Contact Sport
Sydney Morning Herald
Wednesday September 24, 2003
It's not what you watch but who you watch it with that counts. Jeni Porter on corporate hospitality.
Above the western end of Circular Quay a sumptuous private club that's all mood lighting, earthy tones and shagpile rugs has been created in the Overseas Passenger Terminal. The World Rugby Business Club is an exclusive spot where high-fliers can hang out, or "soft network", during the World Cup.
It's all about capitalising on what some see as a perfect marriage - rugby union and business - a union like no other in sport. But some club members had a different kind of union in mind when they handed over $2500 for one of the 1000 gold passes that buy exclusive entry during the Cup.
Special events organiser David Grant, one of the three partners behind the club, says he was surprised at how many single women were signing up, so he asked them why. "They just come out and say it: `I thought I might meet a rich husband down there'," says Grant. He asked one woman, who came in with $5000 in cash to buy a pass for herself and a friend, whether she liked rugby and she said: "Not really, but I like people who like rugby."
The idea of the Cup being a marketing opportunity is not limited to enterprising Sydney women. How to capitalise on the event has been on the minds of many company executives because, as Michael Crawford from Austrade says: "The link between rugby and business is a lot stronger than any other sport."
At its most basic, the easiest way for companies to raise their stocks is to take important clients or contacts to the footy. It's estimated that companies will spend about $70 million doing just that via the official hospitality program, which typically includes entertainment and match tickets.
The spending outside the program could easily be the same again. There are hundreds of lunches, dinners, and talkfests planned. Some companies such as the Seven Network, the official broadcaster, are pulling out all stops by creating an integrated program of hospitality that will see it use a bar in Darling Harbour as a base for broadcasting and entertaining, where its World Cup advertisers can participate.
"It changes the concept of corporate hospitality," says Seven's director of corporate development, Simon Francis. Seven is selling packages to its base, the Docks Hotel, where it expects 1100 people a day.
Crawford, who is Austrade's general manager marketing, says it's no longer just about "schmoozing and boozing". Company executives are much savvier about how they entertain during sporting events and have a much higher expectation about what they will gain from that, he says. Austrade has set up a virtual network of 3000 companies seeking to exchange information and will run a series of business networking events to coincide with major games.
It's all about trying to enhance the outcomes for new export, new investment and longer-term tourism, says David Faulks, a former Austrade executive, who is working with Grant on the World Rugby Business Club. "Any event is only ever an accelerator, however," he says, and the outcomes are longer term and not necessarily directly measurable. But some company advisers think there isn't enough rigour involved when companies commit large sums to sport entertaining. How do you calculate the return on investment from spending, say, $220,000 on a corporate box at Telstra Stadium for 20 people for seven matches, or the equivalent of $1571 a head before GST and catering?
Grant thinks companies often get locked into a certain approach because of the sporting passions of the chairman or CEO. He knows of an international property company, which is a big rugby entertainer, that asked its clients and key staff about the World Cup and only about 20 per cent said they liked rugby.
One major bank has spent $2.25 million on hospitality packages, while Telstra, which is a major sponsor, is rumoured to have clocked up $4 million. Local investment banks such as Macquarie, Citibank, Deutsche and JP Morgan are all spending up large, as befits their reputations as big sporting entertainers.
Grant has three key international companies bringing groups here with one tour party comprising only 120 of its most valued staff and clients from Europe and the United States. When not watching rugby this group can choose activities such as a Palm Beach day, which involves a drive to the beach in a sports car, with surf school, barbecue, deep-sea fishing, ornithology, or just hanging out at a beachside house Grant has rented for a "ridiculous price".
Luxurious though all of that sounds, the daily cost per person is cheaper than the $1000 or so it might cost for them to be at the rugby, he says. "You maybe send them twice to the rugby and then you spend $200 to $500 a day on other activities and at the end they say that was a much more balanced event."
Ross Grant, a seasoned corporate adviser whose face bears the hallmarks of having played the game, in New Zealand, thinks that companies overstate the benefits with all the talk of networking. He considered taking a corporate box at Telstra Stadium for important clients but decided it was just "too horrendously expensive". "What surprises me is how the big companies pay that in full with no qualms about it; I think it's wrong," he says.
Others beg to differ. "It's a heaven-sent opportunity to get that senior level of executive and their partners on our patch for five days," says Patrick Southam, director of corporate communications at Visa.
Telstra's rival, Vodafone, is the Wallabies' sponsor but will be precluded by World Cup sponsors' contracts from its normal public association. It has taken two corporate boxes at Telstra Stadium but is doing little else on corporate hospitality.
John Symonds, managing director of Aussie Home Loans, is paying $45,000 for a box at Aussie Stadium, which he sponsors.
Ross Grant eschews much of the organised hospitality, preferring to hang out with his mates, and their mates. He's booked out Catalina restaurant in Rose Bay for the afternoon of the first semi-final and the final. (s)
© 2003 Sydney Morning Herald
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