The sponsorship attached to the All Blacks new kit is now worth $60 million. In part three of Inside the All Blacks Machine, Gregor Paul looks at the additional pressure this brings, their new obligations and if it will ultimately become a burden they can’t carry.
In 2021, New Zealand Rugby’s global search for new All Blacks kit sponsors came to an end when British petrochemical company Ineos and French construction services firm Altrad signed six-year agreements to put their names on rugby’s most iconic uniform.
It was an extraordinary piece of business, as it saw the value of sponsorship attached to the All Blacks kit almost double to $60m a year, surpassing all expectations and making it easily the most valuable apparel deal in world rugby.
But with great investment comes great obligation and Ineos and Altrad, who do most of their business in Europe, will be getting their pound of flesh from the All Blacks on this end of season tour.
Sponsors buy real estate to showcase their brand name, and also time with the players to leverage the association, and because Ineos and Altrad are European-based, they will be utilising the majority of their promotional hours across the three weeks.
The activity is highly regulated, controlled and managed through the player collective agreement which details how many hours a year they can work for NZR’s commercial partners, when it can happen and under what conditions.
But as regulated and managed as this activity supposedly is, the commercialisation of the All Blacks has become, according to those who understand the mechanics of the team, one of the greatest threats to performance.
Former All Blacks coach Steve Hansen says during his tenure commercial activity exponentially creeped into the high-performance domain, and pushing back against sponsors requests was something he had to exhaustively manage.
He feared that when he stood down, the need to generate money was going to be the undoing of the All Blacks as he felt the demands were starting to overwhelm the players and impact upon their ability to prepare as they wanted.
“You have high-performance on one side and commercialism on the other side. I think that is where most of the pressure came from because it became a real battle to get the balance right.
“And once the balance goes in favour of commercialism over high performance then it is interfering with how you can play. I think at times that got very close.
“People didn’t understand that what they were doing was demand more and more of the players, that they were looking to sell more and more of our IP to make a dollar and the risk of that is that the brand would be damaged if we got beaten.”
The picture has changed yet more dramatically post-2019.
Sponsorship and licensing has outstripped broadcasting as the biggest source of NZR revenue.
NZR’s annual report in 2016 shows $55m of income was generated through sponsorship and licensing, a figure that climbed to $72m last year and is expected to exceed $100m this year.
The All Blacks have 24 significant sponsorships, and this growth has presented three problems. The first is that the number of accumulated commercial hours the players must fulfil has risen.
And because there are now so many partners, managing them all, making sure they abide by the regulations when they have access to the players, has become harder.
This is the evolution of sponsorship — the sums invested have risen and so too have expectations.
Altrad’s investment at an estimated $28m a year is almost double what previous naming rights holder AIG paid in 2016.
Ineos is paying close to $10m a year to have its name on the back of the shorts and as this tour is the first time the All Blacks have been in the UK with these agreements in place, they are facing a heavy commercial workload.
NZR chief executive Mark Robinson says: “There is a range of different activities going on across those sponsorship groups – there is a number of events, functions, hospitality opportunities around games, content capture for partners.
“That is going on right throughout the tour and the London week, as it is a significant market, there is a lot happening. We will learn a lot from this tour, but we think we have the planning in place and the people in place to support our teams.”
Robinson acknowledges that commercial activity is a potential stress point for the team, but he’s confident that the picture Hansen painted of the All Blacks being overwhelmed by increasing and changing demands is not going to materialise.
“When you go into agreements like this both parties are very clear, about what we have agreed to,” Robinson says.
“They [partners] understand the obligations we have, and the All Blacks and their management understand those commitments also. Those dynamics and high levels of communication build trust and hopefully allow the players to rightly focus on performance and for the partners to benefit.”
The volume of activity, however, is not the real issue the All Blacks face on this tour.
The third problem with commercialising so aggressively is NZR has been prepared to strike partnerships with companies that don’t immediately appear to share similar brand values with the All Blacks.
NZR appears to have taken on Ineos and Altrad because they were the highest bidders, and while this lack of synergy and alignment probably wouldn’t have been a problem a few years ago, the All Blacks have arrived in the UK just as attitudes about sponsorship are hardening and advocacy groups, media and discerning fans are starting to question the choices major sports organisations have made in their quest for money.
The topic has erupted since Australia’s netball team refused to wear new kit that bore the name of Hancock Prospecting.
That led to the mining magnate pulling its $15m deal and questions being asked about the growing trend of so-called ‘green washing’ where companies with poor environmental reputations sponsor popular sports teams to win favourable PR and fan support.
Ineos has long been in the sights of Greenpeace and other environmentalist groups as it is regularly listed as one of the world’s worst ocean polluters.
It’s a multi-faceted company, but its core business is oil and gas extraction which has made Ineos owner Sir Jim Ratcliffe one of the richest men in Britain.
When the Herald revealed that NZR was close to signing off a deal with Ineos last year, Greenpeace began a petition to stop it.
“In the thick of the climate crisis, it’s gutting to see NZ Rugby sign a sponsorship deal with an oil and gas polluting conglomerate like Ineos that is responsible for driving us deeper into the climate crisis, and fouling the oceans with plastic pollution,” Greenpeace campaigner Juressa Lee said.
But NZR has justified its partnership on the basis that it says there is an emerging story of sustainability playing out at Ineos, one where it is trying to move into hydrogen production and other renewable, cleaner energies.
It was this conversion process that Robinson says drew NZR to the UK-based conglomerate.
“Ineos is one of the world’s leading science and engineering companies, we saw synergies between Ineos’ grit to take on some of the world’s biggest challenges and NZR.
“Following the Paris Climate Agreement of 2015, most nation states have set the goal to achieve net zero emission economy by 2050. We are aware Ineos has put in place the plans and actions needed to ensure that its business transitions to a net zero economy by 2050.”
Environmentalist groups say it’s these justifications that legitimise ‘green washing’ and Greenpeace, and others, have asked why, given the popularity of the All Blacks, NZR couldn’t have found a sponsor with no links to fossil fuels.
It’s the association with Altrad, however, that is potentially more troubling for the national body.
Next month, Mo Altrad, the eponymous owner of the French building services company, will be back in court, facing jail time if he’s found guilty of bribery and corruption charges.
Investigators arrested Altrad and former French coach and head of the French Rugby Federation Bernard Laporte in 2020, over the nature of an agreement they are alleged to have struck around the French national rugby team’s front of jersey naming rights.
According to the prosecution, a deal under which Laporte agreed to appear in Altrad group conferences and sold his image reproduction rights in return for 180,000 euros, was signed in February 2017.
But while that sum was paid to Laporte, prosecutors claim that he never provided the services he signed up for and later that year, Altrad won the rights to the French national jersey with a $60m offer.
NZR knew the likelihood of this case going to court when it signed with Altrad in 2021, and yet still forged ahead with the deal.
“We were made aware of the allegations in our discussions with Altrad prior to them becoming the front of jersey sponsor although at that time we understood no charges had been laid,” says Robinson.
“Altrad’s founding principles we recognised as relevant to our game and with the support of their international footprint, we will continue to build our global legacy in rugby.
“It is clear they are passionate about the sport and providing opportunities for connection, passion and development on a global scale.”
Both the Altrad and Ineos deals were ‘approved’ by the New Zealand Rugby Players’ Association, with chief executive Rob Nichol saying that his organisation was made fully aware of NZR’s intentions, and that there was no strong objection from his membership.
But it’s a watching brief now given the escalation of judicial events and Altrad could yet prove to be a cautionary tale to rethink how aggressively the All Blacks are being commercialised.
There’s $60m a year of sponsorship splashed on the All Blacks kit, but the deals with Ineos and Altrad may prove to have had significant hidden costs.
