JOCKEYING FOR POSITION

To an outsider, the world of horse-racing represents a number of stereotypical images: basking in money and champagne; genteel behaviour and dubious fashion; and grand days out.

The reality is quite different. Hostilities have broken out among the horse-racing fraternity. The issue that has upset the seemingly happy applecart is, not surprisingly, money. Or, to be more accurate, sponsorship.

The problem has been brewing for months, but it spilled over on January 6 when Richard Dunwoody rode the winning horse, One Man, at The King George VI Tripleprint Chase at Sandown Park. At the end of the race, Dunwoody was given a sash to wear as he entered the winner’s enclosure.

The sash, which carried no branding, was given to him by George Ward, well-known race sponsor and chairman of Grunwick Processing Laboratories, which includes Tripleprint and Bonusprint.

The problem was the sash obscured the logo of the horse owner’s sponsor on the silks of the jockey. This was compounded when the jockey was interviewed on TV. For the interview, he rolled down the collar on his silks, which also carried the horse owner’s sponsor name, to reveal a polo neck with Saab emblazoned across it. Saab provides Dunwoody with a car – and obviously polo-neck shirts.

Horse owners and their sponsors were in uproar. They railed against what they saw as a deliberate attempt on the part of the race sponsors – in this case Tripleprint – to sabotage their own, more recent, branding efforts.

Ward pleaded innocence. But leading horse owner Peter Savill told the Racing Post newspaper that Ward had told him last year he intended to put a sash over the winner of a big race to cover up the owner’s logo.

The man at the centre of the controversy is British Horseracing Board marketing director Lee Richardson, who has been in the job for two years. He and the BHB have been accused of bungling the introduction of horse-owner sponsorship. While Savill was publicly castigating race sponsors like Ward for “not wanting to share his sweets” he also accused Richardson of “gross incompetence”.

The road to horse owner sponsorship began in March 1993, with an agreement between the racing and breeding industries and Customs & Excise that meant horse owners could reclaim VAT on the purchase and running of their horses provided they “actively pursue” sponsorship opportunities in a business-like manner.

As a result of this agreement, the Sponsorship Framework for Racehorse Owners (SFRO) was set up by the BHB in June 1994. The framework created new sponsorship sites for both owners and race sponsors.

For owners, commercial branding sites were created on jockeys’ silks, attendants’ clothing and rugs. For race sponsors, additional branding sites were created on number cloths. This means race sponsors can now brand every horse in a sponsored race.

During the past year, a number of amendments to the framework have been introduced. Logo areas available to owners, particularly the chest area on silks, have been increased in size. Owner sponsors also have to register their sponsorship at least 28 days before a race, to minimise ambush sponsorship by a competitor.

After last month’s debacle, the BHB has also issued a statement aimed at racecourses “and other interested parties”, saying that: “The use of sashes by race sponsors which obscure owners’ logos is unacceptable. If self-regulation by racecourses is not effective, the BHB will legislate through the SFRO code of conduct.”

Clearly the BHB is not going to put up with what it sees as overbearing behaviour on the part of racecourse sponsors. But in a world where sports sponsorship is becoming increasingly competitive, big-time sponsors are not the kind of people to upset.

Horse-racing does very well out of sponsorship, and last year race sponsorship was worth about 9.7m to the racing industry. Its growth has slowed during the past few years (following the heady period between 1983 and 1988 when revenue more than doubled from 3m to 7.5m), but it is growing nevertheless.

Although only 18 months old, horse owner sponsorship is also starting to flourish and is now worth 2.9m.

But some racecourse sponsors are threatening to take their money elsewhere unless the problem of sponsorship clutter is resolved. One of the biggest racecourse sponsors, Grunwick’s Ward, who spends more than 600,000 a year on sponsorship, is also one of the most vocal opponents of the new system. His main complaint is that racing sponsors were not consulted by the BHB when it developed its horse owner sponsorship rules.

Race sponsors, in the form of the Horse Racing Sponsors Association, headed by Ward, were in fact consulted by the BHB – but only by the SFRO Review Group, set up in the middle of last year to assess the existing guidelines. Some sources say the Review Group held three meetings before the HRSA heard of the review, and suggested it might be part of it.

Richardson claims that when the SFRO was first established in June 1994, the HRSA did not really exist and was only kicked into life as a result of the controversy.

Whatever the details, Ward says: “A large number of sponsors are upset. They feel they pay the piper for someone else to call the tune.” More ominously he warns: “It does not matter to me if I pay out my money in racing or in another sport. I can sponsor wherever I feel like it.”

But although there has been a lot of noise about racecourse sponsors withdrawing their money, it hasn’t actually happened. Last year, debt collection company Madagans withdrew its sponsorship from the 2000 Guineas meeting at Newmarket, but there seems to be disagreement among the racing fraternity about whether this was solely because of the horse-owner sponsorship issue.

Sales and marketing manager at York Race Course, David Grouse, seems to think there is a middle ground that can be reached. He believes the racing industry is merely experiencing the normal teething problems associated with introducing multi-sponsorship.

He compares the situation to tennis 15 years ago when player sponsors were tackling the same issues. He says: “It shouldn’t be beyond the wit of all involved in the horse racing industry to allow the two groups of sponsors to exist happily alongside each other.”

People like Ward would like to negotiate exclusive sponsorship deals for races. He points to the fact that, after its review, the SFRO said it would allow “optional” exclusivity arrangements for the current sponsors of the Grand National (Martell) and the Derby (Vodafone).

Ward sees this move as an admission on the part of the BHB that hard and fast rules on sponsorship cannot be laid down.

Ward claims that he made a proposal to the BHB suggesting that if race sponsors had exclusivity at large meetings, they could give a percentage of the winnings to the horse owners. He says this was rejected “because the BHB did not think of it first”.

But a more tangible fear for people on both sides of the fence is that the uncertainty may prompt prospective race sponsors to hesitate or, at worst, put their money into another sport.

At the moment, however, potential sponsors seem undaunted. Horse-racing sponsorship statistics show that it offers good value for money. According to the BHB, nearly 5 million people go racing and the sport attracts an annual TV audience of more than 100 million viewers. In 1993, the BBC and Channel 4 devoted more than 300 hours to racing, more than any other sport except football.

Sponsorship deals also carry with them massive corporate entertainment facilities – probably the most alluring benefit for sponsors.

But somehow the issue needs to be resolved. Richardson at the BHB is adamant that no resolution is necessary and that the rules of sponsorship are now in place. “We have reached these conclusions and there will be some people who don’t like our decisions, but this is what we are sticking to,” he insists.

Apart from Ward, it is difficult finding a horse-racing sponsor to contribute to the debate. And despite his high-profile protestations, one has to question whether Ward himself would ever abandon the sport.

It seems to be in his blood. He owns a stud farm and has about 20 horses. He also has the reputation for making sure his views are heard, and no one is really able to imagine him getting so involved in any other field.