"Team Liquigas fights to continue in cycling"

[nobilis]

It's an article from Cycling Weekly :

http://www.cyclingweekly.co.uk/news/latest/531426/team-liquigas-fights-to-continue-in-cycling.html

Apparently, the contract with the natural gas company ens as of end of this year and it's not sure whether Liquigas would like to renew especially that success doesn't necessarily rhyme with attracting sponsors (like what happened to HTC.)

Also interesting point in the article is when they mention the ROI in terms of publicity. With an investment of around 10M Euros (70% from Liquigas), the team's 2010 season resulted in about 42M Euros worth in advertising, which i think, is good, but maybe sponsors are usually interested in a bigger margin of profit that they could find in other sports.

 

[El Pistolero]

A 400% "profit" rate? Companies would kill for that. Not sure if your numbers are correct though.

 

[Barrus]

Will there now be a similar style article every time a sponsorship contract is about to expire. It just seems likea very alarmist type of article, or at least headline. Sponsorship contracts have always ended and will always end after a certain period of time and either they will be renewed or there will be another sponsor, 9 times out of 10 at least. Half of the article does not even have to do with Liquigas, but with teams from Anglophone countries and is not even related in any manner with the main subject of the article. Also it seems strange, to me at least, that this is only added in the very end of the article:

Liquigas had intentions to leave, Amadio said, but thanks to the team's successes, above all in 2010, it is considering renewing.

Which seems quite a bit more important than the part about Sky and Greenedge and the like

 

[nobilis]

A 400% "profit" rate? Companies would kill for that. Not sure if your numbers are correct though.

I got the numbers from the article. That's what Amadio said.
About the profit rate, i was talking more in terms of absolute numbers rather than percentages, like you invest much more money in Football but the profit will be much bigger in numbers.

 

[Mellow Velo]

A 400% "profit" rate? Companies would kill for that. Not sure if your numbers are correct though.

I make it 600%. LG pay €7 million of the total budget.

"it was around six times more than his sponsor's investment.

"There are alternatives," added Amadio, "but for the same return, you'd have to pay more: 30 per cent more in Moto GP and double to be on a top football club's jersey."

But, in every other respect, you are correct, sir.
Twice the investment for the same return doesn't sound like good business practice to me.
Why bother to invest €14 million to get the same return?
Unless Leaky have got the odd hundred mill to spare, I can't see the point of jumping cycling's ship to disappear into the black hole of intermediate football sponsorship.

 

[Angliru]

With HTC, the impending move of their cash cow, Cavendish, to SKY was the likely reason for their bailing on continued sponsorship. No coincidence that when he left so did they.

 

[Zam_Olyas]

I am not that worried.

 

[tomazo]

Sylwester Szmyd wrote on his blog in 2010 about this. He said that when liquigas would like to buy the same amount of advertising time on italian tv they would have to spend 41 milions. They calculated that the logo of the sponsor was seen on the foreground for 31h 17min. Giro itself gave them 28 milions. 41 millions is two times more than in 2009 and six times more than in 2005 when they started sponsoring.

So it seems that the advertising in cycling is really profitable, although probably in countries where cycling does not have that large following, the numbers are smaller.

 

[Ripper]

Just to be clear, we are talking about expenses, not profits. Advertising in cycling is less expensive that other platforms. However, profitability from cycling sponsorship is another thing entirely. If Leeky has completed an evaluation of how effective cycling sponsorship is to their bottom line, we certainly do not have the details.

 

[El Pistolero]

Just to be clear, we are talking about expenses, not profits. Advertising in cycling is less expensive that other platforms. However, profitability from cycling sponsorship is another thing entirely. If Leeky has completed an evaluation of how effective cycling sponsorship is to their bottom line, we certainly do not have the details.

That's why I put it under quotation marks. Cutting advertising expenses by 400% increases profit.

 

[tomazo]

it actually refers to the money they "saved" by not buying the regular ads in tv so i guess it is some kind of profit

 

[luckyboy]

I thought Liquigas only sponsors a team because the boss is a massive fan of cycling?

 

[nobilis]

I thought Liquigas only sponsors a team because the boss is a massive fan of cycling?

that too. I remember back in 2000 i think, Liquigas used to sponsor another cycling team (different Sports Sturcture than Amadio's). I think it was called Liquigas-Pata.