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SBD Global/February 8, 2013/Marketing and Sponsorship

Australian Sports Codes Are At Risk Of Losing Sponsorships Following Doping Allegations

Millions of dollars in revenue for Australia's major sporting codes are at risk as sponsors "seek reassurances from sports' governing bodies about allegations of widespread use of performance-enhancing drugs and links to organised crime," according to White & Bingemann of THE AUSTRALIAN. On Thursday, sponsors were "demanding briefings from the governing bodies," including the Australian Football League, the National Rugby League and Cricket Australia about the issue and how the codes planned to respond. Sport sponsorship is "estimated to be worth tens of millions of dollars a year" with companies such as Toyota, Hyundai, the Commonwealth Bank, National Australia Bank, Telstra, Optus, CUB and Coca-Cola paying to put their brands in front of millions of TV viewers and live spectators. Football Federation Australia naming-rights sponsor Hyundai condemned the use of drugs in sport and said that the responsibility for fixing the problem "lay with the sporting bodies." Wesfarmers CEO Richard Goyder, an AFL commissioner and former board member of Fremantle football club, said that his companies Coles and Bunnings retailers, which are official partner sponsors of the AFL, "would monitor developments" (THE AUSTRALIAN, 2/8).

DEALS IN JEOPARDY: In Sydney, McCullough & Barton reported the NRL's A$100M ($103M) sponsorship deal with Telstra "could be in jeopardy" if the Australian Crime Commission report results in adverse publicity for the code. Telstra has been the naming-rights sponsor for the NRL since '01, and "renewed the deal for another five years in December." Telstra CEO David Thodey said, "Our brand image is tied up with those who we sponsor, so if there is untoward behaviour that we don't agree with, we would make our position very clear. We will always do that" (SYDNEY MORNING HERALD, 2/8). Also in Sydney, Bingemann reported if the "wrongdoing is found to be as widespread as the ACC suggests," Telstra sporting sponsorships worth millions of dollars "could be in jeopardy" (THE AUSTRALIAN, 2/7). In Melbourne, McKenzie & Baker reported a former supplier of nutritional supplements to the Fremantle FC "has been prosecuted and fined" A$3.1M for unlawfully importing unregistered substances. The company is the parent of sports nutrition business Nutrition Systems. Its sole director "is Perth fitness identity Danny Pavlovich" (THE AGE, 2/8).
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