Drink company 'relaxed' about dwarf boxing

By Steve Deane

As an exercise in brand exposure, slapping boxing gloves on a couple of dwarfs and encouraging them to slug each other in front of national television audience has to be one of the more creative approach's of recent times.

Having appeared on the front pages on Sunday newspapers, cluttered up the talk radio airwaves and featured on multiple television channels, tonight's dwarf boxing 'world title fight' has garnered the attention it was designed to.

Hydr8 Zero, the product sponsoring tonight's West Auckland 'Explosion' - which also features a fight between heavyweight contender Joseph Parker and Frans 'The White Buffalo' Botha - has certainly gained plenty of face time. But it's hard not to wonder if this is exactly what Kiwi entrepreneur Shane McKillen had in mind when he signed a deal to sponsor five boxing promotions over the next year?

"I'm pretty relaxed about it," Mckillen says as he pours the Herald a glass of the product he hopes will gain a nice slice of the $1 billion dollar transTasman sports drink market. "It's entertainment. They're little guys, they're entitled to fight.

I don't think it's too controversial."

McKillen sounds like he had a fair idea what he was signing up for when he decided "owning" professional boxing - a sport with a dubious reputation - was the way to take on the multinationals that dominate the sports drink market.

Boxing is not without risk, he acknowledges, but the same can be said about any sport. Just look at the toxic fallout from the Tiger Woods and Lance Armstrong scandals.

"You always face risk when you tie your brand to a sportsperson or team," McKillen says. "If the sportsperson fxxxs it up, the brand tarnishes as well. So yes, it is a risk, but you can't keep your brand in the cupboard."

The upside of his deal with boxing promoter Duco Events is significant, as boxing provides plenty of bang for his buck.

"I can't outspend the big multinationals," McKillen says.

Duco's David Higgins points to the massive national viewership figures from events such as the world title fight between David Tua and Lenox Lewis and the 2009 Tua v Shane Cameron fight in Hamilton as evidence of the sport's pulling power.

"Some people think it is a niche sport," says Higgins. "When it is being watched on occasion by almost half the population it is not niche. There is massive mainstream interest right down middle New Zealand. And [the sport] is totally under-represented in terms of sponsorship. Those sponsors that do get on board get massive cut through.

"A couple of months ago no-one would have heard of Hydr8 Zero. I guarantee you within a year's time it will be household name brand."

Given his company promotes the majority of the major fight cards in this country, Higgins has good reason to talk boxing up as a sponsorship product. But his self-interest doesn't necessarily make him wrong. McKillen, whose success in helping 42 Below Vodka go from cottage industry to a global brand that sold to Baccardi for $138 million suggests he has an eye for an opportunity, is clearly a boxing believer.

"It's not only the TV advertising that surrounds it, it's all the hype and media it gets," he says. "It sticks for so long. It's 90 days of media where you pop up on TV1 News, TV3 News, in the paper."

As well as clever marketing, the key to 42 Below's success was timing. Grey Goose had just created the premium vodka market, rasing the potential spend on a bottle from $15 to $35, and New Zealand was establishing its clean, crisp global reputation.

"Milford Sound and Hobbits is what we're all about," says McKillen. And premium vodka, which Americans lapped up enthusiastically. The bad news for those thinking 43 Below vodka could be a cash cow is that that window has long closed.

"It couldn't happen again," says McKillen. "Everybody thinks they can launch a vodka with a couple of million bucks and they'll knock it out of the park. That category is gone."

The industry has consolidated, and the market is saturated.

A 40 per cent drop off in drinkers of sugary sports drinks is the next window opening, McKillen believes. Consumers have wised-up to the negative effects of sugar, and are now after something else - a zero sugar, zero carbohydrate sports water, to be specific.

McKillen's cocktail factory in Tauranga already had the capacity to produce the product. After 18 months of development, it is ready to hit the market. All he needs to do now is get the message out.

Step up pint-sized pugilists Matthew Wood and Colin Lane, and their highly dubious world title fight.

"That's Duco," shrugs McKillen. "They know how to generate media. For a new, young brand, they are the right guys.

"We are taking on some big players, but we are nimble and quick and can react. We can beat them around the fringe."

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