SBD/April 28, 2014/Marketing and Sponsorship

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  • CarMax Ending Sponsorship With Clippers Amid Sterling Controversy; State Farm Could Be Next

    CarMax has announced that "after 9 seasons, it will end its sponsorship" of the Clippers, according to ESPN's Darren Rovell. A statement from the company indicated that racist comments allegedly made by Clippers Owner Donald Sterling in an audiotape obtained by TMZ are "completely unacceptable” (TWITTER.com, 4/28). Meanwhile, Translation Founder & CEO Steve Stoute, whose company counts State Farm as a client, said he is "telling the brand immediately, 'Let's pull sponsorship,'" beginning with the insurance company. Stoute said, "We have a great program with Chris Paul and Cliff Paul. ... But when you have things like this taking place, somebody has to stand up. And from my standpoint, I'm going to use the opportunity of the brands that we represent. ... They're along with it. Until this thing is further investigated, we're going to have to suspend all spending with these guys." Stoute said, "Sponsoring the athletes is one thing, but no sponsoring of the team" ("The Herd," ESPN Radio, 4/28). Sports talk radio host Dan Patrick said of State Farm possibly ending its sponsorship with the team, "This is when you start to get somebody's attention, the dominoes start." Patrick: "When you have sponsors, advertisers who start to bail, that's when all of a sudden you get some people's attention, and maybe that's what's going to happen. You don't want your product affiliated with Donald Sterling, and you'll see others that will probably follow suit." Patrick: "When you become bad for business, that's when people take notice, that's when the other owners take notice" (“The Dan Patrick Show,” 4/28).

    Print | Tags: Marketing and Sponsorship, Los Angeles Clippers
  • Nike Uses Star Power in New FIFA World Cup Campaign As Soccer Sales Reach $2B

    Nike's launch spot for its "Risk Everything" campaign around this summer's FIFA World Cup was "somber and serious," but with part two released last Friday, Nike "gets its sense of humor back," according to Tim Nudd of ADWEEK. The new four-minute film, titled "Winner Stays," from Wieden + Kennedy and director Ringan Ledwidge, is "vintage" Nike. The ad features "stunning action shots expertly offset by comic relief, all woven into a mini-narrative whose momentum builds to a quietly explosive set piece." Portugal MF Cristiano Ronaldo, Brazil F Neymar and England F Wayne Rooney get "top billing," but U.S. G Tim Howard "gets a major cameo." Lakers G Kobe Bryant, UFC fighters Jon Jones and Anderson Silva, model Irina Shayk and the Incredible Hulk "make memorable appearances." It adds up to a "freewheeling, joyful spot that manages the rare trick of making some of the world's most elite athletes seem both completely rarefied and yet eminently approachable" (ADWEEK.com, 4/25). In Portland, Allan Brettman wrote Nike, adidas and -- to a lesser extent -- Puma are "waging a pre-tournament marketing battle for soccer supremacy." The World Cup has "become an opportunity every four years for the brands to seek significant movement in their market share." adidas, an official World Cup sponsor, said that they "expect their soccer revenue to reach" $2.8B this year. Meanwhile Nike, a "company whose soccer revenues barely registered 20 years ago, recorded about" $2B in soccer sales in its last fiscal year (Portland OREGONIAN, 4/26).

    MARK MY WORDS
    : Nike CEO Mark Parker spoke to CNBC on Friday from Madrid, where the company was launching its "complete line" of soccer products. Parker: "We're seeing our (soccer) category continue to grow. We are the No. 1 (soccer) company in the world. … We feel that with the innovation that we're introducing around this World Cup that that's only going to get stronger and stronger." Parker noted Nike will have “more teams than anyone” in Brazil this summer, and "there is a price attached to that." He declined to put a dollar figure on the investment, but said, "It's significant." Parker also addressed reports that Nike will shutter its wearable-hardware efforts. He said there has been "a lot of speculation" about the possibility of Nike and Apple bringing to market a collaborative device, but he would neither confirm nor deny that notion. Parker said Nike is "focusing more on the software side of the experience." Parker: “I think we will be part of wearables going forward. It will be integrated into other products that we create and then we'll look at expanding our partnerships to create more reach for the Nike Fuel and Fuel System that we have. It's really about actually expanding the reach of Nike Fuel and the best way to do that, we think, is through the best partnerships that we can find" ("Squawk on the Street," CNBC, 4/25).

    Print | Tags: Marketing and Sponsorship, Nike, FIFA World Cup
  • NYAC Backed Keflezighi While Some Sponsors Viewed Him As "Risky Investment"

    Keflezighi first visited the NYAC in '09 while rebounding from career setbacks

    U.S. runner Meb Keflezighi’s affiliation with the New York Athletic Club, which had its winged-foot logo "ironed onto his red and white jersey" when he won the Boston Marathon last Monday, "stemmed from late-career desperation for financial support after most had given up on him," according to Lindsay Crouse of the N.Y. TIMES. Keflezighi first visited the NYAC to "speak at its annual pasta dinner" before the '09 N.Y. Marathon. At the time, he was "rebounding from career setbacks." Where others "saw a risky investment," the NYAC "saw an opportunity." NYAC member Caroline Bierbaum LeFrak said, “He’s the total package: beyond his great personality, he has a willingness to give back to the NYAC. Club members who pay thousands in membership fees each year want to be around athletes that are friendly and charismatic. We thought the NYAC would be the perfect fit.” Crouse noted the recruitment process, including a formal interview, "extended for more than a year," ending in '11. Keflezighi’s younger brother and agent, Merhawi, called it “a simple agreement based on mutual understanding.” Crouse wrote by "formalizing a partnership with Keflezighi, the NYAC received both a front-runner and a charismatic ambassador." Keflezighi "appears at intimate events" such as a summer 10K on Shelter Island organized by members." After racing the N.Y. Marathon, he heads to the NYAC's tap room, where "finishers swift and slow alike are celebrated by members." In return, Keflezighi "receives a monthly training stipend that is renewed annually" (N.Y. TIMES, 4/25).

    Print | Tags: Marketing and Sponsorship, Boston Marathon
  • Under Armour Set To Increase Marketing Budget By More Than One-Third

    Under Armour "will increase its ad budget by more than one-third" in '14, based on projections for sales to reach $2.91B this year, up 25% from $2.33B in '13, according to Natalie Zmuda of AD AGE. UA Founder, Chair & CEO Kevin Plank told analysts he "expected to allocate 11% of revenues to marketing," or $330M. That is an $83.5M increase (34%) "over a year ago," and a $125M boost from '12. The company "handles some marketing in house, in addition to working with" agency Droga5. Plank: "You look at the largest sports-marketing assets out there in the world, it really doesn't put us out of the game for anything. We could theoretically go buy anything we wanted to, but we don't have all the money in the world, so we just have to be really thoughtful and we have to pick the right deals." Nike spent $2.7B globally "on advertising and promotions during its most recent fiscal year." Plank: "We want to remain opportunistic about staying close enough to the athlete and the consumer to find those Jordan Spieths out there, and as you know, they're incredibly rare. But I promise that's what we're trying to do is find athletes before they're really out in the open and the market really has a chance to understand what we're doing" (ADAGE.com, 4/24).

    PIRATES' COVE: In Baltimore, Lorraine Mirabella noted UA will outfit the varsity athletic teams at Seton Hall Univ. starting in July, "continuing a string of deals this year with high-profile Division 1 schools." The company under a multiyear agreement "will design and supply footwear, apparel, uniforms and equipment for training and games to all 14 men's and women's teams" at SHU (Baltimore SUN, 4/26).

    Print | Tags: Under Armour, Marketing and Sponsorship
  • Marketplace Roundup

    Wilson jumped 18 spots this year to top the overall sales list

    Seahawks QB Russell Wilson finished the NFL Players Inc.'s fiscal year ranked No. 1 on the top 50 players sales list, based on total overall sales from March 1, 2013, through February 28, 2014. He jumped 18 spots from No. 19 in FY '13 to the top spot, passing Broncos QB Peyton Manning, who is now ranked second (NFLPI).

    NEW BALANCE OF POWER: The AP reported New Balance is "getting a big boost from the U.S. Defense Department," which announced plans to buy $180M worth of sneakers for military recruits. New Balance Dir of Public Affairs Matt LeBretton said that the company is "one of the few" that makes a shoe meeting all federal requirements. Acting Deputy Secretary of Defense Christine Fox on Friday announced that the agency "will provide military recruits with the American-made footwear, rather than giving them a stipend to buy their own training shoes" (AP, 4/27).

    SLIPPERY SLOPE: In Tampa, Marc Topkin reported Rays manager Joe Maddon "received a letter of reprimand from MLB saying he shouldn't wear a ski cap to the mound as he did on the last road trip." Maddon said that he "would consider wearing the ski cap in the dugout and switching to the other hat when he headed to the mound" (TAMPABAY.com, 4/26).

    Print | Tags: Marketing and Sponsorship
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