GAA commercial director: we go far beyond major charities in distributing our income
Sponsorship and the sale of TV rights are a key part of the GAA’s income, as Peter McKenna explains to John McGee
John McGee THE GAA is outperforming major Irish charities in distributing its income to members, according to its commercial director Peter McKenna.
“Our sponsor partners know that around 82pc of all income that the GAA earns from things like gate receipts, sponsorship, media rights and merchandising is redistributed throughout the organisation into the counties and clubs,” McKenna told the Sunday Independent.
“That’s beyond what the major charities are doing. In fact, most charities would be happy with a 75pc distribution,” he said.
Amid widespread calls for better corporate governance following the Fifa and OCI controversies, McKenna said that the organisation is run on an entirely democratic and transparent basis.
WITH all eyes focused on today’s All-Ireland Hurling Final between reigning champions Kilkenny and bitter rivals Tipperary — not to mention the mouth-watering clash between Dublin and Mayo two weeks later, the final whistle will soon be blown on what has been a busy but successful year for the GAA.
No other brand in Ireland — with the exception, perhaps, of the Catholic Church — has the same emotional reach into cities, towns and villages around the country. With over 1,600 clubs and a fan base that runs into millions in Ireland (and many more overseas), it also makes it a compelling and powerful platform for sponsors and broadcasters to align themselves with.
Unlike other sporting organisations, however, the grassroots have a say in how it is run — and the clubs and county boards that make the GAA tick on a daily basis are the main beneficiaries of the organisation’s commercial success. This is a major selling point for the organisation when striking sponsorship arrangements, says Peter McKenna, stadium and commercial director of the GAA.
“I think one of the great things our sponsors like about the GAA is that it’s a democracy. Any club can raise an issue and it then goes in front of our annual congress and people debate it. There is no major shareholder or anyone who can bring an undue influence to it. This democracy insists that the brand stays true to its core values — values that revolve around local communities, Irish heritage and the enormous voluntary effort that goes into making the GAA what it is today. That’s important for us and our sponsors,” he says.
“Our sponsors and partners also know that around 82pc of all income that the GAA earns — gate receipts, sponsorship, media rights, merchandising — is redistributed throughout the organisation and into the counties and clubs.
“That’s beyond what the major charities are doing. In fact, most charities would be happy with a 75pc distribution. So that’s something everyone in the GAA is very proud of — and it shows that it works as an engine. So there’s a sort of halo effect for our sponsors, and it enables them to get right into the heart of communities in an authentic way, and this is very powerful,” he adds.
These sponsors include many blue-chips like AIB, SuperValu, Eir, Centra, Etihad, Liberty Insurance, Allianz, Electric Ireland, Kellogg’s and Bord Gais Energy.
In turn, each of these sponsors have their own activation strategies — whether it’s AIB’s #TheToughest, Kellogg’s Cul Camps or Electric Ireland’s #ThisIsMajor campaign promoting the minor championship. Collectively, however, they all reinforce the strength of the GAA brand and contribute to the ongoing conversation about the games on a daily basis.
“Many of our sponsors have been with us for a long time. Allianz, for example, is now in its 23rd year of sponsoring the league, which is quite extraordinary. And there’s AIB, which even during its darkest time in the downturn, indexed very highly for its GAA sponsorship, and it’s done some fantastic and innovative work around supporting this sponsorship over the past few years,” says McKenna.
Of course, revenues from sponsorship have played a big role in keeping the GAA’s coffers replenished. In its last financial year (to the end of October 2015) it reported consolidated revenues of €90.6m, putting it ahead of the IRFU, which clocked up a turnover of €74m last year and considerably ahead of the FAI, which turned in €46m.
Around €55.7m of this turnover was attributable to the GAA’s Central Council (charged with administering the various games and all the commercial functions), while €36.6m is attributable to Croke Park — which, apart from benefiting from match-day receipts and concerts, has built a solid and profitable business in conferences, events and stadium tours, according to McKenna.
While total ticket sales accounted for around €26.7m, commercial revenues amounted to €18.3m, with sponsorship contributing €6.5m of this and media rights providing another €11.2m.
The sale of some of the broadcasting rights — to the likes of Sky in particular — has been criticised in some quarters, but it merely mirrors international trends as rights holders seek to generate much-needed income to invest in their sport.
“The big finals are designated as free-toair and that’s not going to change. The reality is that if we are to continue to invest and distribute the money and invest in the games at all levels, the money the GAA earns from the rights will be an important part of that.
“We receive around €2.5m from the government to help run the association — which is great — but in the context of what it costs to run the organisation and redistribute as much as we can, it’s a drop in the ocean. That’s why our commercial activities become so important and why we have to deliver on a consistent basis,” he concludes.