Sports Biz. in this Economy - Hard Candy!

Yes - the sports industry is a 'cool' industry to be in - but in these times, it's pretty much like hard-candy. The present tense is not the *perfect* time to be in the sports domain (ok ... so Man City's Mark Huges has been given 100m to spend this January - that's a horrendous exception) - with corporates hard-bent on rounding corners. This adversely effects their spending powers on sponsorship, employee entertainment, and client flirting. Within the sports industry, these effect (respectively) professional sports events, amateur inter/intra-corporate events (viewed by the HR guys as team-building exercises), and sports tourism (a great tool for client relationship management).

Nowhere else is the effect more evident than in the case of Nascar - one of the biggest and fastest growing brands in the US sports industry (it now makes more revenues than the NFL, NBA and NHL combined). With the motor industry travelling on rocky terrain, and Detroit's Big Three finding holes where they once had stuffed-pockets, Nascar's sponsor-source has been severely depleted.

Recently, I was watching the Big Three 'Bail-Out' hearing on the BBC, wherein the CEO's of the three monsters were blamed (very, very embarassingly) for travelling to the hearing in business class seats! Given this, it's only understandable that the companies, then, decide to cut their investments in sponsorship arrangements like the Nascar, isn't it? 600 employees involved with the Nascar have already lost their jobs, may be more of them will have to rush for the carton boxes.

GM recently went to the extent of declaring that it won't be buying any advertisement slots during the Super Bowl which happens to be the most watched TV show in the US ... 97 million viewers! Golf hasn't been spared - almost everyone knows that GM ended their aeons-long association with Tiger Woods (doubly good - since Tiger's roars sound no more than gentle purrs these days) ... 

We don't usually see the BCCI as a company (because it isn't) ... but the NBA and the NFL are structured companies - and the recession has been hurting them in exactly the same way as it has scratched the other firms. Hence, the NBA has decided to simply lay-off personnel, while the NFL has been finding it extremely gruelling to find partners who could lend their names (and money) to the stadiums of some brnads like Dallas Cowboys, NY Giants, Jets.

In cycling, Tour de Georgia, America's version of the Tour de France, was cancelled for the lack of sponsorship! Not just reduced or postponed - but cancelled!

F1! F1 has been crying, "F1! F1!" (read: "Help! Help!") of late - with the 11 teams that spent 1.5 billion USD in 2008 finding it impossible to justify the spend. While our Mr. Mallya is foolishly spending tonnes of money on the pathetic Force India, Honda has already decided to sell its F1 team (probably also because they don't win anything really - no ROI there), Audi has distanced itself from the idea of sponsoring the legendary Le Mans sports car series (legendary in Europe, never-heard-of elsewhere), the Canadians are done with their version of the Grand Prix ...

(This crisis, on the other hand, may turn out to be good for F1 - as people, like the Formula One Teams Association, who have been trying to get rid of the dictator Ecclestone, now have a solid reason to dethrone him). 

As a soft-note, Ferrari reported 2008 as it's best year ever for sales! Montezemolo (Ferrari chairman - also chairman of Fiat) prophesied that 2009 may be even better, since "there will always be someone crazy enough to buy a Ferrari". Jug jug jiyo! (All they need to find, really, is 6000 buyers - that's all they produce in a year).

I feel that the Tata Group has hit it right on the nail's head by getting their logo on the Ferrari for the forthcoming season. The space would have cost much less in the current times (just a wild guess), and to be recoginzed as a brand in the international arena, it makes complete sense to ride on the shoulders of Ferrari's success. Tata's logo would be seen with logos of the following: Shell, Acer, AMD, and Martini! That's *some* company!! 

A gut feel is that golf will continue to survive much better than the others - it's the primary let-out for depressed and stressed out CXO's (we have plenty of them roaming around, don't we) - and apart from being therapautic, it's one activity which is as much a tourism-thing as a sport. The affluent strata won't really be *that* bothered by the economy and, hence, golf will find it's buyers.

However, as an expert opined, the golf industry will try saving on labour costs (hence, the courses won't be so well trimmed and edged as they are today), as well as on food and beverages costs (so, the menu's at the 19th hole's won't be so flashy).

Professional sport aside, things shouldn't be so bleak. For instance, the amateur sports industry, where sport is perceived (or marketed) less as an advertising tool, and more as a fitness and wellness thing, should cruise smoothly. Afterall, the populace is becoming increasingly aware of, and spending much more than before on, fitness, well-being, health, and stress-free living. Services that would cater to the needs of this part of the population would generally thrive - if what I feel is correct. In such a scenario, people associated with city-marathons, gyms, yoga centres etc. should do good (to me, this explans why Standard Chartered continues to be attached to the Bombay, Dubai and Hong Kong marathons ... )

What about Indian cricket?! Well, that's a national timepass of an emerging economy - can it be affected by these little mosquito bites?

I don't think so!