Mark Turner On the Business of Yacht Racing

Mark Tuner, CEO of OC Group talks to David Fuller about the broader trends in the business of yacht racing.

Professional yacht racing is a relatively new phenomenon. The idea that the sport can exist as a commercial operation, not just a hobby for rich individuals is not embraced by all. Those that get it are taking their sponsors across multiple campaigns in different boats, creating teams like those in motorsport.

“That is absolutely the model. You are able to deliver a package back to your sponsors in multiple countries, spreading the risk. For example – BT Team Ellen; we’ve got an IMOCA 60 doing the Vendee Globe, an Extreme 40 in the iShares cup and doing a lot of other exploitation work all over the place. We have an F18 which Ellen did the Archipelago Raid in. It’s and awesome combination. We’ve been able to deliver events to our sponsors, in particular to BT the title sponsor, in a dozen countries. We’ve taken between 600 and 700 VIPS sailing and avoided compromising the Open 60 preparation.”

Like other sports, sailing is learning that one size does not fit all when it comes to sponsorship. While some companies might be looking for hospitality and networking opportunities, others are looking to associate their brand with the qualities portrayed by sailing or trying to penetrate a particular market. This has implications for the way sailing events are run too.

“It’s rubbish to say that there is one thing in sailing that works. There are great bits in all parts of sailing. Bringing those together in a team is really clever. The evolution of that will be a formalisation at some point – A championship of sailing involving 3 different disciplines – 3 skippers – 3 competitions and an overall – that would be so good for sailing. The deliverables for a sponsor would be awesome.”

The differences in sailing can also lead to complications though. There is an endless list of events from dinghies, monohulls, multihulls, onshore offshore, classes, rules all with differing levels of professionalism. Sponsors have to navigate these options, often giving up and putting money into more recognisable and better organised sports.

“There has been consolidation. What has happened and what some people haven’t seen – is a huge separation between the professional, commercially funded end of the sport and the owner driven, pro-am, amateur end of the sport. The gap has got bigger and bigger and bigger. Races like the Vendee Globe, Barcelona World Race, Volvo Ocean Race and iShares cup are now very different to say the Fast-net Race.

“These other events have their own values, but are amateur events with some pros peppered in there. The Fast-net has been an amazing race and will always be an amazing race, but the gap has got wider. A lot of races have disappeared off the radar.”

In recent years, events like the Audi Med-Cup have started to gain momentum, but do they have a long term future?

“The Med Cup is an oddball competition – it sits in that private owner thing. They have an unreal amount of money, which if I had that kind of budget for the iShares cup I could do something quite amazing, but it is a private owner circuit with a couple of sponsors in there. Privately owned classes have a cycle – a relatively short cycle – it’s something to get into and then it dies pretty quickly. It’s good racing, but is it done for the public and spectators? No. Not at all.”

“Is it good value for money for sponsors? It depends which ones – perhaps. In Spain it has worked quite well, but it doesn’t cut through outside of sailing media. It’s a great event but it will die when the owners decide they want to race something else. And then something else will be born and that’s the cycle. It’s add-on sponsorship rather than the reason they are there in the first place.”

“Audi are a great sponsor and when a series like that gets a good sponsor it can prolong the product and take it up a level, but does it help the sport? I’m not sure. It’s not that exciting – unless you are doing it. It’s got some glamour, because when there is a lot of money it brings glamour. But for me it’s about touching a wide range of people and changing the image of the sport – to make it less elitist.”

Much has been said about how the current financial situation around the world will impact on sports sponsorship. While the Americas Cup teams talk about reducing costs, will there be an impact on other competitions?

“Sponsorship will be tight over the next couple of years, but I think we are well positioned. Compared to some sports, sailing sponsorships are a relatively small amount of money and in some companies; hospitality or client relationship budgets get you quite a long way into the money you are trying to find. Potentially you can run a team without going through a capex committee or big sponsorship review committee and that is helpful in nervous times for marketing directors.”