England Rides Cricket Success With $600 Million Commercial BoostBen Priechenfried
English cricket is turning onfield success into record commercial revenue as the national team seeks a run of victories not seen since the Victorian era.
Over the next four years, the England and Wales Cricket Board will earn about $600 million from broadcast and sponsorship deals, a figure the ECB says will rise if the team can add to its three successive Ashes victories over Australia. The latest encounter starts in Brisbane today.
“A fourth on the bounce would be good news for cricket because success breeds interest, not just from customers but also from potential commercial partners,” John Perera, the board’s commercial director, told Bloomberg News on Nov. 15 during an interview at Lord’s cricket ground in London.
England hasn’t claimed four straight Ashes victories since winning the opening eight series after the contest was founded in 1882. That sequence ended in 1890, when Queen Victoria was nearing the last decade of her 63-year reign over the British Empire.
The ECB’s 23-strong list of sponsors, including Adidas AG and Investec Plc, has enabled non-broadcast commercial revenue to grow 50 percent over the past five years. The increase in commercial activity coincides with an onfield turnaround that has seen England victorious in four of the last five series against Australia. It lost the previous eight.
“We’re now reaping the benefits of the vision 16 years ago, when the ECB was formed,” David Collier, chief executive officer of the board, said in a separate interview at Lord’s. “All aspects of the game, from playground to the Test arena, come under one national governing body. When a company comes to us, whether it’s a corporate social responsibility project or an image-related project, we can deliver all of that range.”
England’s performances have played a major part in attracting sponsors. Following the team’s rise to No. 1 in the Test rankings in 2011, the ECB signed a 10-year deal with Investec worth a reported 50 million pounds ($81 million) for naming rights to all England’s home matches in the elite five-day format.
“It’s the team’s self-belief which makes them so attractive to a sponsor,” Raymond van Niekerk, Investec’s chief marketing officer, said in an interview from Cape Town. “When they take the field, they know they’re going to win. That confidence makes it a good association.”
Ashes aside, there are bigger financial gains to be made from competing against India, where television audiences can be as high as 400 million for important matches.
“If you look at any business, or any sport, you look at where the largest market is,” Collier said. “When you’ve got a country of that size and stature, a population of over a billion that is absolutely in love with the game of cricket, no other sport touches the reach that cricket has in that country.”
‘Range of Sponsors’
England is now ranked third in the International Cricket Council Test rankings, just behind India, with South Africa top.
The ECB’s sponsorship lineup, featuring companies such as Adidas AG, Nestle SA, Investec, Jaguar Land Rover Ltd. and Veuve Clicquot Ponsardin SCS, is now so broad as to resemble that of a major soccer club.
“It used to be just the main sponsor and the clothing sponsor and a couple of others,” Nigel Currie, of sports and entertainment marketing agency brandRapport, told Bloomberg. “There’s a whole range of sponsors and brands associated with the England team and the whole ECB setup. From bottled water to cars to formal clothing to shirts and all sorts of things.”
Tim Crow was marketing manager of the Test and County Cricket Board, the ECB’s forerunner, in the late 1980s. Now CEO of London-based sponsorship agency Synergy, he said he’s impressed by the ECB’s recent commercial achievements, especially its ability to win such a long-term commitment from Investec.
‘Very Good Deal’
“The procurement departments of a lot of companies wouldn’t allow them to make a 10-year investment. Right now it probably looks like a very good deal for the ECB but in 10 years’ time it will look like a very good deal for Investec.”
Investec’s Van Niekerk says the asset manager carried out a “thorough evaluation” of the entire England setup before putting pen to paper.
“It’s a risky investment,” Van Niekerk said. “What if viewership suddenly dropped or if the team started playing really poorly. We have to consider all those aspects.”
While Investec sponsors the five-day format, the ECB has a separate agreement for Twenty20 matches with National Westminster Bank, owned by state-owned lender Royal Bank of Scotland Group Plc. Fifty-over games are sponsored by Royal London Asset Management Ltd. while yet another financial brand, Liverpool Victoria Friendly Society Ltd., known as LV=, sponsors the county championship, the elite domestic competition.
England also has Brit Insurance Holdings BV as its shirt sponsor, to be replaced next year by privately held grocer Waitrose Ltd. It has Adidas as its official kit supplier, Nestle’s Buxton as water supplier and Jaguar as vehicle partner, as well as other licensing partners and suppliers.
Broadcast revenue is the ECB’s biggest income source. At $125 million a year, television deals contribute more than 80 percent of income. The bulk comes from British Sky Broadcasting Group Plc’s Sky Sports. In 2012 Sky won TV rights to all home international and domestic matches. The deal also covers women’s cricket, an increasingly successful part of the game following this year’s Ashes win for the England women’s team.
“We have seen the health of the sport thrive -- reflected by results on the pitch,” said Bryan Henderson, executive producer for cricket at Sky Sports. “With a double Ashes victory this summer for both England teams, there is a lot to be positive about for cricket.”
The ECB also has a long-standing radio deal with the British Broadcasting Corp., a highlights agreement with terrestrial U.K. broadcaster Channel 5 Broadcasting Ltd., and last year signed a seven-year deal with ESPN Star Sports in Asia.
England’s players are also benefiting. Last month the Daily Mirror reported that top players like Kevin Pietersen saw their earnings rise 30 percent to almost $1.6 million. India captain MS Dhoni is cricket’s highest earner with $31.5 million, according to Forbes magazine.
U.S.-based insurer MetLife Inc. has sponsored England batsman Jonathan Trott for the past four years as a way of promoting its asset-management business. It only entered the U.K. market in 2008 and has seen its wealth-management business there quadruple to more than 4 billion pounds.
Former England cricket captain Andrew Strauss retired in 2012, but still has his own endorsement deal with MetLife.
“Players want to make money out of the game,” Strauss said in an interview in London last month. “It’s their career, it’s their job, but in order to do that they need to do a lot of commercial appearances.
‘‘People like to have this romantic notion that sport’s just there for enjoyment and that money shouldn’t come into it,” he added. “They are businesses and they’re competing against other sports that are businesses. If you aren’t willing to be commercial about it, your sport will be affected.”
Ashes schedule: Nov. 21 Brisbane Dec. 5 Adelaide Dec. 13 Perth Dec. 26 Melbourne Jan. 3 Sydney