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F1: Is the pulse racing among sponsors?

Corporates weigh the costs and benefits of a major Singapore event

By VINCENT WEE

(SINGAPORE) Malaysia has the Petronas Malaysian Grand Prix and Australia has the ING Australian Grand Prix. But what are the odds that Singaporeans will be able to stand proudly behind a DBS Singapore GP or a SingTel Singapore GP when the international television cameras focus on the city next year?

Details of sponsorship packages are not available yet. Race promoter Singapore GP says it is finalising various packages including title sponsorship. 'We are in discussions with them (Formula One Administration) for us to help secure the title sponsorship and to jointly offer some trackside advertising packages for local companies,' said a spokesman. And Singapore GP is 'receiving a large number of requests for information on marketing opportunities'.

As the GP race heats up, companies BT spoke to were lukewarm at best to the prospect of sponsorship. Of the three biggest capitalised companies on the local bourse - who would presumably have the resources to consider the $7-15 million title sponsorship bill - top local banks DBS and UOB declined to comment. But with their history of sponsorship being mainly in education and the arts, it appears unlikely they are interested in burning rubber.

Singapore's biggest company Singapore Telecommunications had a more positive response. 'We are open to sponsoring a world-class event like F1,' said corporate communications director Peter Heng. 'In evaluating a sponsorship, we look for brand synergy with SingTel's vision to be Asia-Pacific's best communications group and our aim to set the pace.'

Singapore Airlines is also open to the idea of race sponsorship. 'Of course we will look at the merits of any proposal but if we are approached, we will consider it,' said a spokesman.

Lifestyle company OSIM is also prepared to consider options when they became available. 'We are open to talk. We believe there is international exposure if the price is right,' said chief financial officer Peter Lee.

Property players have different views of sponsorship. CapitaLand recognises the high-profile international nature of the event and the 'endless possibilities for advertisers, including new ways of collaboration and corporate client-servicing activities' it offers. 'Companies like CapitaLand that have not previously associated themselves with sports sponsorship will now have an excellent reason to evaluate the branding effectiveness of such high-profile, high-exposure events,' said a spokesman.

Sentosa Leisure Group, on the other hand, feels the GP does not really match its objectives. 'Although the F1 will no doubt be a most exciting event in Singapore, there is no natural synergy between racing and Sentosa, or co-branding opportunities for both parties,' said a spokesman. Instead, he highlighted Sentosa Cove's sponsorship of the Singapore entry in the Clipper 05-06 Round the World Yacht Race as an example of effective sponsorship, serving to showcase the new One Degree 15 marina there as well. Big foreign players also seemed strangely reticent about GP sponsorship. Aviva, which has been active in sponsoring sports events here like the badminton championship and F1 powerboat race two years ago, declined to comment, as did Swiss financial giant UBS.

Citibank seemed slightly more upbeat, though comments by Citi Singapore's country corporate affairs director Adam Rahman seem to suggest any sponsorship would be restricted to corporate hospitality. 'Citi is always open to such unique and interesting sponsorship ideas,' he said. 'While it is too early to commit on sponsorship, we will definitely be interested in hosting corporate hospitality events for our top clients at the F1.'

Ironically, the smallest local bank, OCBC, is the only one to have given a positive reaction. 'Like all Singaporeans, we are excited at the prospects of having the F1 race in Singapore (and) are open to opportunities to work with the relevant parties to make it an exciting and unforgettable event,' said head of corporate communications Koh Ching Ching.

The issue boils down to branding and scale. While the F1 offers a great chance to showcase a brand to a global audience, many local companies say their brands are too small or do not have sufficient global appeal to benefit from it. This poses a chicken-and-egg question of whether the race can be an effective vehicle for them to get the global reach they now lack.

Another commonly cited reason for not getting involved in F1 is hesitation to spend large amounts without any tangible way to gauge returns. 'What is being offered in return for spending megabucks?' asked an industry player. In fact, the cost-benefit equation was the main deciding factor alluded to by many of the local companies that BT spoke to.

While they are waiting for detailed proposals before making up their minds, all of them say they will analyse the value involved before making a decision.