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After years of putting its name on the Dew Tour and letting NBC’s Alli Sports run it, Mountain Dew has negotiated a new title sponsorship deal that will result in a wholesale reinvention of the property and give the sponsor a management voice in its operation.
Under terms of the deal, the Dew Tour will shrink from a seven-stop series with four summer events and three winter events to a three-event series with stops at a beach town, a city and a mountain resort. Ocean City, Md., San Francisco and Breckenridge, Colo., signed on as the host cities this year and next year.
Sources valued the renewal at $8 million to $10 million a year, which means Mountain Dew will pay slightly more for a smaller series than it paid for the seven-stop tour.
The guiding principle behind the change: fewer, bigger, better.
The resulting management structure resembles the relationship between IMG and Nike as the owner and title sponsor, respectively, of the U.S. Open of Surfing. Ken Strnad, Mountain Dew’s director of brand marketing; Mark Rooks, Pepsi sports marketing director; and Vermont-based Fuse, PepsiCo’s agency, will all be involved in Dew Tour management decisions.
“The former Dew Tour was really good for many reasons, but the reality is that action sports tours have not evolved to meet the different needs of athletes and fans,” Strnad said. “We’re looking to evolve and innovate. We’re looking to make the most impactful broadcast, to make it a must-see and must-attend event.”
Alli Sports President Wade Martin said, “The industry has evolved remarkably since we launched in 2005. There’s more events. The stars are bigger and want to go to fewer events. The landscape is more crowded. We looked at that and said, ‘We need to evolve with it.’ We’re not going to worry as much about tonnage and the series and we’re going to worry more about creating grand slams.”
Each stop will go from three-day to five-day events and will be designed to create more of a festival atmosphere by including more concerts, eliminating general admission tickets and consolidating the sponsor village.
There will be more hours per stop on TV as NBC and NBC Sports Network air 11 hours for each weekend, up from six hours per weekend in 2011. There will be 12 hours total on NBC over the three events, three times what aired in 2011, and 12 hours total of prime-time programming on NBC Sports Network, which is up from no prime-time programming in 2011. But the total number of hours of Dew Tour programming will fall from 41.5 hours in 2011 to 33 hours this year.
The number of sponsors associated with the tour will decrease, as well. At its peak, the Dew Tour had 12 sponsors, but the three-stop series will cut that number to seven or eight.
The deal was cut at a time that most of the Dew Tour’s major sponsorships were up for renewal. Each stop will still have a title sponsor, and Toyota, Nike 6.0 and Pantech, the mobile phone manufacturer, are each committed to title one of the three new stops.
Associate sponsors Ball Park and Sony will not be returning. Sony declined to comment, and sources said Ball Park wasn’t asked to return. Alli hasn’t signed any new associate sponsors.
“We’ve reduced the clutter in terms of how many events are on the calendar and reduced the clutter of the number of sponsors needed to support the cost of seven events,” said Rob Simmelkjaer, senior vice president of NBC Sports Ventures.
The revenue model for the tour isn’t changing drastically. Though it’s eliminating some sponsors and making events free to the general public, it will continue to sell premium tickets that offer access to special viewing areas, and it will be paid by city sports and visitor commissions that want to host one of the three events.
Its operating costs will be reduced minimally by decreasing from seven to three events because the dollars Alli saves will be reinvested to improve TV production, hire musical acts and make other enhancements.
The new Dew Tour is a radical departure from what the series was designed to be. When it was founded, tour developers described it as the first “regular season” of action sports where athletes accumulated points over five stops and those points determined who would be crowned Dew Tour champion. Under the new format, there is no more regular season and no more champions. Event winners, for example, will be simply the “skateboard vert winner at Dew Tour Beach” or the “BMX park winner at Dew Tour City.”
“We thought we could build momentum from stop-to-stop-to-stop over time, but in the end, that’s not how fans consume action sports,” Martin said. “They want great, unique content and athletes to always be progressing and evolving. The fixed model we were in didn’t allow for that.”
The idea of overhauling the Dew Tour developed when renewal discussions between Mountain Dew and Alli Sports began nearly a year ago. The conversations began at a time when star athletes such as Shaun White were skipping stops on the Winter Dew Tour and Summer Dew Tour ratings were relatively flat, averaging a 0.5 Nielsen rating and 786,000 viewers over four events last year.
The change to three events will mean Alli Sports will have to reconsider how it sells the Dew Tour. In previous sales calls, it highlighted its five months of events in five different cities as a way for marketers to get more bang for their buck than a one-off event like ESPN’s X Games. But that is a tougher sell with three events in three markets.
“This puts us much closer to the X Games than we’ve ever been,” Martin said, “but there’s room for the X Games and Dew Tour to thrive from a corporate sponsor perspective.”
At the same time, Victoria Azarenka, Caroline Wozniacki and other top tennis players were beginning to arrive for the WTA tournament that would begin the following afternoon. Sweats and rackets were passing spandex shorts and bike bags by the concierge desk in a changing of the guard rarely seen anywhere, let alone a sandswept spit of land on the fringe of the Arabian Peninsula.
But such juxtapositions have become commonplace in Qatar. In an astoundingly short time, this once-obscure country has gained the attention of the sports industry, and fans, worldwide. Its name is seen globally week after week on the shirts of FC Barcelona, which was the beneficiary of the largest uniform sponsorship deal in history ($230 million over five years) from the government-affiliated Qatar Foundation.
The country shows up throughout the year in video highlights and sports sections from New York to New Delhi as Doha stages a full schedule of international events, including WTA and ATP tournaments, Qatar Masters Golf, MotoGP and World Superbike championships, hydroplane racing, the Sail the Gulf Regatta, and international football friendlies that include England-Brazil and Brazil-Egypt. And though locals aren’t accustomed to attending sports events, an almost unlimited budget means that events can be subsidized so they make sense commercially.
The storied Bundesliga club Bayern Munich trains in Doha at the country’s Aspire Academy
Qatar gets its name out on Barca’s jerseys, and brings in events like Qatar Masters Golf.
Photo by:GETTY IMAGES
The Al Jazeera Sports channel, founded and based in Doha, has spent $520 million to show two games a week of France’s Ligue 1 soccer over the next four years and is looking at bidding on worldwide rights for the English Premier League and perhaps the Bundesliga. That would make it a must-carry for cable and satellite distributors everywhere.
And 16 months ago, following the successful staging of the 2006 Asian Games and three years of the season-ending WTA Championships, little Qatar — a country with scant soccer tradition, one major city, and only 1.7 million inhabitants, the vast majority of which are temporary workers from around the globe — outbid the United States, Australia, Japan and Korea for the 2022 FIFA World Cup.
• • •
More than five million people Googled Qatar in the hours that followed FIFA’s announcement on December 2, 2010, in an effort to learn more about the most unexpected host nation in World Cup history. What they discovered was a country with little tradition in competitive soccer and summer temperatures unsuitable for outdoor play — but one determined to use sports as a means to further its cultural and political goals. “When Qatar won the World Cup, people throughout the world started looking at us in a very different way,” says Noora Al Mannai, the CEO of Doha’s bid for the 2020 Olympics.
The scrutiny was influenced at least in part by the surprise at the vote’s outcome, and the charges, suggestions and complaints of an improper bid process that accompanied it. Allegations quickly surfaced that Qatari organizers had paid several African members of FIFA’s executive committee more than $1 million each for their votes, as arranged by a fixer specifically hired for that purpose.
The ruling emir, Hamad bin Khalifa Al Thani, and wife Mozah bint Nasser Al Missned celebrated the World Cup news in 2010.
Photo by:GETTY IMAGES
So while globally there remains skepticism about the vote’s legitimacy, as well as doubts about the tiny country’s prospects of successfully pulling off a monthlong celebration of soccer that has traditionally been held in multiple cities many hundreds of miles apart, in Qatar, the infrastructure-building process has begun.
Because of the World Cup, Doha is getting more than 40,000 new hotel rooms at a total investment, according to FIFA’s Bid Evaluation Report, of an astonishing $17 billion. Those gains come at the same time that a $5 billion airport is being designed — in part, by U.S.-based HOK — and an extended railroad line, outsourced to Germany’s Deutsche Bahn at the cost of $25 billion over the next 15 years, aims to help open the hard-to-access interior of the country to development.
As reported by Doha’s Gulf Times in February, quoting a British-based securities firm, current infrastructure projects will total $209 billion in spending. Most are improvements that will endure for decades.
And Qatar isn’t finished. On the day after the cyclists and tennis players crossed paths in the Ritz-Carlton, Al Mannai and her delegation flew to Lausanne, Switzerland, to present the formal bid for the 2020 Games. The idea of Doha, which had a population of some 300,000 less than a decade ago, taking its place beside London and Beijing, Tokyo and Paris, Los Angeles and Mexico City as the site of a Summer Olympics seems laughable — until you consider what the country has accomplished.
“It’s like a highway now,” said Abdullah Said Alabda, the founder and president of the Qatari soccer club Al-Sailiya. “It just keeps moving forward. Bayern Munch was here last month. They beat us, 13-0, but when they saw the facilities we have here, they couldn’t believe it. ‘Qatar can do anything,’ the manager told me. ‘Whatever the country sets its mind to accomplish, it can do.’ So when you ask about the Olympics, we answer ‘Why not?’ At this point, we expect it to happen.”
Qatar looked like a lonely place during the Tour of Qatar cycling event in 2006.
“They’ve understood that sports have a power to build ‘Brand Qatar,’” said IMG’s Jefferson Slack, the company’s head of global business development for football (soccer), who is consulting on Qatar’s domestic soccer league. “Just a few years ago, it was, ‘Where is Doha? What is Doha?’ But they have utilized sports to build a brand in an extraordinary way. They’ve thought it through.”
Moore agreed. “This branding allows Qatar, which is a very small country, to be a real force in the world,” he said.
• • •
“Fifty years ago, [Qatar] was very poor,” said Chuck Thorpe, who from 2004 to 2010 was the dean at Carnegie Mellon/Doha. “Fifteen years ago, it was fairly poor. Today, it’s one of the richest countries in the world.”
In fact, by many measures Qatar ranks as the richest country in the world. Per capita income in 2010 exceeded $160,000. “It’s a tiny nub of sand, and as recently as 1996 it had two
Qatar's newfound prosperity has fueled a remarkable building boom.
Photo by:GETTY IMAGES (3)
The Aspire sports complex is a perfect example. It includes indoor facilities for more than a dozen different sports, dormitories and classrooms, strength and conditioning areas, and homes for more than 1,000 athletes, all constructed to the highest standards on an all-but-unlimited budget. “In England, if you ever wanted to get something like that built, it would take years and years,” Richardson said. “Here, they wanted it to happen. So it just happened.”
As with so much else in Qatar, the ruling emir, Hamad bin Khalifa Al Thani, simply dipped into the state treasury and wrote a series of checks. And as with so much else in Qatar, too — notably, the amount it spent on the winning World Cup bid — the cost of building Aspire remains officially unknown, though estimates from those familiar with the project exceed $1 billion.
The engine for such unbridled prosperity is natural gas. When Al Thani came to power in 1995, the nation was nearly insolvent. It was sitting on a massive gas deposit, but existing capabilities weren’t able to extract the gas from the ground, and worldwide demand for it was low. Al Thani spent several billion dollars building a processing plant, making bets that new technologies would ultimately enable the resource to be accessed and that a revival in its value would make the undertaking worthwhile. Both paid off beyond his wildest expectations.
Instead of sitting on the wealth, the government invested hundreds of millions of dollars on subsidizing businesses and infrastructure, including electricity and water for every citizen. Total investment is unknown, but at a European Finance Convention meeting in Doha late last year, the sum of existing projects was revealed to exceed $100 billion. “Imagine the change in one person’s life,” Thorpe said. “Diving for pearls for a living, maybe chasing some sheep around the desert, going to work as a chauffeur in Beirut. Now, all of a sudden, boom!”
Within a short time, Qatar’s newfound prosperity has altered the balance of power in the Middle East. Al Thani recently ranked as the fourth-wealthiest person in the world, yet his goals extend far beyond the accumulation of a personal or governmental fortune.
Even before he succeeded his father as emir in 1995, Al Thani perceived a regional vacuum waiting to be filled. Despite commonalities in culture, religion and language, none of the countries in the Arab world was looking outside its borders to take a leadership role. There was no world-class educational facility, no world-class hospital, no trustworthy news source. In addition, political and cultural concerns — from reported human rights violations, to failure to admit Israeli citizens, to a ban on alcohol sales — limited the reach and international ambitions of some of the area’s largest and most visible countries.
With Qatar’s newfound wealth, and a far more liberal view on individual rights and freedoms than most Arab rulers, Al Thani aimed to become a major regional player from almost a standing start.
“Bringing in a women’s tennis tournament was counterintuitive,” said Pac-12 Conference Commissioner Larry Scott, who ran the WTA as chairman and CEO from 2003 to 2009 and had earlier helped bring the ATP to Doha in the early 1990s. “But that was part of the rationale: to debunk the international perception about the role of women in the region. The reason for sports for Qatar is to generate international prestige and recognition and credibility, and also to distinguish Qatar from other countries in the region. This was one way to do that.”
• • •
“This country has big ambitions in several fields,” acknowledged Saad Mohammad Al Rumaihi, one of the emir’s closest friends and advisers. “Not just sports, but culture, politics, aviation, education. We want to be the leaders in the region, but also to help lift the region.”
Now a minister-without-portfolio at the right hand of the emir, Al Rumaihi is also a director of Qatar Navigation, Qatar Industrial Manufacturing Co., Qatar Shipping Co. and Qatar Telcom, and the former head of Qatari Television. He’s emblematic of a society in which power and influence are very tightly controlled by a few families, and multiple responsibilities across several disciplines are common.
From a front-row seat, Al Rumaihi has watched his small country gain stature. Al Jazeera started in 1995 — another element of Al Thani’s desired development of the country — and almost immediately began to serve as a trustworthy voice across national boundaries. American universities started to arrive soon afterward: Cornell’s medical school, Georgetown’s school of foreign service, Carnegie Mellon’s business school, Texas A&M’s engineering school, and Northwestern’s journalism and communications programs, among them. Later, I.M. Pei designed the new Museum of Islamic Art, and a Ritz-Carlton, Four Seasons and W facilities sprung up to cater to visiting executives.
It never would have happened this quickly, Al Rumaihi insists, if not for sports. “The turning point came in 2002,” he said. “The emir told me a long time ago, even before he assumed power, ‘We will look forward to one day hosting the World Cup and the Olympic Games.’ He knew that the Asian Games would be a steppingstone, so he concentrated on that. In 2002, Qatar won the bid for the 2006 games. Ever since, when I travel outside the country, all people want to talk to me about is Qatar and what we’ve been able to accomplish.”
The 2006 Asian Games in Doha helped convince the sports world that Qatar was for real.
Photo by:GETTY IMAGES
“We are different than other countries in the region,” Al Rumaihi said. “We know that sport is different than politics. You have to open your door. If an Israeli handball team qualifies for the event, you have to let them come. You have to welcome them. Because of that, we are the only country in the region that could have the World Cup, the Olympic Games, events such as these. We have a different mind-set than everyone else in this part of the world.”
FIFA took notice. And the world’s soccer governing body was already well aware of Qatar. In 1995, only weeks before Nigeria was scheduled to stage the FIFA World Youth Championship, that strife-ridden nation announced that it would be unable to hold the event. Qatar stepped in on the shortest of notice and pulled it off using three Doha venues.
“I remember João Havelange of FIFA coming up to me at the end of the tournament,” said Al Rumaihi, who coordinated television coverage of the event. “He was very grateful. He said, ‘Thank you, thank you, thank you.’ And he didn’t forget.”
• • •
Yet for all this modernist thinking, and the country’s headlong immersion into the modern world, much about Qatar remains rooted in the last century, or even the one before. The power structure is closely knit. The emir’s family and friends run almost everything, and leading executives play multiple roles.
“The way they make decisions is, they go right to the top,” said IMG’s Slack.
Business isn’t easy to transact. Emails are often unreturned; voice mail is close to nonexistent. If you want to reach someone, you keep calling them — or you get in the car and go see them. “They lead the world in cellphone penetration, they have the most modern and up-to-date everything,” said Carnegie Mellon’s Thorpe. “But there’s only 250,000 Qataris and they’re divided into 20 tribes, and it’s rare that anyone marries outside his tribe. A lot of the real business happens over a cup of tea with someone your family has been related to for generations.”
With power centralized in only a few hands, events can be set in motion swiftly. On Feb. 14, Qatar held its first annual National Sports Day, billed as the only national holiday in the world devoted to sports. Businesses and organizations were given less than three months notice to create and plan events, for Al Thani only announced the existence of holiday late in 2011. Nevertheless, just about the entire country ground to a halt to attend corporate- and government-sponsored festivities. Thousands of Qatari nationals and foreigners working there took to the streets for jogs, runs, walks, competitions and games. There were tours, tournaments, lectures and events, all designed to show how committed each entity was to sport in all its guises. Newspapers published special sections. State television covered the events throughout the day.
Typical was the scene at the state tennis center, where Hamad Al Thani, the emir’s son and officially designated heir apparent, suddenly appeared in an immaculate white track suit and tapped balls over a net to a gaggle of earnest 5-year-olds. It was an exercise designed to illustrate the country’s sporting future. For all the world-class events that pass through Doha, the average Qatari still spends very little time playing sports — or even, really, attending them. The crowds that fill stadiums for soccer, tennis and other events tend to be dominated by the expatriate community, businessmen or skilled laborers in Doha on multiyear contracts, often without their families, who have money to spend and not much other than sports to spend it on.
At the side of the heir apparent was his friend and confidant Nasser Al Khelaifi, who stands at the nexus of Qatar’s international sporting push. A former pro tennis player who cracked the world’s top 1,000 in 2002, he’s the president of the Qatar Tennis Federation, the head of the Qatar Investment Agency, the president of Paris Saint-Germain, and the chief executive of Al Jazeera Sports. Small wonder that he doesn’t return phone calls and is difficult for even business associates to pin down. “One French reporter has been waiting to speak with him for three months about his plans for Saint-Germain,” said a press attache as Al Khelaifi strode past. “I feel so bad for her.”
It isn’t just a matter of his time. “Part of the culture in Qatar is that nobody wants to stick his neck out, to take credit for anything,” said an American businessman who works closely with the royal family and doesn’t want his name used. “They want to deflect all the credit to the emir.” The inevitable result is an opacity reminiscent of the old Soviet Bloc. Official comment is often meaningless, and unofficial comment is rare.
The difference, of course, is that Qatar is a capitalist country with the need to look outward and do business with the rest of the world. “You have to think of it as almost doing business with an extended family,” Scott said. “There’s an inner circle of a few people, and they tend to have broad portfolios, but they are capable of doing what needs to be done. They might do it on a different time frame, and the line between point A and point B might be a zigzag and not a straight line as an American might prefer, but Qatar wouldn’t be seriously considered for these kinds of events if it didn’t deliver on its commitments. Sports has helped them get farther faster. They’re not going to do anything to jeopardize that.”
For both Qataris and the international firms that do business with them, the biggest rewards may be still to come. A high-performance training center for female athletes is planned for Doha, to be yet another symbol that the country’s attitude toward women is markedly different from that of much of the rest of the Arab world. It’s also part of the public-relations onslaught accompanying the bid for the 2020 Olympics, different pieces of which are being managed by various British and American firms.
A short list of candidate cities will emerge from an IOC meeting in Quebec in May, and the host city will be selected in September 2013. If Doha manages to beat out Madrid and Tokyo (nobody is giving Istanbul or Baku, the two other candidates, much of a chance), it will provide exponential business opportunities for consultants, logistics and security firms, and other specialists from around the globe.
Even more than the World Cup, nobody pulls off the Olympics without help from those who have done it before. And though the Asian Games build-out means that nearly all the Olympic facilities already exist, additional construction on infrastructure will be necessary — and almost certainly, outsourced. If a Western businessman must navigate through a sea of cultural differences, the feeling is that the rewards will be worth the journey.
At the same time, Qataris believe the Olympics will provide the ultimate validation for their country and, equally important, the traditionally Arab way of life. “With sports, and the Olympics in particular, we are taking the initiative to show the world the importance of [the Arab] market,” said Al Mannai, the bid group’s CEO. “Why shouldn’t the Olympics come to the Arab world? That is the question we are asking with our candidacy. We are eager to hear the response.”
Bruce Schoenfeld is a writer in Colorado. He can be reached at email@example.com.