July 14th, 2011

Mercedes Hopes a Good Walk Brings Spoils

The New York Times

CARMAKERS, familiar rivals on the race course, are increasingly focusing on an area of competition that does not, at first glance, have much to do with horsepower or handling: golf.

Mercedes-Benz’s sponsorship of the British Open, which begins Thursday at the Royal St George’s Golf Club in Sandwich, England, is part of a bigger push into golf by the carmaking unit of Daimler.

Since 2008, when it began a major push into the sport, Mercedes has been a sponsor of three of golf’s four major tournaments — the British Open, known formally as the Open Championship; the Masters; and the P.G.A. Championship. The company has its sights on the United States Open, the other major, once Lexus’s sponsorship deal expires in 2015.

Mercedes’s push into golf represents a challenge to BMW, which sponsors the P.G.A. European tour as well as numerous other golf events. BMW continues to outspend Mercedes in golf, according to Sport & Markt, a consulting firm based in Cologne, Germany.

Unlike BMW, which sponsors a range of sports, Mercedes is concentrating its international sports budget on golf and auto racing, a sport with obvious links to the product.

Mercedes has turned to golf at the expense of tennis, which may seem odd for a brand trying to appear younger and more stylish. Tennis is a sport of lithe 20-somethings and golf is often associated with paunchy, middle-age men.

But Mercedes managers say they are convinced that golf is acquiring a younger and hipper image, and that it is growing in popularity in Asia, where luxury car sales are soaring.

“Thanks to players like Rickie Fowler, golf is no longer as staid as it used to be,” said Lüder Fromm, director of global marketing communications for Mercedes-Benz, referring to the 22-year-old American player who has made a music video and often wears bright orange outfits on the course. “There will be a sort of new energy coming with these younger pro players,” Mr. Fromm said.

The most closely watched player at the British Open may be Rory McIlroy, the 22-year-old from Northern Ireland who won the United States Open last month. Mr. Fowler is scheduled to play in Sandwich, as is Ryo Ishikawa, the 19-year-old Japanese sensation whose nickname is “Bashful Prince.”

Danny Townsend, president for Europe and South Asia for Repucom, a brand analysis firm, said the new generation of players meant that golf was in its best position in years to refute perception that it was a sport only for older rich people. That is especially important now that Tiger Woods, whose appeal transcended golf, no longer dominates competition the way he once did.

“If you cut the world into three parts you have a superstar in all three regions, which is very rare,” Mr. Townsend said. “You have three guys in every part of the world who are the future of golf.”

“Golf is always in danger of being a stale old person’s sport,” he added. “They are definitely bucking that trend.”

Part of the appeal of golf for sponsors is that it is the sport of choice for many older rich people with money to spend. Sport & Markt estimates the value of global golf sponsorship by car companies at 62 million euros ($87 million), reflecting the sport’s efficiency as a way to reach a wealthy audience.

“It is an obvious platform for car companies, particularly at the premium end,” Mr. Townsend said. “The demographic of people who play and watch golf fits the profile of luxury car purchasers.”

BMW remains the biggest golf sponsor, spending 39 million euros, followed by Mercedes with 21 million euros and Volvo at 15 million euros, according to Sport & Markt. Hyundai, Kia, Toyota, Audi and Lexus are also active. Mr. Fromm declined to say how much Mercedes was spending on golf.

Mr. Townsend, who spent a decade in Singapore before recently locating to London, said that golf was a status sport in Asia, where there were few private clubs and most courses were open to anyone who could afford the fees.

Mercedes sales in China soared 59 percent during the first six months of 2011, to 95,000 vehicles, the company said last week. “More and more people from China are buying cars and playing golf,” Mr. Fromm said.

Mercedes, which has pushed its marketing through a variety of online efforts, including a Facebook page, has been sponsoring golf with varying levels of commitment for decades. The German professional Bernhard Langer remembers being chided for arriving in a Jaguar at the Masters in Augusta, Ga., in 1985 — which he won.

“I drove up in a Jag and somebody said, ‘You’re German and driving a British car!’ “ Mr. Langer recalled in a telephone interview. Mercedes heard about Mr. Langer’s preference in cars and offered him a sponsorship, which continues to this day.

“Mercedes has a great reputation, the kind of reputation I would like to have as a golfer,” Mr. Langer said. “Standing for precision and hard work and all that stuff.”

In 2008, Mr. Fromm of Mercedes said, the company decided to concentrate its international sports marketing on golf. (Mercedes continues to sponsor tennis and other sports like soccer at the national and local levels.)

“We decided to do it right,” Mr. Fromm said. “The idea was to have the best tournaments under contract.”

Mercedes wants to close the circle by grabbing the United States Open, perhaps the most important tournament of all. “It’s a long-term engagement,” Mr. Fromm said. “We would like to be part of the golf family.”

Read more: http://www.nytimes.com/2011/07/14/business/media/for-luxury-automakers-a-new-marketing-frontier-golf.html?_r=1&ref=business


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