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Access to customers via sponsorship

Released at: 10:17, 04/12/2019

Access to customers via sponsorship

Photo: VET Magazine

The move by Lexus to sponsor a golf tournament in Vietnam puts the brand at front-of-mind of prospective car owners.

by Chau Vu

In early August, Lexus Vietnam confirmed its support for the development of professional golf in Vietnam by being the title sponsor of the Lexus Challenge 2019. This marked the Japanese brand’s first foray into professional golf. In the entire auto industry in Vietnam, Lexus is the first and only player with such involvement. 

Bringing the Lexus Challenge 2019 to the golf community was a quiet yet bold process. Quiet, because planning and preparation had been underway for several months in collaboration with the VPGA Tour, a leading organizer of golf tournaments in Vietnam. And bold, because of the decision to invest in professional golf in Vietnam, which is still young and immature at this point, instead of other activities.

Men’s major golf tournaments around the world, including The Masters, the US Open, the Open Championship (British Open), and the PGA Championship, not only have a long history and prestigious reputation but also an attractive prize purse. These factors together draw the attention of avid golf fans all over the world, which inarguably makes golf sponsorship a lucrative investment. Hence, the race to secure a sponsorship deal is ever-more competitive among companies. Auto brands have to compete against one another within the industry and with players from other industries. Some leading automakers are even willing to spend a substantial sum in order to have their brand name in the tournament title. However, Lexus has been the only automotive brand with their own professional golf tournament.

Investing in Vietnamese golf: Risky or wise?

In general, golf is a sport with a much smaller audience compared to other sports. In Vietnam the sport is relatively new. As the golf landscape is quite young, why does Lexus still want to invest?

First, let’s look at why sport sponsorship is selected over other activities. Sport and motor cars have been inseparable over the years. Spending on sports sponsorship accounts for approximately 50 per cent of automakers’ budgets. According to Infomedia, automotive brands spend over $1.2 billion annually sponsoring sporting events.

When it comes to golf sponsorship, automakers lead the charge. According to a report by IEG Research, the sector is 4.4 times more likely to sponsor golf than all other sponsors.

From a brand perspective, golf is the ultimate choice that fits Lexus’s brand image. As Lexus focuses on the premium segment, it prefers not to partner with something that is too mainstream.

Lexus global has invested heavily in golf. They are the first and only automotive sponsor of the USGA (United States Golf Association) and its championships, including the US Open, the US Women’s Open, the US Senior Open, the US Senior Women’s Open, and the US Amateur Championship. Lexus also partners with leading professional players and golf legends, with current Lexus Golf Ambassadors including Jason Day, Johnny Miller, and Lydia Ko, to name just a few.

Moreover, Lexus and golf share common values. According to a Lexus spokesperson, the brave and pioneering spirit to overcome personal limits, as well as attention to detail - traits that belong to golfers - are also the core values Lexus relentlessly pursues. So, if Lexus were to invest in a sport, it had to be golf. 

Reaching prospective customers

Throughout its five years in Vietnam, Lexus has hosted the Lexus Cup, a VIP client appreciation golf tournament, for three consecutive years. The annual event serves the purpose of retaining existing clients.

However, to survive and grow, every company has to expand their customer base. From a business perspective, investing in a golf tournament gives Lexus unique opportunities to reach new customers. While it is true that the golf audience in Vietnam is not as broad as in other sports, what Lexus cares about is not how many people are watching but rather who is watching. 

According to the VPGA Tour, their golf audience is between the ages of 25 and 54 and are middle- to high-income earners. The demographic of golf fans matches Lexus Vietnam’s target audience.

By joining forces with the VPGA Tour - an experienced organizer of well-respected golf tournaments within the Vietnamese golf community - Lexus Vietnam can reach customers before, during, and after the tournament. Spectators during tournament week as well as fans who follow the tournament via online platforms and the media will be exposed to the brand. 

International professional golf tournaments attract athletes and fans because of the lucrative prize purse. The higher the number of viewers, the better it is for sponsors. With that in mind, the prize purse at the Lexus Challenge 2019 is VND1.5 billion ($65,000) - a record in Vietnam’s golfing history.

Long term branding

While the Vietnamese golf market is young, it holds major potential. A three-fold increase in the number of golf courses by 2020 is expected. Furthermore, we are witnessing the rise of the next generation of young and talented golfers. When there are more golfers in the game, the tournaments will become more exciting.

By that time, the race to become a sponsor will have become more competitive as other brands see the benefits and decide to join. But Lexus will already have an advantage thanks to its established position as the pioneering brand supporting the development of golf. 

The Lexus Challenge 2019, which was held in August, was even more meaningful because of “The Sustainable Challenge” - a series of actions taken to make a positive impact on the environment and the community. The Lexus Challenge 2019 was the first golf tournament in Vietnam to say “no” to single-use plastics. For long-term branding, whether Lexus’s move into professional golf is wise or not is still in question. It may take one year, several years, or even longer to gauge the outcome.  

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