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S’pore Airlines extends F1 deal

SINGAPORE — Ahead of the eighth edition of Formula 1’s first night race, Singapore Airlines (SIA) announced yesterday (Aug 20) that it will extend its title sponsorship of the Singapore Grand Prix for two years until 2017.

SIA’s contract extension with the Singapore Grand Prix came as no surprise to industry watchers, since both are global brands and the event presents business opportunities 
that both parties can exploit for mutual benefit. TODAY file photo

SIA’s contract extension with the Singapore Grand Prix came as no surprise to industry watchers, since both are global brands and the event presents business opportunities
that both parties can exploit for mutual benefit. TODAY file photo

SINGAPORE — Ahead of the eighth edition of Formula 1’s first night race, Singapore Airlines (SIA) announced yesterday (Aug 20) that it will extend its title sponsorship of the Singapore Grand Prix for two years until 2017.

While the airline did not reveal the value of the contract, previous media reports said that Singtel, sponsor of the race from 2008 to 2013, had paid an estimated sum of between S$10 million and S$15 million a year for the title rights.

In a statement yesterday, SIA chief executive officer Goh Choon Phong said the street race here is “one of the most exciting races in the F1 calendar”. “We look forward to further showcasing the race to the world, and helping to strengthen Singapore’s image as a world-class tourism, cultural and sporting event city.”

The airline’s current two-year ­contract expires after next month’s race at the Marina Bay circuit from Sept 18 to 20. Industry watchers told TODAY the extension was not unexpected and it made sense for SIA to be associated with a high-profile, sell-out motor-racing event with a huge international following.

Both are also global brands and, with the presence of many of the world’s leading industry captains attending the night race, it presents business opportunities they can ­exploit for their mutual benefit.

“From a philosophical standpoint, it’s a good move (by SIA), as generally speaking, the returns from sponsorship escalate over the long term, and to pull out now would do themselves out of potential future return on ­investment,” said Ben Heyhoe Flint, chief executive of Asia Sponsorship News. “Very few brands can afford F1’s price tag. And, being realistic, it has to be a home-grown brand that takes on the title sponsorship in Singapore. So the long-list of replacement candidates when Singtel pulled out was instantly a very short-list of only, probably, half a dozen brands. But conceptually it works for SIA.”

Lars Voedisch, principal consultant and managing director of PRrecious Communications, added the partnership between SIA and the Singapore Grand Prix has business synergies. “They are a natural fit for each other,” he said. “They have a global reach and share the target audience in the middle to upper segments of the market, and there are clear opportunities for sales activation in the sponsorship.

“Apart from sales activation, it’s an exciting environment for Singapore Airlines to amplify their brand across their target markets.”

Flint added that SIA also needed to regain its sparkle over ­increased competition, some of whom, such as Emirates and Etihad, are already involved in Formula 1.

“F1 adds some pizzazz to the brand. I am sure SIA saw the potential and are now exercising that option to generate incremental ­revenues through fly and ticket promotions, like Cathay Pacific is doing in rugby with the Hong Kong Sevens,” said Flint.

“Notwithstanding these benefits, SIA is enjoying global brand exposure from the international content platforms that F1 brings to the table. All these factors undoubtedly contributed to their renewal.”

Welcoming SIA’s decision to continue its run, Formula 1 boss Bernie Ecclestone said the airline’s “brand fits with our other global partners and Formula 1”. Added Singapore GP chairman Teo Hock Seng: “It has been a great partnership with this iconic brand and we are delighted to have Singapore Airlines extend for another two years. We look forward to jointly promoting Singapore at its very best to a global audience.”

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