SBD/May 29, 2013/Marketing and Sponsorship

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  • Nike Discontinuing Livestrong-Branded Products After '13; Logo To Remain Until End Of '14

    Nike has told the Livestrong Foundation that it will "discontinue its line of Livestrong-branded products by the end of this year," according to Darren Rovell of ESPN.com. Nike North America Media Relations Manager KeJuan Wilkins in a statement said, "We will continue to support the Livestrong Foundation by funding them directly as they continue their work serving and improving outcomes for people facing cancer." Sources said that Nike just last year "sold $150 million of Livestrong-branded products, its most ever." But sources added that Nike, as well as Dick's Sporting Goods, which "sold the most product at retail, were ready to give up the business." Rovell noted the foundation together with Nike "made more than 87 million of its Livestrong yellow rubber wristbands since May 2004." Nike raised more than $100M for the foundation "through sales of the $1 wristbands and a minimum guarantee and royalty payments made on the sale of Livestrong gear" (ESPN.com, 5/28). USA TODAY's Brent Schrotenboer reports the Nike logo on the packaging of Livestrong's yellow bracelets will "remain until the entire contract expires in December 2014." Nike's decision to "stop other merchandise production -- shirts, shorts, jackets -- marks the latest blow to Livestrong, the charity founded by Lance Armstrong." Livestrong VP/Communications & External Affairs Katherine McLane said that Nike would "continue to support Livestrong through the end of its contract" (USA TODAY, 5/29). In N.Y., Juliet Macur notes Livestrong has been "bracing for the fallout, including a budget reduction of nearly 11 percent from last year in case it brought in less revenue." The organization also has "tried to re-brand itself by dropping the name Lance Armstrong Foundation and adopting the name Livestrong Foundation." Livestrong earlier this month also "launched an advertisement campaign promoting its new buzzword, StillStrong, and reminding people that the charity is still providing free services to cancer patients" (N.Y. TIMES, 5/29).

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  • Tony Kanaan's Indy 500 Win Relieves Financial Pressure On KV Racing Team

    Kanaan with the $2.3M win hopes to focus on driving rather than sponsorship

    Indianapolis 500 winner Tony Kanaan on Monday said that KV Racing Technology co-Owners Kevin Kalkhoven and Jimmy Vasser "went into Indianapolis unsure if they'd finish the season" due to a lack of sponsorship, according to Jenna Fryer of the AP. However, Kanaan's win, which comes with a $2.3M windfall, has "relieved the financial burden" on the team. Kanaan had been "piecing together corporate support since right before the season opener when the team announced Hydroxycut had signed on for nine races." That deal "left five unsponsored" races for the team. Kanaan said, "The past three years I've been working extremely hard, probably even harder than driving the car, to find the sponsorship to keep surviving. I hope this win helps me a little bit more, makes it easier to either find a sponsorship or maybe get back on a team that is well-funded. I'm not saying we're going to make the same money we used to make, because these are different times. But I would like to have a little bit less pressure on my side, to just really concentrate on driving." Fryer noted KV signed him "shortly before the 2011 season opener when sponsorship materialized." Kanaan was "out of a job at the time because his sponsorship at Andretti Autosport had gone away, and a plan to drive for a new team started by fellow Brazilian Gil de Ferran fell apart because of a lack of funding" (AP, 5/27). ESPN.com's John Oreovicz wrote although he already is one of IndyCar's "most recognizable stars, the Indianapolis victory should boost Kanaan's public profile even more." Kanaan said, "If it helps the series, that's awesome. I've been extremely popular here for so many years. And it was a great race. Now we just need to keep it steady" (ESPN.com, 5/28).

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  • Added Race, New Sponsors To Boost Revenue At Detroit's Belle Isle Grand Prix

    Chevrolet returns as presenting sponsor for the Detroit Belle Isle Grand Prix

    The addition of a "second IndyCar Series race for next weekend's Chevrolet Detroit Belle Isle Grand Prix is predicted by organizers to fuel up to a 10 percent increase in the event's total revenue," according to Bill Shea of CRAIN'S DETROIT BUSINESS. Belle Isle Grand Prix Chair Bud Denker said that corporate sponsorships will "generate millions more in revenue and have increased" 10% over last year. New sponsors "paying for exposure to car enthusiasts and race fans include watchmaker Shinola and vehicle sales sites Cars.com and Autotrader.com." Denker said that Quicken Loans is "upping its financial sponsorship commitment." Shea noted the "main draw for fans and sponsors are the two afternoon Izod IndyCar Series races, one of which will be run each on Saturday and Sunday -- giving corporate sponsors options for clients." A "significant race revenue boost comes from the introduction of 'double-decker' trackside rental chalets." Denker said that 10 companies have "each rented $135,000 two-story chalets that seat 75 people and were used during last year's Summer Olympics in London." That "alone is an estimated" $1.35M in revenue. Denker expects the new chalets to "entice other sponsors to want them next year." The "traditional single-story, 50-person chalets along the paddock rent for $60,000; the riverside chalets $84,000; and the rest $100,000." Denker said that "all 51 chalets have been leased for the weekend, which is six or seven more chalets than 2012" (CRAIN'S DETROIT BUSINESS, 5/26 issue).

    CHEVY ON A ROLL: In Detroit, Doug Guthrie writes Chevy enters the event "riding record sales and hungry for a racing win in its hometown." GM "helped bring racing back to Belle Isle last year as a celebration of its return to competitiveness in showrooms." Chevy won the IndyCar series championship last year, but "nothing is remembered more clearly in the highest offices of the Renaissance Center than the two most bitter losses of the season: the 2012 Indianapolis 500 and the hometown race at Belle Isle." Some of that "pain was eased Sunday" with Tony Kanaan's win in the Indianapolis 500 (DETROIT NEWS, 5/29).

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  • Marketplace Roundup

    The GLOBE & MAIL's Jeff Pappone reported the upcoming Dreamworks release "Turbo" just "might help IndyCar become relevant again in a U.S. racing landscape dominated by stock car behemoth NASCAR." The movie, which opens July 17, "chronicles the adventures of a garden snail who dreams of racing glory in the Indianapolis 500." With film director David Soren and Dreamworks' "track record of success, many in the paddock hope Soren’s handiwork will do big things for the profile of IndyCar." IndyCar team Owner Roger Penske: "If we can excite young people about racing and to come to Indianapolis, I think it’s a great opportunity to showcase the sport and the environment we are in" (GLOBE & MAIL, 5/28).

    COFFEE BREAK: The MLS Fire and Dunkin' Donuts yesterday announced a deal making the chain the club's official coffee provider. Dunkin' Donuts will have a presence at the Fire's FireFest, a family-friendly interactive area, and will provide coffee sampling for five different home matches throughout the '13 season. The team as part of the deal also will hold Dunkin' Donuts races, customized for soccer, which will be featured at halftime and see fans receive a winning Bagel, Coffee or Donut coupon (Fire).

    NOT FOR ME
    : In DC, Kilgore & Wagner report Nationals P Jordan Zimmermann "will not consider" any opportunities to appear in any advertisements, especially after Nationals P Stephen Strasburg "filmed one for Toyota." Zimmermann said, "I would never do that. He said that those commercials take like six hours. I’m like, ‘There ain’t no way I’m hanging out and saying the same (stuff) for six hours'" (WASHINGTON POST, 5/29).

    Print | Tags: Marketing and Sponsorship
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