SBD/Issue 41/Sponsorships, Advertising & Marketing

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  • FedEx, Other Marketers Unsure On Super Bowl Ads Amid Economy

    With ads during Super Bowl XLIII commanding as much as $3M for a 30-second spot, some marketers are "wondering whether during these tough economic times they can afford the big game," according to Suzanne Vranica of the WALL STREET JOURNAL. FedEx, which has advertised in 12 previous Super Bowls, still "hasn't decided if it will buy in." A FedEx source said that the company is "concerned that shelling out big bucks -- at a time when it's 'asking employees to do more with less' -- will look 'wrong.'" The source: "Companies have to be mindful that jumping into the game can open them up to criticism." Meanwhile, other advertisers are "taking a pass" on the game altogether, including GM, which has advertised in 16 Super Bowls, and Garmin, which aired spots in the last two games. NBC had sold "most of its Super Bowl ad inventory by early September, prior to the meltdown on Wall Street," but the net "seems to have experienced some slowing of demand over the past few weeks." NBC said that it now has "about eight ad slots left to fill," which Vranica notes is "roughly the same number that were left in September" (WALL STREET JOURNAL, 11/11).

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  • Nike's Social Network For Runners Helps Boost Shoe Sales

    Nike+ Web Site Allows Runners To Network
    Since the '06 launch of Nike+, the company "has built a legion of fans," and is "building brand loyalty via online social networking," according to Jay Greene of BUSINESS WEEK. The technology used in Nike+ "tracks data of every run and connects runners around the world" at nikeplus.com, and this past August, 800,000 runners "logged on and signed up to run a 10K race sponsored by Nike simultaneously in 25 cities." The company now is "testing a social network to promote its basketball shoes,"and Nike is "beta-testing Ballers Network, a Facebook application that lets players organize real-world games and manage their teams online." But how Nike+ "benefits the company's bottom line is harder to gauge." SportsOneSource said that Nike "accounted for 48% of all running-shoe sales in the U.S." in '06. Market share has increased since then to 61%. SportsOneSource analyst Matt Powell: "A significant amount of the growth comes from Nike+." Greene notes Nike originally envisioned Nike+ as a "clever way to combine music and running, not as a prototype for a new kind of marketing." Nike Global Dir of Brand Connections Stefan Olander: "It was never about how can we convert some percentage of users (to buy Nike shoes)."  SportsOneSource indicated that Nike to date has sold 1.3 million Nike+ iPod Sport Kits, and 500,000 SportBands, "wristwatch-like devices for runners who don't want to listen to music." Sales from these products have totaled $56M, though that is "just a rounding error" for a company that posted $18.63B in sales in FY '08 (BUSINESSWEEK, 11/17 issue).

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  • Court Denies Acushnet's Desire To Overturn Patent Infringement

    U.S. District Court Decision To Halt Sales Of
    Titleist's Pro V1 balls By January 1
    The U.S. District Court in Wilmington, Delaware, yesterday rejected Acushnet’s request to overturn a jury ruling that found Acushnet had infringed upon Callaway’s golf ball patents. The district court also granted Callaway’s request for a permanent injunction to halt sales of Titleist’s Pro V1 balls by January 1. The Pro V1 line of balls holds a market share of around 20%, according to market research by Golf Datatech. Acushnet plans to appeal the decision. It is unclear how much of an effect the ruling will have on the sale of Pro V1 balls, which are no longer produced under the disputed patents, according to an Acushnet statement. "In September 2008, we converted production of the existing Pro V1 models so that they are outside of the patents in question; and we have also developed and will be introducing new and improved Titleist Pro V1 products in the first quarter of 2009 that are also outside the scope of the patents in question,” said Acushnet Exec VP/Corporate & Legal Joe Nauman in a statement. Callaway first sued Acushnet over the patent infringement in ’07, nearly seven years after Pro V1 was first launched.

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  • DHL Cutting 9,500 Jobs, Status Of Sports Portfolio Unknown

    Germany-based DHL yesterday said that it will leave the "U.S. domestic-only express" delivery business on January 30, a move that will "cost 9,500 positions across" the country, according to Doreen Hemlock of the South Florida SUN-SENTINEL. DHL, whose U.S. operations are based in Plantation, Florida, said that the job cuts will include the U.S. HQs, as well as offices in Wilmington, Ohio, Allentown, Pennsylvania, and Riverside, California, among others. DHL said that it will "continue to offer express delivery service to and from" the U.S., but that it can "no longer afford to lose billions of dollars on U.S. domestic-only air and ground services competing head-on with U.S. market leaders UPS and FedEx." DHL does about $3.5B in U.S. domestic-only business (South Florida SUN-SENTINEL, 11/11). Ohio Gov. Ted Strickland yesterday noted that about 7,000 jobs in the Cincinnati area are in "direct peril" as a result of the planned job cuts (CINCINNATI ENQUIRER, 11/11). DHL, which has planned to "have UPS handle its shipments within the U.S.," said that it "plans to go ahead with a UPS deal on a much smaller scale than the originally announced value of up to" $1B annually (COLUMBUS DISPATCH, 11/11).

    SPORTS SHORTS: DHL boasts a robust sports marketing portfolio in the U.S., most notably its current four-year partnership with MLB, which was extended prior to the '07 season. The following lists some of DHL's sports sponsorships (THE DAILY).

    DHL SPORTS SPONSORSHIPS
    MLB
    Cleveland Indians
    MLBAM
    L.A. Dodgers
    Baseball HOF
    N.Y. Mets
    Atlanta Braves
    N.Y. Yankees
    Boston Red Sox
    S.F. Giants
    Chicago White Sox
    NHRA driver Scott Kalitta
    Cincinnati Reds
    USOC

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  • Marketplace Roundup

    In Oklahoma City, Darnell Mayberry reports Nike in mid-December will debut a commercial featuring Thunder F Kevin Durant in an "interview type of set-up." Durant in the spot is dribbling a basketball while "answering personal questions about his family, his favorite moments growing up, when he knew he loved the game of basketball and what he typically does before a game." Durant said of the ad, "It's something different. It's not scripted at all. Hopefully, it comes out pretty nice." Durant filmed the ad during a preseason road trip in October (DAILY OKLAHOMAN, 11/11).

    MARKETING FLASH: Heat G Dwyane Wade appeared on YES Network’s “CenterStage” last night, where he discussed some of his endorsements. YES’ Michael Kay mentioned his deal with T-Mobile and asked is Charles Barkley “really one of your Fave Five?” Wade: “He is this week.” Wade talked about his Gatorade endorsement, noting he and Celtics F Kevin Garnett are the only NBA endorsers. Wade: “We don’t have a lot, lot of athletes (at Gatorade). We have a select few, the best in the game in their different sports. So it’s a great relationship to have.” Wade added of having his own signature Converse shoe, “I always wanted to have my own shoe. I mean, you look down and you're wearing shoes with your name on them. It’s always crazy” (“CenterStage,” YES, 11/10).

    Watch The Clip

    SLIPPING ON ICE: The GLOBE & MAIL's William Houston wrote two new NHL-related TV spots, from Chevrolet and Scotiabank, "portray men as particularly stupid and childish," and "even more cringe-inducing in the new commercials is the role played by leading sports figures." In the Chevy spot, Hockey HOFer Bobby Orr is "behind the wheel of a van, driving, with a dopey grin on his face." Orr in the ad "thinks the attention he's receiving on the street is because of his fame, when, in fact, it is his passenger, Chevrolet Million Dollar Shootout contest winner Darwin Head," In the Scotiabank ad, Flames RW Jarome Iginla and Hockey HOFer Darryl Sittler "play adults behaving as children." The spot is "silly and should be an embarrassment to Sittler and Iginla" (GLOBE & MAIL, 11/10).

    ROUNDUP: Patriots QB Tom Brady Friday night attended a promotional event for Glaceau, the parent company of SmartWater, which Brady endorses, at the Liberty Hotel in Boston. Brady reportedly earns "in the neighborhood" of $3M for his endorsement deal (BOSTON HERALD, 11/11)....The Ducks and Honda Center have reached a deal with L.A.-based Sparkletts bottled water, which will have a table on the plaza concourse level at every event at the arena. Additionally, Sparkletts will provide the Honda Center and the Ducks with five gallon water and coffee service (Honda Center)....Vancity and Citizens Bank of Canada have launched a $50 prepaid Visa card, the first in their "series of 10 Olympic-themed cards." Citizens Bank and Vancity Dir of Prepaid Visa David Chong said that the bank "doesn't know how the Canadian market will respond" to the cards. Chong said Visa Int'l during the '06 Turin Games sold 650,000 cards, and noted that if Citizens Bank "sells half that number, it will be considered a success" (Vancouver PROVINCE, 11/11).

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