Turf
Name dropping
Robin Oakley
Racing has got itself in a fine old ker- fuffle over the issue of sponsorship. Indeed, the row had generated enough air to have saved a couple of frosted-off meet- ings if only it could all have been concen- trated in a few hectares. Photo-processing magnate George Ward, one of racing's most generous sponsors, brought it to a head by placing a 'Winner' sash over Richard Dunwoody's head after a race his company had sponsored at Sandown, so obscuring the logo of the company spon- soring the winning horse. The British Horseracing Board (BHB) has made clear its disapproval and Mr Ward is threatening to take away his cheque book and stop sponsoring races.
He is not the only one. Madagans, the company which used to sponsor the Guineas meeting at Newmarket, has ceased to do so, upset at the degree of publicity accruing on 'their' days to 'owner sponsors' who, at smaller cost, have paid for the right to attach their logos to stables, horses and jockeys.
Race sponsors say that they are the vic- tims of 'ambush marketing' and that they do not therefore obtain value for money in terms of establishing their own brand image. Some of them say that, at least for sponsorship deals in excess of £10,000 they should have 'exclusivity' of advertising.
That principle would seem to have been established by the BHB granting Voda- phone and Martell, sponsors respectively of the Derby and the Grand National, exclu- sivity on their big races. On those occa- sions, other sponsors cannot have their brand names displayed on silks, number cloths, blankets or attendants' clothing. But the BHB says that this is due to contractual obligations and its internal review of spon- sorship has rejected the 'exclusivity' option. Their studies show, too, that race sponsors get 87 per cent of the brand name exposure available on television.
Owner sponsors, too, have a case. Office equipment firm Danka pulled off a coup last year by tying up a deal to sponsor 30 Lambourn yards. Their horses went out with the company's name on the jockeys' `Legend has it that it's a mobile phone dead area.' silks. And since Lambourn stables collected the (Smurfit) Champion Hurdle, the (Tote) Gold Cup, the (Martell) Grand National and the (Stakis) Scottish National, the company name won plenty of attention. If race sponsors were to be given exclusivity, where would be the benefit for such owner sponsors?
We are not talking small potatoes. Some 2,500 race sponsors, ranging from the cor- porations sponsoring Classics to the Ferret and Firkin up the road sponsoring a maid- en hurdle at a country gaff, give racing nearly £10 million a year. Owner sponsors are coming in at the rate of 70 a week, and their contribution to racing's finances has mushroomed from nothing to £3 million in less than two years.
The BHB's real concern is a larger fig- ure. The sponsorship explosion has been set off by the deal done with the Govern- ment in 1993. To help British racing com- pete, the Government agreed to scrap the levying of VAT on the purchase and run- ning costs of racehorses provided they were run as businesses, competed for prizes and their owners actively sought sponsorship.
The 17.5 per cent saved in each case, the BHB reckons, gains each individual owner an average £7,000 and profits racing as an industry by £20 million a year.
The VAT concession was conditional and is to be reviewed by the Treasury. That is why the BHB invented its Strategic Framework for Racehorse Ownership, to produce the sites to sell to sponsors. What we are seeing now is the painful crashing of gears as the racing industry adjusts to a world of sponsorship which other sports came to terms with some years ago. So what's to be done?
Sensible moves are afoot. The BHB is encouraging courses to boost advantages to race sponsors. Interview boards, maximis- ing exposure of logos, and more advertise- ments on equipment like starting stalls are two obvious moves. A new code setting out how sponsorship sites are to be divided between race and owner sponsors is cru- cial. Part of the trouble is that many old race sponsorship deals were not spelled out in detailed contracts. Says Lee Richardson, the BHB's marketing director, 'Greater clarity is needed about just what people are buying.' Racing is an expensive activity and needs all the sponsorship it can get. It certainly cannot afford to lose the George Wards. And if the local Curl Up and Dye hair- dressing salon is tempted to contribute to the costs of the yard which sends its lads in for a quick back and sides it must be given every encouragement. Co-existence is vital. But perhaps one other move is needed too. Surely race and owner sponsors should also be allowed a representative on the BHB's industry committee. No taxation without representation is a sound principle, even where the 'taxation' is voluntary.
Robin Oakley is political editor of the BBC.
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