Sepp Blatter’s limp-wristed approach to racism on the pitch.

But the scandal now engulfing Barclays is of such epic proportions that even the Premier League – not normally known for its ethical sensitivity – should carefully consider whether it is prudent to continue its association with such a blighted brand. Let’s face it, it doesn’t look too clever, does it? ‘We’re a wholesome family sport, happy to take money from anyone – cheats and spivs especially welcome’.

Of course, the Premier League commercial negotiators have been unlucky in their timing. Little were they to know that, as protracted negotiations were nearing their conclusion, international financial regulators would hit Barclays with a £290m fine for manipulating the interbank lending rate. Even so, a suspension in the negotiations would now be the intelligent way forward – while the Premier League looks for an alternative commercial partner; and Barclays does the decent thing by withdrawing its offer. Tip for Premier League negotiators: try sectors other than financial services. It will save pain later.


Will GM’s Manchester United sponsorship deal shift more Chevies?

May 31, 2012

For years the auto industry has been asking: how long before the Vauxhall marque becomes Opel? Maybe the question now needs rephrasing: how long before Opel becomes Chevrolet?

Certainly Opel becoming – in the fullness of time – Chevrolet would be one logical outcome of the sponsorship deal its owner, General Motors, has just struck with British Premier League football club Manchester United.

But that’s just a side-light on a global marketing communications strategy that actually has very little to do with Europe, where Chevrolet accounts for only 1.5% of total car sales. Symbolically, the sponsorship agreement between GM and Manchester United has been inked in Shanghai. Recent research by Kantar found that over half of Man U’s estimated 659 million fans worldwide are to be found in emerging markets, such as the BRICS. That is exactly where GM is targeting most growth for its prime brand, Chevrolet.

All very fine, you may say. But isn’t this just another example of fame-hungry GM global marketing supremo Joel Ewanick grabbing the headlines? And a costly one too, which may not eventually stack up. After all, what traction does a British football club – even one whose brand has achieved substantial recognition in the rest of the world – have in the market where Chevy currently sells most of its 4.76 million units a year? Not that much really (despite Kantar’s projection of  a 35 million Man U following in the USA – who are these people?).

Some might go even further and claim Ewanick and GM are actually being unpatriotic. What this sponsorship deal is really about is cocking a snook at America’s prime sport, baseball: Ewanick has personally decided that Super Bowl ads are too expensive (at $3.4m for 30 seconds prime time, a not unreasonable point of view) and he’s perversely made his point by concluding  a deal with a sport that cannot have any discernible uplift on US sales in the immediate future. Nor is this an inexpensive gesture. Recent sponsorships deals with Man U have not exactly cost peanuts. In 2010, for example, the club struck an agreement with insurance firm Aon worth £80m ($125m) over 4 years.

There may of course be a grain of truth in these objections. Ewanick’s behaviour is clearly tactical as well as strategic in intent. It is designed, at one level, to bring the Super Bowl ratecard (and let’s throw in the Facebook ratecard while we’re there) to heel by demonstrating there is a marcoms alternative. But a tactic is exactly what it is. My betting is he cannot afford to boycott either platform in the longer run.


Admen watch out: health Bannism is back

April 16, 2012

It’s been a while since the medical profession got onto its high horse about banning the promotion of fast-food and soft-drinks brands.

But now, sensing the increasing vulnerability of the Coalition Government, it’s charging straight for the breach.

The militant assault comes from the Academy of Medical Royal Colleges, an umbrella organisation which can count on the (at least passive) support of 200,000 doctors. It’s being directed by the academy’s vice-president Professor Terence Stephenson, something of a zealot in these matters.

Specifically, Stephenson wants:

  • A ban on brands like Coca-Cola and McDonald’s sponsoring major sporting events such as the Olympics. Carling, sponsor of the Carling Cup, also comes in for some harsh words;
  • Prohibition on the use of celebrities or cartoon figures in promoting “unhealthy” food and drink to children;
  • A safe area around schools, free from fast-food outlets;
  • “Fat taxes”, as in Scandinavia, levied on such foods;
  • Much clearer labelling on the calories, salt, sugar and fat contained therein.

Same old, same old, you may say. And you would be right. This is the “Bannist Tendency” making a not-very veiled attack on the Government’s proclaimed policy of collaborating with industry via so-called “responsibility deals”, which emphasise self-regulatory restraint rather than expensive-to-police and often-ineffectual red-tape.

When I say “ineffectual”, I should qualify that. In the short term, the proposed bans might well have a debilitating effect on commerce without achieving concomitant success in combatting national obesity. Longer term the strategy is tried and tested, however. It amounts to demonising fast-food and soft drinks in the same way the medical profession has managed to demonise smoking. At this very moment health secretary Andrew Lansley, the arch-proponent of industry “responsibility deals”, is contemplating stripping the last vestiges of marketing support from the tobacco industry with a ban on branded packaging. That’s what, in a generation’s time perhaps, the medical profession would like to see happening to Big Food brands.

Reducing the amount of salt, fat and sugar in our diet is of course a commendable aim, and it is right that the medical profession – of all special interest groups – should embrace it. But is it also right to equate the variable impact of HSSFs on our health with the addictive and truly pernicious effects of smoking? There is a matter of degree here, which does not seem to be adequately reflected in the uncompromising messianic fervour of the medical profession. Or, rather, some of the zealots who seem to have hijacked it.

Stephenson himself is a case in point. He may be an eminent paediatrician, but he also harbours some eccentric views. Among them, that second hand smoke (from tobacco) is a significant contributor to cot-deaths. He is also someone who clearly lives in a bubble blissfully sequestered from the inconvenient realities of commercial life. Here he is on the subject of football sponsorship:

“For adults, beer is a source of calories. I like going to a football match and drinking beer, but it’s the high-profile sponsorship that means that every time we mention this trophy, we mention in the same words Carling Cup.” So, let’s ban it, eh? Personally, I’m all the way with Stephenson on renaming it the “English Football League”. Period. But I do wonder where all the extra money is going to come from if we prohibit the likes of Carling, Coca-Cola and (heavy heart, here) McDonald’s from investing in sports events.

Surely, a little more personal responsibility exercised over how many HSSFs we ingest at any one time, not to mention how much exercise we take, are more salutary – and certainly less puritanical – solutions to the national obesity problem?

And, if we’re going to consider banning any advertising at all, what about reviewing the wall of money Big Pharma spends on targeting the medical profession?

Now there’s an unhealthy relationship.


Bell Pottinger buyout proceeds – despite veto from top Chime shareholder WPP

March 8, 2012

Summing up a satisfactory set of annual results, which had seen Chime pre-tax-profits climb 16%, chairman Lord Bell concluded: “The group is well positioned for the future with a very positive year ahead for sports marketing in particular.”

But not with me on board, he might have added sotto voce, and not with my deputy Piers Pottinger either. Nor, come to think of it, quite a few others in Chime’s PR division.

Bizarrely, despite the naked glare of publicity and overt hostility from Chime’s biggest shareholder WPP, Bell is forging ahead with his buyout proposals, which I flagged earlier.

On that subject, more specific information has come to light. Bell and Pottinger are planning to take with them the whole of Bell Pottinger, including public affairs, Sans Frontières (transborder reputational issues) and Pelham BP (financial and corporate), of which Chime owns 60%. What triggered the talks is the prospect of losing the remaining US government business at BP, which would cause a profit plunge in the Chime PR division as a whole.

Both sides at the negotiating table are rather hoping that Stakhanovite growth in sports marketing will paper over any divisions and, more to the point perhaps, make Chime’s necessary “repositioning” after a Bell buyout more palatable to shareholders. At the moment, PR is the biggest element in the group’s operations – accounting for 44% of its revenue. But it is already on a downward trend: operating income slid 7% to £69.2m in 2011. Sports marketing, on the other hand – accounting for 25% of total revenues – soared 64% to £83m. And with a number of acquisitions under the belt in such places as Brazil, that makes Chime look well set for the World Cup in 2014 and the 2016 Rio Olympics.

When and if buyout negotiations are finalised, Chime senior non-executive director Rodger Hughes is expected to sound out Fidelity (7% shareholder) and possibly JP Morgan (7%) about the proposals. How Chime will square WPP (nearly 18%) remains to be seen.

Here’s what WPP chief executive Sir Martin Sorrell recently had to say on the matter:

“I think it sets a terrible precedent. It isn’t logical, and if you start to dismember the management of it [Chime], where does that begin and where does that end? As an investor in the company, one would rather it stayed together than split asunder.”

I await the outcome with interest.


FIFA sponsors are the only ones who can splatter Blatter

November 20, 2011

Well, what a week of wasted moral outrage that was, even if it did produce one of The Sun’s finest headlines for a very long time.

Make no mistake. “Splatter Blatter” may have sold extra copies of the red-top, but will do nothing to remove the Teflon Man, whose life’s achievement has been to carve himself an impregnable position as world football’s supremo.

In a way, you’ve got to admire him. Like Bernie Ecclestone, whom he resembles in a variety of ways, Blatter is a master tactician at the top of his own, very particular, game: not the administration of Formula One or FIFA, but the administration of power.

The secret of their supremacy is the same. It lies not (or very little) in formal status, but in a second-to-none understanding of how to manipulate an opaque global system that has no loyalty beyond its self-perpetuation.

To be sure, FIFA and F1 are, or have, venerable governing bodies guided by what appear to be democratically elected representatives acting in accordance with a constitution. In reality, the election of these officials is manipulated to suit insiders; and the workings of the institutions they represent are so complex and well-defended that they defy almost any outside attempt to hold them to account.

If there is any parallel to representative government, it is the quaint Rotten Borough system that existed in Britain before 1832. Boiled down to essentials, it involved the King and his chosen First Minister fixing a parliamentary majority by procuring the election of their chosen placemen in all the seats that actually mattered. For placemen read “men in blazers”, and you get the picture.

Corruption was the indispensable lubricant of this system. It involved greasing people’s palms, and not just at election time. The disbursement and retraction of patronage – primarily offices of state awarded on the basis of interest rather than merit – was key to successful management.

Recognise the parallel? Allegations of corruption have plagued Blatter’s 4 consecutive terms of office, culminating in the 2018 World Cup scandal that broke earlier this year. As for F1 scandals, need I enumerate them?

But what do Blatter or Ecclestone care about that? The same opacity which protects these organisations from outside investigation also insulates their ringmasters from public criticism – and any punitive measure that might result from it. Hence the stream of crass remarks that regularly issues from their mouths. For Bernie, Hitler was an OK bloke who built excellent roads even if he did later succumb to a power complex. For Blatter, racism on the pitch is a non-issue which can be settled with a handshake at the end of the match. Out of touch, clearly. But then, so what? They’re also out of reach, and they know it.

Blatter has deftly deflected calls for his departure from the likes of David Cameron, David Beckham and The Sun by portraying the outcry as a case of sour grapes. Only Britain has worked itself up into a national lather over racism on the pitch. Why? Because England lost out in the contest to become 2018 World Cup host, and is now conducting a vendetta against the man perceived to be its nemesis.

So, can he now blow the final whistle and move on? Not quite. If there’s one chink in Blatter’s armour, it’s money – or rather its threatened withdrawal. What if the sponsors – household brand names, with household reputations to maintain – deem he has gone too far and pull the plug on the hundreds of millions of pounds a year that FIFA depends upon for its survival?

Ordinarily, that simply wouldn’t happen. However much they may privately tut-tut about Bernie’s ex-wife spending £12m on their daughter’s nuptials, Max Mosley’s grubby sexual antics or Blatter’s moral insensitivity, the last thing they are going to do is scupper a strategic investment with a noble gesture. Their investment is, after all, in the global game, not the administating organisation and the people who lead it. And their justification for inaction the not unreasonable conjecture that most football and motor-racing aficionados have little knowledge and less interest in the shenanigans of sports administrators.

One sponsor’s uncharacteristic response to Blatter’s racism episode is what, in fact, makes this furore so interesting. True, most of FIFA’s six official partners have played entirely true to form. Coca-Cola has categorically rejected a review of its sponsorship; while Visa, Hyundai/Kia, Sony and Adidas have contented themselves with more or less bland statements condemning racism in sport. But Emirates has broken ranks by taking the almost unprecedented step of reviewing its sponsorship.

Whatever next? Not Blatter’s resignation, for sure. But perhaps the beginning of the end of his reign.


FIFA’s Sepp Blatter and Max Mosley are two of a kind

June 1, 2011

Will the sky fall in on Sepp Blatter, much reviled president of FIFA, just because Coca-Cola and Adidas, Visa and Emirates Airline – 4 of football’s 6 biggest sponsors – have fired a shot across his bows?

Will the English and Scottish football associations’ vociferous appeals for a postponement to FIFA’s presidential election – which currently leaves Blatter dribbling up to an open goal – make an iota of difference?

No and no. The contest between FIFA and its critics is asymmetrical precisely because, unlike Coca-Cola and its fellow sponsors, FIFA is not a brand. It is not vulnerable, in the first degree, to public criticism – however merited or angry that criticism may be.

Indeed, as Matthew Patten recently pointed out, FIFA resembles nothing so much as a medieval guild. It owes allegiance to no one other than the 208 merchant adventurers who make up its membership. Nothing, culturally speaking, could be more removed from the modern corporation. There is no transparency in its business dealings, because the daylight of accountability is not an element in its constitution. The anonymous men in blazers ply their trade in a way that is endemic to all closed mercantile organisations: through mutual back-slapping, nepotism and, let’s face it, financially lubricated manila envelopes – if they think can get away with it. And lording it over them are the merchant prince oligarchs: men (they are always men) like Sepp Blatter and Mohamed Bin Hamman.

FIFA is part of a pattern which, if not peculiar to the administration of world sport, is certainly highly characteristic of it. Remember the cleansing of the Augean Stables at the International Olympic Committee (IOC), after the corruption scandal that was the Salt Lake City Winter Olympics bid came to light in 1998? That was a relatively benign outcome. Less satisfactory have been the consequences of the more recent shenanigans at Formula One. Despite the engulfing stench of scandal, and the twittering of vocal criticism, its twin ringmasters Max Mosley and Bernie Ecclestone managed to protect the integrity of their power base. Admittedly Mosley eventually went, but it was at a time of his own choosing and on his own terms. Ecclestone, meanwhile, continues to crack the whip without let or hindrance. He is currently said to be negotiating an exit deal with Rupert Murdoch.

Blatter, a man who once fronted an organisation dedicated to stopping women exchanging their suspender belts for pantyhoses, is more likely to draw his inspiration from Mosley than the aftermath of the Salt Lake City scandal. He will brazen the “crisis” out.

And there is little, in the last analysis, the sponsors can or will do about it. On the surface, that might seem a strange thing to say. After all, they are bankers to the organisation and provide its marketing pot. Each contributes between £100m and £300m to a FIFA revenue estimated at £2.4bn in the 4 years up to and including World Cup 2010. Surely that gives them more clout than most stakeholders in the struggle to wring reform from the World Cup organiser? Only up to a point. Let’s not forget that FIFA is less dependent upon sponsors these days to the extent that it can dip into billions of dollars worth of syndicated worldwide TV rights. Moreover, rather than presenting themselves as a united front, the sponsors perceive themselves as embattled and vulnerable competitors (rather like the constructors in the F1 equation). Blatter, like Ecclestone, is a supreme tactician in exploiting such weaknesses. There’s always someone else, he will say, to take their place if they don’t want to play ball. A Pepsi for a Coke, a Nike for an Adidas, a Delta for an Emirates, a Mastercard for a Visa.

And do you know what? He’s right. The only chance the sponsors have of effecting change is if they stand united. My suggestion is not that they threaten to defect, merely that they withhold some of their funding until tangible reforms, prime among them greater transparency and accountability, are in place.


Hugh Curly-Whirly’s TV campaign single-handedly triples Sainsbury’s sales of Colin

January 18, 2011

Oh, the awesome power of celebrity endorsement, especially when it is attached to a good cause. Our local fish-lady (stockist, not mermaid) reckons that Hugh Curly-Whirly, as she insists on calling the eminent TV chef, is now revered as a latter-day saint by fisherman at the Cinque Port of Hythe.

Fearnley-Whittingstall recently devised and fronted Channel 4’s three-parter Fish Fight campaign, which appears to have had a galvanic impact on national fish-consumption.

Curly-Whirly’s purpose was to highlight our over-dependence on certain edible fish, namely cod, tuna and salmon. That and the inanity of current EU regulations which, in seeking to inhibit over-fishing, actively promote “discards” (dead and dying fish thrown back into the sea) on a biblical scale – playing no small part in the destruction of our marine fishing industry while they’re at it.

The net result (if you’ll forgive the pun) has been shoals of consumers shimmying around all our best known supermarkets, in a desperate effort to buy up every available “alternative” fish and seafood species. Words rarely heard outside angling circles, such as “coley”, “whiting” and “dab”, have now become the common currency of over-the-counter exchanges with baffled in-store fishmongers.

What Sainsbury’s persists in calling “colin” (that’s pollack to you, with a French accent) is now going out of its doors three times faster than last week, when the programmes were aired. And Tesco, the country’s biggest fish retailer, claims that sales of fresh sardines, coley, brown crab, sprats and whiting have grown between 25% and 45% over the same period.

Mind you, one of the things you won’t hear Tesco trumpeting is sales of its tuna. The saintly Hugh used one of his programmes to excoriate the supermarket’s antediluvian attitude towards netting its own-brand stuff. Whereupon – Hey Presto! – Tesco instantly dropped its attachment to the wasteful but cut-price “purse seining” technique of slaughtering millions of innocent fish. It was a move cynical enough to leave Princes stranded at the bottom of the tuna eco-league table but, in the event, did not elevate Tesco further than fifth place.

So, nice one Mr Curly-Whirly. Just a single piece of advice from our local fish-lady and the good fishermen of Hythe, if I may. Before you direct consumers on an indiscriminate trawl for every available alternative edible fish species, do you think you could do something to educate them on their seasonal availability? All this demand at once – it’s simply unsustainable.


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