Top companies back a winner

22:47, Jul 29 2012

The Melbourne Cup is fewer than 100 days away and already companies from around the world have flooded race organisers with sponsorship and hospitality deals that will push revenues in this year's spring racing carnival 20 per cent above those before the global financial crisis.

The Victoria Racing Club, which runs the race that stops a nation and helps generate more than A$750 million (NZ$970m) in economic activity, is experiencing strong demand for tents and marquees in the highly fashionable Birdcage, led by James Packer and his Crown Casino, which will celebrate the carnival trackside for the first time this year.

Close on the heels of the Crown deal, BusinessDay can also reveal the VRC has recently inked a string of new and highly lucrative sponsorship deals, including French champagne house G. H. Mumm, which has re-signed as official champagne sponsor for the next five years. The company replaced Moet & Chandon as the official bubbly of the Cup two years ago.

"The successful three-year partnership between G. H. Mumm and the Melbourne Cup Carnival has contributed to the brand becoming the fastest-growing champagne in Australia in the last financial year, and also the fastest-growing market for G. H. Mumm worldwide,'' said Julien Hemard, managing director of Pernod Ricard Australia.

Close to 100,000 bottles of champagne are consumed during the Cup carnival each year.

BusinessDay has also learnt that Lion, Australia's biggest brewer, which owns Tooheys, James Boag and distributes Corona, has exercised its option, taking it through to next year's Melbourne Cup.

The former wine arm of Foster's, Treasury Wine Estates, will continue its sponsorship through to 2015 via its sparkling wine Yellowglen; vitamins group Swisse has confirmed a further three-year partnership through to 2014; and

National Australia Bank has signed a further two-year deal.

Corporate sponsorships of the spring racing carnival, taking in hospitality, tents, marquees and race sponsorships, can deliver immediate attention and hype around a brand, providing businesses with instant recognition among consumers.

''We intend to use the momentum created by the brand in the past few years to continue to build brand awareness in Australia,'' Mr Hemard said.

''In just two years, G. H. Mumm has climbed to being the third-highest champagne in value in Australia from the eighth position, a very impressive result.''

The company's champagne sales are up 123 per cent over the past year.

Despite the uncertainty created by the global financial crisis and pessimistic domestic economic news around consumer sentiment and spending, the Melbourne Cup has continued to rake in the cash from companies via sponsorships and trackside hospitality, and this year's event could be the biggest in years.

According to VRC documents, sponsorship revenue is up 19.4 per cent on pre-GFC levels, with corporate hospitality revenue up 32 per cent on 2009.

Within the famous Birdcage, where high-flyers, the corporate elite, company directors, celebrities and hangers-on float around from marquee to marquee, there will be 18 new corporate private marquee clients for the 2012 carnival, including Crown Casino.

Michelle Terry, managing director at Lindeman's, a business unit of Treasury Wine Estates, and whose portfolio includes Yellowglen, said it had signed an ongoing deal with the VRC that would cover sponsorship, signage and activities around the track during the carnival.

''I think Yellowglen is an incredibly good fit with the Melbourne Cup - it's been Australia's premier house of sparkling for over 40 years and it's about togetherness and the celebration of joy,'' Ms Terry said.

''Certainly, around November is strong sales for us in sparkling, as is December, and [sales] are certainly correlated [to racing advertising].''