THE HARLEM GLOBETROTTERS OF RUGBY
FOR THE LAST DECADE THE ALL BLACKS HAVE LOOKED TO PLAY ONE-OFF TESTS OFFSHORE TO TRY TO MAKE MONEY AND ALSO TO GROW THE INFLUENCE OF THEIR BRAND.
In the last decade the All Blacks have become a travelling roadshow. They have played tests, for significant amounts of cash, in a number of countries where perhaps 10 years ago, no one imagined the All Blacks would end up.
The purpose of these offshore ventures is essentially two-fold. The first component is the shortterm need to make extra cash.
Rugby economics are still wedded to the amateur model where the host union meets the accommodation costs of their opponent and keeps all the gate income.
Tier One nations are locked into an agreement with World Rugby where they are obliged to play three tests in June and three in November. These tests are scheduled years in advance and are deemed to be the ‘official window’ where clubs are required to release players.
Because these games are deemed to be in the official window, they fall under the traditional financial arrangements.
The system, probably, just about makes sense but the problem for the New Zealand Rugby Union is that they are picking up gate revenue from comparatively small stadia.
The capacity of New Zealand stadia ranges from 17,000 in Christchurch to 48,000 at Eden Park – numbers which are dwarfed by the massive venues in Europe where Twickenham has 83,000 seats, Stade de France, 80,000 and Millennium Stadium in Cardiff 74,000.
The respective unions in Europe have invested in their stadia and accumulated debt to pay for the development so they rightly benefit.
But NZR has looked to work around the existing system by trying to play tests outside the official window where they can strike better financial terms.
NZR is able to command a set fee for playing outside the window as there is no obligation to honour the traditional model. So instead of just having their costs covered, NZR looks to make a significant profit.
The leverage they have to do this is the profile and popularity of the All Blacks. In 2005, for example, NZR negotiated a deal to play Wales outside the official window.
Terms were only agreed mid-way through the year, but within days of tickets going on sale, the game was sold out. The other three tests that Wales hosted that November weren’t – that’s the power and influence of the All Blacks.
That was seen the following year when an extra test was negotiated against England at Twickenham, and again, within days, the tickets were gone. Back in 2005, NZR was looking for about $1 million per game, a fee which has risen to $4.5million if it is a test against a traditional Tier One opponent. That’s the fee they were paid to play England in 2012 outside the official window.
The second part of the offshore test strategy has been driven by a desire to take the All Blacks to new and potentially prosperous markets to grow the profile and value of the brand.
That policy began in 2008 when the All Blacks and Wallabies agreed to play a fourth Bledisloe Cup test in Hong Kong. Both countries felt their rivalry had a compelling history that could potentially be taken to ‘neutral’ venues.
The All Blacks certainly felt that their brand was strong enough to play test matches outside of their traditional zones and showcase the values, skills and personalities of the team.
The game in Hong Kong managed to sell out and was deemed a major
success commercially – netting both countries about $4 million each. It was also considered a job well done in marketing terms as significant numbers of people who had never seen the All Blacks before were suddenly gripped by the legacy and qualities of the team.
As a result NZR looked to explore more options. In 2009 they took the fourth Bledisloe Cup match to Tokyo, although at one stage it was all but locked in to be played in Denver in the USA.
“Tokyo is as far down the track as this [Denver], yes,” NZR chief executive Steve Tew said. “We have a very firm offer to play in Tokyo and that’s encouraging.
“We are taking a two or three-year view of this, we are not just talking about 2009. We may be looking at a programme that goes through 2010, 2011, 2012.
“The challenge for us is to make sure it’s successful as an attraction. We are mindful of the importance of the All Blacks and their reputation.
“It’s not a circus and we also wouldn’t be delighted if they ended up playing in a half-full stadium.
“The great thing in Hong Kong was we were always confident there were enough expats to fill that stadium who could fly in or were still there, plus the closer proximity to New Zealand.
“You can sit back and listen to the critics, but at some point you have to take the leap of faith and do it. You will never know otherwise.”
Having taken that leap of faith by playing in Hong Kong and Japan, NZR grew in confidence that they could take the All Blacks to unusual venues and target growth in desired markets.
With New Zealand’s comparatively tiny economy, NZR feels it has no choice but to explore the possibility of making money in offshore markets. And the best way to have influence in those markets is to sell the All Blacks directly to the people – let them come and see for themselves what the fuss is all about.
It was no surprise that the last three tests the All Blacks have played outside the test window have been in Japan and the USA.
Having dipped their toe in the Japanese market in 2009, NZR was always keen to return as the game is growing in Japan and the World Cup will be there in 2019.
Ideally, NZR would like the All Blacks to be an influential brand in Japanese rugby ahead of the 2019 World Cup, which is why they played there in 2013 and will do so again in 2018.
The US has been another long-term target for NZR, after they signed a strategic partnership agreement in 2005. That initial deal saw NZR provide access to coaching resources and a sharing of some intellectual property to help the Eagles fast track their development.
Once AIG came on board as a major sponsor in 2012, that elevated the relationship and it became a goal to have the All Blacks play on US soil. That first happened in 2014 when they played the Eagles at Soldier Field in Chicago. The game sold out in a flash and was such a success in raising awareness of the All Blacks and rugby in general, that the All Blacks returned there to play Ireland in 2016.
That second venture was in some ways more telling as it confirmed the influence of the All Blacks to be able to sell out a huge venue in a foreign land.
These ‘neutral’ venue tests in big markets are likely to become more commonplace in the next decade. This is the way sport is moving – the NFL now play one regular game in London; Argentina took a Rugby Championship test to London in 2016 and the All Blacks receive multiple offers every year to play tests in neutral venues. Offers are always on the table to play in Germany, China, the USA and Asia.
That’s the influence the All Blacks have – they are in demand in places where rugby is barely played or understood.
THE CHALLENGE FOR US IS TO MAKE SURE IT’S SUCCESSFUL AS AN ATTRACTION. WE ARE MINDFUL OF THE IMPORTANCE OF THE ALL BLACKS AND THEIR REPUTATION.’ STEVE TEW
The Bledisloe Cup twice went to Hong Kong to sell all that was good about the rivalry. BRAND EXPOSURE