SBD/July 19, 2012/Marketing and SponsorshipPrint All
Former Rockets C Yao Ming retired last July, but “there no doubt remain millions of residual Rockets fans from Beijing to Guangzhou, making it easier” for Rockets Owner Les Alexander to sign off on a three-year, $25M contract for G Jeremy Lin that “many, even hopeful Houstonians, see as being a bit over the top,” according to Dale Robertson of the HOUSTON CHRONICLE. N.Y.-based PR firm 5W President & CEO Ronn Torossian said Lin is a “marketing dream come true.” However, Torossian believes that Lin will have to “raise the bar much higher in a Rockets jersey to match the riches he could have found playing on Broadway.” Robertson noted other marketing experts “contend the disparity isn’t as great as might be assumed, thanks to Lin’s Chinese ancestry and Houston’s unique synergy with the Asian market after Yao Ming.” N.Y.-based marketing firm WebiMax Founder & CEO Kenneth Wisnefski said, “I expect his value on and off court to climb as endorsement opportunities should rise. We know (the Houston) area is receptive, given the success of Yao Ming. In addition, the inroads that were developed with Yao Ming in the international Asian market can carry over and impact Jeremy Lin’s brand recognition.” Robertson noted Rockets personnel were said to be “reluctant to discuss the marketing impact of acquiring Lin, lest people think he was signed for that reason and not for his basketball skills." Robertson reported the Rockets did “happily announce that in the first 18 hours after they announced Lin was coming, they had picked up more than 3,000 new Twitter followers and 10,000 new ‘likes’ on Facebook.” The number of season-ticket sales sold since the acquisition of Lin is unknown, but Rockets Media Relations Dir Nelson Luis said, “It will take a few days before we see a lot going on. That’s the way it was when we drafted Yao” (CHRON.com, 7/18).
REDUCING LIN-VENTORY: In N.Y. Richard Sandomir writes under the header, “Lin Is Gone, And So Is The Buzz.” It is “time to unload his merchandise” at N.Y.-area stores, and at Modell’s locations, $20 Lin T-shirts were reduced to $5, while replica jerseys were discounted from $60 to $20. Lin’s $90 swingman jerseys were cut to $40. Modell’s CEO Mitch Modell said, “This could be the biggest markdown on a traded player in our 123-year history.” Sandomir notes Lin Knicks apparel is “still for sale at the NBA store online, but none of his Rockets merchandise is ready.” NBA Exec VP/Global Marketing Sal LaRocca said that fans can “personalize the online retailer’s stock of blank Houston jerseys with Lin’s name and number” (N.Y. TIMES, 7/19). The Rockets’ website has an offer to pre-order an adult-size Lin No. 7 replica jersey for $55.43 (USA TODAY, 7/19). Steiner Sports CEO Brandon Steiner said, “We’re trying to understand the Houston market, determine if Lin will have the same level of fame and intensity. We hope so. But New York is a special place. You can’t compare to New York” (N.Y. DAILY NEWS, 7/19).
CRITISICIM FOR DOLAN: In New Jersey, John Rowe writes Knicks Owner James Dolan “showed his true colors in the handling of Jeremy Lin’s restricted free agency.” It is how the Knicks “first encouraged Lin to bring them an offer sheet from another team and how they reacted when the bottom line was more than they anticipated.” Rowe added Dolan “went as far as to criticize Lin behind the scenes for being disloyal to the team that gave him a shot and for hiring a publicist” (Bergen RECORD, 7/19). ESPN’s Michael Wilbon said the Knicks leaking information about Lin is a "lowlife, low-rent move even for Knicks management. … It’s classless.” ESPN's Chris Broussard said, "Instead of the focus being on them losing this superstar that they had, at least in terms of his celebrity, they want to put the focus him and why he left” (“PTI,” ESPN, 7/18). In N.Y., Harvey Araton asks whether Dolan did not re-sign Lin “on the grounds of his being an ingrate and daring to exploit his leverage for what could be the one time in his basketball career?” In “contrast to Lin’s work, there is more than a sampling of Dolan’s, enabling us to make an educated guess as to how cool and calculated he was upon learning that Lin and the Rockets had conspired to make their deal even more tax punitive for him to match” (N.Y. TIMES, 7/19). Meanwhile, Denver Post columnist Woody Paige said the Knicks have “overspent for 15 years and they have nothing to show for it." Paige: "Suddenly, they’re going to be financially responsible?” (“Around The Horn,” ESPN, 7/18).
THE RIGHT MOVE: In Baltimore, Steven Petrella noted Knicks management "is finally putting its foot down and not giving into the fan base and pitchfork wielding fans, but instead doing what makes the most sense for the future of the franchise” (BALTIMORESUN.com, 7/18). In San Jose, Tim Kawakami writes Lin was the “most exciting thing to happen to the franchise in decades, and his departure rightly sparked local outrage.” But the Lin “contract saga is a classic NBA conundrum: Really, what is he worth?” Kawakami writes, “In the monthlong burst of ‘Linsanity’ last season, Lin proved he can be a dynamic difference-maker. He's also probably never going to be special enough to merit the attention he has already received and the contract he just got ... and his NBA peers know this” (SAN JOSE MERCURY NEWS, 7/19).
ROCKETS’ RED GLARE: In N.Y., Howard Beck notes Rockets GM Daryl Morey has been criticized by some "for violating an unwritten code by changing the terms of Lin’s deal." However, it "was a legal maneuver ... because no contract had been signed.” Two league execs said that Morey was “well within bounds, technically and ethically” and “praised Morey for the bold maneuver” (N.Y. TIMES, 7/19). Alexander said that the “benefits to the business of basketball are nice, but far from the motivation, instead citing how they might help the Rockets rebuild.” Alexander said of the signing, “I love it. I think it’s great for the city of Houston. It’s great for the fans. I think a team needs to have that attention to attract free agents and do what we have to do to win. It helps. It always helps (the business), but the real reason is it helps to attract free agents” (CHRON.com, 7/18).
The U.S. House yesterday voted 216-202 "to continue allowing military sponsorships of NASCAR teams,” according to Bob Pockrass of SPORTING NEWS. Republicans voted against the amendment (in favor of sports sponsorships) "by a 156-81 margin Wednesday night, while Democrats voted for the amendment (and against sponsorships) by a 121-60 margin." This vote was “much closer than two taken last year, when the measure failed 281-148 and 260-167, respectively.” A 30-minute debate on the House floor prior to the vote pitted U.S. Reps Jack Kingston (R-Ga.) and Betty McCollum (D-Minn.) "against seven House members who spoke against the amendment.” U.S. Rep. Patrick McHenry (R-N.C.) said of the sponsorships, “It delivers results. The fact is no matter the size of the military, you’re still going to need recruits.” But McCollum said that the National Guard program “did not produce recruits.” McCollum: “It would be just irresponsible and outrageous that Congress would go ahead and continue to borrow money from China to pay for one racecar driver’s team $26 million for delivering zero recruits.” Pockrass noted the amendment was “predicted to produce savings of $72.3 million in the $608 billion defense spending bill.” The U.S. Army and National Guard have “the two most prominent NASCAR sponsorships.” The Army “already has announced it would end" its $8.4M NASCAR sponsorship at the end of the '12 season. That deal included sponsorship of Stewart-Haas Racing’s Ryan Newman in the Sprint Cup Series, "as well as for at-track displays and other promotions." The National Guard has indicated that it “wants to continue its program.” NASCAR sent a letter, co-signed by the NBA, NFL, MLB and the IndyCar Series, to Congress in opposition to the amendment (SPORTINGNEWS.com, 7/18). But THE HILL’s Pete Kasperowicz noted “several members from both parties defended DOD's ability to sponsor sporting events in a bid to win recruits” (THEHILL.com, 7/18).
ALL IN FAVOR? The AP’s Donna Cassata noted the rejected measure “had targeted the money the National Guard spends to sponsor Dale Earnhardt Jr., NASCAR's most popular driver, as well as IndyCar Series driver JR Hildebrand.” It also would have “cut money the Army spends on the National Hot Rod Association drag racing, funds the Marine Corps uses for the Ultimate Fighting Championship and money spent on bass fishing.” The House also rejected an effort by McCollum “to reduce the budget for the military's 140 bands and 5,000 full-time musicians from $388 million to $200 million” (AP, 7/18).
Nationwide Insurance has turned to NASCAR drivers Dale Earnhardt Jr. and Danica Patrick for a new ad campaign “which kicks off during the opening ceremony” of the London Games, according to Nate Ryan of USA TODAY. Nationwide’s new campaign is a “less irreverent series of commercials designed to sell the mutual company as a Main Street alternative to its publicly held competitors.” Nationwide Exec VP and Chief Marketing & Strategy Officer Matt Jauchius said that Earnhardt and Patrick were “the right fit to convey a softer, humanized message.” Jauchius: “They are popular and transcendent, but, equally important, their personal brands are so aligned with our brand.” The campaign, which includes a voice-over from actress Julia Roberts, will "have a tone more like the racetrack commercials featuring Earnhardt and Patrick that began appearing last year to help showcase” the company’s NASCAR title sponsorship. Jauchius will appear “with Earnhardt in the new series of ads July 28 during the Indy 250, the first Nationwide race" at Indianapolis Motor Speedway. Nationwide is in the fifth year of a seven-year deal to title sponsor NASCAR's No. 2 series, and Jauchius said that negotiations “would begin next year with NASCAR on an extension.” Business attributed by the company to its NASCAR sponsorship “grew 40% during the first quarter of 2011” (USA TODAY, 7/19). SPORTING NEWS’ Bob Pockrass wrote Nationwide for the first time is using its NASCAR connection to help launch a new ad campaign called “Join the Nation.” The ads also will feature “NASCAR personalities Ned and Dale Jarrett, speaking as customers.” Pockrass noted Nationwide asked Earnhardt to “shave his beard for the commercial and to not wear sunglasses” (SPORTINGNEWS.com, 7/18).
NASCAR today named Ogilvy & Mather its agency of record, choosing it over Leo Burnett and McCann Erickson in a four-month process to identify a new creative agency for the sport. Ogilvy & Mather replaces Jump Company, which handled the sport’s creative for the last 10 years. The agency will be tasked with developing creative that addresses NASCAR’s five-year action plan, which is focused on attracting youth and multi-cultural fans and engaging existing fans. It will develop a new “brand platform” ahead of next year’s Daytona 500, a NASCAR release said. The sanctioning body reviewed 110 submissions to become its agency of record. NASCAR Managing Dir of Brand & Consumer Marketing Kim Brink led the review, with heavy involvement from Senior VP & CMO Steve Phelps and Chair & CEO Brian France. In a statement Ogilvy CEO John Seifert said, “We view NASCAR as a lighthouse brand. ... We couldn't be more proud to add the sport to our portfolio.” The agency has done work with IBM, Ford, American Express, the Tribeca Film Festival and the '10 FIFA World Cup.
Tiger Woods' marketing appeal "means something different in 2012 than it did in 2011 and certainly different from 2010,” and “quietly, almost imperceptibly, his brand has recovered,” according to Eric Adelson of YAHOO SPORTS. The phrase, "Go on, be a Tiger" was Accenture's marketing slogan for Woods while he was an endorser, but it “became a punch line” after his infamous Escalade accident in Nov. '09. But these days the phrase is “more palatable -- at least on the golf course.” The phrase “doesn't make us cringe the way it did,” and that is “significant.” Univ. of Oregon Warsaw Sports Marketing Center Managing Dir Paul Swangard said, "He was an 11 before (2009) on a 10-point scale. He transcended his sport. He moved the needle. After the car crash, I'd put him at a 3. He was pretty much tainted as a marketing vehicle. I'd say he's back to a 7 or an 8." Adelson noted Woods before the scandal “could endorse any product -- inside or outside sports.” Now performance companies, like Fuse Science and Nike, are "not only getting the benefit of hours of camera time this weekend at the British Open but also the fairly safe assumption that Woods will not embarrass the brand on the course.” Swangard said, "Endemic sponsors like Nike are still with him. They can sell against that brand equity. What we saw with Kobe (after being accused of rape in Colorado), as soon as he was out there throwing 82 points down, Nike was able to monetize that." Woods is “gradually ceasing to be reflective of anything other than golf.” That was a “bad thing for years, as his marketing meaning was corroded permanently,” but now it has “become a good thing” (SPORTS.YAHOO.com, 7/18). Woods' current sponsors, in addition to Nike and Fuse Science, include Timex, Upper Deck and Electronic Arts (THE DAILY).
TOO HARSH? Golf Channel’s “Morning Drive” discussed whether the media has been too harsh on Woods. Golf Channel’s Gary Williams said, "No ... He has the most unusual relationship of a player in the media in the history of golf. But there are a lot of positives that come with it. He is the only one that gets a ‘Tiger Tracker.’ There’s no ‘Bubba Tracker.’ There’s no ‘Phil Tracker.’ There are times that yes, can they be hard on him, but in general, no.” Golf Channel’s Jerry Foltz: “If Tiger played golf as well as he played for the last 20 years and there was no media, Tiger would be on our salary, basically. He would win a lot of money in purses, but the media made him a ridiculously wealthy person by exploiting his fame. Are they too hard on him? Maybe sometimes they go one step too far, but that's part and parcel with the territory” (“Morning Drive,” Golf Channel, 7/17).
adidas Group China is “continuing its aggressive push into Chinese lower-tier cities with the planned opening of up to 600 stores,” according to Li Woke of CHINA DAILY. adidas Group China Managing Dir Colin Currie said, "We plan to open 500 to 600 stores in lower-tier cities by the end of the year." Currie said that the company “plans to open new stores in at least 300 to 350 cities where it does not have outlets now but where local competitors are present.” He added that the store openings this year “will focus on the western and northwestern parts of China.” The move follows the company's first quarter results, which were “boosted partly by strong sales in China, with a 26-percent increase.” Currie “attributed the rise to the company's Route 2015 strategy, which calls for five years of double-digit annual sales growth in China.” adidas has “opened more than 6,000 stores since it entered the Chinese mainland market in 1997” (CHINA DAILY, 7/19).
CLOSING TIME: Meanwhile, the WALL STREET JOURNAL’s Laurie Burkitt reported adidas is “closing its only company-owned apparel factory in China as part of a move to improve efficiency.” An adidas spokesperson said that the company “will close the 160-worker factory in China's coastal city of Suzhou at the end of October.” The company said that it “will source its products from other local Chinese manufacturers.” It already “works with 300 supplier factories in the country.” The spokesperson said that closure is part of adidas' “efforts to restructure business in China and globally to ensure efficiency and leverage scale.” The spokesperson added that adidas “will not be reopening the factory elsewhere” (WSJ.com, 7/18).
adidas and MLS announced that the league will integrate the adidas miCoach Elite System league-wide in the '13 season. The announcement, made at a press conference this morning in N.Y., comes ahead of the '12 AT&T MLS All-Star Game next Wednesday at PPL Park, which is set to be the world’s first “smart game” integrating the system. All 19 MLS clubs will use the data-tracking technology from adidas, providing coaches, trainers and players with real-time performance metrics including heart rate, speed, acceleration, distance, field position and power. adidas Chair & CEO Herbert Hainer in a statement said, “As the paths of sports and technology continue to converge, we are pleased to be pioneering in this area and continue to deliver cutting-edge innovations to teams and leagues worldwide.” MLS Commissioner Don Garber said, “Working with adidas, we are bringing players, coaches and fans across the league a revolutionary technology to help teams perform at the highest level.” adidas said the system was developed in consultation with MLS Red Bulls, Union and Sounders FC, as well as European clubs Real Madrid, AC Milan, Ajax and Bayern Munich.
In DC, Dan Steinberg noted on the heels of the debut of his adidas commercial, Redskins QB Robert Griffin III appears in "another new spot," this one for Gatorade. Steinberg: "It seems pretty clear that this kid is now D.C.’s most marketable athlete, before he’s played a single down of professional football" (WASHINGTONPOST.com, 7/18).
HOMETOWN HERO: In Indianapolis, Curt Cavin notes Alabama firefighter Curtiss Shaver's name "will be a featured part of the Brickyard 400 at Indianapolis Motor Speedway." Shaver is the "winner of a Hometown Heroes contest conducted by Crown Royal, the title sponsor of the 19th annual Sprint Cup Series race." He will be the "guest of honor for a four-day sporting event that culminates July 29" with the "Crown Royal presents the Curtiss Shaver 400 at the Brickyard powered by BigMachine Records.com." Shaver's name "will be on all race memorabilia." Crown Royal "presented five candidates for fans to vote for on Facebook" (INDIANAPOLIS STAR, 7/19).
BANK ON IT: MARKETING magazine's John Reynolds reported RBS has "agreed to a 70% increase in its 6 Nations rugby sponsorship deal, as it looks to have beaten rival HSBC to retain the title sponsorship of the annual tournament." The bank "is set to confirm" a US$68.7M four-year deal to retain sponsorship rights (MARKETINGMAGAZINE.co.uk, 7/17).
DROPPING DOWN: The FINANCIAL TIMES' Robert Budden noted commercial TV broadcasters "are set to suffer a significant downturn in revenue during the Olympic Games." Media buyers and a senior airtime sales exec said that the TV industry "is now predicting falls" of 8-10%. The "sharp deterioration in the advertising market comes as many companies fear that the BBC, which is the host broadcaster for the Olympics in the UK, will dominate viewing figures during the Games." TV industry execs admitted that some advertisers "had moved their ad spend around to avoid the Olympics, either by shifting campaigns into the second quarter or postponing them until the fourth quarter, after the Games" (FINANCIAL TIMES, 7/17).