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Volume 21 No. 2

Marketing and Sponsorship

The BT Sport Industry Awards in London is European sport’s big, black-tie, red-carpet affair, attracting a celebrity-laden crowd that looks to honor and celebrate the year’s best. Among the industry cognoscenti, the SIA Agency of the Year category is the evening’s most sought-after, and marketable, piece of silverware.

This year’s event sprung a surprise when data specialist agency Two Circles took the award over a field of more traditional sports marketing agencies. But what’s particularly notable in this case, beyond simply the win, is what Two Circles did to get the winning vote.

Matt Rogan (holding trophy) and Gareth Balch with rugby’s Courtney Lawes and Owen Farrell

This is a story about storytelling.

Across the industry, many of the generalist sports agencies are becoming hard to tell apart, offering a mix of PR and traditional sponsorship activation work. Two Circles is telling a different story, with a promise of helping sports rights holders make the most of their substantial amounts of customer data.

“In an age when every agency and brand is talking about data, Two Circles won a BT Sport Industry Award by proving that they live, breathe and understand it inherently,” said Nick Keller, chairman of the Sport Industry Group, which presents the annual awards.

Matt Rogan, who runs Two Circles along with co-founder Gareth Balch, calls it a big growth area for the entire industry. His hope is that Two Circles’ data-led approach will further the argument that sponsorship needs to be more than a media buy.

“We are able to prove the potency of sport as a marketing vehicle, based on evidence, not intuition,” Rogan said. “That will fundamentally change the way in which sponsorship and ultimately TV rights are transacted in an increasingly digital landscape.”

Two Circles use the many sources of customer data held by their clients to drive their marketing plans. This allows professional clubs to combine ticketing, retail and hospitality data; match-day survey results; and digital traffic to understand each customer’s behavior on an individual basis.

“Data isn’t a sector of the market,” Rogan said. “It’s the underlying proof point of all of the work that the sports marketing industry does. It answers the old question of all marketing: which 50 percent of this activity is actually working? It provides irrefutable, unquestionable evidence of changing customer behavior. There’s nowhere to hide any more.”

Balch and Rogan co-founded Two Circles in 2011. The firm now has 45 employees and an enviable list of clients.

Two Circles’ focus is entirely on the rights holder, and the agency is accumulating an enviable roster of clients running the gamut from clubs and leagues through to venues, mass-participation events and the commercial side of federations. The company, founded in 2011, has 45 employees, and its first clients were big ones: Premier League club Manchester City and the England and Wales Cricket Board. It has since expanded to include other Premier League clubs, Ascot Racecourse, Lord’s Cricket Ground and the Lawn Tennis Association, the governing body for tennis in the U.K.

A recent deal with La Liga club Valencia CF speaks to the firm’s European expansion outside the core U.K. market, as well.

“Our partnership with Two Circles has yielded excellent results; their agency proposition is unique in that it delivers financially measurable return on the performance of our data,” said George Foster, head of marketing and communications for client Surrey County Cricket Club. “The data-driven strategies we have developed as a result of our work with Two Circles have led to award-winning campaigns with record financial results across ticketing and membership. Data can now fulfill its potential as a fundamental pillar in all our sales strategies.” 

The decision to specialize on the rights-holder side puzzles some people in the industry, who see the greater budgets on the sponsor side of the equation. On the contrary, Rogan is comfortable with the current strategy.

“When we get it right, it works for the brand and the sponsor anyway,” he said. “That means the brand ups its direct marketing and digital activation spend with the rights holder — which is spent at least in part on us, as an outsourced member of the team. So we’re delivering for everyone anyway, and it’s just really clear whose side of the fence we’re on.”

Rogan’s confidence stems from being at the front of a disruptive trend that is changing the expectations of sports fans, who want to enjoy the same levels of service they get from major retailers and best-of-class online providers. The cost of delivery of personal experience has decreased, as well. “Technology is now cost effective in this space,” he said. “Five years ago, it would have been a blocker. Now, it’s an enabler for even midsize properties.”

More broadly, Rogan is excited to see a greater range of skills being employed in the sports sector, and he is meeting more people with high levels of corporate marketing experience at brands and rights holders alike.

“They are perfectly aware of the level of data-driven accountability now possible,” he said. “The rest of the world started to leave behind logo views and cost per thousand years ago … but sport had not moved on.”

It’s a shift that means that the holy grail of sports marketing — identifying the link between cause and effect — is in sight.

“There’s often a perception that this area is called CRM [customer relationship management] and therefore an expensive CRM computer system will make the problem go away,” Rogan said. “But a system in itself never solved anyone’s challenges. There are thousands of disgruntled and embarrassed CEOs around the world who were upsold the wrong technology and are watching their customer base decay as a result. Those making strides now are those brave enough to say, ‘We need to change this.’”

Disruption has arrived in the sports marketing sector. You can, literally, count on it.

Richard Gillis is a writer in London.

Entrepreneur Kenny Dichter is in talks about a long-term partnership with former world No. 1-ranked amateur golfer Patrick Rodgers as part of his plan to make his private aviation startup, Wheels Up, the preferred provider for PGA Tour players.

Dichter is using athletes to build private aviation service.
Dichter has founded a number of companies, including Marquis Jet, and has traditionally used sports as a way to build the brand. He’s at it again with Wheels Up and has signed several golfers, including Nick Faldo, and sports personalities such as Yankees first baseman Mark Teixeira and Fox Sports NFL analyst Troy Aikman as ambassadors for the new company.

“I have always felt that working with athletes and entertainers who are thought leaders and influencers in their space is a great way to market a business,” he said.

Wheels Up was launched in August 2013.

Although a deal was not complete as of last week with Rodgers, who recently turned pro, Dichter said, “Patrick Rodgers’ potential is limitless, and we look forward to a long, mutually beneficial relationship.”

John Mascatello, executive vice president and managing director of golf at Wasserman Media Group, which represents Rodgers, said, “We are in discussions about building a strong relationship with Wheels Up, and when it is time for him to have a private aviation partner, we would expect them to be part of Team Rodgers moving forward.”

Patrick Rodgers
Wasserman golf clients Kevin Kisner and J.B. Holmes are already Wheels Up ambassadors, and both wear the company’s logo on their apparel.

Wheels Up focuses on athlete “ambassadors,” who Dichter said pay for their hours on Wheels Up planes, but receive discounted hourly rates or bonus hours in exchange for services they provide, including company appearances.

“Wheels Up is a utility and everybody has to pay their utility, it doesn’t matter how famous you are,” Dichter said. “With the ambassadors that we have, they buy a certain number of hours. Once they purchase a certain number of hours, that is when we can get into a discussion if whether there is a fit for an ambassadorship. And that ambassadorship will never be cash, it will always be hours. I want to be very clear on that, because we never pay cash.”

It’s a concept that Dichter developed at Marquis Jet, which he founded in 2001 and sold to NetJets in 2010. Dichter resigned as vice chairman of NetJets, a Berkshire Hathaway company, in 2011.

Wheels Up uses turboprop aircraft, and has a fleet of Beechcraft King Air 350i planes, which reduces the cost of travel compared with private jets.

“I would tell you that Marquis and NetJets fly better than 50 of the top 100 golfers in the world, but what we have developed at Wheels Up, in my view, is a better mousetrap,” Dichter said. “We have lowered the entry point and lowered the hourly [rate]. So players who fly Wheels Up will be able to keep more of their prize money than players who fly other aviation companies. If I was going to make an advertisement for PGA Tour players, I’d say, ‘Keep your prize money. Fly Wheels Up.’”

NetJets spokesman Thomas Hoyt had no comment on Dichter’s remarks, but noted that 50 to 60 PGA Tour players fly with NetJets and that the company has sponsorship deals with top golfers including Jim Furyk, Matt Kuchar, Zach Johnson and Jason Day.

Pro athletes, and especially golfers, rely on private aviation for transportation on a frequent basis, and deals with private aviation companies keep their travel costs down, agents said.

“The schedule is tough, and many of these golfers have and travel with young families,” said LeslieAnne Wade, a manager for Faldo. “It allows freedom in being able to get to the next business stop quickly or to get home for a couple quick days to be with children. With this schedule, both the time devoted to business and the time devoted to family would be limited without private jet service.”

Faldo became an ambassador for Wheels Up last year, after having a similar deal with NetJets. As part of his Wheels Up deal, Faldo, a three-time Masters winner, hosted a Wheels Up event at Augusta earlier this year.

Dichter also co-founded the sports marketing and music company Alphabet City, which was sold to the former SFX Entertainment in 1998.