NBA Poised For Big Season With Eyes On Superteams Under Armour Has Slowest Sales Growth In Six Years Axe Bat Completes Corporate Realignment Knight Commission Chair Predicts Grim FBS Future World Series Tickets Still Setting Price Records Yankee Stadium Adding Social Gathering Areas Dolan, Manfred To Discuss Chief Wahoo Logo Cubs Poised For Marketing Opportunities MLB Postseason Viewership Down 8% NHL, Players Set Escrow Withholding Rate At 15%
SBD/January 26, 2012/People and Pop CulturePrint All
Visa Head of Global Sponsorship Marketing MICHAEL LYNCH, one of the most influential voices in the sports sponsorship industry, has resigned after 16 years with the leading payment-card brand. Lynch was one of the first people hired specifically for sponsorship marketing for Visa, which has a portfolio that includes the Olympics as an IOC sponsor, along with the FIFA World Cup and the NFL. Lynch, who headed domestic and later global sponsorship marketing at Visa, will stay at Visa through March. Lynch said in an e-mail yesterday, "I have decided to pursue the next phase of my business career. We have shared many great successes over the years and are proud to have one of the finest and most enviable sports and entertainment sponsorship portfolios in the business.” There is no word on a successor at Visa nor of a new job for Lynch, although he does plan to stay in the sports business. In recent years, his name has been rumored for several open NGB and Olympic-related marketing positions. Lynch joined Visa in '95 after serving as VP/Events for Radio City Music Hall Productions in N.Y. Prior to that, Lynch was a VP at ProServ.
After a 40-year career in the insurance industry, Farmers Insurance President of Enterprise Marketing PAUL PATSIS retired late last year, bringing to an end a robust marketing career that included several signature deals in sports. The most noteworthy of those was Farmers’ agreement with AEG to buy naming rights to a future NFL stadium in L.A. They also include the deal, starting this year, to sponsor the Hendrick Motorsports No. 5 NASCAR Sprint Cup car driven by KASEY KAHNE. Patsis, who has relocated from L.A. to the Pacific Northwest, spoke to SportsBusiness Journal staff writer Tripp Mickle about some of the memories from his career.
Q: How did you get started in the insurance business?
Patsis: It was an accident. Most people in the insurance business start there accidentally. I had gotten out of the Army and needed to get a job. The apartment we were in was across the street from an insurance office for INA. I walked in and they sent me downtown to the main office where they hired me as an underwriter. I never intended to stay. I thought I'd go to law school, but I liked it and had a lot of fun.
Q: What was your first exposure to marketing?
Patsis: I was at INA, which merged with Connecticut General to become Cigna. Technology was starting to change the business. INA moved into the direct marketing business. I saw the direct mail thing would be a real powerful force and there would have to be more horsepower behind marketing than there had been 100 years before then.
Q: Why has the insurance business gotten so invested in sports in the last few years?
Patsis: I can get pretty philosophical about this. If you look at the insurance business, it’s been historically focused on the pricing models. The reason is basic economics. You have unlimited demand for auto insurance. Everyone has to have it. All the companies said that since everyone had to have the products they would focus on underwriting to get the right price. But what’s happened recently is some companies woke up one day and said the truth is it’s not an efficient market. It doesn’t necessarily matter what pricing is. The consumer goes to get two or three quotes, so companies have realized that being considered matters. Geico, State Farm, Allstate, Farmers and others realize that they need to raise unaided consideration.
Q: Was it hard to persuade Farmers to go that route?
Patsis: Farmers was more in the vein of letting its agents lead. It came later to the game. Once we were able to make the business case and I was able to show how driving unaided consideration would drive your quote volume and allow you to grow the business, the attitude was, “OK, let’s dip our toe in the waters and see if we see some results.” We had some results, and that created some believers.
Q: Is there an end in sight for the spending spree in insurance?
Patsis: Nothing is evergreen. Things will force some shifts and changes. A lot of that could revolve around technology. You might see a shift in how the Web works.
Q: Is it still pretty TV heavy?
Patsis: TV is a big driver, but social media and the Internet and sponsorships are really following closely behind that.
Q: Tell me about the naming-rights opportunity. How do you persuade a company to spend money on a stadium that doesn’t exist?
Patsis: When the opportunity came up to do this, I personally was very interested in jumping all over this for a couple of reasons. Farmers is a Los Angeles-based company. It’s really close to the site where AEG wants to build a stadium. We looked at the fact that there was no stadium and no team as a plus. It gave us a chance to get our name connected to the stadium right at the get-go and not having the problems later on of having to dislodge a name already there. The other thing we looked at was: No real cash leaves the company for several years. We've had billions of mentions of Farmers without having to spend a penny.
Q: What was it like to go head-to-head with TIM LEIWEKE on the negotiation?
Patsis: Tim said some nice things about us. He said we got smart in a hurry. But it went well because Tim’s values and our values lined up from the beginning. After our first meeting with Tim, I said, “This is the perfect match for us.” When I made my pitch to the Farmers board, I said the success or failure of a venture like this depends on the partner. I spent the next 15 or 20 minutes talking about AEG. Then I went into the football stadium, how the numbers penciled out and what the analysis showed.
Q: What would people who have never sat across from Tim be surprised to hear about?
Patsis: The enormous capacity this guy has to cover so many bases with so much energy. He’s in another league. He has an incredible ability to anticipate and cover the waterfront with an energy that¹s second to none.
Q: What is your favorite moment from a sports negotiation?
Patsis: When I first looked under the hood of NASCAR and got to see the Hendrick organization from the inside and looked at how well-run an organization really needs to be and the amount of teamwork involved in getting the results they get, [it] surprised me. I expected to see that in Formula One. I didn’t expect to see that level of sophistication and organization. To see the breadth and scope they had to cover to field a winning team blew me away.
Q: What was it like to negotiate with RICK HENDRICK?
Patsis: I flew to one of the NASCAR races, I think it was Phoenix, to have a face-to-face meeting with Rick. I talked to him for a half an hour and we never talked about a deal. During that conversation, I said to myself, “I don’t care if we do a deal or not. He’s just a cool guy to know.” He’s the nicest, most genuine, heartfelt guy I’ve ever done business with. If I was going to pick a family member, I’d pick that guy. I can't overstate how much of an effect that had on us doing that deal.
Q: Is the sports sponsorship market priced fairly?
Patsis: The market always determines pricing. We’ve seen a shift in price as the market's gone up or down. The issue becomes: Is the price a property is available at right for your company or not? That's when you put the numbers down and ask, how many impressions can I drive, what's that fan base like and can this drive business?
Q: What sports property would you buy stock in right now?
Patsis: There’s no name that comes to mind right now. There’s a lot of teams that are struggling. But if the price drops, that doesn’t necessarily make it a better buy. You still have to ask: Is the amount I’m spending going to deliver the quotes I’m looking for?
Q: What sports property would you short?
Patsis: Teams that have had trouble with union negotiations and soured their fan base, there are some issues. Early on in the year, I would have been concerned about the NBA, but they seem to have bounced back.
Q: What would you like to see changed in sports sponsorship?
Patsis: I wouldn’t say change so much. One thing I think people need to pay attention to is that the game doesn’t end when you write the check for the sponsorship. The component you have to pay attention to, where you can sink or swim, is on the activation side. Drawing a closer connection between the actual sponsorship component and activation component is where there's great opportunities to have greater success than the past. There’s new ground that can be broken there.
Boston-based Shawmut Design & Construction has announced the launch of a Sports Venues division that will specialize in the management of construction projects at stadiums, arenas and other athletic facilities. The new division will be overseen by RANDY SHELLY, who has been with the company since '02 (Shawmut)....PR, marketing and events firm KemperLesnik promoted TOM VALDISERRI to Exec VP and AMY LITTLETON to Senior VP (KemperLesnik)....Loyola Univ. Maryland promoted BILL WNEK to Associate AD (Loyola)....Marketing firm CSE appointed veteran PR exec JIM WEISS to the newly created position of VP/Communications & PR (CSE)....USA Hockey added Blackhawks GM STAN BOWMAN to the U.S. Men's National Team Advisory Group (CHICAGO TRIBUNE, 1/26).
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In Pittsburgh, Ron Musselman reports thousands of people lined the streets to pay their final respects to former Penn State football coach JOE PATERNO as his funeral procession "slowly made its way through" the university's campus yesterday. The burial followed a private service attended by Paterno's family, "current and former football players and coaches." Pro Football HOFer FRANCO HARRIS, Nike Chair PHIL KNIGHT and former Penn State AD TIM CURLEY were among those in attendance (PITTSBURGH POST-GAZETTE, 1/26).
REQUESTING TO BE INTERVIEWED: GOLF WORLD's Ron Sirak notes golfer SOPHIE GUSTAFSON has been "unable to share her personality because of a stutter so severe one sentence rarely follows another without hitting a stop sign." However, prior to the start of the Solheim Cup last September, Gustafson "got up the nerve to do her first television interview," and the response "was remarkable." Gustafson approached Golf Channel's VAL SKINNER about "doing a TV interview because she felt left out as others were asked to do spots in advance of the Solheim Cup." Gustafson will go to The Masters in April to "receive the Ben Hogan Award from the Golf Writers Association of America, which goes to a player who has overcome injury or illness to compete" (GOLF WORLD, 1/30 issue).
IN THE STUDIO: Twenty current and former NFLers, including NFL Network's TORRY HOLT, Colts S ANTOINE BETHEA and Rams CB AL HARRIS, will take part in the NFL Business of Music Boot Camp at NYU's Clive Davis Institute of Recorded Music. The program will run from Feb. 27-March 1 and is being directed by NFL Player Engagement and the Clive Davis Institute in NYU's Tisch School of the Arts (NFL).
ON THE INJURED LIST: Broncos QB TIM TEBOW has reportedly "backed out of next month's AT&T Pebble Beach Pro-Am due to injuries he suffered in the Broncos' AFC Divisional playoff loss" to the Patriots (N.Y. DAILY NEWS, 1/26)....ANN MARA, widow of late NFL Giants Owner WELLINGTON MARA, broke her shoulder in a fall after returning from S.F. Team President & CEO JOHN MARA, Ann's son, in an e-mail said, "She is 'probable' for SB" (ESPNNY.com, 1/25).
NAMES: The British Financial Services Authority yesterday said that it fined hedge fund manager DAVID EINHORN and his firm Greenlight Capital Inc. a "combined $11.2 million for trading on information Mr. Einhorn received in a 2009 conference call about a stock offering by U.K.-based Punch Taverns PLC". Einhorn's deal to become a partial owner of the Mets fell through last September (WALL STREET JOURNAL, 1/26)....As part of the "Bubba & Friends Drive to a Million" initiative announced by golfer BUBBA WATSON, Ping will "donate $300 for every drive he hits over 300 yard (up to 300 drives) in 2012" (ARIZONA REPUBLIC, 1/26)....Maple Leafs President & GM BRIAN BURKE spoke last night at a leadership series hosted by the Rotman School of Management at the Univ. of Toronto. A crowd of "more than 400" listened to JASON FARRIS, author of the book "BEHIND THE MOVES: NFL GMS TELL HOW WINNERS ARE BUILT," talk with Burke, who wrote the book's foreword (TORONTO STAR, 1/26)....Olympic gymnast SHAWN JOHNSON will release a memoir, "WINNING BALANCE: WHAT I'VE LEARNED SO FAR ABOUT LOVE, FAITH, AND LIVING YOUR DREAMS." Illinois-based Tyndale House Publishers announced the book is scheduled to be released June 5 (THE DAILY)....NASCAR Driver KEVIN HARVICK and his wife DELANA are expecting a their first child in mid-July (SCENEDAILY.com, 1/25)....Patriots WR WES WELKER reportedly is engaged to his girlfriend ANNA BURNS (BOSTON HERALD, 1/26).