The advertising market is changing
Terrestrial coverage continues
Jumping’s digital coverage supports the terrestrial platform
A key driver to newspaper sales
Online is outstripping TV & print

The advertising market is changing
Technology is forcing advertisers to market their goods in new ways, and sponsorship is the beneficiary of these changes. The way consumers absorb information and commercial messaging is changing away from traditional TV and print advertising to more interactive methods of delivery.

This process has been accelerated by the economic downturn as the TV advertising market has shrunk. Mainstream commercial channels underwritten by advertising revenue recently met with DCMS to discuss the opportunities for product placement among other measures to fill the gap made by declining mainstream advertising.

However, the product placement story only corroborates what has been going on in the sponsorship market for several years. Integrating a brand message into the content of the programming through sponsorship is proving a more cost effective method of delivery to consumers, whilst also building brand loyalty in a way that above the line advertising will not.

Between 2007–8, the global sponsorship market grew by 15% to $43.5 billion (Source SComm) against advertising’s growth of 6%. Even allowing for the fact that sponsorship spend is only 10% of the total advertiser spend, the growth pattern is consistent across many sports, including UK racing.

Terrestrial coverage continues
The past twelve months have been unsettled for racing with the prospect of change in broadcasting arrangements. The prevailing agreement for Channel 4 Television to continue its weekly programming of racing coincided with structural change at the broadcaster and the loss of business confidence through the latter part of 2008 led to reduced advertising revenue for the channel, forcing it to examine the cost of getting content to its screens.

At the same time, BBC TV made a decision to reduce its racing coverage to around 13 key days focused around the headline events of Royal Ascot (5 days) and the John Smith’s Grand National Meeting (3 days).

In July 2009, Racecourse Media Group, a consortium representing courses with televised races through the year, finally agreed terms with both BBC and Channel 4 for the period 2010–12 inclusive. The new agreement will provide around 80 days racing each year, representing around 200 Jump races and 80 hours of coverage of the sport.

In addition, the agreement secures the continuation of the popular magazine programme Morning Line, which previews the afternoon’s coverage between 8am and 9am every Saturday and on selected other key days like the Festival.

The regularity of broadcasts of the sport is its trump card. Only football achieves more terrestrial TV coverage than horseracing, and the continuity of coverage week on week offers the sport and its sponsors access to a loyal and regular viewership. As most advertising relies upon repetitive messaging, this gives racing at large an enormous advantage over its competitors. Jump racing secures itself a cumulative annual audience of around 50 million viewers.

Andrew Thompson, former Head of Sport for Channel 4, and now its racing consultant, commented on the new deal:

“Channel 4 has been the home of UK racing for many years – delivering quality sporting spectacle every week of the year. We want to continue to be that home going forwards, and work in partnership with all the racecourses to secure its continued terrestrial base. Channel 4 will continue to work ever closer with the sport to produce the most compelling coverage for the widest possible audience for the next three years.”

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Jumping’s digital coverage supports the terrestrial platform
Terrestrial coverage of racing marks the full extent of TV coverage through digital channels Racing UK and At the races. Racing UK broadcasts daily racing from 30 courses in Britain, whilst its rival At the Races, broadcasts from the remaining 30 courses and from the 29 Irish courses.

Racing UK has successfully built sponsor offerings for access to its regular audience, and offers a loyalty package to its subscribers through Racing UK Club, which provides a selection of free admission offers on nominated days to its member racecourses. Programme sponsors and advertisers have included Coral, Seasons Holidays and John Smith’s.

Racing UK operates a different business model to its rival, focusing on member subscriptions. With over 37,000 members and a burgeoning commercial application through over 2,300 clubs and pubs, its reach is considerable. The monthly cumulative audience reach is 200,000. Until August of 2009, the channel was operating under a Setanta umbrella. The demise of that broadcaster has not prevented Racing UK from continuing its successful growth. And the channel sees a strong jump in subscriptions in October and November as main stream jumping returns to the fore.

At the Races is a dedicated horseracing channel broadcasting live content from 30 UK courses, every Irish racecourse and from the USA. The company is a partnership between British Sky Broadcasting, Arena Leisure Plc and the 30 UK racecourses. In addition to its UK content, it broadcasts over 300 meetings from Ireland.

Unlike Racing UK, ATR is a non-subscription channel, part of Sky’s News & Events mix. The channel reaches over 1 million viewers each month.

Racecourse Media Group, parent company of Racing UK, established Turf TV in 2008 to deliver a dedicated TV service to betting shops. Turf TV provides pictures and content to 9,700 betting shops in the UK and Ireland, from 31 of the UK’s best racecourses.

Racing UK also creates an international platform for its media rights, offering a daily racing-betting package to the global market through a network of satellites to more than 20 countries in 6 continents. This puts UK racing, with its 500 Jumps fixtures, right at the forefront of a global market for racing.

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A key driver to newspaper sales
Competition for readers among the nationals is intense. Newspapers are competing not just against each other but for a share of a time-poor audience whose attention is as likely to be spent watching or reading other media outlets like TV or online.

The rush to provide content free online has been fuelled by a significant shift in advertising revenues to online from traditional print media. European online advertising revenue is set to reach £10.8 billion by 2012, 18% of the total advertising market. The downturn is, inevitably, impacting upon this advertising spend, and among newspapers, each is watching the other to see whom will break ranks first to make online services chargeable.

High quality content therefore is key to newspaper circulation and therefore to advertising spend. Sport plays a very significant role in providing that content, and racing is right in the vanguard of that provision. This is in part a result of the regular TV exposure racing receives, but also that daily racecards, runners & riders, and results are the bread and butter that reinforces a decision to purchase or view. And there can be no doubt that sports which have a terrestrial television aperture to a wider public receive a far greater airing in print than sports that don’t.

It is no coincidence that two of the three leading red tops in the UK publish a dedicated racing pull out each Saturday to coincide with Channel 4 and BBC coverage. And special events like the John Smith’s Grand National and Festival allow both the Sun and Star the opportunity to publish daily supplements in support of their coverage. In 2009, The Times dedicated 4 pages each day to the Festival, coverage that is matched by no other sport except football. This coverage all adds value to the sport’s sponsors through a combination of name checks and sponsor branded photographic imagery.

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Online is outstripping TV & print
The online advertising market continues to capture market share from its rivals in TV and print media. The UK consumer now spends 14.3 hours online each week, against 11.1 watching TV. As far back as 2006, online advertising outpaced terrestrial TV advertising, albeit that much of this is pay-per-click rather than display advertising.

In fact, the quarterly Bellwether survey of the advertising sector by the Institute of Practitioners in advertising and accountancy firm BDO for the third quarter of 2009 reports the only growth area to be online (Source Guardian.co.uk Oct 12).

What impact will this have on Jump racing? The answer is that the sport must adapt its sponsor offerings to the market’s demands. To an extent this has already begun. Both Racing UK, ATR and Racing Post, the sport’s only national daily dedicated to the sport, have advanced web sites, with sponsored content, commercial applications and so on. Increasingly, racecourses are providing online sponsorship solutions that support the event marketing and TV coverage that orthodox sponsorship modules offer.

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