User:U3025472/The Impacts of the Proposed 'Pokies Legislation' on Sporting Sponsorship

Overview
Preentation on Youtube.

Hi, my name is Kait Ludwig and today my presentation will be about the impacts of the proposed ‘Pokies Legislation’ on sporting sponsorships.

Politics has played a major role in shaping and developing sport over the past decades as a result of an increased government involvement in sport.

The introduction of a proposed pokies legislation has become a prominent news story of late, attracting the attention of licensed venues and sporting teams around the nation. It is feared that the proposed legislation which requires punters to register and set limits on their gambling, will have detrimental impacts on the annual revenue of clubs and casinos. Thus, having impacts on the overall commodification of sport at all levels. This presentation will address the importance of sponsorship in sport and the impacts of this proposed legislation on sports sponsorship at a local and national level.

I am also fortunate enough today to be joined by Spiro Tsiros, the commercial and marketing manager for the Canberra Raiders. As NRL is one of the sports which would be largely affected should this legislation come to pass, the information Spiro can provide will give a detailed insight into the impacts of this legislation at a local, national and even international level. Sports ranging from a grass roots level up to the elite rely heavily on sponsorship funding from large companies and licensed venues. Sponsorship funding is often used to purchase equipment, pay staff and athletes and promote the sport or team to the sports consumer. The proposed pokies legislation has been developed to target problem gamblers but what some have failed to recognise, is the detrimental impacts this will have on the funding of local and national sport.

If implemented, the pokies reform will lead to the discontinuation of many partnerships between sporting clubs and licensed venues which could see a large change in Australian sports in the future.

Transcript
I am now joined by Spiro Tsiros, the Commercial and Marketing Manager for Canberra’s premier Rugby League team, the Canberra Raiders. Sprio, thank you for giving up your time to discuss this issue with me today. So, obviously you and the club have been working hard in the off season to re-sign sponsors for 2012 and,

How vital is sponsorship funding for the Club in achieving its goals and objectives for next year?

''Well first and foremost, we’re measured by our success on the field but in the office, we’re measured off the field. To keep ‘on-the-field’ running, we need a budget of which about 40% is taken up by sponsorship revenue. So if you don’t achieve your revenue target, it’s hard to give the players everything they need to achieve on the field.''

In the wake of the new ‘Pokies Legislation Proposal’, sporting sponsorships have come under fire, with a lot of major clubs and casinos pulling their sponsorship from sporting teams. Has this proposal had an impact on the Canberra Raiders and if so, what does it mean for the club going forward?

''Well it hasn’t had an impact yet. But we’re supported by 8 licensed clubs. Which is, without talking out of school, on an average, the 15 clubs that participate in the NRL that are supported by poker machines, have somewhere between 10 and 15% of their operating budget supplied by poker machine revenue. So, whilst the laws haven’t come into play, it’s put the pressure on clubs to go out there and find additional sources of revenue or tighten up expenditure, to come into line.''

Okay, so aside from NRL sponsorships, are there any other elements of the club that may be affected by the implementation of this legislation?

''It’ll probably have far reaching effects further into the future than the short term. We’re facing a TV rights deal so, if we’re short in funding because of poker machine legislation, we’ll probably be insulated in the short term. Going forward however, with the amount of revenue, about 7.5% of obligatory spend in the community driven by poker machine funding, when that starts to dry up, what we’ll see is not only in rugby league but across all sports, a drying up of junior talent because community groups will not receive the funding from poker machine environments to then put their kids in the sporting competition.''

So should this legislation come in to pass, do you think Australian teams in Rugby League will be disadvantaged to their counterparts overseas?

''Not in the short term. But with the stemming of junior participation in the next 5 to 10 years, and then the slower flow on effects of younger kids coming through the ranks to first grade football, there will obviously be a smaller talent pool. When you have a smaller talent pool, there’s less ability to identify big and large talents. So, in the next 10 to 15 years, there will start to see a slimming of top grade rugby league players in Australia. However, in saying that, New Zealand have never had a poker machine environment for which to fund Rugby league and they seem to be going ahead in leaps and bounds. So maybe we’ve just got a bit of catching up to do.''

It is evident that sponsorships and the sale of sponsorships can mirror team performance both on and off the field. After a somewhat unsuccessful season in 2011, have you seen the impacts of the performance on your sponsorship sales?

''Well, there’s a few different levels of sponsorship. One is overt branding, which you see on our playing apparel. That in some cases is a little more insulated from team performance because the decisions on that property are normally made on a marketing/commercial level. We get below that and get into the more personal sponsorships, particularly Canberra being a small business market, you’re confronting owners, and they’re emotionally driven decisions in much of the case. So it becomes more difficult to attract probably the smaller investor. Whilst we haven’t seen how difficult it is yet to attract the larger ones.''

And what means are you going to in order to provide, I guess, an additional benefit to the sponsors that do re-sign for next year?

''Well, using some experience as a guide, I think the sponsors we have in the Canberra marketplace are quite well looked after by not only the club but this team. So going forward, if we can just monitor what we have done for them historically, that should see them stay on board for years to come.''

Conclusion
It is evident that sport sponsorship plays a vital role in the funding of sport not only at an elite level but from the grass roots level and upwards. The funding received from sponsorship often provides valuable resources to a sporting team which enables them to achieve success in their given competition.

The announcement of this proposed legislation has caused many clubs to assess their budgets and revenue sources as a loss of poker machine revenue could result in a large void in their annual income. This has left many licensed venues reconsidering the distribution of their funds and many may no longer be able to afford to sponsor local sports if this legislation eventuates. This extinction of funding for local sport could result in a decline in community or grass level sports. Which, in some circumstances may lead to a decline overall sport participation in future years.

The government needs to asses these factors, as this political decision could hinder the sporting pride and success of the nation. Funding assistance may be provided through additional government grants or initiatives as other countries have done. In the short-term, the Canberra Raiders will endeavour to continue their relationships with both large and small businesses and further grow their sponsorship base within the Canberra area.

I hope you have enjoyed this presentation. Thank you.