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SBJ/February 25-March 3, 2013/Marketing and Sponsorship
Ryder Cup nails down first global sponsor
Published February 25, 2013, Page 1
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Standard Life Investments, an Edinburgh, Scotland-based investment house, has agreed to be the Ryder Cup’s initial worldwide partner, making it the first company to acquire rights to Ryder Cups on both sides of the Atlantic. Never before could companies buy Ryder Cup rights in both Europe and the U.S., until this new global platform was introduced in 2011.
|The Standard Life deal is the first to bridge the gap between the U.S. and Europe.
Terms of the deal were not available, but industry sources said that such a global sponsorship was being shopped for high seven figures annually. The global deals are being sold in two-year increments to give the partner a full year to promote leading up to the event. As a worldwide partner, Standard Life will have the ability to market its Ryder Cup association in 2014 and ’16 in both European and U.S. markets.
The PGA of America and European Tour hope to have as many as four worldwide partners for the 2014 Ryder Cup.
“The first one is always the biggest hurdle to overcome,” said Tim Shaw, sales director for the European Tour, which handles the commercial rights for Ryder Cup events in Europe. “Now we’ve got a blueprint and we hope it will lead to additional global partners coming on board.”
Standard Life’s worldwide partnership will be rolled into two separate contracts, one with the European Tour and another with the PGA of America, covering the 2014 and 2016 Ryder Cups.
The European Tour oversees commercial operations of the Ryder Cup when it’s in Europe, while the PGA manages Ryder Cup business when it’s in the U.S. Having two separate organizations with differing marketing philosophies has been an obstacle to creating a truly streamlined, global sponsorship package.
But after working through seven months of negotiations, Standard Life emerged with many of the same hospitality, promotional and on-course rights as Team Europe sponsors in 2014, except that Standard Life will be the only one to call itself a worldwide partner with unique marks in its advertising.
The primary difference is that 2014 Team Europe partners BMW, Diageo, Ernst & Young and Rolex will have no rights for the 2016 Ryder Cup in the U.S., whereas Standard Life will again have full partner rights domestically and internationally.
The most notable on-course change from 2014 to 2016 will be exposure. The Ryder Cup in Europe provides significant signage on the golf course, especially in the background of camera shots, whereas the PGA of America prefers a clean venue when the Ryder Cup is in the U.S.
“The PGA and the European Tour have been operating under two different business models for a long time, and that’s why it’s taken a while to find a solution,” said Kevin Carter, the PGA’s chief business officer. “We’ve worked very closely with the European Tour to find a way for Standard Life to have the ability to market here in the U.S. and abroad, and we’ve got something now that elevates the Ryder Cup to a truly global platform, as it relates to sponsorship and marketing.”
Standard Life will have category exclusivity for the 2014 and 2016 Ryder Cups. Neither the PGA of America nor the European Tour had this category filled. The closest category to Standard Life is the accounting giant, Ernst & Young on the European Tour side, or American Express on the PGA side.
Synergy, a marketing agency based in London, worked with Standard Life on the deal.
Synergy and Shaw began discussions last August. Initially, the European Tour was seeking sponsors for Team Europe in the 2014 Ryder Cup.
“As those discussions progressed, it became clear that Standard Life was looking to promote and market itself in North America as well,” Shaw said. “We made introductions to the PGA of America, and we were able to come together for the first common program.”
Even though Standard Life’s rights will vary somewhat from 2013-14 to 2015-16, Walsh said the value in both years aligned well.
“The PGA and the European Tour have differences in the way their events are delivered,” said Walsh, who has been with Standard Life for three years and works out of the Edinburgh headquarters. “But the rights were similar enough that the process really went smoothly. … To be the first worldwide partner on such an iconic event, it’s a distinction that’s very important to us.”
Walsh said the Ryder Cup will be a core platform as Standard Life attempts to grow from a strong United Kingdom company to a more globally recognized investment house.
The firm manages $264 billion in investments, making it one of the largest in Europe, but it has little presence in the U.S., where it hopes the Ryder Cup will elevate its brand recognition.
“We worked quite diligently to find commonality in the wording and to find enough collective reference points in the deals to clear all the hurdles,” Shaw said. “It remains somewhat complicated, but there is now a comprehensive program of branding, advertising, promotion and hospitality rights.”
Standard Life is still working through just how much of a presence it will have on the Ryder Cup broadcasts on NBC domestically and Sky Sports in Europe. Walsh said its media commitment will be determined in the future.