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  • Jul 23, 2014
  • Updated: 5:09pm
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PUBLISHED : Sunday, 09 September, 2012, 12:00am
UPDATED : Sunday, 09 September, 2012, 1:44pm

HK Open's sponsor struggle shows mainland is where it's at for blue-chip backers

Golf tournament's struggle to find a blue-chip backer shows that mainland is now where it's at for luxury brands

BIO

Alvin Sallay, a Sunday columnist with the paper for more than 10 years, has been reporting on the Hong Kong sports scene for the last 25 years. Through his columns he has covered four Olympic Games and one soccer World Cup. A long-time Asian expert, he has also been to seven consecutive Asian Games.
 

London's Soho Square was buzzing last month during the Olympics, especially Omega House which had a themed party almost every night.

One invitation couldn't be resisted - a Bollywood night of dance and frolic. Hoping to bump into actor Abhishek Bachchan and his beautiful wife and actress Aishwarya Rai, I instead had to settle for Stephen Urquhart, the president of Omega. There's no time like the present so I immediately asked him why Omega had not signed up as title sponsors for this year's Hong Kong Open. For months, it had been rumoured the Swiss giant was on the verge of coming back - it had been sponsor from 2000 to 2004 - and then it had got cold feet.

His answer was disturbing. He said Omega had decided to withdraw its offer from the table. It seemed their marketing strategy had changed in a twinkling and they, like so many other big corporates, were looking at the mainland.

So is one of Asia's most venerable tournaments, the Hong Kong Open, losing its lustre? The city's oldest professional sporting event, which in November celebrates its 54th anniversary, seems to have lost the ability to attract blue-chip backers.

Omega's change of heart suggests this might well be the case. But you cannot blame them. Big business is always on the lookout for the best way to enhance its image and product. In the past, Hong Kong might have been one of the best places in Asia to tout luxury brands but with the mainland's growing economic power, our city is second best.

The Hong Kong Open is a co-sanctioned tournament between the Asian Tour and the European Tour. The latter calls most of the shots, especially when it comes to securing title sponsorship. It seems they have failed this time which makes one wonder if our tournament and the Asian Tour are getting the best out of this deal.

Like big corporations, the European Tour is also casting covetous eyes to the mainland. Just look at next month's BMW Masters at Shanghai's Lake Malaren Golf Club. This tournament was created by private enterprise and appeared out of the blue last year. It wasn't sanctioned by any major tour - the Asian Tour is persona non grata with mainland golf authorities - but due to a huge purse, US$5 million, the world's top players arrived with their wheelbarrows. Rory McIlroy won the event and took home a massive purse of US$2 million.

McIlroy, having added the PGA Championship to the 2011 US Open, will be returning to defend his crown in Shanghai late next month. There is extra cachet in the event now with ranking points up for grabs due to the European Tour jumping on board, and oh, of course prize money being increased to a whopping US$7 million, making it one of the richest tournaments in the world.

There was no need to twist the arm of German marque BMW. Last year the company sold 217,068 cars on the mainland, an increase of 37.7 per cent, while its Mini range sold 15,518 units. Its sales in the other parts of the Greater China region - Hong Kong, Macau and Taiwan - last year were around 20,000. No prizes for guessing the more crucial market.

Urquhart hinted at this being part of the reason why Hong Kong isn't as attractive as it was thought to be. Omega, too, is willing to spend big bucks but its return on investment must be of equal stature. If BMW can sell more cars in China than in Hong Kong, you don't have to be a rocket scientist to do the equation that Omega could sell more watches on the mainland than in the smaller local marketplace.

This is the reality we have to come to grips with. It won't help the Hong Kong Open which has gone back to UBS. The bank has been a good friend to the tournament. helping grow the event over the past seven years and raising prize money from US$750,000 in 2004 to US$2.75 million.

But what this protracted delay to land a new title sponsor will do is give the upper hand to UBS which is likely to drive a bargain-basement deal. Tournament organisers have been forced to go cap in hand to the government again and hope for an injection from the Mega Events Fund, which last year handed over HK$8 million. In these hard times, it is up to the government to step up to the tee with renewed gusto. It should identify those sporting events which can help raise the city's profile and give them all the assistance they need. Hong Kong sport needs this backing badly.

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