Dolphins Unveil Sun Life Stadium Renovations Louisville Announces Stadium Expansion Plan Lexus Gets Dallas Arena's Platinum Level Name DraftKings Inks Deals With Cowboys, Chiefs, Pats University Plans Threaten Downtown Cincy Project Raiders Move Into New Training Facility Iowa State Completes South End Zone Renovations Florida Close On O'Connell Center Financing Facility Notes NESN Sees Backlash From Orsillo Decision
SBD/Issue 84/Facilities & Venues
Roundtable: Analysts Discuss Bank Of America-Panthers Deal
Published January 21, 2004
By Kris Johnson, Staff Writer, The Sports Business Daily
|Yowell Believes BofA Overpaid As Compared
To Lincoln Financial’s Deal In Philly
With the Panthers advancing to Super Bowl XXXVIII in Houston, THE DAILY asked industry analysts about Bank of America's announcement last Friday of a 20-year naming-rights pact with the NFC champion, which will reportedly pay the team $7M annually. THE DAILY wondered if the experts see it as a good deal for BofA, which already has a leading brand presence in Charlotte. Could emotion have been a driving force behind this deal? How would a Panthers' Super Bowl victory enhance its value?
WAS THE PRICE RIGHT? Gemini Sports CEO & President Rob Yowell said, "(BofA) overpaid for Ericsson Stadium by nearly two times its market value. The fact that BofA paid the same price to rename an eight-year-old facility with  NFL games and a bowl game in Charlotte as what Lincoln Financial paid for a new stadium with twice as many events in a larger DMA of Philadelphia speaks for itself." Yowell added, "This was not a deal of necessity for BofA, but perhaps a move made to overshadow Wachovia's growing presence in the market." But Univ. of South Carolina Sport & Entertainment Business Chair Tom Regan thinks the deal is a good investment for BofA: "The price is correct for a mid-major market. Charlotte is a financial center, and the naming rights is approximately .0875% of their marketing budget. The deal will supplement the national image of BofA." The Bonham Group Chair & CEO Dean Bonham: "My experience with financial institution sponsorships leads me to believe (BofA was) particularly attentive to the cost/value ratio that the deal generates and the establishment of a high-profile connection with the NFL." Gilco Sports Dir of Business Development David Cope noted it is difficult to judge the value of the price without knowing the particulars.
REINFORCEMENT: Regan acknowledged BofA's brand presence in Charlotte "is strong - but they aren't Coke or GM. The consolidation of the financial markets has caused some confusion on the regional and national levels. Who owns who? Therefore, they need to continually establish branding." Bonham added, "By sewing up the NFL team and the most important sports facility in its own backyard, the deal has the effect of protecting BofA from encroachment by a competing entity in its category." Yowell noted, "With the brand already known and respected in the region, creativity will be the key to success."
|Super Bowl XXXVIII Title Would Add
Marketing Ammunition For BofA
EVERYONE LOVES A WINNER: Cope, on the timing of the deal, "I don't think it's a coincidence that the deal was negotiated during a season when the Panthers were playing well and winning, and announced prior to the NFC Championship game." But Cope added, "Having some relationships with BofA and knowing how sophisticated they are in their sports marketing, it was much more than an emotional buy. ... They're doing this for a business reason." Bonham concurred: "The Panthers' success may have accelerated the process, but this was not an emotional buy. This has probably been in the works for some time and will certainly be in effect for a long time to come. ... The emotional component was negligible." Yowell: "The Panthers winning this year is an added bonus, but I do not believe this deal was influenced by this year's success. ... This is simply a 'boardroom deal' between BofA execs and the team not even a negative recommendation from BofA's sponsorship group would have prevented this deal from closing."
TO THE VICTOR GO THE SPOILS? Should the Panthers defeat the Patriots to win the first Super Bowl title in franchise history, Yowell said it will "add a nice marketing angle for next season's promotion of the BofA relationship. ... It may get a few more games on the national time slots with the Panthers' success, but unless the stadium hosts a Super Bowl or BCS title game in the future, I don't foresee any significant enhancement of the deal for BofA." Bonham: "It's hard to quantify that value. Being a sponsor of a Super Bowl champion will unquestionably add luster to the deal via increased media exposure, credibility enhancement, etc., but BofA will want to leverage that exposure through a judicious use of ads, special events, player appearances. Remember though, this is a long-term investment that will pay dividends based on long-term strategic thinking and a commitment to derive and deliver value from both parties."
COMING TOMORROW: Our analysts address activation efforts around Reliant Energy's naming rights deal and what the company can expect in terms of measurable gains during the Super Bowl fortnight in Houston.