Bloomberg News

World Cup Would Lift All Blacks Brand Past NZ$100 Million

October 06, 2011

(Adds location of final in 13th paragraph.)

Oct. 7 (Bloomberg) -- A first Rugby World Cup title in 24 years would take the All Blacks brand value past NZ$100 million ($77 million), lifting New Zealand’s national team to the same level as top-20 European soccer clubs, according to Brand Finance Plc.

Should the All Blacks win the Oct. 23 World Cup final in Auckland, their brand valuation would rise by NZ$12 million to NZ$108 million on improved merchandising and sponsorship opportunities, said Brand Finance, which advises companies including brewer SABMiller Plc and bank Standard Chartered Plc.

“It’s about taking the next step up because I’m pretty sure the brand could work harder,” Tim Heberden, managing director, Brand Finance Australia, said in a telephone interview. “That next level of partnerships maybe need a bit of gloss from the trophy.”

The All Blacks have won three-quarters of their 481 Test matches since 1903, international rugby’s best win ratio. They took their only World Cup title in 1987 when the tournament was last played in New Zealand. Since then, the team has lost a final, three semifinals and a quarterfinal. They host Argentina in the last eight on Oct. 9 in Auckland.

While the All Blacks’ estimated NZ$96 million brand worth is dwarfed by the 412 million-pound ($638 million) valuation of record 19-time English soccer champion Manchester United, it places them on the fringe of Europe’s top-20 clubs.

Four-time European champion Ajax ranked 23rd last week in Brand Finance’s survey of the continent’s top 30 teams with an estimated brand value of 46 million pounds.

‘Against the Tide’

Rather than being reliant on World Cup success, the equity of the All Blacks is underpinned by a win ratio that’s crept up over 80 percent since rugby went professional in 1996 and their status as the game’s most-recognized marque, according to Simon Arkwright, chief executive officer of Wellington-based Sport Research Group.

“They’ve done that slightly against the tide in that while they’ve been the top-ranked team for basically the last 24 years, everybody is aware they haven’t had a little gold cup in the cabinet,” Arkwright said in a phone interview. “They’re pretty solid in terms of being the sport’s No. 1 brand.”

The biggest threat may come from South Africa, Arkwright added. The defending champion Springboks are seeking an unprecedented third title this month and face fellow two-time winner Australia in the quarterfinals.

Facebook Following

When the All Blacks became the first New Zealand brand to gain one million Facebook followers in August, the Springboks’ page was the next-best among national rugby teams with about 390,000. More than 800,000 of the All Blacks fans came from overseas, the Wellington-based New Zealand Rugby Union said.

The All Blacks’ 10 sponsors include Adidas AG, Air New Zealand Ltd. and MasterCard Inc., according to their website. Adidas has sponsored the All Blacks since 1999 and three years ago extended its contract through 2019. Upon renewing the deal, Adidas CEO Herbert Hainer described them as “one of the most inspirational and talented sports teams in the world.”

“We’ve done exceptionally well despite our pretty average World Cup record,” Steve Tew, the NZRU’s CEO, said in a telephone interview. “If we were lucky enough, and good enough, to win this one, or any of the future World Cups, then that would enhance things.”

A victory in this month’s final at Eden Park in Auckland may help attract previously rugby-shy companies, Arkwright said.

“If you were to bring in a new partner that previously hadn’t occupied the rugby space, then a world championship would give more comfort at an executive or board level in terms of signing off on some big dollars,” Arkwright said.

Balancing Act

Maximizing the All Blacks’ commercial potential is necessary in ensuring the game’s health at all levels in New Zealand and also requires a balancing act because of their heritage and place in society, Tew said.

“All Blacks rugby generally is a part of what New Zealand is,” said Ron Palenski, chief executive of the New Zealand Sports Hall of Fame in Dunedin. “Playing rugby is one of the few things that we’ve been able to do, historically, better than anyone else. It’s helped shaped the identity of New Zealanders more than most other things. The New Zealand Rugby Union is very well aware of going too far.”

Sponsors twice got it wrong in the World Cup buildup.

Adidas drew the ire of New Zealanders over what rugby fans said were exorbitant prices for All Blacks’ replica jerseys, while negative reaction forced Telecom Corp of New Zealand Ltd. to cancel a campaign encouraging New Zealanders to abstain from sex to show their support for the All Blacks. Telecom said it had “misjudged public feeling.”

“The financial opportunities are important and that does kind of feed all of the activities that the NZRU carry out,” Brand Finance’s Heberden said. “They can’t just sit back. They have to make sure that they push it as far as deemed to be reasonable.”

--Editors: Bob Bensch, Christopher Elser.

To contact the reporter on this story: Dan Baynes in Auckland at dbaynes@bloomberg.net

To contact the editor responsible for this story: Christopher Elser at celser@bloomberg.net.


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