Herald rugby writer Gregor Paul’s new book Black Gold charts the evolution of the professional game and how the All Blacks became rugby’s most marketable asset. It also explores the pressure that making money puts on the players and their performance.
In this extract, Paul details the background to the first big commercial deal of the professional era - and reveals just how close Nike came to beating Adidas to own the famous black jersey. Legendary adman Kevin Roberts was in charge of leading the hunt for the All Blacks’ new apparel partner, and Nike invited him to the US in early 1997.
Kevin Roberts was never in any danger of being branded as a typical executive. He had many conventional qualities – he was smart, erudite, ambitious and ruthless – but he also had a pronounced flair for the dramatic, a love of big gestures and a savant-like ability to see into the future. At Pepsi, he had once machinegunned a Coca-Cola vending machine. He’d also held a senior management meeting with Lion Nathan staff at Auckland Zoo, famously throwing a box of a rival brewer’s product – Foster’s Lager – into the lions’ enclosure. He joked afterwards that the lions had eaten the box but wouldn’t touch the beer.
While this deep love of the theatrical jarred a little with rugby’s typically staid conservatism, it was in fact precisely what NZR needed if it was to successfully reposition the All Blacks for the professional era.
When the game of rugby union, for all its long history committed to the amateur ethos, turned professional in 1995, the Southern Hemisphere nations had shot out of the blocks, securing an enormous broadcast deal and restructuring their competitions in lightning fashion. The Northern Hemisphere unions had initially been slow to grasp that the movement to professionalism was real and happening. But they were no longer asleep behind the wheel. With vastly bigger populations and infinitely greater corporate horsepower, the UK and France had potential financial clout way beyond New Zealand. In the professional game, money was going to talk: it would buy and retain players and coaches, support high-performance advancement and develop a strong grassroots rugby community.
Says Roberts: “Unless we got ourselves sorted out, we were going to be f**ked, because we couldn’t cope with the big money elsewhere. We were making $3 million a year from Canterbury. That is all we made. Three million Kiwi. F**k me. The world was going to go to England and France and the big TV markets. Whoever had the big TV markets would command the biggest audiences and the big fees, and they both had 50 million people and we only had three. We had to win the world from the edge, is how I put it to our board, otherwise all our players would go to [rugby] league or offshore, and we would be f**ked.”
There was a big Nike team waiting to hear what Roberts had to say when he arrived in Portland, Oregon. The group included Nike’s founder and chief executive Phil Knight, general manager Mark Parker (who would later become chief executive) and Chris Van Dyk, son of the legendary Dick and the brand director for Nike’s Asia-Pacific operations.
“Here’s what I said to these guys,” says Roberts. “After soccer, rugby is the next international sport globally. We are played in 104 markets, we are going to boom in female participation. And we are going to boom across a whole range of countries. Forget rugby league, because it was the f**king northwest of England and Australia. That’s it. Forget it. And it was a moronic game – run, run, run, kick. This is going to be the next game.
“Why are we going to grow this game? Because no matter what shape you are, you can play. You can play it with or without contact. You don’t have bats, helmets or pads … you just need a bit of space and you can run. At that time, the rules were easy enough to understand. It’s good for TV … 80 minutes … in, out and shake it all about.
“I’m also telling all these guys that it is cheap as chips to get in. I know a lot about marketing and advertising, and advertisers would kill to talk to affluent young males – but they can’t, because they don’t watch shit on telly. But they will watch rugby on TV, and advertisers are going to pour money into this.”
Roberts, passionate and compelling, wasn’t telling Nike’s executive team anything they didn’t already know. He was merely confirming what they had worked out for themselves: that rugby was a growth sport with untapped potential. But now his innate sense of theatre and natural timing paid off.
“And there is only going to be one winner in this,” Roberts announced. He left a suitably dramatic pause – enough time for him to stare across the table and confirm that he had Knight’s full attention – and delivered his killer line: “Whoever controls the All Blacks controls the game.”
Knight, warming to Roberts, asked why.
“Because they are f***ing Brazil,” Roberts replied. “They are to rugby what Brazil are to football. We have tradition, heritage, iconography … all in black. Are you kidding me? This is to die for. Sex, drugs and rock’n’roll. Heroes, athletes. Everybody wants to be an All Black. The best job in New Zealand is to coach the All Blacks. The highest-profile guy is the captain. Compared with Brazil and Real Madrid, this is going to be unbelievable value. If you get the All Blacks, you f***ing win.”
The idea of being the dominant player in global rugby had massive appeal, and the Nike team could see how a partnership with the All Blacks would set it up to fulfil that ambition. They told Roberts they wanted time to digest his presentation.
Two days later he was back at Nike headquarters. He’d talked to [NZ Rugby CEO David] Moffett and [NZ Rugby chairman Rob] Fisher after the first meeting and told them he thought they should be aiming for a three- to five-year deal worth about US$40m ($62m). Roberts wasn’t sure if he would be able to negotiate a figure that high, but he’d researched what the likes of Manchester United and Arsenal were getting, and the sort of money that was swirling around track and field, and that was the ballpark.
“I rock up in Portland,” he relates, “and when I got there, across the entire building was this huge vinyl sign: ‘Welcome Kevin Roberts and the All Blacks’. I give them the number and they are pissing around, like they do. After about two hours I am really bored of it, and say, ‘It’s simple – it is not going to work if you look at it like a sponsorship. You have to look at it as a total package. You are going to have the All Blacks’.
“I ask them about the deal they have done with Brazil, and they say they have to play 14 games in this kind of pro circus. I say, ‘We will do that. We are going to do a Sanzar [South African, New Zealand and Australian] tournament. Then we are going to be doing a northern tour, and apart from that we will play anyone you f***ing like. You can have this big swoosh on the jersey and we will play wherever you f***ing want. If you want us in LA, we will be there. If you want us to play in China, we will play, and we will do big dinners, everything you want’.
“I agree to five games, and then we got to a number on the cash. They say great. They will talk to their lawyers and I will go to my board to approve it. They say, ‘We will be in Hong Kong next week, and we want you to present this deal to our operating board. We will do three hours with head of promotions, shoes, rugby … they will all be there, and they will ask everything about it’.”
Roberts, who knew how big corporates worked, was almost certain he’d be closing the deal in Hong Kong.
THE NUMBER Roberts and Nike had settled on was US$75m ($116m) over five years. It had risen that high because the scope of the deal had changed. Nike had realised how compelling the All Blacks’ brand story was, and how it could be leveraged globally – and in the US in particular. If Nike could secure the All Blacks, and possibly the likes of England and South Africa too, it could build what some would cruelly describe as a global rugby circus. This new world order would include sanctioned rugby properties such as the Tri-Nations, the Six Nations and the World Cup, and the unofficial Nike element sitting alongside: exhibition games all over the world, and perhaps even novelty ideas such as the All Blacks playing the Dallas Cowboys in a hybrid version of rugby and American football.
Something else, too, had changed by mid-March 1997: Roberts had stood down from Lion Nathan and had set up his own consultancy business. He was also on the shortlist to become worldwide chief executive of the advertising firm Saatchi & Saatchi. And it was to Saatchi & Saatchi he turned once he was back in New Zealand after his successful meeting in Oregon.
Roberts confided in James Hall, the head of Saatchi’s Wellington office, that he was both in line for the global job and on the cusp of securing Nike as the All Blacks’ new jersey sponsor. He wanted help with the presentation he would make to the Nike operating board in Hong Kong. And so Hall set Roberts up with his best creative, John Foley.
“Kevin told me he had a big meeting with Nike in Hong Kong, and could I help him with the presentation,” says Foley. “He said, ‘I want a big hype video and a strategic plan for Nike to own rugby via the All Blacks’. He wanted to get their attention and sell them this five-year plan about becoming the biggest name in the sport. I made this video for a Nike audience, [who] I assumed were largely American and knew bugger-all about rugby. I made it quite aggressive, lots of big hits, and I made it to an epic opera song and wrote this five-year plan: ‘Here’s how you become the biggest brand in rugby …’. I go back to Kevin’s house a few days later with the video, with the presentation, and Kevin is like, ‘F***, I am taking John with me to Hong Kong’.”
The meet was in a suite at the top of a five-star hotel overlooking the harbour. When Roberts and his team got there, an army of Nike executives was waiting.
“I wanted some X-factor,” says Roberts. “I make this presentation, and I show all this All Blacks footage and it’s f***ing stirring. The Americans don’t really know what’s going on, but they are amazed there are no helmets or pads and how physical it is. For a bit of a laugh, I showed some footage of the NFL after the rugby stuff, and I can, in retrospect, see that it was quite provocative.”
Roberts had brought with him All Black legend John Kirwan, who was the first employee of Roberts’ Red Rose Consulting. And Nike, he relates, had brought their own former champion, a Detroit Lions linebacker, who did not enjoy Roberts’ video.
“He got the right s***s,” Roberts recalls, “and he is huge. He can barely fit under the table, and he starts laying into me verbally, and then he starts getting up. I am engorged now in All Black mythology. I am so deep into the brand, the history, the legacy, the story that I believe every single thing about this, and he came to me, and he was going to f***ing belt me and I was going to be sent reeling. Then JK stands up, and he stood up big. People might think JK is a p***y, but he’s not, because he’s right in front of this guy. Nobody moved. Everyone else is s****ing themselves, and then very slowly they calmed down and the tension dripped away.”
Foley sat transfixed by the proceedings, and by Roberts’ incredible ability to generate passion and drama. It may have looked like spontaneous theatre, but Foley believes it was a well-calculated ploy by Roberts who, he says, knew precisely what he was doing.
“After this guy had gone nuts, Kevin said, ‘Are you finished?’ And it was a brilliant way of saying, ‘You have asked us to give this presentation, and if you don’t want to hear it, maybe go down the back of the room and make yourself a cup of tea’. He asked if anyone was interested in hearing the rest of the presentation, and all of a sudden they were laughing at their own guy for overreacting.”
At the end of the meeting, Nike signed a letter of intent to sponsor the All Blacks. It was effectively a done deal, but for the respective boards’ approval. It was also agreed in Hong Kong that Saatchi & Saatchi in Wellington would be Nike’s agency for the All Blacks and rugby in general. With the deal all but signed, Foley and his team were asked to generate a creative campaign, and were invited to present it in Oregon later in the year.
“Given that Nike was such an irreverent, in-your-face brand, I thought from the get-go that I don’t know how that sits with the All Blacks’ values,” says Foley. “If they get too much control over this, they will start to portray the All Blacks in an aggressive, irreverent kind of Nike way, and they are not a good fit. Our whole presentation to Nike was to pull them back. ‘This is what is at the heart of rugby – camaraderie and humility – and here is how you would align with the All Blacks.’ We had all this creative ready to go, all these flights booked, and then Kevin calls out of nowhere and says, ‘Hey, the trip to Portland is off – we are going with Adidas and the deal will be announced next week’.”
Footnote: The Adidas deal was $US100m ($156m) for five years.
Black Gold, published by HarperCollins. RRP $39.99
