Targeting the Market, Finding the Champions, Part II

Tom Danielson became a feared rider while contracted to Saturn.

 

JP: When you look at the domestic peloton these days, what do you think about the health of the sponsorship scene?

TS: Overall, cycling is healthy. Not racing, but cycling. The numbers are there for commuters, riders, racers. It’s an aging demographic, but it works for lots of people. Most cyclists have no interest in racing. You don’t need to be in racing to be a supporter of cycling.

An advertiser can use a bike in their marketing without sponsoring racing. Racing leads to another layer of cycling which leads to people riding bikes. Making bike racing a little more user friendly or making people more aware of it and why it’s an interesting activity.

So cycling itself is very healthy. Especially in our cities where it’s used more and more as a tool. Bike racing, the sponsorship, ebbs and flows, like car racing. Is racing necessary? It goes back to human nature.

I think a lot of the sponsorships … It’s expensive to sponsor a national (level) bike team. When you look at the money and measuring the return on investment, that’s the issue. If they could get return of investment at half the cost, it would be a much easier decision. It’s hard to get an American team to get to the level of Tour of California. It’s not an inexpensive activity to be involved in. Cost is a factor.

GoDaddy chooses the Super Bowl, which costs $3 million every 30 seconds. Why that and why not cycling? Car companies want to advertise how tough their trucks are, and the Super Bowl might be an easy decision.

The brand wants to get involved in an activity their customers are involved in. When it’s the non-endemics, why do they need to be in cycling? You have to make that link. Just putting your name on the team and hoping it works is not a good use of your marketing dollars

 Chris Horner enjoyed some of his most successful seasons as a Saturn rider.

JP: What about with the international peloton?

TS: In the European peloton, you see a lot more, you can kind of segment, you can see the sponsorship and see the segments or strategy a little clearer. There have only been a few true global brands that do cycling. Is Rabobank a Global Brand? I don’t think so, but they’re primarily a Dutch initiative. Their metrics, and they’re an example where they’re deep in Holland and deep across all cycling activities in Holland. It’s an example of a marketing plan where you see a return on investment.

Liquigas-Cannondale might be a business-to-business deal. I think Lampre, what is Lampre? The French brands have been national brands. There’s been Toshiba, an international brand. Motorola had potential, it was paid out of a variety budgets, but was a national brand. T-Mobile was an international brand. It had a German-American axis, but it was a national brand.

The day when more teams market globally, it will help the stability of the sport. In terms of the teams that have been around for a long time, they still don’t have a reason to go everywhere. I don’t think Liquigas sells in Holland. You have categories of true internationals, nationals, and business-to-business. There are teams based on a business relationship model. Not too many of those coming to mind at the moment. A business-to-business team is one that doesn’t influence consumers so much, but trying to get your dealer base or certain dealers.

 

JP: How about the now-departed Navigators Cycling Team (which was a pro team from 1995-2007)? Weren’t they a patron?

TS: When Navigators activated, it was business-to-business model. But to their credit, they were always trying to bring customers to entertain, even internationally.

 

JP: If ROI is important and Highroad had such an impressive ROI, why do you think they couldn’t land a sponsor? 

TS: No matter how good your numbers are, and I believe Bob had numbers to back up their sponsorships, the people believing those numbers need to be inside those companies. The team, to be successful, they have to be people in the company, pounding their chests just as hard as the Bob Stapletons and Tom Schulers about how great sponsorship is. If you had that, the sponsorship lasts. You had it at T-Mobile and Saturn.

You can get all kinds of metrics and I wouldn’t doubt that Bob’s ROI were significant, certainly enough to justify continuing or finding a new sponsor. But the people in the company have to be touting those numbers.

He turned around a ship that was taking on a lot of water. He ran a good program, and seemed to, through Cavendish and victories, I would have put him at the top of the heap for providing a return. He’s probably had six different sponsors in there. But again, if it’s just three years, it probably didn’t work as well as they could have for the company.

 Saturn was a team with unusual depth and organization.

 

JP: Do you need to find the “champions” of cycling to sponsor a professional cycling team?

TS: You need to have people inside (the company) to believe in it. It can’t be just one person. It has to be a recognition inside the company of ‘this thing works for us.’ You can’t tap someone on the head and say ‘now you’re a believer.’

We had brand managers at Saturn come and go all the time. A new person may come in and want to look at different metrics. They’re skeptical, but they look in the field and look around. I can understand how someone who inherited a cycling team comes in not being a believer. Cycling teams are multi-dimensional in terms of what they can offer a company.

 

JP: When people discuss what seems to be worse and worse news for top-level teams, two concerns are repeated, one is the state of the global economy, the second is drugs in the sport. Do you think these things are scaring away sponsors or limiting what is happening? 

TS: The global economy in general, the general trepidation of people to spend money and make those decisions. As tenuous as cycling sponsorship is, we’ve had the same go/no go decision rate in both good times and bad. You can say banks aren’t loaning money now, but I can’t say people aren’t considering cycling now. UHC (UnitedHealthCare) is a good contra indicator.

And drugs, I think we’re kind of, I think Stapleton alluded to it. It could be a country-by-country basis; it might not be as significant. In Germany, it could. Over there, at least, there are some pretty strong metrics in place to measure. But when you lose television coverage of your biggest event. So Bob’s comments are directed at the German market as much as anything. Has doping impacted the sponsorship we’ve gotten in America? I don’t think so. Vaughters program is working on moving out of that era, as was Stapleton’s. Wherever there’s a disaster, there’s an opportunity, too. Net-net, I’m not sure. I have to believe what Bob says when he says it has been an impact.

The public doesn’t seem to like The Cobra (Riccardo Ricco). But David Millar, guys like him are still heroes. I think at the end of the day, everyone feels that if it was my kid and that was the circumstances, I could understand it.

As cyclists, we might be bigger conspiracy theorists, and more skeptical. I agree that corporate America doesn’t care as much.

 

JP: What do you think teams should be doing to improve their chances to land a good sponsor?

TS: I think it’s incumbent on all the team managers to make that sponsorship as valuable to sponsors, and that’s how they can help ensure longevity. Pure impressions is one thing. If it leads to more traffic to the store, more purchases, and it’s incumbent on the managers to make things work and that will go a way to increasing the longevity of the sponsorship.

 

Friday Group Ride #21

So this week the well-respected journal the Annals of Internal Medicine published a study that human growth hormone (HGH) does, in fact, improves athletic performance by helping to build fast-twitch muscle fiber. Specifically, the study found that in men HGH would improve performance by 3.9 percent—shaving .4 of a second from a 10-second sprint time in the 100-meter dash. And while sprinting performance was dramatically improved, HGH did nothing for endurance (unsurprising) or overall strength (somewhat surprising).

In cycling, an improvement of 3.9 percent isn’t the difference between steps on the podium, it is the difference between pack fodder and crushing the competition. Whether you look at the results from a Grand Tour or from one of the Monuments, a single percent range in performance can include the top-20 finishers.

Some of the men in the study also received injections of testosterone. For those men, the performance increase was a whopping 8 percent. Imagine for a second being an 8-percent-improved rider. That’s going from a 1-hour 40k time trial to a 55:12 40k time. Eight percent could turn you from a climber into a time trialist or a nobody into a god.

The study begs several questions. First, is anyone really surprised by this? There has been strong anecdotal evidence that HGH produced results for anyone looking for an illegal edge.

A bigger question is, what is the dosage size that athletes taking HGH normally use? Dr. Ken Ho, who ran the study, gave his subjects modest doses for only eight weeks, as compared to what guys like Mark McGwire were taking, which is alleged to be a much higher dosage for extended periods of time. Obviously, the gains could be more than 4 percent. Much more, perhaps.

The World Anti-Doping Agency (WADA) helped fund the study. One wonders why they wanted the results printed in a peer-reviewed journal. This would seem to be information that they wouldn’t want athletes willing to dope (or their doctors or coaches) to find out. One can safely assume that some aspect of this study will aid those who are trying to evade detection of their drug use.

The amateur athletes who participated in the study reported several side effects. The HGH caused fluid retention that resulted in some swelling as well as joint pain. One man reported that his breasts grew.

Maybe drug testing in the future should include looking for pros who are wearing jog bras.

More seriously, the media has reported the publication of this paper with a certain amount of surprise. As I read about it, I’ll admit my jaw went slack, but my expression was more “duh” that “holy cow.”

There have been whispers about who in the peloton has been using HGH, but so far, the most substantive accusation was that the entire T-Mobile team was using the stuff along with EPO. And of course, boatloads of the stuff was in Willy Voet’s Festina team car when he arrived at his fateful border stop in 1998.

I don’t want to accuse you readers of being a cynical bunch, but are any of you surprised by the results of this study, either in general or the more specific aspect of just how much performance can be improved by either HGH alone or in combination with testosterone?

And in other news … there’s this little cycling tour that’s going to take in some great sights in Italy. Disingenuousness aside, most of the cycling media outlets are saying this is the most wide-open Giro in years. That may be right. With no Menchov, no Killer, no Pellizotti and no Contador, Evans would seem to be the heir apparent; he seems to have developed a taste for actually winning instead of just showing.

Does anyone think Garzelli has something like a chance to win? Even Simoni seems to have conceded that he is over the hill and will hope for a stage win in this, his final Grand Tour.

So two questions to you all: Who will take the maglia rosa in the prologue? We’ve got stickers for the first correct answer on that. Also, who do you think will get to go home with the pink jersey once the last kilometer is ridden? Stickers to the first correct prognosticator.

I’ve got my money on Evans.

The Irony

I believe that Bjarne Riis holds the keys to the future of professional road racing in continental Europe [Cue the sounds of a needle scratching a record/glass shattering/monkey's rioting at the banana packing plant].

For years we’ve been talking about the impact that each new doping scandal would have on the sport’s ability to attract sponsors able to support teams on the financial level necessary to race the UCI’s evolving, global race calendar. And, certainly, sponsors have dropped out after prolonged exposure to the negative publicity of having their athletes frog-marched out of the Grand Tours, heads hung in shame. What brand benefits from having their name associated with a bunch of anorexic junkies?

And yet, every time we lost a stalwart sponsor like T-Mobile, we gained a Garmin or a Columbia. Even the recent emergence of teams like RadioShack, Sky and BMC suggest that there are still deep-pocketed brands who believe in cycling. It is, perhaps, noteworthy that the Shack is built specifically to support Lance Armstrong, a marketing juggernaut independent of cycling. Sky comes out of the British Cycling Federation’s successful track tradition, a group without doping-related baggage to carry around on tour with them. Among those three, only BMC, formerly Phonak, has struggled through years of dope-conjured setbacks, specifically with Tyler Hamilton, Floyd Landis, Oscar Camenzind and others. Their survival can be put down, completely, to the iron will of owner Andy Rihs, who loves cycling, perhaps to his own detriment.

On the European continent, things have not gone so well. Formerly dominant Italian teams have self-destructed or soldiered on, shadows of their former selves. Spanish sponsors have fled nearly wholesale, and the French, well, they seem to be underachieving on every front. Milram, the only ProTour team in Germany, will end their sponsorship commitment at the end of this season. Doom? You’re soaking in it.

That brings us back to Bjarne Riis and his Saxo Bank team. Among the ProTour horde, Saxo Bank stands out. They have dominated the Spring Classics through Fabian Cancellara, a rider who will also bring them Grand Tour stage wins in any race against the clock. They also have the Schleck brothers, Andy and Franck, who, in addition to contending for GC honors in the Tours, also represent the fresh, young face of cycling. Few teams bring to the ProTour what Saxo Bank brings, and much of that is down to their owner and manager, Riis.

And now that Saxo Bank is ready to end its sponsorship of the team, it is Riis scrambling around to find funding for what is, arguably, the best team on the continent. The irony is that Riis himself is a repentant former doper, who confessed, without coercion, to having won the 1996 Tour de France with the help of the blood booster erythropoietin (EPO), even offering to give back the yellow jersey he won that year.

A polarizing figure in cycling, Riis is clearly at the forefront of modern team managers, bringing new training techniques and technical innovations to the table more aggressively than any other. Many cycling fans are ambivalent about his influence though, disgusted with his participation in the drug culture of the late ’90s peloton, but intrigued by the performance and tactics of his team. Never a particularly warm presence, Riis has managed his team in the same ruthless way he raced. It wins races, if not always fans.

So now it’s down to this man to find a title sponsor for his team. It’s a proposition that tests the very premises of continental racing. Can a former doper with the best squad on two-wheels secure the funds? There is probably not a more valuable commodity than Team Saxo Bank, not a better end product to sell. But Riis may well be his own albatross. The deal maker might just be the deal breaker.

And this dilemma is not peculiar to this team. Every continental team has baggage to contend with when talking to sponsors. That is what makes Saxo Bank such a clear litmus test for the ProTour.

Let’s not be too dramatic. Pro cycling will not die. Where teams fail, others will spring up, but the new shoots of growth might come from unexpected sources, Australia or Japan maybe. The UCI has undertaken a globalization project for the sport. This can be looked at as either an effort to grow into new markets, or a tacit admission that the peloton has simply poisoned the well in mainland Europe.

Let’s hope this isn’t the case. Whether we like him or not, let’s hope that Bjarne Riis can present a business plan that overcomes the trepidation that must come from shaking hands with a former cheat.

Image: John Pierce, Photosport International

The Taint of Suspicion

Alexander Vinkourov’s victory at Liege-Bastogne-Liege was met with boos and questions. It comes less than a year following his return to cycling after a two-year suspension for doping during which time the rider shed no light on his past. Vinokourov has voiced his displeasure with the reaction to his success, and released a letter voicing his views, which you can read here.

Robot has also written a post concerning the convicted doper’s win at one of the five Monuments.

Linger. Fester. Spread. Grow.

When you think about the words that are used in conjunction with the noun suspicion they are words used to apply action to sores, smells and cancers. And like a cancer, suspicion can spread in directions surprising and predictable at equal rates.

Alexander Vinokourov’s win at Liege-Bastogne-Liege gave us examples of both. That suspicions linger about what sort of rider he is—that is, how he achieves his success—should surprise no one. What may have surprised you was to hear boos from the crowd as he crossed the line. No matter who’s feed you watched, the crowd’s disapproval was audible.

Was Vinokourov naive to be shocked? No. It was a crowd display that is unprecedented and stands in direct opposition to Richard Virenque’s win in Paris-Tours just months after his return to competition following his suspension for doping. The two situations couldn’t be more similar and yet, the crowd reactions couldn’t have been more dissimilar.

Virenque was hailed by the crowd as if he was a returning war hero. He was lionized in the (French) press as a true champion. He was still and again Richard the Lionhearted, the darling of France.

Vino? Not so much.

To be booed must have hurt. How could it not? That’s got to be defeat snatched from the jaws of victory. And then to be questioned by the press as much about his past vis-a-vis doping as the circumstances that led to his win was obviously infuriating, so much so that he took the unusual step of writing an open letter to the cycling world. You’ve probably seen it, but if not, you can read it here.

Vinokourov asks a fair question: Why can he line up for a race, but not win it? Indeed, the boos took the sweetness of victory from him more certainly than the UCI ever could. Why roll across the line first if you won’t be granted the crowd’s adulation?

Many writers have contrasted Vinokourov with David Millar and wondered why we accept the Scot, but not the Kazakh. It’s a fair comparison and could serve as a very teachable moment for Vinokourov.

So Millar’s apartment in Biarritz is raided by police and they find a syringe with traces of EPO. Millar responds by confessing. He told us not only that he had used EPO, he told authorities exactly how long he had used the drug and how using it weighed on him.

As doping confessions in cycling go, it’s the single best example out there.

Richard Virenque denied, denied, denied and then confessed—tearily—in court at the sharp end of a prosecutor. It worked for the French but anyone without a Gallic soul was left adrift by it.

Bernard Kohl conducted interviews on a monthly basis with German media, teasing out details of his past and his knowledge of doping in what seemed to be a calculated effort to keep his name in the headlines. In the end, it seemed self-serving.

Kayle Leogrande confessed in confidence to soigneur Susanne Sonye and after she testified about what he told her he sued her. That suit was ruled a SLAP and tossed out of court, but not until another cyclist, lawyer Tom Fitzgibbon, came to her rescue. Leogrande? Persona non grata to the cycling world.

Four confessions. Four very different results.

Vinkourov has confessed virtually nothing. We remain suspicious. We suspect much about his past. And because he has done things recently—such as train in Tenerife (the current haunt of doping docs Michele Ferrari and Eufemiano Fuentes), a place nearly as out-of-the-way as Mexico when considered from the Continent—that smack of present doping practices, we suspect there is more to the story.

In his letter he refers to “the dark years of my career.”

Years. Plural.

Imagine that on the evening Vinokourov was ejected from the Tour in 2007 he had given a press conference. And suppose that during the press conference he had said, “Yes, I used a clinic in (insert name of German town here) to conduct blood doping. Earlier, when I was at T-Mobile, we used EPO and our system was organized by (insert name of dirtbag here). My first drug use was in 199x and that season I won X, Y and Z with its help.

We wouldn’t like the news, but at least we’d know. His suspension, in the wake of a confession could serve as a sort of penance for all of his past doping.

Vinokourov was suspended for a single infraction—not years of drug use—and to this day has confessed nothing directly. He says, “I don’t think cycling needs to reconsider all these dirty stories to move forward.”

Wrong. Worse yet, he adds, “I have nothing to hide.”

Again, he has confessed nothing, though he has referred obliquely to years of drug use, so it is impossible for this one suspension to serve as penance for years of standard practice. He is still hiding much.

Let’s consider how the courts would view this. For pleading guilty and confessing the full extent of the crime(s), a person is almost always rewarded with a reduced sentence. And then there’s the plea bargain, in which the criminal signs a full and complete confession and in exchange is charged with a lesser crime. Very often, it’s a trade to avoid being convicted of a felony. In the United States, the punishment for a felony conviction lasts long after any prison time has been served and any fine paid. The felon cannot vote and will forever have ‘splaining to do in job interviews.

It would seem that Vinokourov is suffering the sort of moral equivalent to a felony conviction. He won the race, but not in the hearts of many present.

In closing his letter he writes, “I can’t do more than what the sport regulations ask me, to prove my honesty. Today, I only wish to be respected as I respect everyone, my colleagues in the peloton as the journalists. I don’t want to be the only and too easy target for all the ills of cycling.”

In this, he misses the point entirely. He has never proven his honesty. Sure, he’s testing clean now, and while we should applaud him for that much, because we don’t know the full extent of his past, we struggle to trust him in the present.

And is he the “only and too easy target”? Not by a long shot. Now would be exactly the wrong moment for him to play the persecution card.

Vino, you have nothing in common with Job.

Let us hear him say, “I did X. I was wrong. I am sorry,” and that, sports fans, truly is a game changer.

Were Vinokourov to hold a press conference on the eve of the Giro d’Italia and finally confess everything he did and knew, I truly believe he could win the prologue the next day and be applauded.

His career is a matter of reputation, something only he can restore.

Image: John Pierce, Photosport International