There is a longstanding phrase in motorsports — win on Sunday, sell on Monday. Put another way, winning is good for business. Research repeatedly shows an abnormal correlation between the share price of listed sports teams such as Juventus or Ferrari and their success in prestige events like the Champions League or the Monaco Grand Prix. Winning on the global stage brings with it more fame, more fans, better players and, with all this, commercial benefits.
This applies even on a national level. A study by Goldman Sachs showed that every World Cup-winning country since has seen its stock market outperform the global averages, for at least the next quarter.
So, one might think that it would apply to the advertising industry and winning at Cannes, too. In a piece earlier this week, the editor of Campaign commented that holding companies seek Lions at Cannes because they provide "meaty headlines for their hungry investors".
The share price of the recently crowned holding company of the year has fallen in the last month. Of course, lots of different variables affect stock prices, but surely winning "the big one" should be a tide that raises all boats, for a few weeks at least?
It was the same last year, when the winners again saw no meaningful benefit on Wall Street. Instant sales are harder to generate for a holding company than in the Real Madrid shirt shop. But stock prices are based on future earnings, not just short-term spikes, and I am convinced that a big win at Cannes enhances that future potential. Did the phone ring off the hook with new-business calls the next day?
