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SBD/June 6, 2011/Marketing and SponsorshipPrint All
Sprint CEO Dan Hesse yesterday said that his company "is in talks with NASCAR to extend its title sponsorship of the Sprint Cup series," according to Randy Covitz of the K.C. STAR. Sprint is in the eighth year of a 10-year, $750M deal with NASCAR through '13. Prior to yesterday's Sprint Cup Series STP 400 at Kansas Speedway, Hesse said, "Our intention is to continue the sponsorship with NASCAR." In addition to title sponsorship of NASCAR's top series, Sprint "lends its name" to the annual All-Star Race at Charlotte Motor Speedway and also "supports NASCAR in other ways, such as delivering 15 to 20 cell phone towers to each race as well as The Sprint Experience, a mobile, interactive display at each track." Covitz notes Kansas-based Sprint's "presence in NASCAR played a role in Kansas Speedway’s securing a second Sprint Cup race starting this year" (K.C. STAR, 6/6).
The NHL's seven-year, $375M deal with MillerCoors in the U.S. and Molson Coors in Canada, the "most lucrative sponsorship deal in NHL history," has been "put in doubt after an Ontario judge ruled in favour of Labatt's claim that the League reneged on its deal with the beer company," according to Darren Calabrese of the CP. The Ontario Superior Court ruled Friday "in favour of Labatt's accusation that it already had an agreement in place with the NHL" before the league reached its deals with Coors. Anheuser-Busch is Labatt's parent company, and Labatt VP/Corporate Affairs Charlie Angelakos said, "Budweiser and hockey are a natural fit. We look forward to a very productive relationship with the league through the 2013-14 season, and are actively looking for opportunities on a team and grass-roots level to reinforce that connection." The CP noted A-B already is "the sponsor for 22 of the 24 teams" based in the U.S. (CP, 6/3). In Toronto, Josh Rubin noted Ontario Superior Court Justice Frank Newbould "shot down Molson-Coors' suggestions that it was blameless." Newbould said that Molson Coors "suspected that the league had already reached a deal with Labatt when it decided to negotiate its own agreement." Molson Coors said that it was "considering its options" in the wake of the decision. Molson Coors Canada Chief Public Affairs Officer Ferg Devins: "We've received the decision and counsel is reviewing it to determine whether or not we'll appeal" (TORONTO STAR, 6/4). ESPN.com's Pierre LeBrun reported the NHL "was very confident in its case," and it "will appeal the court's decision" (ESPN.com, 6/4).
NOT A REPUTATION YOU WANT: NHL Deputy Commissioner Bill Daly Saturday said, "We obviously do not agree with the reasoning or holding of the Court, and we plan to pursue an appeal expeditiously." In Toronto, Damien Cox wrote NHL Commissioner Gary Bettman "had to have been stunned to learn of" the ruling. An allegation of "double-dealing from a court" is "not the kind of business profile a league wants." The ruling "quoted an internal Miller-Coors email saying the company entered into talks with the NHL 'with great suspicion' over a possible existing deal with Labatt, and sought indemnities from the league in the event of legal action by Labatt." The rejected Miller-Coors deal "not only robs the NHL of revenue but also draws into question the league's management." An industry analyst said, "It's very embarrassing. Basically, they were trying to sell the same property twice and got caught." Cox wrote, "All in all, not good for the NHL. Even if there is a successful appeal, Friday's judgment creates a bad smell at a time when the Bettman administration clearly believes it has really hit its business stride, just six years after the last lockout threatened to damage the league's business" (TORONTO STAR, 6/5).
Gold Medal-winning snowboarder Shaun White and Red Bull "haven’t come to terms on a renewal of their three-year relationship, opening the door for one of the nation’s most recognizable athletes to sign with a new beverage partner," according to Mickle & Lefton of SPORTSBUSINESS JOURNAL. Sources said that White's deal with Red Bull, valued at more than $1M annually, "ended after the Winter X Games in January." White's agents at CAA since then have been "pitching beverage companies" on a deal worth more than $3M a year. CAA officials "have discussed a renewal with Red Bull, approached Coca-Cola and talked to Pepsi about a deal with its Mountain Dew or Gatorade brands, but haven’t signed anything to date." Mickle & Lefton note the more than $3M price tag that CAA "has placed on a future beverage partnership with White is reflective of the Olympian’s growing fame." But sources indicated that brands are "objecting to the pricing of the youth marketing magnet and demands for creative authority and control over any content created." Even with White's "year-round visibility and success, a $3 million to $6 million deal will be tough to sell." Connexions Sports & Entertainment President Bob Walker: "I don’t see any brand paying that type of money for him during these economic times, but if anyone can get it, Shaun can because of the Olympic program" (SPORTSBUSINESS JOURNAL, 6/6 issue).
Demand for Mavericks merchandise "has been so strong since the playoffs started that the team is considering expanding its retail franchise,” according to Maria Halkias of the DALLAS MORNING NEWS. In addition to its team store at American Airlines Center, the team “has operated one Dallas Mavericks Ultimate Fan Shop at NorthPark Center" since '06. Mavericks Merchandise Manager Alyssa Moog said that team officials are "considering adding one or two permanent stores in the area, including one in or near Fort Worth.” For now, the team will set up “additional temporary stores on game days” in Victory Plaza and inside American Airlines Center. In addition, Moog noted that “two people usually operate www.mavsgear.com, but the additional business is keeping seven more hires, including two interns, busy.” Clarence Brooks, Manager of the NorthPark store, said that since the playoffs began, “daily sales have doubled and tripled from last year.” Brooks indicated that as a result of the increased sales, “merchandise shipments have increased from twice a week to every day" (DALLAS MORNING NEWS, 6/4). SPORTSBUSINESS JOURNAL's John Lombardo reports the Mavericks-Heat Finals matchup "is bolstering NBA merchandise sales that are expected to soar past last year’s levels.” NBA Exec VP/Global Merchandising Group Sal LaRocca said, “Last year, we had a double-digit increase, but we should end the season well over 20 percent.” LaRocca would not disclose total league merchandise sales. The Licensing Letter’s ’11 Sports Licensing Report said that that the NBA in '10 “generated $1.93 billion in gross sales for its licensed merchandise in the United States and Canada” (SPORTSBUSINESS JOURNAL, 6/6 issue).GERMAN ENGINEERING: In Dallas, Brendan Case reported Mavericks fan Jordan Rogers created two Dirk Nowitzki-inspired T-shirts -- "Dirk Defined" and "Ghoastface Drillah" -- and had "sold about 500 of them as of mid-day Friday." Rogers "originally set out to make" the shirts just for himself. But then ESPN Radio 103.3 Dallas host Ben Rogers "started wearing one of Jordan's T-shirts" during the Mavericks-Lakers Western Conference Semifinals. Ben Rogers' partner, Jeff Wade, "got one, too, and the radio personalities started talking about the shirts" (DALLAS MORNING NEWS, 6/5)
Richard Petty "believes the decision to cut from four to two Sprint Cup teams is working for Richard Petty Motorsports,” but he would “like to see things move forward a little quicker,” according to Bob Pockrass of SCENEDAILY.com. Petty on Friday said, “Basically I was sort of a figure in front of Richard Petty Motorsports last year. Over a period of time, that kind of disintegrated and I’m (now) more involved in running the show.” One element that “could make running well easier is that improved performance always helps when seeking sponsorship.” STP was the primary sponsor on AJ Allmendinger's No. 43 car during yesterday's STP 400 at Kansas Speedway “as part of a renewed relationship between Petty and the company.” STP served as Petty’s primary sponsor during his racing career, and the company, which is “under new ownership, is looking to revive its rich motorsports heritage.” Petty: “Hopefully they’ll be back and big in racing the way that you grew up with. We are glad they came back and came back with us to increase their involvement in motorsports” (SCENEDAILY.com, 6/4).
DECADE-LONG REST: YAHOO SPORTS’ Jay Hart noted STP was “sold to a private equity firm last year” and is “once again ramping up its profile in the racing business.” STP in ‘72 “became the first nationwide company to back a driver full time when it paid Petty Enterprises $250,000 to put its logo on the hood of Richard Petty’s No. 43 for all 31 races.” Petty said, “That was like money falling out of the sky because we had never had sponsorship.” The relationship “finally ended after the 2000 season when Clorox, which purchased STP in 1998, moved in another direction.” Hart wrote the “re-emergence of the STP 43 conjures up more than memories, it raises the question of today’s full-time sponsors, which are few and far between.” With DuPont no longer serving as Jeff Gordon’s primary sponsor, the “longest-tenured relationship between driver and primary sponsor is Jimmie Johnson and Lowe’s, a relationship that dates back to the final few races of the 2001 season.” Besides Johnson, the only “current driver and primary sponsor pairing that have been together for at least five years is Denny Hamlin and FedEx.” Petty: “Economy-wise and stuff, it gets tougher for anybody to stay with anybody for that long.” RPM's deal with STP was for “just one race,” but the “hope is to add more” (SPORTS.YAHOO.com, 6/3).
The BBC’s Tom Burridge reported Gold Medal-winning U.S. gymnast Shawn Johnson has “recently signed a sponsorship deal with Nike,” which is “designing a line of clothing, marketed around Shawn.” The company will “use the virtual imaging of her movements to help them make the clothes.” Burridge wrote Nike is “actually taking a risk” with Johnson, who “might not even compete” at the ’12 London Games due to an injury. Still, with “her profile, her youth, her good looks and her success as an athlete, Shawn Johnson is hot property in the world of sports marketing” (BBC.co.uk, 6/3).
PLAN B: The AP’s Barry Wilner noted marketing partners for the NFL and NFLPA “aren’t panicking,” or even “fleeing.” They are “making contingency plans, of course, because the time when sponsors and advertisers must make decisions on how loyal they can be to pro football is rapidly approaching.” However, NFL Players, the marketing arm for the union, said that it “has not lost any marketing partners.” NFL Players President Keith Gordon “believes the worth of its players to advertisers and sponsors could actually grow should the lockout continue into the fall” (AP, 6/4).
TRYING A NEW STRATEGY: In this week's SPORTSBUSINESS JOURNAL, Terry Lefton reports Under Armour has "tabbed Omnicom Media Group’s Optimum Sports to plan and execute its media buying, along with some strategic and activation assignments.” It marks the “first time Under Armour, which passed $1 billion in revenue last year, has used an outside media agency,” as its “previous media planning and buying for its brand campaigns was handled in-house.” Optimum’s first assignment “will be to fashion a media plan for a back-to-school campaign.” Under Armour joins a roster at Optimum Sports including State Farm and Gatorade. Sources said that Optimum “won an agency shootout that also included Interpublic Group’s Initiative Media” (SPORTSBUSINESS JOURNAL, 6/6 issue).
SURF & TURF: In San Diego, Mary Kenney noted surfer Kelly Slater has “been hired as a pitchman for Daphne’s California Greek, a San Diego-based restaurant chain that emerged from bankruptcy and is now trying to draw more customers with healthier food.” Slater will “create a surf team that represents the company and he’ll serve as a consultant on Daphne’s menu.” Slater said, “My menu contributions will result from working with the internal team at Daphne’s California Greek and just throwing ideas out there to see what makes sense and then formulating as we need to get it right” (SAN DIEGO UNION-TRIBUNE, 6/5).