IT IS an indication of the mixed fortunes of the financial sector that as one company pulls the plug on big sponsorship deals, another is about to embark on one of its most ambitious.
A need to cut costs but also distance itself from conspicuous boardroom indulgences has forced Royal Bank of Scotland to halve its £200m sports sponsorship budget, which will mean ending its support for the Williams Formula One racing team and possib
ly its backing for tennis star Andy Murray.
But its near-neighbour in the west of Edinburgh, the life insurer Aegon, is heading in the other direction. The Dutch-owned company has been developing a long-term marketing campaign around sports sponsorships and most pointedly as a means to finally nail an ongoing identity crisis.
It may be one of the biggest companies in its sector, yet it does not figure highly among the best-known brands. Ownership of Scottish Equitable since 1994 brought it into the UK but it has agonised over its identity ever since.
Eighteen months ago the board hired Steve Clode as director of marketing from Nationwide Building Society, where he had been involved in its Proud to be Different campaign and the sponsorship of the English football league and England national football team.
Clode was tasked with putting Aegon on the front foot and getting the name known to a wider audience. When the rights to sponsor British tennis became available, he seized the opportunity to try something new and his first big campaign begins next weekend. Fans attending the Davis Cup matches between Great Britain and Ukraine at the Braehead Arena, near Glasgow, will see Aegon's branding on tracksuits and around the arena, together with a range of quirky advertising material and crowd giveaways created for the event by the Leith Agency, which was hired by the company last September.
Aegon is investing £25m in a five-year campaign with the Lawn Tennis Association (LTA) that will include sponsorship of the Queen's Club tournament, which has been synonymous with Stella Artois for 30 years. From June it becomes the Aegon Championships.
Clode is hoping for some instant hits after recent research revealed the extent of the identity problem.
While brand awareness is strong with financial advisers due to the group's distribution strategy, it is much lower with consumers. A 2007 study found that spontaneous awareness was almost nil and prompted awareness was just 10%.
Aegon is already running a tracking study to monitor awareness of the partnership with a specialist agency, Havas Sports Insight. The first wave was carried out in the last week of January when a general sample of consumers showed very little awareness of the new tennis partnership. But with a group that had expressed an interest in tennis, 5% confirmed they were aware of Aegon as a sponsor and 5% were also aware that Aegon is lead partner of British Tennis.
Given the main marketing campaign has yet to kick off, this was seen as a good sign. Clode and his team will be expecting a significant change by the end of June, after the Aegon Championships have taken place.
Bagging the rights to such a top-level event is a spectacular coup for Clode and the company, but the sponsorship package goes deeper than big tournaments. A crucial element in the deal is a major community and schools project designed to make tennis more accessible through greater access to courts in public parks and bringing tennis equipment into schools. It will, of course, carry the Aegon brand.
Aegon says this community aspect is vital to the deal, but it is not just about doing good for the community and grassroots tennis. Nor is the brand-building the only positive that the company hopes to gain from the deal. It is also important in helping a battered financial services sector win back people's trust.
"It is moving from brand exposure to something broader," says Clode. "Because of the financial crisis it takes on a wider importance."
Clode was brought in by the company's UK boss Otto Thoresen, who wanted some external input into improving brand recognition. It had already been decided that Scottish Equitable would be used to sell certain products, but Aegon had to be the pre-eminent brand. A deal to sponsor Ajax Amsterdam football club by the Dutch parent would give the name a lift and would appear on shirts whenever the team played in Britain.
But more was needed. "Some people still don't even know how to pronounce it," says Clode. "It is Ay-gon, not E-gon or even E-jon."
The correct pronunciation will be made clear in guidance notes issued to the BBC commentary team for the major tournaments. "Queen's gets about 25 hours of terrestrial television coverage, which will really get the name across," says Clode, who examined a number of potential opportunities before pursuing the LTA, which had never previously had a lead sponsor across a range of activities and events. Before this deal, British tennis had 40 sponsors, which merely diluted the impact for all parties.
It is a lucrative package for the LTA at a time when other sports, including horse racing, Formula One and football, are losing sponsors, but Clode rejects suggestions that Aegon may have overpaid when it signed the deal last summer, before the recession took hold.
"We have got a fair deal. The LTA are great people to deal with and I can tell you that is not always the case. It can be very difficult with the partners wanting to tear each other's throats out."
He was particularly delighted to get the rights to the Queen's tournament, the first time it had come up in a generation, and with the bonus of terrestrial television coverage.
"In some ways the timing presents us with an opportunity," says Clode. "While others are pulling back, we are saying that this is a big business and more people should be aware of us. At the end of the five-year period we want Aegon to be a household name.
"In some ways we are the biggest financial services company that no one has heard of. We have to fix that. We won't do it in year one, but we can get there eventually.
"I am absolutely confident we will look back on this as the best thing we have ever done."
