Sustainability in Drinks - Sports Sponsorship in the Spotlight

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Sponsorship of sporting events by alcohol companies is once again under intense scrutiny, across a number of countries, and pressure on policymakers to regulate against it is increasing. Ben Cooper delves deeper.

Diageos Johnnie Walker brand has been a sponsor of the McLaren Mercedes F1 team since 2005

Diageo's Johnnie Walker brand has been a sponsor of the McLaren Mercedes F1 team since 2005

In New Zealand last month, the Ministerial Forum on Alcohol Advertising and Sponsorship recommended that the country's Government ban alcohol sponsorship of all streamed and broadcast sports, with the eventual objective of banning all sports sponsorship by alcohol companies. The measures, along with others, are aimed specifically at reducing youth exposure to alcohol.

Industry bodies have naturally voiced their opposition to the Forum's recommendations. In a statement to just-drinks, the Brewers Association of Australia & New Zealand said it agreed with the Forum's objectives of reducing youth exposure to alcohol, but said the evidence "does not support the case for a ban of alcohol sponsorship of sport to achieve that goal". It said such a ban "could have a major impact on many community and national sports".

Diageo Australia also said it "does not believe there is any evidence to show that banning alcohol sponsorships would be effective in addressing harmful drinking". Marketing and advertising through sport is "not about encouraging excessive consumption of alcohol", a spokesperson said. "It's about maintaining brand loyalty with our consumers." Meanwhile, the Association of New Zealand Advertisers said the recommendations were "poorly thought through and fail to recognise significant global evidence".

Professor Doug Sellman, director of the National Addiction Centre in New Zealand, welcomed the Forum's recommendations, but told just-drinks he believes the Government will balk at implementing a ban. 

Sellman said the Government "appears quite ambivalent about measures that would interfere with the excessive commercialisation of alcohol, which have been shown to work to reduce alcohol-related harm, including marketing and pricing of alcohol".

"I would be very surprised if the current government acted on all of the Forum's recommendations," he said, "particularly the most robust ones. I anticipate they will devise a way of looking as if they are responding positively to the report, while not substantially changing anything."

The Government's immediate response seems to support Sellman's contention. New Zealand Justice Minister Amy Adams said further exploration of the full impact of the proposals is required, and has asked officials to report back to her again in mid-2015.

The situation in New Zealand is typical of that found in so many markets. Sponsorship by alcohol brands has become crucial to major sports teams and sporting events, to the extent that governments are extremely reluctant to ban it. Sporting rights associations and clubs lobby heavily against any such moves, as does the drinks industry. The New Zealand Forum itself recognised the importance of alcohol sponsorship to the sustainability of many sporting events and placed emphasis on initiatives to find replacement funding.

Finding replacement funding is no easy task, however. According to sponsorship research firm IEG, the European sponsorship market alone was worth some US$14.1bn in 2012, with the alcohol industry the sixth largest contributor. Sponsorship is growing faster than traditional advertising, according to IEG. Meanwhile, the World Sponsorship Monitor (TWSM) put the value of alcohol sponsorship deals globally at US$473m in 2012. TWSM research shows that sport is overwhelmingly the largest recipient of sponsorship globally, accounting for around 91% of the market.

Bans on alcohol sponsorship of sports do exist in France, Norway, Ukraine and Russia, but these are very much the exceptions. And, it is not only in New Zealand where moves towards a ban appear to be meeting political resistance. In Ireland last year, the Government set up a working group "to consider the value, evidence, feasibility and implications" of regulating alcohol sponsorship and to consider alternative sources of funding. However, media reports this month have suggested plans to introduce a sponsorship ban as part of a wider public health bill later this year will be dropped.

In the UK, the Labour Party, which is currently in opposition, is placing considerable emphasis on preventive public health measures related to obesity and diet-related ill health in the build-up to the May General Election. At one stage, it appeared possible that an alcohol sponsorship ban might form part of a raft of policies in this area, but Labour Shadow Secretary for Health Andy Burnham recently distanced the party from such a move.

Burnham said Labour was not "making any proposals in that area beyond saying there needs to be a debate about it", adding that there "are no plans to change the existing arrangements or to introduce any form of ban". However, Burnham said that, should Labour gain power, it would be "working with sport governing bodies to look at the impact of sport sponsorship".

Drinks companies will rightly seek to be an active participant in the debate wherever it surfaces, and will emphasise the positive contribution to society that such funding can make.

Diageo points out that it can reinforce its messages regarding responsible consumption through its contact with sporting events. "We believe that, through our involvement in sport, we’re able to promote responsible drinking messages at events where the message has a real impact with consumers," the Diageo Australia spokesperson said. "We continue to work collaboratively with sports organisations, government and community groups on responsible drinking initiatives to bring about positive change in drinking culture."

Arguably, the large audiences attracted by major sporting events can give such messages a higher profile than other forms of public health messaging. That said, Diageo's contention that its involvement in motorsport sponsorship helps reinforce its messaging on drink-driving has been hotly contested by health groups, and motorsport remains one of the most controversial areas of sports sponsorship by alcohol companies.

As it stands, it appears that sports sponsorship has simply become too valuable to rights-holders and drinks companies alike to be banned, but this has not prevented the debate from escalating. In fact, sport's dependence on alcohol sponsorship arguably only fuels concern.

The onus on drinks companies to promote the benefits they believe sports sponsorship can bring has arguably never been greater.

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