What’s your name and position within the organisation?
Marcus Wight, Chief Executive of PHAR Partnerships
Can you tell us a little bit about PHAR Partnerships?
I set up PHAR with three colleagues in 2011. We are now a company of 120 people with offices in London and SouthEast Asia.
We specialise in delivering ancillary revenues for owners of transport, infrastructure and leisure properties, through creating and selling sponsorship packages.
Our work covers both public and private sectors, mass public transport systems, airlines, airports, multi-billion dollar property developments and major tourist attractions. Some examples of our clients in UK include: London Olympia; Manchester Airport; Transport for London; Transport for Greater Manchester; Transport for West Midlands. Across the globe our projects range from a new urban “Skytrain” system in Ghana, to a new airport terminal in Panama, to the metro system in Manila, to Changi Airport in Singapore and a new world-class sport and entertainment destination being built in Singapore.
We provide a full range of services, from assessing the potential size of the sponsorship opportunity, to designing a sponsorship strategy and creating sponsorship packages, through to selling and negotiating deals with brands.
A key part of our work is our industry-leading expertise in sponsorship research and evaluation – ensuring we can provide our clients with an objective and evidence-based assessment of the income potential, and can support the sales and negotiation process with robust statistics and analysis.
Having grown rapidly over the past decade, we are planning the next phase of our development to include an expansion of our footprint into European markets. Whilst Coronavirus clearly causes a hiatus to this expansion we expect and intend to resume our plans once the current situation has passed as more than ever our rights holder clients need new revenue streams and we know what major brands like Coca-Cola, Yamaha, Uber, HSBC, Shiseido, Intel, Sixt, Tissot, Oppo and Vodafone are wanting from such partnerships wherever they are in the world.
That’s an unusual part of the sponsorship industry. How did you decide to focus on that particular sector?
Having worked in the sponsorship industry for 20 years, we had identified that there was massive untapped potential for sponsorship to create new revenues for transport, infrastructure and leisure properties.
Increasingly, established brands were coming out of ‘traditional’ activities such as sponsoring sports teams and competitions. Whilst these are great for creating exposure for the brand logo in the media, what brands were increasingly looking to do was to engage more meaningfully with audiences – to showcase their products in a real-life environment, to add value to people’s experiences, and to be seen to be making a positive contribution to society.
At the same time, owners of transport, infrastructure and leisure properties were increasingly looking at ways to generate non-core revenues, to help fill funding gaps or to help enable the delivery of enhancements to the visitor/user experience.
We realised that transport, infrastructure and leisure properties deliver many of the attributes that brands are increasingly looking for – large volumes of people, attractive audience profiles, long dwell times, large quantities of physical space, multiple touchpoints and the ability to communicate over extended periods of time.
Having been asked to work on a few projects over the years – an airport, a zoo, a library, a leisure centre – we were confident there was a real opportunity here, to apply our knowledge of sponsorship to unlock the revenue potential inherent in transport, infrastructure and leisure properties.
And so we invested in building up a team of experts across a network of offices – and thankfully our instincts have proved right, and we have become the industry leaders in this particular specialist area.
How interested are brands in sponsorship opportunities of this type?
Brands are definitely becoming increasingly attracted to opportunities of this nature. We believe that even more so now that brands need to show that they are making a positive contribution to society.
We have had companies using national live media to announce their partnerships with the simple message that we know for our city to succeed that we need to reduce congestion and that is why we are sponsoring our local train station or bike hire scheme.
The other key element is the b2b side of the relationship that can be created in partnerships of this nature. With major infrastructure projects and property developments often costing hundreds of millions or even billions of dollars, our clients are often needing to spend significant sums on – to name just a few categories – items such as energy, TV screens, WiFi, cars, food and beverage. We look to bring in brands who can supply world-class products and services, whilst reducing the cost to the property owner by providing the brands with packages of marketing rights and benefits that are of value to their business.
As a result, whether it is through the opportunity to showcase their product in a real-life environment, or by delivering enhancements to the user experience, or by offering rewards to their customers, or by demonstrating their credentials as a positive corporate citizen – more and more brands are seeing that their objectives can be more powerfully delivered through partnerships with transport, infrastructure and leisure properties than through some of the more ‘traditional’ sponsorship opportunities.
This is obviously a very new and developing area. How do you work out what these kinds of opportunities are worth?
This is one of the hardest questions, and probably one of the reasons why this type of sponsorship has till now been less common than sports sponsorships. And so we have invested a lot of time and resource in developing tools and techniques to work out what transport, infrastructure and leisure sponsorships are worth as marketing opportunities.
How does anyone know what the ‘right’ price is to name a station, or to sponsor an airport terminal, or to be the official technology partner of a new visitor attraction? Each opportunity is a ‘one-off’, so how can anyone – whether the buyer or the seller – say what a brand should be paying for it? And how can the property owner be sure they’re not selling it too cheap, and leaving money on the table?
This is where the PHAR Insight department comes in. Our Insight team has specialized in sponsorship research and evaluation for over 20 years, working with some of the biggest names in the industry including The Premier League, Mercedes F1, Ryder Cup, Volvo Ocean Race, Women’s Tennis Association, Laureus World Sports Awards, O2, Allianz, Nokia and Zurich.
PHAR Insight has now applied the learnings and techniques built up over 20 years to create a range of proprietary analysis tools, to identify what any individual sponsorship opportunity is worth to a brand as a marketing investment – whether this is for naming rights to a metro station, sponsorship of the lounge areas at an airport, or sponsorship of the WiFi service on a city’s tram network.
The most sophisticated in the sponsorship industry as a whole, these analysis tools provide crucial evidence to enable us to identify what any of these ‘one-off’ opportunities is worth and, importantly, to provide brands with hard evidence and robust analysis to justify the pricing when negotiating the deal.
How do you see things developing over the next five years?
Coronavirus is obviously the big unknown factor at the moment, but I believe that once we are through the worst that we will see a significant movement towards more sponsorships of this nature.
On the supply side, public transport authorities, airports and airlines are going to need to find as many sources of revenues as they can to get their businesses back to where they were previously, and developers of new infrastructure projects and leisure destinations will continue to look for partnerships with brands – not just for the additional income they can provide but also the opportunity to work together with leading brands to create enhancements to the visitor experience.
And on the demand side, the trend away from one-dimensional logo exposure will accelerate as brands look to ensure their relevance to people’s lives, and to be seen to be making a positive contribution to society – whether through helping get public-facing services back on their feet, or through being seen as the solution to global issues such as climate change and social cohesion.
We have seen how sponsorship of transport, infrastructure and leisure properties have successfully delivered a powerful solution to many of the objectives that brands were increasingly looking to achieve before the pandemic hit – and will do so even more strongly once this is over and consumers’ expectations from brands have moved to a new and different level. I can only see sponsorships of this type becoming more relevant and more prevalent – and doing increasing good for our society and communities as a result.