"PRO" Cycling Discussion

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ave
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by ave

I think top level cycling getting too expensive to sponsor.

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53x12
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by 53x12

I'm not sure it is getting too expensive to sponsor (maybe it is, maybe it isn't), but lets assume that is the case. Just means that riders salaries would have to decrease as a whole (not getting paid much compared to other top sports) and maybe just cut out some of the smaller races?
"Marginal gains are the only gains when all that's left to gain is in the margins."

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silentassasin
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by silentassasin

I wouldn't say top level cycling is too expensive to sponsor, it's just getting too expensive at the current time. Taking premiership football for an example, American football or baseball could quite easily be substituted, sports that have a far higher outlay for players continue to thrive. It's not the sponsorship that brings in the money to my knowledge, rather the TV rights. For cycling to have the same level of payout each year from the likes of SKY or Eurosport here, there has to be a larger perceived audience. There currently is that audience of mindless people who will happily sit and watch 90 minutes of men running up and down a field. The audience for cycling is considerably smaller. It's there for the big events, the British winners of the Tour de France here, or maybe even the Worlds, but the rest does not offer the same potential to advertisers.

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ave
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by ave

First of all there are a high number of teams which do not operate on the real market.
Katyusha, Astana, BMC, Sky.
Saxo and Omaga Pharma, Lampre also do not sponsor cycling for ROI.

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53x12
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by 53x12

I just don't think cycling will ever get the attention that football/NBA/NFL/MLB receive (sponsor wise nor TV contracts). We (cycling fans) are a very small minority. I think we will always tend to be that way. I'm ok with that.
"Marginal gains are the only gains when all that's left to gain is in the margins."

LeePaton
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by LeePaton

Just seen Puritos win. What an awesome way to win, Wait Wait Wait ride away like no one else is trying.

Herb5998
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by Herb5998

TV Revenue sharing will be very helpful as a whole for the teams, the money is currently going to the networks and nothing is coming back to the teams in comparison to the profits actually being made.

Overall, in addition to sponsorship costs, the poor relationships between race organizers, sponsors, Riders, Team Bosses, and the UCI/National agencies doesn't work to better the sport. I believe having strong players/riders unions helps both riders and the teams/sponsors. Instead of teams folding, sponsors would have to honor their agreements for the length of their commitment and less guys would be left out in the cold.

American Pro sports aren't the best examples for sure, some of the CBAs and player unions have helped the overall expansion of the sports.

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53x12
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by 53x12

Do you guys think a ProTour cycling TV channel that is online based would work? Something like UFC.tv or espn3.com. Probably not enough interest or information to do a 24/7 cycling channel, but at least have a station directly responsible for covering the races? But that would then leave out the national media chains from getting a piece of the pie, so that might not work with politics and all.
"Marginal gains are the only gains when all that's left to gain is in the margins."

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euan
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by euan

ave wrote:First of all there are a high number of teams which do not operate on the real market.
Katyusha, Astana, BMC, Sky.
Saxo and Omaga Pharma, Lampre also do not sponsor cycling for ROI.


I think BSkyB would argue that they do get the ROI. They are spending less than 1% of their advertising budget and getting massive exposure not just through Team Sky but their other investments in cycling in the UK.

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ave
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by ave

>Do you guys think a ProTour cycling TV channel that is online based would work?
cycling.tv ?
But I would not want to miss out on Sporza's coverage of the classics, for example, others would miss RAI's coverage of the Italian races.
Perhaps some would even miss the "voice of cycling" . ;)

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53x12
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by 53x12

Cycling.tv is close but has too many restrictions imo.
"Marginal gains are the only gains when all that's left to gain is in the margins."

HUMP DIESEL
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by HUMP DIESEL

I do think the TV coverage and subsequent money coming in will help, but the one thing that makes cycling so great, is also one revenue generating line for most other sports, and that is gate ticket cost. All the sports we try to compare cycling to have this. Have you priced a "Big Game/Super Bowl" Ticket lately? Formula 1, Moto GP, they all have ticket cost associated with each event, they are not riding out in the middle of nowhere and then finishing in a town, they are doing lap after lap of a designated list of tracks. Maybe we should just do that, race on the same tracks as the F1 or Moto Gp races are held on, You could do multiple laps and they are set up to catch almost the entire track on camera.

HUMP
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djm
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by djm

I've always thought cycling was a really cheap way for advertisers to get exposure.

For the price of 4-5 tv spots you can establish a cycling team, dope some Russian to the gills and put him in a three man breakaway and show off your jersey for hours on TV. :-)

Ok, I'm unfair making the doping assumption, but it has happened! ;-) Nevertheless, cycling is relatively cheap considering the amount of exposure you can get.

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by HUMP DIESEL

In that aspect, yes it is cheaper compared to an NFL team or a Premier league soccer event, but it is the TV coverage on a large brand network that gets the money and pays the bills. In Europe I can see this, in the US, the fan base is so small compared to the other sports, that the TV time is not there. Think about the last time you saw cycling on a big network channel and I don't mean Universal Sports, I am talking FOX, NBC, CBS and the like.
I think the F1 model is a good one to start with and build from there.
Why are the best things in life always the ones you start last?

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prendrefeu
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by prendrefeu

@DJM

Yes, but the ROI is missing for advertisers in the current environment.
This is the line of thought on the issue after talking about it casually with some colleagues over the past few months:

'Traditionally' - and we're reaching back here - advertisers were typically one of two types: brands that appealed to the majority of viewership (non-participants) and those that appealed to a majority of sport fans (participants).
Viewership = people who were at home a lot, watching mid-day, mid-week (when most racing happens), who live in towns and are willing to get out of the house for a little bit, get some fresh air, and watch the young (men... now women too) race by like horses. Yes, we're talking about pensioners.
Participants = people who also ride and have some connection, however aspirational or relational, to the efforts of the athletes.

From there we have two types of advertisers:
-General commodities that a pensioner, or home maker, might need/buy. (Quickstep, Liquigas, Molteni (coffee), Ag2r, Cofidis, Sky (watch our media), Vacansoleil, Saxo, Tinkoff, etc:...) This is the far longest list of the two and goes back to well before racing was televised and by all accounts the overwhelming majority of sponsor vertical.
-Sport-specific commodities (Bianchi, Cannondale, BMC... sport-specific brands). This is a much smaller vertical. Much, much smaller.

How have things evolved?
The internet, for one, allows specific targeted advertising. The home-maker and/or pensioner has more direct and effective places to be shown an advertisement. If they surf the web at all (which they do!), advertising is much more effective, and affordable, than on the jersey of a pro team. A credit-line company is more likely to get their brand's message to the viewer on a banner advert than they are by simply having the name strewn across a jersey that might, maybe, win, if the pensioner/home-maker is watching... but that's less likely because of the internet which is better able to appeal to their actual interests or the evolution of television, which now offers a vast array of specific programming to appeal to specific interests. Remember that back in the day cycling was a method of getting people out of their homes because, well, life was pretty damn boring sitting at home and listening to the radio and not seeing anyone all day, etc:. Now there are a lot of shows and plenty of channels to flip around. With that came more specific advertising availability. Previously a commercial would could only be shown across a program to all persons regardless of location. Now a commercial can be very targeted: a specific time slot and shown to specific areas/regions only. For a company on a budget this is highly effective.

As for the sport-specific advertisers? That's a tough call. Usually they are backed in one of two-ways:
1. They are backed by a wealthy individual who really loves this sport. BMC, for example, is largely propped up by a guy who should be advertising his hearing-aide devices, but instead is ok with just supporting the Bicycle Manufacturing Company of Switzerland. Something really important comes up here which we'll cover later: the wealthy backer has a personal connection to the activity itself because he or she was able to participate in their youth. This is extremely important.
2. A company is owned by a much larger company (Cannondale/Dorel) and the larger company decides that it is willing to offer an expenditure for a few years in order to support a team, which may boost sales, but the goal is really to find a backer willing to support a successful team (going back to the general commodity vertical). Trek really does not want to sponsor a team on the long run, but they can calculate an expenditure in the short (1 or 2 years) and hope that a backer... as happened with Radioshack or Nissan... would come around to help alleviate the costs. In the case of Specialized, they got together with Lululemon to basically save a significant powerhouse in women's cycling, which in a sense helped the women's side of the sport from going into the history books. Lululemon benefited by putting out their clothes a bit more and advertising in an increasing market of women's athletic wear, Specialized got to make other US brands look like pigs in the eyes of women coming into the sport - again an increasing number - by being the first brand name out there associated with a strong, successful, women's team riding some really well designed paint schemes with matching clothes.

But things have changed with the audience as well. In the past few decades (with increased ability to travel (better healthcare allowing this), internet access and other sorts of media) we are seeing less pensioners and home makers watching the sport, but instead a demographic that is largely full of participants, and mostly men in the 30+ age range. The income level has increased as well, 'cycling is the new golf' as a double meaning: not only is it the new past-time of older executive types, access to the sport is similar with golf. It is affordable to the upper-middle and upper-class of the world, not as accessible to others. Compare this to football, where any kid anywhere in the world can play the game without having to shell out a lot of money to participate and feel a connection to the game. If you don't feel a connection to the sport - as in it is something you could possibly do in some way even if it is not at that high level of ability - you are more likely to watch and follow the sport. Here are a few examples:
F1? Nascar? I'm personally not a fan but it's easy to see why people feel a connection: I too can drive a car.
Football? I can play virtually anywhere, anytime, and there is a strong youth-development system in most countries.
Basketball? I can play.
Hockey? Interestingly this is a good comparison. The sport tends to be geography/location specific, appealing to places with colder weather patterns, and more significantly, it is a very expensive sport to participate in once you get proper equipment. Even the base-level equipment can be a heavy burden of cost. The NHL and KHL have been struggling to grow their audience with mixed success.

Going back to the 'cycling is the new golf' we also see an issue in growth. There is no truly recognizable development system or method, except for a few countries but certainly not globally, that encourages youth to ride. If the kids are not growing up doing this, they're less likely to take interest in it when they (1) grow older, (2) have income to spend and (3) have a better emotional or physical connection with other forms of entertainment (Professional Sport is entertainment).

The landscape change has not been sudden, it has been a slow evolution, but I believe we are seeing the effects more so now than ever before and unless there is a significant change in the structure and accessibility of the sport - not necessarily having it televised as the main priority - we will continue to see a loss of sponsorship on the general commodity level.

I can not offer any suggestions or thoroughly considered solutions for this dilemma at the moment, and I (personally) wouldn't present any unless I had really thought it out, so I have no idea and I am definitely interested in what gets proposed both here and at the UCI/Cookson level. I had for a while thought of a league-like structure with teams actually based somewhere (to get local support) and having an actual name to the team with relegations, transfer seasons, and different league levels, as being a possibility. Shared revenue on televised rights, perhaps. A World Championship that isn't due to one race but a series of races spread throughout the season, in between the grand tours and classics, worth a level of points. A true World Tour of events and so forth that would then appeal to the major, significant advertisers such as we would see on professional, top-tier football clubs. We would then see advertisers such as Emirates, FedEx, Aon, Sky (already here), and so on. But this idea has too many gapping flaws and a long way to go before finesse, and at this time I don't think it would be viable in the end.



Apologies KWalker, that was a long post. ;)
Just ribbing ya, man.


*also, for the Americans here - "football" in this post refers to Association Football (aka soccer), not American Football.
Last edited by prendrefeu on Tue Oct 08, 2013 6:11 pm, edited 1 time in total.
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