Thursday, 9 February 2012

Breaking the Cycle - A Sponsors View

With the news that Alberto Contador has this week had a two year ban for contravening regulations around banned substances in his bloodstream and former Tour de France winner Jan Ullrich now facing a retrospective two year ban (although he is now retired), I found myself driving home the tonight thinking about the potential impact that such news has on sponsorship for the sport.

It's a well known fact that there aren't many big ticket sponsors out there in the world right now, look at how difficult it was for Andy Schlecks Leopard-Trek team to gain a title sponsor - teams requiring millions of dollars a year in sponsorship income are desperate to woo the big brands to the sport.

As a director of a large technology multi-national, I'm forever being approached by a myriad of sporting teams across a wide range of sports for sponsorship.  So, what goes through the mind of a potential sponsor around the pro-cycling opportunity?

Usual things - potential audience, demographic, reach and brand image are key, then there are the drugs, the history, the omerta and the potential for some serious brand damage.

The key issue why many brands don't take the leap is the continuing talk around doping and cheating in the sport which it continues to try and shake, if a rider or team is found to be associated with any kind of doping case then it instantly reflects on the team and the sponsors.  Just think Willy Voet and Festina in 1998 to see how that can unfold.  Therein continues to lie the problem with attracting sponsors to the World Pro Tour scene

Things did seem to be improving from the really terrible times of the 90's when EPO and other substances made all the headlines, when average speeds went superhuman and riders just rode away in questionable circumstances.  New teams with zero tolerance policies like Garmin-Cervelo (now Carmin-Baracuda) and Team Sky are making their stance clear and the talk around the 2011 Tour de France was one of it being the "cleanest ever."

The Contador case puts the sport on the backfoot and in the spotlight for the wrong reasons again. The whole Contador mess has taken far too long to sort out - if there is something amiss a sponsor will want it dealt with quickly.  They won't want to see their name associated in lights over a long period, which is exactly what has happened with Contador. 

Executives at Saxo Bank-Sungard I'm sure will be less than happy, think about T-Mobile when Jan Ulrich was discovered to be doping, they totally pulled out of the sport.  It's taken five years for the ruling on Ullrich to materialise incidentally.

The potential brand damage of a doping cyclist will mean sponsors may wish to distance themselves or to completely discount the whole concept given the potential risks that cycling seem to carry vs. other sports (rightly or wrongly).  Perhaps the authorities need to take some responsibility for this, they need to act swiftly and decisively, think about lifetime bans and create the conditions to bring sponsors in, to finally deal with this once and for all.

At the end of it all, it's part of a vicious cycle (excuse the pun).  Riders want to earn big salaries, so some choose to enhance their performance illegally - ruining it for everyone else when they are discovered and distancing further potential sponsors.  But without those big sponsors, big salaries will be nothing but a dream for all but the very best. 

I think the worst of the days are behind the sport, genuine progress has been made since the days of Pantani et al, however the sport still presents known unknowns to potential sponsors of reputational damage.  Only if a sponsor is a cycling nut can they perhaps know who to back, which riders are suspect, which teams are clean or how to enter the industry in a way which minimises that risk.  One thing I do know is that the cycling authorities have a very big part to play in creating the conditions for this situation to improve.


  1. Another good post Phil.
    You've hit the nail on the head in terms of the responsibility resting with the authorities, and ensuring these cases are dealt with quickly and efficiently.
    That being said, I don't think you can discount the sponsors, teams and the riders role in all of this.
    If a sponsor is measuring success on the number of times their logo is seen on TV, in magazines etc (which in my opinion is the least important output of a successful sponsorship), then they are putting the riders and the team under pressure to regularly perform and to win, and hence they make take extreme measures to ensure this happens (e.g. Pantani and Mercatone Uno). I refuse to believe that the teams don't know who is doping, and of course the riders have responsibilities to their fellow athletes, teams and sponsors.
    In short, the best place to start is the authorities, but I think everyone needs to up their game, and approach sponsorship in a more realistic, transparent and open fashion.

  2. Good post Phil. Reputational risk is one of the major concerns for corporates today. With the emergence of social networking and 24/7 news reporting, corporates have become very risk adverse in protecting their brand and reputation.

    The governing bodies need to get on top of this and quickly. This is damaging for the sport and further damage will be caused if they continue to stick their heads in the sand.

    If Saxo Bank do lose their pro tour license the repercussions could be disastrous for the sport and for teams trying to retain of secure future sponsorship deals.


  3. Doping is a no-rules competition between authorities and pharmaceutical companies. I think it's almost impossible to say that doping technology will ever vanish, since there are huge profits coming out of this process. For this reason, sponsors will always be under risk when they support sports and athletes. Unfortunately, drugs and substances cover a big share on the market nowadays, and the whole system behind this trade, invests millions of dollars in laboratory research. So, shall we just accept this and introduce a new sports' competition concept; one category for athletes who register as dopants and another one for those who don't dope?