- Publish Date
- Monday, 15 June 2020, 9:13AM
New Zealand Rugby wants to sell the All Blacks jersey to an overseas investor in a groundbreaking, yet likely contentious, deal that could earn the cash-strapped organisation more than $300 million.
As part of the Business of Rugby series, the Herald can today reveal that NZR is trying to sell its entire portfolio of jersey sponsorship rights — the All Blacks, Black Ferns, Sevens, Māori and under-20 team — to a single investor, possibly a major US or Japanese advertising agency.
The agency would then on-sell the rights to specific companies that want to put their name on the team's jerseys.
Over the past few years, sponsorship income has been one of NZ Rugby's biggest sources of revenue after broadcast rights, but the Covid-19 pandemic has severely impacted the organisation with a decline in revenue of $120m expected for the current financial year.
NZR recently announced a $7.5m loss for 2019 and it is expected that nearly 50 per cent of its 180 fulltime jobs are set to be lost.
Current jersey sponsor AIG — which has naming rights to all the national teams — is not renewing its deal, which expires in 2021, leaving NZR desperate for a new deal.
The historic deal struck with AIG in 2016 is believed to be worth $120m over five years, but the Herald understands NZR is looking for significantly more for its next naming rights deal — and has priced a five-year deal to one investor at $300m over five years, a figure that trumps the entire total income of all sponsorships from 2016 to 2019.
NZR chief commercial officer Richard Thomas says a proposal is ready to take to market.
"Our view is that we need to be flexible about what the audience and potential buyers are looking for."
The decision in 2012 to brand all the national teams — Sevens, Juniors and NZ Māori — as All Blacks has not been universally popular with fans, but from a commercial perspective, it has created a larger and more valuable inventory to sell to sponsors.
NZR has also built playing schedules for the various "All Blacks" teams in different geographic territories in the last few years — particularly trying to gain recognition in the United States, Canada, South America and Japan.
The strength of the All Blacks' brand over the years will also mean NZR will be less reliant on broadcast rights, which have become less predictable, especially in the streaming age.
Between 2016 and 2019, broadcast income averaged 35 per cent of NZR's total income, but for the first time it wasn't the biggest source of revenue for the national body.
Broadcast contracts are not linear — they fluctuate depending on the volume of content — and with the All Blacks only playing three home tests last year, viewing rights income was $57.4m while sponsorship and licensing revenue was $72.9m.
In the same four-year period, sponsorship income totalled $258m, with $308m from broadcast rights.
This article was first published on nzherald.co.nz and is republished here with permission