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Vaughters’ visionary cycling sponsorship model

Garmin Director navigates route to pro cycling’s sustainability and growth

Jonathan Vaughters’ article provides a clear and sustainable business model for professional cycling. Although The Geox Paradox, published almost one year ago, foreshadows Geox’s exit from professional cycling, Vaughters’ solution provides an achievable roadmap for professional road cycling to navigate difficult times.  The foundation of the Garmin-Cervelo Director’s business model is: Sustainability, Accountability, Flexibility and Partnership.

Sustainability: Recent sponsor defections clearly illustrate the need for long term contracts between events, teams and, ultimately, sponsors. Vaughters proposes the UCI contractually guarantee teams participation in major events for 10 years. The evaluation criteria would be based on history (not “what have you done for me lately?”), performance and ethics. Today, teams and sponsors are faced with a few options to combat the year-to-year cycle (each with their own consequence): win, win at all costs or stack rosters with riders carrying the most points. One could argue longer term contracts and guaranteed entry would help companies, wealthy benefactors and sponsors avoid the “immediate results today” mentality, and could shift focus to cycling sponsorship’s positive impact on business objectives.

Accountability: If all parties are held to specific ethics and standards, contractually, there could be a decrease in sponsor defections. Drugs, cheating and unethical behavior are obvious. Two areas worthy of exploration are sponsor expectations and measurable results. Why? If a sponsor is guaranteed their team will compete in the Tour De France and they don’t the sponsorship contract is voided. Another option worthy of consideration is to have teams and sponsors contractually agree upon measurable results (i.e. – Sponsor investment will deliver an ROI of increased web traffic of 15%, increased sales of 25%, increased brand recognition of 10%).  Once again, if results aren’t achieved the sponsorship contract is voided. One would believe greater care would be taken before contracts are signed. (Ed. – I am suggesting the example for measurable results. Successful partnerships should always include well defined objectives and results that can be measured.)

Flexibility: The ability to adjust strategy and tactics is as important in racing as it is in business and sponsorship. Options often create opportunity and can help establish a roadmap for success. In Vaughters’ model, sponsors could opt to fund teams guaranteed entry into Tier 1 events, or choose to fund teams that will develop slowly and eventually compete at the highest level. One only has to look at the genesis of teams like Garmin-Cervelo, Team SpiderTech and GreenEdge to understand the merits of building a team (and a brand) slowly.

Partnership: Professional road racing is the pinnacle of teamwork and partnership. Teams, sponsors and events could adopt an environment that fosters collaboration and cooperation to achieve a common goal.  The end result would be success for the team and the sponsor which would facilitate growth for our sport. Vaughters suggests two areas where partnership can help professional cycling. The first is sponsor equity investments (similar to employee stock options). Teams could sell equity when sponsorship dollars are not readily available to cover operating expenses. The second area partnership impacts is perceived value. Limiting the number of teams guaranteed entry into top level events, over 10 years, creates exclusivity and limits the number of sponsorship opportunities. Exclusivity always creates greater value which is a basic rule of economics (supply and demand; when something is in short supply it becomes a more valuable commodity).

Had pro cycling instituted a model similar to Vaughters’ maybe we wouldn’t be witnessing title sponsors exiting the sport. And, potentially prospective sponsors like BigMat would jump at the chance to promote their brand through cycling sponsorship (as they once did as BigMat -Peugeot-IBM).

Think about it.

Thanks for visiting. Remember, until next time, “Keep the rubber side down.”

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Here we Geox again

Published on 20. Oct, 2011 by Al in Featured, Pro Cycling Sponsorship

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Here we Geox again

After a year of experience in professional cycling, the company considers its presence in this sport not strategic anymore – Geox Press Release

Hmmmm…..sponsoring professional cycling is not strategic anymore? Wondering what they expected?

Could the root of the problem be misplaced expectations. When team owners don’t get what they expect, well, they Geox away! (Sounds like cycling sponsorship did not help the company sell more shoes.)

When you have owners like Flavio Becca (Leopard-Trek now RadioShack-Nissan-Trek) and Mario Moretti Polegato (Geox) who are enamored with the sport, fork over a Brinks truck worth of cash, they expect their riders to compete and win the Tour De France and when they don’t, there will be trouble. The situation gets compounded when a sponsor does not get the “strategic” value they expect for their brand (i.e. – more sales). When teams don’t understand or set a sponsor’s expectations properly there will be consequences!

John Wilcockson’s article, A Flawed System, documented how Geox founder and chariman, Mario Moretti Polegato, “threatened to pull his funding when the Tour invite he’d been promised evaporated.” Geox expected their brand to be visible in the world’s biggest bike race. And, as a result probably expected to reap the rewards increased visibility would drive such as more web traffic, retail store traffic, sales and revenue. (Apparently Mr. Polegato’s disappointment of not competing in the Tour De France could not be appeased even with Juan Jose Cobo’s win at this year’s Vuelta.)

The bottom line: Teams have to take ownership in setting expectations of rich benefactors and company magnets before they accept those big fat sponsorship checks. Otherwise you end up with a press release that reads:

“After a year of experience in professional cycling, the company considers its presence in this sport not strategic anymore”

The same scenario can play out all levels of cycling. Beware of what your sponsor expects from their investment in your club or team. Otherwise, they might just Geox away!

Thanks for visiting. Remember, until next time, “Keep the rubber side down!”

P.S. – I still contend a team leaving the sport has little to do with revenue sharing. But, I’ll continue that argument another day.

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Revenue sharing will NOT save pro cycling!

“If cycling wants to grow, the essential first step to a solution is clear: A financial model must evolve wherein event owners share revenues with its teams“. – Alex Fairly, Odd Men Out, Velo, October 2011.

If revenue sharing is the key to growth professional cycling will flat line!

“Odd Men Out” does not present a feasible business model. The cornerstone of Fairly’s argument is that the ASO (Amaury Sport Organisation) and major races should share revenue with teams and riders. What would motivate the ASO to share revenues with teams? In fact, what would motivate any event organizer to share revenue with teams? Revenue sharing is not a viable option for professional road cycling. Cycling is not the NFL, English Premier League or Major League Baseball. There are several reasons why these sports can command revenue sharing. Teams are corporate structures and rely on ticket sales and merchandise to create a large portion of their revenue. Lastly, teams in professional football, soccer and baseball rely heavily on large AND small market teams to ensure the overall success of the league.

Rather than focusing on unrealistic business models professional cycling can never successfully implement, I would propose focusing on things we can change to fuel the growth of professional cycling.

There are four realistic strategies for growing professional cycling: increase globalization, deliver on sponsor expectations, continue to clean up the sport and capitalize on capturing a larger piece of the $70 billion dollar sponsorship pie.

Embrace globalization: In 2002 – 2004 “70 – 80% of UCI races were in four countries: France, Italy, Spain and Belgium” quotes Alain Rumpf, head of the UCI’s Global Cycling Promotion division. The cyclingnews.com article “Global Cycling Promotion on Beijing and the way forward” described how lack of globalization was a major weakness which resulted in companies leaving the sport, the most notable being Motorola. Today, professional cycling is growing in continents outside of Europe, such as North America, Africa and Asia, with new races emerging. Rumpf states “….part of the thinking of GCP was to make the sport more global and there is a great opportunity at the moment because we can see countries are hungry for events and sport.” The global growth, reach and marketability of professional cycling can provide companies with a platform to directly reach consumers and clients through cycling sponsorship. Continued focus on growth is a more viable option than pointing to revenue sharing as a solution.

Stand and Deliver: Set sponsors expectations carefully and only promise what you can deliver! “…no sponsor wants to be sold on something that isn’t real…..” John Wilcockson’s VeloNews article “A Flawed System” chronicles how professional cycling’s sponsorship model derailed Pegasus and almost cost Geox their title sponsor. Consider the consequences when a benefactor or company does not reap the rewards of their sponsorship investment because their team did not compete, perform or worst deliver on the promise of increased visibility, sales and market share. A thorough understanding of what the sponsor expects is critical to maintaining a mutually beneficial and sustainable relationship. Judging what you can deliver is equally important. And, as stated in “Winning doesn’t guarantee sponsorship!”, winning alone is not enough to maintain sponsors.

Perception IS reality: Companies will not jeopardize the image of their brand! Continued steps to ensure the sport is perceived in a positive light is vital to professional cycling’s longevity and the ability for teams to attract major sponsors. The blog post “Handling objections regarding cycling sponsorship” provides a good basis for handling discussions with clients regarding the state of the sport.

Take a piece of the pie: Sponsorship is a $ 70 billion dollar industry!: Companies are investing heavily in sponsorship to connect with consumers and clients. Sponsorship provides increased visibility and awareness for their company, brand, products and services. Cycling sponsorship gives companies a unique and highly effective marketing platform to reach their targeted segment. Look at the number of fans attending races, sponsors paying for television advertising during broadcasts and the popularity of the growth of the sports demographic globally.

Let’s stick to things we can impact and change.

P.S. – Have you checked out my new e-book “Cycling Sponsorship 101: How to get cycling sponsorship!”. “Cycling sponsorship 101″ is a comprehensive, step-by-step, guide walking you through the entire cycling sponsorship process in an easy to follow format. Simply stated, “Cycling Sponsorship 101″ will help you get more sponsorship and funding! I am offering my subscribers a 100% money back guarantee.Want to read a FREE chapter from the book? Download your preview copy.

Thanks again for visiting. Remember, until next time, “Keep the rubber side down!”

References

“Odd Man Out: In order for pro cycling to move forward, event organizers must share revenues”, Alex Fairly, Velo, p. 23, October, 2011

“Q&A”: Global Cycling Promotion on Beijing and the way forward”, Daniel Benson, cyclingnews.com, September 7, 2011

“A Flawed System: Pegasus and Geox are two examples of how cycling’s sponsorship model can fail teams, riders and sponsors. Team managers Vaughters and Bruyneel have some answers — or do they”, John Wilcockson, VeloNews, p. 19, April, 2011

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Winning doesn’t guarantee cycling sponsorship!

Winning doesn’t guarantee cycling sponsorship!

  • 485 wins since 2009 is simply incredible!
  • Losing a title sponsor that heralded your team as a valuable marketing asset is unfathomable.
  • Is HTC’s loss of their title sponsor simply the cost of doing business?

As cyclists and cycling fans we just learned a very important lesson! Winning races alone does not guarantee cycling sponsorship! Even the most successful team over the last 3 years, winning 485 races, is not immune to a title sponsor deciding to walk away. It seems difficult to fathom, in light of HTC CEO Peter Cho’s rousing endorsement of Bob Stapleton’s team and the value sponsorship would bring to the company’s brand: “…we are excited about the opportunity to communicate HTC’s brand value through the great sport of cycling…. “HTC’s sponsorship of Team Columbia-HTC is one step in HTC’s commitment to increasing its global brand value and recognition.”

So, why did HTC have such a dramatic about face? Here are a few thoughts we should keep in mind with regards to corporate cycling sponsorship.

01) Cycling sponsorship is a business! Corporations as Taiwanese telecommunications giant, HTC, invest in sponsorship to achieve business objectives as increasing sales, revenue, market share and competitive position. Companies leverage cycling sponsorship, its global platform and growing demographic as a marketing platform to:

  • Create awareness and visibility for their company, brand, products and services.
  • Increase customer and brand loyalty.
  • Project an intended image and garner positive PR to attract new clients and consumers.
  • Augment existing marketing and advertising campaigns.

Companies don’t sponsor cycling, as the recent velonews.com article “The secret handshake for bicycle racing sponsorship” noted, because they share our passion for our wonderful sport!  In fact, I think one of the comments from a velonews.com reader summed it up best by writing “…Simply riding in the team kit and getting on the podium isn’t enough.” The bottom line, cycling sponsorship is a business!

02) Cycling sponsorship MUST drive business results: Companies expect a Return on Investment (ROI) from their investment in sponsorship. Measurable business results like increasing sales, revenue, market share and competitive position only come from creating (or increasing) awareness and visibility with consumers and clients in the company’s target markets. Cycling sponsorship’s impact on a company’s Key Performance Indicators (KPI’s) may be measured through:

  • CPM (Cost per one thousand media impressions; the number of marketing opportunities presented how many people see and/or recognize the company’s brand, product or service in an advertisement, at an event…). The Reuters article “Sponsors see value in backing cycling teams” describes how cycling delivers more affordable cost per one thousand media impressions (CPM) making cycling sponsorship a bargain when compared other popular spectator sports.
  • Surveys, questionnaire’s, focus groups, etc, help identify the impact of sponsorship on recognition of a company’s name, brand, product or service.
  • Codes, e-mail, registration or “opt in”, responses to promotions, traffic (store, event or website): Metrics sponsors will review are – “Did sponsorship have a significant impact on the number of consumers entering a specific code, signing up for something through e-mail, registering on a site on the web or redeeming a coupon?” Most sponsoring companies will quantify how well sponsorship of your team supported a company attaining their business goals by measuring these factors. Which is why it’s critical to qualify what a sponsor expects and what your team can realistically deliver. (More on sponsorship qualification later).

Visibility may also be measured through something as simple as counting minutes of television exposure the team and sponsor receive. During Versus’ coverage of the Tour De France Paul Sherwen noted how one team broke down the number of minutes its riders were on television throughout the Tour. Typically these minutes were in long breakaways where the sponsor’s company name was highly visible to the global TV audience. The minutes were tallied and presented to the sponsor as publicity and exposure which drives awareness, brand recognition, interest and traffic which can result in increases in sales, revenue, market share and competitive position.

03) Meeting expectations: As mentioned in the previous section, clubs and teams need to qualify sponsors thoroughly to ensure they can deliver expected business results. It is vitally important to perform research, engage in discussions and understand how your team will be measured and how the prospective sponsor will measure success (Example: increase in coupon redemptions by 25% over 60 days, increase in survey responses, increases in traffic and sales by 30%). Your club needs to have a thorough understanding of the sponsors business objectives, how you will be measured, over what period of time, and if it is possible to deliver the desired results.

04) Sponsor qualification: Another component of the cycling sponsorship equation is your qualification of a prospective sponsor. To ensure success your club or team needs to evaluate how well sponsorship will help the prospective sponsor reach their target audience and cycling’s demographic.

The sponsor is qualifying you and the value sponsorship of your club or team provides. It is equally important for your club to qualify the sponsor in order to meet their expectations and maintain a long-term, mutually beneficial relationship. To establish a successful sponsorship relationship overlap needs to exist between their market and people who will be exposed to your team through events, races, participation in community service, local or national initiatives, communications or social media platforms.

Simply stated, if a company sells a ubiquitous, industry leading, telecommunications product, but most of their target market are not cyclists or fans of cycling; their sponsorship of a global team is not going to provide the return on investment they expect! It doesn’t matter if cycling sponsorship is a more cost-effective vehicle than traditional sports or advertising methods. Reaching their target audience and driving results has to be the foundation of a mutually beneficial sponsor relationship. If they don’t achieve the expected results the relationship will not last.

Here are a couple of tips to keep in mind.

Always look for new sponsors: Your search for new sponsors should never end. It is a year round proposition which, just like training for a race or major event, never stops. An effective annual sponsorship plan is just like base miles can in preparing for the upcoming season. It’s a continual process which can pay huge dividends by following a structured process. Think about it, when is it ever a problem to have too many sponsors or too much funding?

Lastly, perception means everything! A positive perception by companies sponsoring, or interested in, sponsoring our sport is paramount. Identifying and understanding those perceptions enables your cycling club or team to remove potential barriers and objections which might prohibit a sponsor from investing. As mentioned in “2011 Tour: A recipe’ for sponsorship success use every opportunity to sell the value of our sport to companies large and small, regardless of industry or location. Point out how companies sponsoring professional teams are receiving incredible exposure for their company, brand, products and services. When loyal domestiques go off the front, fry in the sun and are battered by winds for hours, explain how this is a tactic to not just attempt to win, but more so to provide exposure for the sponsors emblazoned across the jersey’s, helmets, shorts and butt! Television cameras, photographers, eyeballs in person, and on television, internet, from smart phone, laptop, are all capturing and displaying the action.

Watching HTC-Highroad fold is not easy for any fan of cycling! However, hopefully, we can learn from this experience and accept that winning races is not the only component in the sponsorship equation.

Thanks for visiting. Remember, until next time, “Keep the rubber side down!”

P.S. – Thanks to Bob Stapleton, members of the HTC-Highroad men’s and women’s team and to the HTC company for giving us some incredible memories over the last 3 years! You did it right!

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2011 Tour: A recipe for cycling sponsorship success!

2011 Tour will drive value for cycling sponsorship!

The Tour de France, A.S.O. and the sponsors of the 22 participating teams have got to be licking their chops in anticipation of the unprecedented global media exposure this year’s race will receive. Why? Because controversy fuels discussion, passion, interest, attendance and viewers! Controversy also fuels dollars; think sponsors, advertisers, vendors, tourism, restaurants, etc. You’re going to hear about the Tour and how things unfolds in any and every possible format you can imagine. Sponsors, advertisers, the A.SO., France and participating countries are counting on it!

Fans will pack the roads along the race route while those not lucky enough to attend will watch the drama both on the road and behind the scenes. Cycling and non-cycling enthusiasts are going to tune in, blog, tweet, party and/or protest as the Grand Boucle unfolds. Many will follow this years Tour to witness whether or not, arguably, one of the best Grand Tour riders in history can win his 7th straight, 3 week race! Some will watch to see if the runner up from the last two editions can finally take the final step to the top of the podium. Yet others will watch to see if another “shoe will drop” revealing new revelations of doping, performance enhancement, tainted food, or foreign dispersants or additives are once again found where they shouldn’t be!

2011 Tour Recipe for cycling sponsorship success!

The bottom line: despite ominous comments foreshadowing the demise of cycling, once again, the Tour will be heavily attended and will draw large global audiences to watch the race.

When you mix:

  • 2 parts Rivalry (Contador vs. Schleck and everyone else; Riis vs. Schleck brothers and his old team)
  • 2 parts Intrigue (Is Contador guilty or innocent? Accusations against previous Tour champions)
  • 1 part Conspiracy Theory = Spanish Cycling Federation + UCI + WADA + Court of Arbitration for Sport
  • 3 parts Action (The race itself!)

And, shake vigorously (and the media will)!

You get every sponsor and advertiser’s dream — eyeballs seeing their brand as the Tour and the plot develops. The end result, Tour organizer A.S.O., team sponsors and advertisers are going to take advantage of the extraordinary marketing opportunities presented by global exposure, and will be laughing all the way to the bank!

4 Reasons why the 2011 Tour is a recipe for sponsorship & marketing success!

01) Alberto Contador’s participation is going to drive attendance and ratings! Period!

Whether you like him or not, believe he is guilty or falsely accused (or, receiving preferential treatment) Alberto Contador’s participation in this year’s Tour is fueling increased interest and awareness in the race and in the sport of cycling. Cyclists, journalists, sports prognosticators and fans are taking sides about whether Contador should even be in the race, if he is guilty of using PED’s and blood dopers, and if he will win this year’s Grand Boucle. This year’s event with Contador’s participation is a sponsor, advertiser, marketing executives dream. The Tour will deliver increased visibility and press coverage, along with exceptional opportunities for extensive market reach. It’s a captivating story. From a sponsorship perspective there is nothing better than supporting an event which delivers increased visibility, awareness and interest for your brand! Because increased interest can drive increased traffic, sales, revenue and market share.

02) The Tour and cycling will take center stage for the majority of July! Delivering unprecedented visibility and reach!

The media will continue to pump the bellows of controversy to keep the Contador and Armstrong stories alive!

The cycling journalists, and some of you, have been fanning the flame since the “tainted beef”, clenbuterol, story broke in September, 2010. The aftermath has had more twists and turns than a B-grade movie!

In January, 2011, Sports Illustrated vaulted to the front of the media caravan by summoning ghosts from Tours past when it released its expose “The Case Against Lance Armstrong”. Of course, this was cleverly timed with the interest generated by the NFL playoffs to increase readership and sales. Meanwhile countless professional cyclists have been paraded before us as they were summoned to testify in front of a Federal Grand Jury ala Barry Bonds and Marion Jones.

Not to be outdone, 60 Minutes poured gasoline on the story with its primetime Tyler Hamilton interview. Of course, the interview resulted in a swift and defensive response foretelling the demise of our sport with the quote; “…..this is going to kill the sport of cycling.” (Ed. – Uh, no don’t think so!)

Again, the media is going to make sure every angle of the Tour is covered. For almost an entire month cycling, the Tour de France, and every company sponsoring cycling is going to be the center of attention. Everyone is talking about it. The media has seen to that, as has the Spanish Cycling Federation, the UCI, WADA and the A.S.O.

Why is this good for the Tour, cycling and sponsorship?

Controversy fuels discussion, passion, interest, attendance and viewers! Controversy also fuels dollars; think sponsors, advertisers, vendors, tourism, restaurants, you name it. You’re going to hear about the Tour and how things unfold regardless of whether you want to or not. Sponsors, advertisers, the A.SO., France and participating countries are counting on people watching, reading, texting, talking, debating….And, sponsors are hoping throughout the next month that you see their company and brand name emblazoned across helmets, jersey’s and bib’s!  They want Contador at the Tour! Regardless of whether it is to applaud or boo him (respectfully, the UCI asks). And, they want you to tune in and pay attention! Which leads to my next point.

03) Companies sponsoring cycling get it! And, so should you!

The major sponsors of the 22 Tour teams starting the Tour encompass 22 separate  industries. Think you might have a company in your area that you could approach regarding cycling sponsorship? One that is similar to one of these 22 companies? You bet! Point to the lead sponsoring companies as examples when you approaching prospective sponsors. I mean, check it out:

  • Telecommunications, Cable Providers, Cellular: 4 (Movistar, Euskaltel, Sky, HTC)
  • Banks, Financial Services & Insurance: 4 (Saxo Bank, AG2R, Cofidis, Rabobank)
  • Sports Management Companies: 2 (Leopard, Highroad)
  • Lotteries: 2 (FDJ, Lotto)
  • Rental Car companies: 1 (Europcar)
  • Retailer: 1 (RadioShack)
  • Manufacturing companies: 2 (Quick Step, Lampre-ISD, Omega Pharma, Garmin)
  • Pharmaceuticals: 1 (Omega Pharma)
  • Environmental Products & Services: 1 (Saur)
  • Food Producer: 1 (Sojasun)
  • Information & Software Technology: 1 (Sungard)
  • Natural Gas Distributor:1 (Liquigas)
  • Campgrounds: 1 (Vacansoleil)
  • Plant Food Producer: 1 (DCM)
  • Cycling Foundation & Development Teams: 2 (Katusha, Euskadi)
  • Bicycle Manufacturers: 4 (Cannondale, Trek, BMC, Cervelo)

Non-cycling related companies sponsoring Tour teams: 22 (And, these are only the headline sponsors).

04) What can you do? And, why is the 2011 Tour good for cycling and cycling sponsorship?

See what’s happening? Everyone is talking about cycling in one form or fashion. This is extroadinary coverage of the sport we love. Take advantage of the spotlight cast on cycling. Your club has nothing to be defensive about. The sport is no longer the same it was ten years ago with previous Tour victories being in question. And, it will be cleaner, and better in 5 years than it is today! Companies are still heartily ponying up marketing and advertising dollars to sponsor teams participating in the Tour, continental, amateur clubs and teams and cycling events. (See attached link for more information on companies sponsoring professional teams)

Use this opportunity when cycling has the spotlight to sell the value of our sport to companies large and small, regardless of industry or location. Point out how companies sponsoring the professional teams participating in the Tour are receiving incredible exposure for their company, brand, products and services. When loyal domestiques go off the front, fry in the sun and are battered by winds for hours, explain how this is a tactic to not just attempt to win, but more so to provide exposure for the sponsors emblazoned across the jersey’s, helmets, shorts and butt! Television cameras, photographers, eyeballs in person, and on television, internet, from smart phone, laptop, are all capturing and displaying the action. (Also, see “Tips on how to get a cycling sponsorship”)

Regardless of where your allegiance falls this year’s Tour is going to be good for cycling and and an even better example of how media exposure and cycling drive value for sponsors.

Enjoy the Tour!

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Report of cycling’s death greatly exaggerated!

Response to VeloNews Armstrong Exclusive: “This is going to kill cycling”

Dear Mr. Armstrong:

I have to take issue with your quote“…but this [controversy], at a time when the sport has made significant changes, is going to kill it.” (VeloNews, July 2011)

Sorry, but, no don’t think so!

The sport of cycling is bigger than any individual champion and the myriad of accusers and alleged swirling accusations. As long as cyclists continue to race, fans continue to attend races (or watch broadcasts), purchase bikes and accessories, companies will continue to invest in the sport as a marketing, advertising and PR vehicle. Companies sponsoring cycling get it! They recognize their investment in sponsoring professional, amateur, recreational cyclists, races, events, etc. gives them unprecedented visibility and reach. That’s right; companies will continue to leverage this beautiful sport to drive value and create visibility for their brand, products and services, and to reach their target market and consumer.

So, as long as people are attending European classics, the Giro, Tour of California and Philadelphia Championships, and the impending Tour de France, our sport will be just fine. As far as American racing is concerned, there are tons of races that have endured (and prospered) for several decades: Nevada City Classic, Cascade Cycling Classic, Athens Twilight, Tour of the Gila, Redlands Classic. (See Neal Rogers article “The Key to Longevity – Community”, VeloNews, November 2010).

People are not going to stop riding their bikes, nor will people stop buying bikes (even that particular brand you ride made in Waterloo, Wisconsin). Professionals are going to continue to race, and new riders and racers will enter our sport. All of this will facilitate companies continuing to sponsor cycling in some form or fashion!

What kills a sport is when events are canceled like the 1994 MLB World Series, or entire seasons are canceled like the 2004 – 2005 NHL season (and, potentially the upcoming 2011 – 2012 NFL season). Doping and Performance Enhancing Drugs and associated controversy don’t kill sports alone! Fans losing interest kills sports which subsequently drives away sponsors, ultimately resulting in the sport flat-lining!

Although this might be a painful process for you Mr. Armstrong cycling is going to continue to grow and prosper. New sponsors are entering the sport every year. Sure, some leave, but in the long run, this is nothing more than a back story! Kind of like a good piece of fiction:  interesting plot, protagonists and antagonists, people will take sides, debate and become overly emotional. The sport of cycling has survived decades of controversy, (2) World Wars, recessions and depressions, natural and human inflicted disasters. Our sport has shown it is quite resilient and at the moment is experiencing a renaissance with an emphasis on clean racing. As you mentioned to John Wilcockson, the current controversy might impede sponsorship negotiations with HTC, Team RadioShack, Garmin and Amgen. However, there are multiple, recent examples of global and American corporations stepping up each year to sponsor our wonderful sport.

So, just as the peloton so deftly maneuvers around a crash and continues down the road, so too will the sport of cycling! In other words, the reports of cycling’s death are greatly exaggerated. (Sorry Mark Twain I stole shamelessly!)

I wish you the best of luck in this latest controversy and with your incredible foundation. But, the sport will be just fine.

Thanks again for visiting. Remember, until next time, to “Keep the rubber side down!”

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Cycling sponsorship & lessons learned from sponsors of UCI Top 20 cycling teams

What can we learn about the value of cycling sponsorship by looking at companies sponsoring cycling teams in the pro peloton?

The VeloNews article “The 2011 VeloNews Power Rankings” ranks the Top 20 UCI cycling teams for the 2011 racing season. Reading the article triggered a thought regarding cycling sponsorship – “Wouldn’t it be interesting to identify what sponsors of professional cycling teams are saying about the value of cycling sponsorship to their company, brand, products & strategy?” Specifically, why are non-cycling industry, and non-sports industry, companies investing in cycling sponsorship as a key component of their marketing strategy?

Potentially, as members of cycling clubs and teams, we can learn additional valuable information from the pro ranks. Many of us study, and apply lessons learned from the pro’s – to training programs, executing sound race tactics, decisions about frame technology, finding the lightest or most durable componentry, which  technical wear will help us stay comfortable during a Gran Fondo. Why not do the same with sponsorship? Especially if it helps improve our chances of securing cycling sponsorship, and consequently, improving the opportunity for our voice to be heard for the interests, initiatives, and causes we support as a collective group!

(Ed. note – I stayed away from sponsors which are cycling business related (example – Liquigas-Cannondale; I researched why Liquigas sponsors pro cycling; not why Cannondale does; we know why they sponsor!)

Here is what I found:

Rabobank: http://www.rabobank.com/content/about_us/sponsoring/cycling

VeloNews Power Ranking – #4; UCI Pre-season Ranking – #2

Sponsors business: Dutch bank

Why Rabobank sponsors cycling – Visibility for the Rabobank brand, social responsibility & positive PR.

What Rabobank says about the value of cycling sponsorship – “The Rabo Cycling Plan was established in 1996 as a key spearhead of the strategy for attaining an improved positioning for Rabobank.” ….“Cultural sponsorship provides excellent opportunities for demonstrating Rabobank’s versatility and social involvement. Rabobank supports the development and conservation of the Netherlands’ cultural heritage through its association with cultural partners.”

Liquigas –Cannondale: Liquigas extends cycling sponsorship

VeloNews Power Ranking – #6;UCI Pre-season Ranking – #4

Sponsors business: Natural gas distributor

Why Liquigas sponsors cycling – Visibility & to promote their brand.

What Liquigas says about  the value of cycling sponsorship -  “The President of Liquigas Sport, Polo Dal Lago, announced that Liquigas will continue to sponsor and own a team for two more years and confirmed that both Ivan Basso and Vincenzo Nibali have re-signed with the Italian ProTour team for another two years.”…..”We’re very happy to announce the renewal of our sponsorship. We think cycling is the best means to promote our brand,” Dal Lago said.

HTC-Highroad: High Road Sports and HTC Announce Partnership

VeloNews Power Ranking – #3; UCI Pre-season Ranking – #4

Sponsors business: Mobile phone company

Why HTC sponsors cycling – Visibility for the HTC Brand; use exposure to communicate & increase brand value.

What HTC says about the value of cycling sponsorship – “The HTC High Road Sports partnership is a great match of like minded organizations driven by innovation, excellence and competitiveness and we are excited about the opportunity to communicate HTC’s brand value through the great sport of cycling,” said Peter Chou, chief executive officer, HTC Corporation. “HTC’s sponsorship of Team Columbia-HTC is one step in HTC’s commitment to increasing its global brand value and recognition.”

*NOTE – OptumHealth-Kelly Benefit Strategies is NOT part of the VeloNews Power Ranking or UCI Top20, however still interesting when looking at why companies invest in cycling sponsorship.

OptumHealth-Kelly Benefit Strategies: OptumHealth co-sponsors Kelly Benefit Strategies

VeloNews Power Ranking – NA

Sponsors business: Health & Wellness company

Why OptumHealth sponsors cycling – Visbility & awareness of products & services; align with healthy lifestyle market.

What OptumHealth says about the value of cycling sponsorship – “We are unabashedly proud, vocal proponents of active, healthy lifestyles,” said Tom McEnery, chief marketing officer for OptumHealth. “As co-sponsor of one of the country’s top cycling teams, we can create greater visibility and awareness about the importance of fitness, health and well-being.”

“Professional cycling in the United States continues to grow as a major spectator sport and serves as a great way to reach health-conscious consumers,” he added. “This particular partnership provides a highly visible and mission-consistent opportunity to both advance our message and drive awareness of our products and services.” (Kelly Benefit Strategies Pro Cycling | News | OptumHealth Joins Kelly Benefit Strategies Pro Cycling as 2011 Co-Title Sponsor)

Another reason companies sponsor cycling is cross-branding and B2B. Charles Aaron from the team’s management company, Circuit Global Sports Management, describes the value of companies working together, B2B and cross-branding opportunities in the following quote. “We like to think of ourselves as more than just a cycling team, our sponsors are more like partners with us,” said Charles Aaron “We all share a common interest and goal and we wanted to bring them together to brainstorm ways to help them get the most out of their strategic sports sponsorship.” “We spent a great deal of time discussing how sponsors can work together to make the most out of their investment,” Aaron said. “This included, cross promotional, media and activation strategies for 2011.”

So, what do the examples from professional cycling mean to your cycling club or team? How do the previous examples help to answer the question “Why should a company Sponsor My Cycling Club?” Sponsorship of your cycling club or team can provide a company with the chance to increase the visibility of their brand; which can increase awareness, interest, traffic, and ultimately sales & revenue. In addition, companies interested in promoting social responsibility and consciousness can leverage sponsorship of your club or team to promote a positive image; demonstrating support of emerging concerns as health and environment. Cycling sponsorship can also be an excellent vehicle to reach a sponsors targeted audience by aligning with the growing health & active lifestyles segment. Bottom line – cycling, as demonstrated by companies sponsoring teams in the pro peloton can be a valuable tool,  in helping to reach business goals & objectives. You can refer to the following posts for more information describing why companies sponsor and what corporations are saying about the value of cycling to their brand.

A couple of takeaways

As you approach prospective sponsors keep some of the examples in mind. Focus on the audience you are communicating with – whether through Social Media, a page on your website designed to attract sponsors, a sponsorship proposal or letter, or during a casual conversation. Understand the reason companies sponsor cycling; their motivations – to make money, to save money, and to promote an intended image. Lead the discussion by articulating the value of cycling sponsorship to their company. Cycling sponsorship is an excellent avenue for companies, of all sizes, to deliver their message to the market. Again, draw from the examples of the larger pro teams.

Hope you liked today’s post. I enjoyed researching and writing it. Good luck!

Thanks for visiting. Remember, until next time, “keep the rubber side down!”

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