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Making waves in sponsorship [National, The (United Arab Emirates)]
[April 13, 2014]

Making waves in sponsorship [National, The (United Arab Emirates)]


(National, The (United Arab Emirates) Via Acquire Media NewsEdge) Gulf Agency Company, based in Dubai, is a moving force behind the Extreme Sailing Series held recently off the shores of Oman. Now the shipping company is looking to add further to its portfolio, which also includes golf, motor racing and basketball, Chris Nelson reports Most people would be unable to find a link between a cold, muddy football field in Scotland and a world-class yacht race in the warm blue waters off Oman.



That is something Gulf Agency Company (GAC) aims to change.

Established in 1956 when a Swedish entrepreneur and a Kuwaiti group joined forces to create a shipping agency in the Arabian Gulf, Dubai-headquartered GAC is today a sprawling conglomerate – and the sponsor of the Scottish Premier League (SPL) club Aberdeen, among others.


It is also the official logistics provider and a sponsor for the Extreme Sailing Series, which it also competes in, the second leg of which was hosted by the Almouj Golf Club on the Muscat coast recently.

With a workforce of some 10,000 in more than 300 offices internationally, global reach is one thing the privately-owned multi-unit group has in spades.

"GAC is a significant player in the international shipping agency market," says Fiona Henson, a spokeswoman for the UK-based multinational Braemar Shipping Services, which provides shipbroking and logistics support to the global shipping industry.

The Gulf company is a heavyweight among the world's major operators, she adds.

"The main competition includes Inchcape Shipping Services, Denholm Barwil, Cory Brothers Shipping Agency and S5 … GAC is a big player in the sector." The global shipping industry is expected to emerge from its longest downturn in three decades, after years of overcapacity that have depressed freight rates since the end of a boom in 2008.

"Our reading of the market is that the up-cycle will continue until the early or middle part of 2016 before starting to slip," Khalid Hashim, the managing director of Thai dry bulk ship owner Precious Shipping told Reuters earlier this year.

No earnings are available for GAC on its website but rival Inchcape, listed in London, reported revenues of £6.5 billion (Dh40.06bn) for 2013.

However, it is worldwide brand recognition that GAC's group marketing director Sean Bradley is currently focusing on.

"Originally, I think the sports marketing side came through a passion for sport, but the key is to try to make it work in business," he says.

"What I've tried to do in the last 18 months is show a tangible way in which it connects with dollar generation.

"The sports marketing concept commercially is to provide returns to the company, so brand awareness, recognition of the brand, is one of the key take-outs of any of the sponsorship." GAC is heavily involved in sports sponsorship and as well as Aberdeen and the Extreme Sailing Series, it is the long-term sponsor of the English Premier League (EPL) club Crystal Palace and the English third-tier team Sheffield United. Add to that involvement with the Houston Rockets basketball team in Texas, plus what it calls "ambassadorial" contracts with pro golfers such as Chris Wood and the racing driver Alex Brundle, and it is clear sport runs deep in the company's veins.

The challenge for Mr Bradley is how to measure the value of such sponsorship deals.

"If you don't have some validation then whatever you report back to the company is spurious and people question that," he admits.

"There is a question in the minds of a lot of people in the company about how much should we spend, why are we doing it and is it worth it. You've got believers and non-believers and my job is to turn the non-believers into believers through evidence as much as I can." To help to address those questions, GAC has some practical applications to try to gather such evidence.

"We measure [the value of the sports marketing programme] in several different ways; we have a sports marketing company that looks after a lot of our PR, which will increase the penetration into various publications, which we can measure," Mr Bradley says.

"But one of their specific roles is to work with us on generating publication of appropriate articles that are industry-linked into the geographies where we operate. So there would be no point in creating a fantastic editorial piece and a load of nice pictures to go into a publication in a country where we have no presence." The company also makes use of technology specialists to gain a handle on how much bang it is getting for its buck.

GAC works with, among others, the US-based sports marketing research company Repucom to provide data that will help to determine value in marketing and sponsorship.

That allows GAC to ascertain "the amount of seconds and minutes your logo appears … which is a fantastic return on investment", says Mr Bradley.

And sponsorship investments can be pretty hefty.

"A shirt sponsorship deal in the EPL will be anything from £1.5 million per year up, that's not to say that's what we're paying. SPL is different, rugby similar, national rugby teams," he says.

According to the market researcher SportsPro, based on historical agreements of a similar nature GAC's commitment to Crystal Palace is thought to be worth £516,000 annually.

Luck plays a part, too. GAC signed its latest two-year shirt sponsorship deal with Crystal Palace in 2012 – when the club was in the English second-tier championship. However, the following year the team won promotion to the EPL. As the company admits, if the team stays up this year, the next deal will be significantly more expensive.

"We don't look at short-term relationships," says Mr Bradley. "We've been with Crystal Palace over eight years, Alex Brundle for three or four, with the Houston Rockets, we're in the second to third year. Aberdeen is quite new, we just started that last year but we're looking at building a long-term relationship." There are also other ways to factor in returns on investment.

"What a lot of people won't see is an internal measurement of how we profile our customers, how the sales and commercial teams encapsulate the whole of the sporting stable." The profiling of customers helps to maximise the effectiveness of what GAC calls "the sports event experience", designed to strengthen client relationships and woo new business.

"[Profiling] is both personal and commercial," Mr Bradley says.

"I would love to say that we're fantastic globally but that would be not true – we struggle to get information into the system accurately, on time and, in terms of profiling, what a particular customer would like," he acknowledges. "We can't just say, 'Hello dear customer, would you like to go to a football game?' We have to be a more subtle than that, it's an investigative type of questioning in a work environment.

After arranging to meet a client or potential new customer: "You walk away with maybe knowing he's either single or married, he's got a family of two or three, he's into ballet, or he's into theatre, in which case a football invitation might be useless. It's at that sort of level." GAC's stable of sports stars can also prove a useful tool when customers require some help, Mr Bradley adds.

"Just recently, for example, I had a senior manger of a service provider in Europe phone me up and say: 'Look Sean, I've got a problem, I've had a big hiccough with a customer, can you give me an experience? I need to salvage this guy like yesterday,' And I spoke to one of our ambassadors and sorted something out. It looks like we're going to be able to rectify that service issue through a sporting issue." So what next for Mr Bradley and GAC? Again, it is all about measurements.

"We're looking at how to measure what the value of the GAC logo actually is, to see how far we reach geographically, to what kind of audience, and tie all that down into a bit more detail and see if we can determine the level of retention of customers and clients that have been through the [sports experience] system," Mr Bradley says.

"We'd like to maybe do a bit more in Asia, try to identify in Asia if there's a generic sport that might encapsulate most of the countries where we work." With golf, motor racing, football and basketball already covered, that may prove difficult.

But one sport does stand out: it is the second-most popular participatory sport in the world, just behind football, according to ESPN.com, and played by many millions of people daily across South East Asia.

GAC might find a suitable candidate in badminton.

"Badminton?," says Mr Bradley.

"That's the one thing I hadn't thought of." [email protected] (c) 2014 s Abu Dhabi Media Company, All rights reserved. Provided by Syndigate.info, an Albawaba.com company

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