Building blocks: how the NRL’s Cronulla Sharks are rebuilding their brand
After a supplements scandal that rumbled on for several years and inflicted telling blows on their brand, the Cronulla Sharks are now making positive strides forward. For Lyall Gorman, the chief executive of the National Rugby League side, reinstalling core values is now allowing them to shape their own future.
By Mike Kennedy
The supplements scandal that rocked Australian National Rugby League (NRL) outfit Cronulla Sharks in 2013, and dragged on late into 2014, came about after a year-long investigation by the Australian Crime Commission (ACC) into widespread drug use in Australian sport. The Sharks were among six teams implicated and the club came under the scrutiny of the Australian Sports Anti- Doping Authority (ASADA).
That ASADA probe centred on the Sharks’ 2011 supplements programme and the involvement of sports scientist Stephen Dank, who was employed as support staff under coach Shane Flanagan at this time. Dank received a lifetime ban by the NRL in the wake of the investigations, while former Sharks conditioner Trent Elkin was also given an indefinite ban from the game, though this was later successfully overturned on appeal. Cronulla were eventually hit with a AU$1 million fine and suspensions for Flanagan and 17 current and former players. At the height of the scandal, there was even the threat that the league’s organising body would forcibly relocate the club from their home in Sutherland Shire, south Sydney.
With suspensions having been served, the Sharks are moving on from the saga and looking ahead to a brighter future at their traditional base, according to Lyall Gorman – the man appointed as chief executive in November 2014 following the sacking of Steve Noyce. “I’d say there’s zero chance of [relocation],” Gorman tells SportsPro in mid-September. “In fact, our discussions in Australia in the NRL at the moment are more around perpetual licences. This club belongs in The Shire; it will be celebrating its 50th anniversary in 2017 and everyone is very committed to its long-term future.”
Having joined the Sharks amid the fallout of the supplements episode and after a two-year stint with Australian A-League soccer team Western Sydney Wanderers, Gorman has set about rebuilding and reshaping the club. A key challenge that faced the Australian upon his appointment was to restore faith and equity in a damaged brand. “I wouldn’t have taken the role unless I had full alignment with the board on the future direction of the club,” notes Gorman. “It is fair to say that there was a lot of negative brand equity in the organisation on the back of ASADA and some of the player behaviours in the past and so on.
“So the starting point for us really had to be a revisit around culture, values, vision and then assessing the capability of the organisation – the current capability set against what was needed to take it to another level,” he continues. “So I was given that mandate by the board and I’ve got to say they’ve been incredibly strong in their support of me regarding the change programme.”
With the mantra ‘more than just a football club’ as a guiding principle, giving the club a point of difference in the market, Gorman says the Cronulla Sharks are now defining their own future after the dark days as they begin to roll out those changes.
“We are now in the process of launching our foundation, Sharks Have Heart, and we are very excited by it because it gives us an opportunity to engage with our broader community and the corporate community as well to really leave a long-term lasting legacy for the club in many forms, whether it’s infrastructure, or social health programmes, or welfare and education programmes for players, or elite training facilities,” he suggests. “Since I joined it’s always been about timing and getting the other building blocks stronger first. So the base of the club was strong, but then you can run your foundation off that.”
With a mission statement to make ‘a significant contribution and real difference to our community and our broader Sharks family’, the Sharks Have Heart foundation is built on four fundamental pillars: ‘building healthy communities’, ‘developing people’, ‘elite performance’ and ‘our heart’ – which is about looking out for the club’s ‘family’.
“All these pillars integrate and the success of our club will be very much measured around all of those, not just around results on the field,” explains Gorman. “While [results] are important and relevant, we’ve got to always have major contributions to make to the community at various levels and really change the dynamics of how a football club operates in Australia.”
Setting out a plan for the club’s long-term security was a key task when he was brought in by the board and Gorman notes that, among the many benefits of the foundation, its tax effective structure within Australia provides a clear financial incentive. When asked how the success of the foundation programme will be measured, Gorman admits that the level of money raised will be a telling factor, but suggests that how the money is spent and the purpose it serves is of far greater relevance.
“Well, I think at the end of the day it will be… you know, I don’t want to be as mathematical as saying whatever dollars coming through equals whatever we can do on the other side – whether it’s a new centre of excellence, whether it’s the staff to run these programmes or whatever,” Gorman offers, before listing some of the benefits different levels of donations can contribute, as laid out on the foundation’s website. A AU$250 (US$175) donation, for example, will allow a school to participate in a ‘Sharks Active Program’ and/or contribute to the ‘Academy Pathway’ programmes, equipment and facilities, while any donor who contributes in excess of AU$20,000 (US$13,989) will become a member of the Sharks Have Heart Founders Club, with a special recognition programme put in place on an individual basis ‘tailored to meet the specific needs of each donor’.
While the foundation is intended as a means to secure the club’s future, a major challenge Gorman faced upon his appointment came with the need to return commercial viability to the club’s brand and bring about swift financial stability. Since 2012 the Sharks have had a number of short-term front-of-shirt sponsors to fi ll the gap left by the departure of naming rights partner Hisense. Drinks brand Shark Energy, throat lozenge company Fisherman’s Friend, and One Solutions – a lending, insurance, financial and property adviser – have all come and gone. For much of the 2014 season the club even wore the initials ‘CSFC’ – Cronulla Sharks Football Club – in an effort to bring a semblance of conformity in line with the other 15 clubs in the NRL, all of which carried sponsors’ logos on the front of their jerseys.
In June, however, Southern Radiology, an Australian medical imaging provider, came on board as naming rights sponsor after signing an initial three-year deal worth in excess of AU$2 million (US$1.3 million) per year to the Sharks. An impressive contract in the Australian market, according to Gorman, the company’s deal serves as a marker of the club’s progress since the scandal.
“First of all we had to go back to the basics around visions, ideas and culture and really change the narrative of the club so that we had something we could take to market,” states Gorman. “So we had to rebuild that trust, respect and rapport in the broader market place. And that was always going to take time and fortunately I had the support of the board. We weren’t just driven by the chase for the dollar, but equally important is whose dollar it was and their brand values and alignment and the synergies with where we were heading.
“[Southern Radiology] have got very like-minded values with us around social impact and contribution to the community and health and so on,” Gorman says. “So we got to the table with them and we clicked from the very first meeting, ironically – the very first meeting we had it was game on and it was a very exciting time for the club because it was a strong statement by a large corporate in Australia of its belief in our future.”
While the deal with Cronulla is Southern Radiology’s first major foray into the Australian sport sponsorship landscape, Gorman says the shared values and aligned thinking between the two organisations has ensured a positive start to what he hopes will be a lasting relationship. “When we sat down with them we were very hopeful that this would be a wedding ring, that this would have a very long-term future,” he says. “But let’s get in there and make sure that it’s working for everyone in the first three years and see where it goes from there. But I’d say the early signs show that both parties are very confident, it’s a very fruitful relationship and everything we thought it would be.”
The Sharks are in an atypical position among their NRL rivals in that they own their own ground, Redmonis Stadium. Gorman believes the opportunities this significant asset allows for has given the club a strong base to build on. “We’re one of if not the only rugby league club that owns its own stadium in Australia, which is a very unique model,” notes Gorman. “And of course it brings with it tremendous opportunity, because on a day-to-day basis we can define what happens in there: whether it’s from a branding point of view, a brand engagement point of view or whatever. So it gives us a great flexibility that a lot of other clubs don’t have the benefit of.”
Having ownership of the stadium also allows the club to take a long-term approach to how this facility can best serve both the needs of the rugby league team and the community in which they sit, and the club are now looking to transform the ground into a multi-purpose venue as part of a wider development project. “We’re blessed with the development that we have happening around the club which will secure its long-term viability,” says Gorman, who lists a 650-apartment development, an 18,500-square-metre retail development, and a new hotel among the amenities that will come from this joint venture project.
The Australian Rugby League Commission went some way toward securing the immediate future of rugby league with a five-year, AU$925 million (US$647 million) broadcasting agreement with pay-TV broadcaster Fox Sports and free-to-air network Nine in August, and the Sharks look well placed to capitalise on this and ensure their own brighter prospects.
“The club will have significant dollars invested in the futures fund within 18 months on the back of the completion” of the stadium redevelopment, Gorman notes. “So its financial future is secure, its brand equity and integrity has been re-established, and it’s got an incredibly long-term and exciting future.”
This article was originally published in the November 2015 edition of SportsPro.
http://www.sportspromedia.com/magazine_features/building_blocks
