SBJ/October 22-28, 2012/Marketing and Sponsorship

Ryder Cup still seeks global sponsor structure

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It was January 2011 when Ryder Cup officials announced plans for a unified global sponsorship that would offer brands the rights to both the U.S. and European teams, something that traditionally has not been available. But 20 months later, both sides are still trying to figure out exactly how to take a global Ryder Cup partnership to the marketplace.

In the past, sponsors have put their money behind one team or the other, buying U.S. Ryder Cup rights from the PGA of America or Team Europe rights from the European Tour — the two primary governing bodies for golf’s most unique event. That had a tendency to create an interesting marketing mix. The U.S. team has Mercedes-Benz; the Europeans have BMW. The U.S. has Omega; the Europeans have Rolex.

The U.S. and European teams have been seeking a platform for brands to sponsor both teams and the event itself.
Photo by: GETTY IMAGES
Until recently, there really hasn’t been the opportunity to buy the Ryder Cup unto itself. The PGA and the European Tour are trying to change that by developing a platform that will accommodate brands willing to pay close to eight figures for a sponsorship that includes rights to both teams and the event as a whole.

“If it were 1927 and we were all starting fresh with the first Ryder Cup, we’d be trying to find a global solution,” said Tim Shaw, the sales director for the London-based European Tour. “But what we’ve got is a most complex space for sponsorship. It’s going to take time, but both parties are committed to finding a solution.”

Because the Ryder Cup has been around for more than 80 years and both sides have conducted their business separately throughout that time, their sponsorship models differ vastly. When the event is on U.S. soil, as it was last month at Medinah, the PGA of America controls the competition and the business of the Ryder Cup. When in Europe, it’s the European Tour’s event. Each has its own idea of how it should be run.

The PGA keeps the course clean from most commercial signage when the event is in the U.S. — the exception is Omega, which places its branded clocks on the course as the official timekeeper. Team U.S. deals, which range from $3 million to $6 million a year, are heavily loaded with media on NBC and Golf Channel.

The European Tour, by contrast, offers its sponsors much more on-course signage and event integration when the Ryder Cup is in Europe. Those sponsors negotiate their own media deals with Sky Sports, which has the TV rights in the U.K.

“They just have different structures that inherently will create problems with them working together,” said Scott Seymour, who runs Octagon’s golf division and represents brands such as MasterCard and BMW. “They just have two totally different approaches and they’ve got their own interests that they have to look out for.”

When Shaw was asked if it’s taken longer to build a global platform than he expected, he said, “We always recognized that the challenge to a genuine global partnership was the different commercial models we apply to each Ryder Cup. Both the PGA and the European Tour have broad commercial relationships that extend well beyond the Ryder Cup.”

Because of the Ryder Cup’s immense popularity in Europe, the event is a huge driver of business for the tour. For example, Team Europe sponsor BMW also title sponsors four events on the European Tour.

Team U.S. sponsors are also PGA of America sponsors, which includes rights to the PGA Championship, Senior PGA and other PGA of America events, as well as access to the organization’s 27,000 PGA pros.

“It’s a challenge to break down and strip out the Ryder Cup as a separate asset,” Shaw said of the ongoing efforts between the European Tour and the PGA to create the global partnerships.

“There are just different approaches that we have to work through,” said Kevin Carter, the PGA of America’s senior director of business development. Carter and Shaw have taken the lead for each organization in constructing a global Ryder Cup partnership.

Creating a singular logo for the Ryder Cup was a small step toward a unified approach to the event.
One issue the PGA and European Tour don’t have to worry about is the new Ryder Cup logo, which was in play for the first time last month at Medinah. In previous years, the PGA created its own logo for Ryder Cups on U.S. soil, while the European Tour had its own mark when the event was held in Europe. Creating a singular mark to stand for the Ryder Cup, no matter where it’s being held, was the first step toward a more unified approach to the event.

Both sides remain optimistic that one or two global partners will be in place for the 2014 Ryder Cup in Scotland. Commonly mentioned categories for a global partnership are insurance, like an Allianz or Zurich, and telecom companies like Samsung, industry insiders say, while the categories that already are occupied, such as timekeeper and auto, will remain as they are and will not be sold as a global deal.

At the same time, the European Tour is seeking three more Ryder Cup sponsors for Team Europe in 2014, including a replacement for MasterCard, unless the credit card company decides to come back. The European Tour’s efforts to sell both Team Europe deals and Ryder Cup global partnerships speaks to the complexity of the arrangement.

American Express could be a candidate for a global Ryder Cup partnership with MasterCard out, but neither side would comment on specific conversations they’re having.

If a global partner is found, the brand likely will have a different set of rights when the event is in the U.S. than when it’s in Europe.

“In the short term, you’re probably going to be looking at independent programs,” Shaw said of any global deals sold for 2014. “In the U.S., the deal will be more like the PGA deals. Over here, it will look more like our deals. That’s just a reality-based approach for right now.”

But in the long run, the tour and the PGA still hold out hope that they’ll be able to sell global rights that will look the same, no matter where the Ryder Cup is being held.

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