SBD/25/Sponsorships Advertising Marketing

BRANDWEEK LOOKS AT SPONSORS' WILLINGNESS TO PAY NFL FEES

          With the NFL "struggling to net an increase in a soft-
     drink category that has been its cash cow, NFL owners ...
     may finally be ready to address the question of whether" the
     league "should fundamentally change the way it sells
     corporate sponsorships," according to Terry Lefton of
     BRANDWEEK.  Recent "industry buzz" has incumbent Coca-Cola
     offering $18M and Pepsi $14-15M, "but with little
     enthusiasm," for the category.  And while NFLP Senior Dir of
     Corporate Sponsorships Steve Phelps said that fast-food
     negotiations have been "put aside" pending a soda deal,
     "insiders say Taco Bell balked" at the $10M price tag the
     league was "hoping to get from incumbent McDonald's." 
     Without being specific, Phelps said that those numbers have
     changed and added, "we will land a soft-drink deal within a
     month, and we will get an increase if we grant certain
     rights."  Strike Ten VP/Marketing John Sohigian on the NFL's
     negotiations: "Rights fees are going down as far as pure
     cash, so to get an increase, the value has to go up
     significantly."  MLS Exec VP Randy Bernstein: "Sponsors
     don't care so much about logo exposure, it is their caseload
     and are you moving that?" (Terry Lefton, BRANDWEEK, 3/23).
          HOW MUCH IS TOO MUCH? Lefton adds that the "larger
     issue" is whether the NFL should expect rights fee increases
     "when sponsors may see as much as a 30% increase in the cost
     of advertising on NFL games."  Sprint VP/Advertising &
     Sponsorships Tim Kelly, on the $24M annual rights the
     company pays: "I'm pretty confident in telling you we won't
     be able to buy much more."  The NFL has 17 categories up for
     renewal, and Phelps said, "We are going to have a record
     year as far as renewal percentage as well as renewal dollars
     and activation."  Lefton adds that the value of the TV and
     Sprint deals "may have also convinced ownership that there
     is similar revenue potential in corporate sponsorship." 
     IMG's Gary Jacobus, a former NFLP Sales Exec, said, "Some
     owners think they should be getting that (amount) in every
     big category.  It just can't be done" (BRANDWEEK, 3/23). 

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Related Topics:

Coca-Cola, IMG, McDonalds, MLS, NFL, PepsiCo, Sprint

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