TCS paying top dollar for the New York marathon

TCS hopes to create a positive image for outsourcing by sponsoring a famous marathon

In the seventies and eighties, Japanese auto firms in America faced a severe backlash as they started gaining market share. They were blamed for stealing US jobs and car sales, with outraged auto workers even smashing Japanese cars in protest.

One of the tools that several firms adopted to change the tide of public opinion was to sponsor local cultural events that would make them seem like  insiders.

When India’s largest IT services provider Tata Consultancy Services (TCS) recently announced that it has tied up with the New York Road Runner (NYRR) as its title sponsor, many in the branding world felt a dejaRs vu. NYRR organises the popular New York City Marathon.

“Offshoring and outsourcing have become pejorative terms in the US. Companies like TCS for whom the US is their largest market, at this point of time, need public opinion in their favour. So that people do not see them as outsiders,” says Alpana Parida, president, DY Works, a design consulting firm.

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Indian IT firms have been at the receiving end of public opinion in the US.

The anti-outsourcing propaganda reached a crescendo when US President Barack Obama said that he would tax companies who take jobs out of the country.

In recent times, this sentiment has also affected the visa procedures. Indian IT firms that depend heavily on L-visa and H1-B visa have been increasingly facing rejections. The rejection of L1-visa applications continues to be as high as 80 per cent, say industry sources.

Parida believes that the tie-up with NYRR is TCS’ step to reinforce its credentials as a global brand.

“The New York City Marathon, one of the prime properties of NYRR, has a deep-rooted history. Hence, there is a special connect with the marathoners who take part in it. Once you own such a property you become highly-visible, which means huge public relations mileage,” she explains.

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The NYRR was founded in 1958 when a small group of passionate runners vowed to bring running to the people.

Over the past 55 years, NYRR has grown from a local running club to a premier community-running organisation. Its marathon is one of the oldest events and attracts both the world’s top pro-runners and amateurs. NYRR raises millions of dollars annually for charity and driving economic impact for the City.

Before TCS got on board, ING, the Dutch financial firm, was the key sponsor of the event for about a decade, which highlighted its retirement and wealth management businesses for the executives running at the event.

ING is reported to have decided to focus on sponsoring events supporting financial literacy and is expected to not renew its other marathon sponsorships across the US, as part of a rebranding effort.

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For N Chandrasekaran, CEO and managing director of TCS, who had also participated in the NYC marathon, it is not just about getting marketing mileage but also sealing the fate of TCS as a global brand.

He did not comment on the investment made by the company for such branding. However, according to a news report in The New York Times, the TCS sponsorship is substantially more than the earlier ING agreement.

“New York is very important for us from multiple angles. From TCS’ point of view, it is a market that is large for us. Within the US, NY is very big for us. We work with many companies in and surrounding this area. Two, it is also important to promote our brand. We are extremely well-known within our customer base and potential customers. But we are not that well-known beyond that segment,” he adds. The US contributes over 50 per cent to TCS’ revenue.

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This is not the first time that TCS will be sponsoring a marathon. In 2011, it signed up to become a title sponsor of the Amsterdam Marathon for five years. It also sponsors the Berlin and the Mumbai marathons. While Europe contributes a substantial chunk to TCS’ revenue, the company has been keen on expanding its presence in Germany and France.

“On a personal level, a marathon is something we connect with. As a marathon-runner myself, the NYC marathon holds a special place for me. Internally, too, health is a serious focus of the company. We want every associate and her family to be health-conscious,” adds Chandrasekaran.

Though Indian companies have been doing business in the US for over a decade now, their marketing efforts are directed towards their customers, that is, enterprises, rather than the local people.

“Indian IT firms have a stiff challenge in terms of general awareness or brand awareness in the US. The public opinion is that IT firms take away jobs to India. Though the political stance against the industry is much better now, it is tied to the public sentiment. Indian firms need to work on changing the public opinion,” says Partha Iyengar, vice-president and India head, Gartner.

Iyengar believes that TCS tying up with NYRR is not just a marketing exercise but a brand-building exercise. “There are three aspects to marketing – lead generation, practical marketing and strategic marketing. With this, TCS is moving towards strategic marketing. It’s a smart ploy by TCS,” he says.