x Abu Dhabi, UAEFriday 28 July 2017

DP World chips in to keep Dubai in swing

DP World says that the Dubai World Championship brings an array of benefits to emirate as the company looks at renewing its involvement in the golf tournament.

Ross McGowan hits his tee shot off the first hole tee during the third round of the Dubai World Championship which DP World is looking to sponsor again. (Photo by Jeff Topping/The National)
Ross McGowan hits his tee shot off the first hole tee during the third round of the Dubai World Championship which DP World is looking to sponsor again. (Photo by Jeff Topping/The National)

There are few immediately obvious parallels between golf and container terminal operations.

Luxury watches, expensive cars, and banks are the sponsors one more readily associates with the sport.

But DP World, the global ports operator based in Dubai, is going into the third year of its association with the Dubai World Championship, as the main sponsor of one of the richest tournaments in the world. DP World is also in discussions to extend the agreement, which expires this year.

"Sponsoring events of such magnitude and prestige is always a carefully-weighed decision," said Mohammed Sharaf, the chief executive of DP World.

The reasons for sponsorship concern the company as well as the emirate, he said.

"It reinforces [Dubai's] position as an international sport and golfing destination," Mr Sharaf said. It also gives the ports operator, which has 60 marine terminals across the world from Peru to London, "a year-round branding opportunity", he adds.

"Contrary to popular belief, corporate boardroom decisions or huge business deals are seldom, if at all, struck between the 9th and the 18th hole.

"Having said that, golf's immense popularity in the corporate world stems from its innate ability to create networking opportunities and community relationships that go beyond business."

A total of US$15 million (Dh55m) is up for grabs at the finale of the Race to Dubai, which starts on Thursday. The competition involves the 60 top golfers on the European Tour competing for $7.5m in tournament prize money and a $7.5m bonus pool distributed among the top 15 players.

The Middle East offers the highest average purse per golf event in the world, according to data from KPMG, with the average prize money at professional golf tours in the region estimated at €2.15m (Dh10.5m). This compares to €1.14m in the US and €450,000 in Europe. The limited number of lucrative golfing events in the region partly explains why purses are so high.

The pay-off for sponsors often comes in brand value, important for names such as Rolex and BMW, which also sponsor the Dubai Golf Championship.

But for DP World, which has no consumer exposure, it is more about reinforcing "Brand Dubai" as a sporting destination.

"[The tournament] showcases Dubai in a very positive manner," said Colin Smith, the director of international development in the Middle East and Asia for the PGA European Tour. "The audiences are huge. Golf is a very befitting sport. The world's media arrives in Dubai. We have tourists coming in. We have the local population, which is made up of all stratas and nationalities, they come and watch it. There's a large knock-on effect. Obviously the major effect is the worldwide audience focusing their attention through 20 hours of live coverage of Dubai. DP World is not a consumer brand, so they're very keen to showcase Dubai."

The European Tour reaches about 500 million households through television each week, with the tournament promoting Dubai throughout.

The four-day event, for which tickets are free, attracts up to 60,000 spectators, he says.

Although there was talk this could be the last year for the event in the emirate, Mr Smith said Dubai was still the favoured destination.

"This is the last year of the current agreement and we're in discussions to continue that further," he said.

"I think in the last year of any contract there's always going to be rumours about what happens next.

"I would like to say that we're hopeful and we would like it to stay in Dubai. We're hopeful that it will stay in Dubai and we're looking to make an announcement on that quite shortly," he said.

Mr Sharaf said an announcement on the company's future involvement in the tournament would be made before the end of the year.

And there are similarities between the game and container terminal operations, Mr Sharaf said.

Golf is all about getting round the course in the least number of club strokes.

Operating a successful terminal is about manoeuvring containers using cranes in the fewest number of moves.

"We call it operational efficiency," he said.


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