SBJ/January 9 - 15, 2006/Marketingsponsorship

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  • BofA close to multitrack deal with ISC

    Bank of America Corp. will soon expand its NASCAR portfolio with a wide-ranging sponsorship at most or all of the 12 tracks owned or operated by International Speedway Corp., according to sources familiar with the negotiations.

    Experts expect the deal to be announced
    before NASCAR returns to Daytona.

    The deal has not been confirmed by the bank or ISC. Bank of America spokesman Joe Goode would only say the bank planned a NASCAR-related announcement in the next couple of weeks.

    Last year, Bank of America made its first foray into stock-car racing sponsorship by becoming the lead backer of a prerace show on NBC and TNT as well as signing on as the official bank of Concord, N.C.-based Speedway Motorsports Inc.

    The SMI deal includes naming rights for the fall Nextel Cup Series date at Lowe’s Motor Speedway in Concord, N.C., beginning in 2006. Industry experts estimate the Bank of America-SMI alliance is worth $2.5 million a year.

    Industry experts anticipate an announcement of the Bank of America-ISC agreement before next month’s Daytona 500, NASCAR’s first race of the season. An ISC official wouldn’t comment about a potential deal.

    It is unclear how any deal with Bank of America would conflict with current deals ISC has in the financial services category.

    Lenny Santiago, senior investor relations analyst at ISC, said the company has deals with Wachovia Corp. at Talladega Superspeedway, Martinsville Speedway and Darlington Raceway. In addition, ISC has deals with SunTrust Corp. at Daytona International Speedway, Homestead-Miami Speedway and Richmond International Raceway.

    Chemung Canal Trust has a smaller deal with Watkins Glen International.

    Exact terms of those deals are unknown but it is believed that all of them, except the Talladega deal, run through 2009. None of the deals is believed to be all-encompassing along the lines of what Bank of America has done at five of SMI’s six tracks.

    Both the SMI and ISC deals come as Bank of America CMO Cathy Bessant, a self-professed NASCAR fan, serves as a key player in Charlotte’s bid to win a $137.5 million NASCAR Hall of Fame. Sanctioning body NASCAR, a sister company to ISC (both are led by members of NASCAR’s founding France family), will award the hall of fame to one of five cities later this year.

    Adding ISC makes sense for Bank of America, as the track company has facilities in several of the bank’s key markets, including cities in California and Florida.

    The move by Bank of America to add the ISC tracks to its sponsorship portfolio comes less than three months after another NASCAR newcomer, Texas Instruments, through its DLP HDTV brand, signed multiyear partnerships with both SMI and ISC. Even though Bank of America has yet to announce a team sponsorship similar to the DLP and Hall of Fame Racing team partnership, it will be interesting to see if other new sponsors to the sport take this multipronged sponsorship approach.

    Erik Spanberg writes for the Charlotte Business Journal, an affiliated publication. SportsBusiness Journal staff writer Scott Warfield contributed to this story.

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  • Longhorn fans clear out shelves of title apparel

    With 26 seconds left in last week’s Rose Bowl, University of Texas quarterback Vince Young waltzed into the end zone to win college football’s national championship and seal his superhero status with Longhorns fans.

    Seconds later, as the game clock struck zero, the first fan rushed through the doors of the University Co-op store on Guadalupe Street in Austin, Texas, to buy some of the night’s first available Longhorns national championship gear. “[That fan] must have been listening to the radio outside,” said University Co-op CEO George Mitchell.

    The 72-year-old Mitchell, who’s been in the retail business for 50 years, said he’s “never seen anything like this.” The Co-op sold out of its first 1,800 preprinted championship T-shirts soon after the game and waited two hours for newly printed shirts to arrive on trucks from Austin Screen Printers.

    Mitchell estimated that the Co-op sold 5,000 shirts and 1,800 caps the night of the game. He hopes to sell 50,000 shirts.

    At about $20 for a shirt and $24 for a hat, the store’s goal is to sell $4 million worth of national championship garb, Mitchell said. Sales had reached $1 million on Thursday.

    The story was similar at the Academy Sports & Outdoors store in North Austin. The store had sold out of merchandise by 3 a.m. the morning after the game, said Jim Mastrianni, the store’s apparel manager.

    Longhorns apparel generated the most royalties of any of the 200-plus schools affiliated with the Collegiate Licensing Co. in the third quarter of 2005.

    Jonathan Selden writes for the Austin Business Journal, an affiliated publication.

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  • Marketing service aligns with NACDA

    With its men’s basketball and football programs poised to take off, Southern Illinois University wanted to raise the teams’ profile in the collegiate sports world.

    So in 2002, athletic director Paul Kowalczyk signed an agreement with Strategic Marketing Affiliates to develop a five-year, strategic marketing plan for those Salukis teams.

    Marketing assistance provided to Southern Illinois
    sparked the idea for NACDA Consulting.

    SMA’s ideas “were a big help to us,” Kowalczyk said. They helped the Salukis boost their home attendance and the number of times they appeared on television, among other things.

    Now, SMA hopes to assist other college athletic departments. The Indianapolis consulting firm recently signed a five-year agreement with the National Association of Collegiate Directors of Athletics to form NACDA Consulting, a new division of SMA.

    The group seeks to seeks to fulfill the consulting needs of NACDA’s 1,600 member institutions.

    “There are people out there doing some things like this, doing different pieces,” said NACDA Consulting President Bob Bernard. “We felt like we could be a one-stop shop for all of these services.”

    The services that NACDA Consulting offers athletic departments include analysis to maximize revenue, advice on launching advertising and marketing campaigns, assistance in evaluating and finding candidates for athletic director and head football coach openings, industry and market research and background checks on potential recruits.

    The company is based in Indianapolis, with a regional office in Atlanta. Bernard, who heads SMA, and vice president Russell Wright, former vice president of CSTV Online Inc., have assembled a roster of 15 consultants, including Collegiate Licensing Co. Chairman Bill Battle, former Navy athletic director Jack Lengyel and outgoing University of Cincinnati athletic director Bob Goin.

    NACDA Consulting already has two clients, Merrimack College and Florida Atlantic University, for whom it is conducting corporate sales analyses. The company also is discussing projects with other schools.

    “We’ve got a very strong stable of consultants on board right now,” Bernard said. “We are ready to go.”

    The for-profit company hopes to generate revenue of $300,000 in its first year, Wright said, and ultimately could bring in as much as $5 million annually.

    With so many athletic departments needing help, “We really think this is limitless,” Wright said.

    NACDA Consulting will charge athletic departments a fee up front or for royalties after the job, depending upon the agreement reached, Wright said. For example, if it helps a department boost a season-ticket base, it may take 5 percent of the extra revenue generated by that increase.

    NACDA will receive licensing fees from NACDA Consulting, money that will go toward the nonprofit’s operating expenses, said Bob Vecchione, NACDA associate executive director.

    NACDA Consulting has not yet devised a price roster but will charge considerably less than it would a corporate partner, Wright said, in order to meet the budgetary demands of athletic departments.

    Bernard has experience working with the departments. He handled licensing for Clarkson University when Sean Frazier was its athletic director, Frazier said. Now Merrimack’s athletic director, Frazier said he recently hired Bernard there. Bernard’s work has also pleased Craig Angelos, Florida Atlantic’s athletic director.

    Bernard spent a few years researching and developing NACDA Consulting because of discussions with athletic directors who needed help.

    That is one reason that Vecchione is promoting the company. “As this industry has evolved, there just seems to be a need for our institutions to reach out and use outside entities,” he said.

    That’s because being an athletic director demands knowledge of law, accounting, marketing and management, among other subjects, Bernard said.

    But NACDA Consulting does not cover all of the bases, said Herb Greenberg, CEO of Caliper Corp., a Princeton, N.J., company that has consulted for professional and collegiate teams for more than 20 years. NACDA Consulting does not offer psychological evaluations of recruits, for example. That is a Caliper staple.

    “I think [NACDA Consulting] is a very good idea,” Greenberg said, “[but] there are still holes.”

    Bernard intends to fill those holes. Once NACDA Consulting has established itself, it hopes to add more consulting services, he said.

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  • NFL mixes monster brands in Stones/Super Bowl merchandise

    Two of the most valuable marks in licensing, the Rolling Stones’ classic “tongue” logo and the NFL’s Super Bowl mark, will be the centerpiece of a joint licensing program surrounding Super Bowl XL. The combined marks of “the World’s Greatest Rock and Roll Band” and America’s top sporting event will be on apparel sold throughout the Motor City and on TV. The Stones will perform at halftime at Ford Field in Detroit.

    Mick Jagger and the Rolling Stones will play
    during halftime at the Super Bowl in Detroit.
    “It’s a bigger and bigger way of saying ‘I was there,’” said Don Brown, senior brand manager in the NFL’s Consumer Products Group, “and we’re offering something from the most iconic rock band and the biggest event of the year that says that.”

    Reebok, VF and G-III will produce a variety of men’s and women’s T-shirts, fleece, sweats, polo shirts and outerwear with the combined marks. Given the winter climate in the host city, the outerwear selection has been expanded to include more than 10 different SKUs on denim, leather and quilted ranging up to $160. A special television segment on Home Shopping Network supporting the merchandise also is in the works.

    Since outerwear is one of the few licensed apparel categories that never bounced back from the late 1990s collapse, the Detroit market will be an interesting test of whether it can once again be a viable product.

    “Getting outerwear back and responding is one of the things that’s front and center on my desk,” said Susan Rothman, NFL vice president of consumer products. “Relative to Detroit, there should be a demand, but so much of the [wholesale] demand is last minute and so much of the retail space is in hotels and at the stadium, so the question is how much display space you’ll have.”

    In addition to outerwear, look for licensed cold-weather accessory sets, such as hats and scarves. Distribution is through Detroit retailers such as Meijer and Dunham’s Sports and Super Bowl hotel concessionaires, as well as at Ford Field. Apparel also will be sold at some of the Stones’ concerts before the Feb. 5 Super Bowl.

    In a mature retail environment, expectations are high regardless of the game matchup. “We had some of the biggest retailers, like Meijer and Dunham’s Sports in here a year ago talking about how to maximize this,” said Leo Kane, NFL senior director of licensing and consumer products. “We’ve also got a better, earlier and more consistent logo and style than ever, so the guy buying a [souvenir] football will be looking at the same banner he’s been seeing in his hotel room for a few days.”

    PAYING A VISIT: A neat bit of strategic targeting has Marquis Jet using visiting pro sports locker rooms — a traditionally ignored parcel of pro sports real estate — as a marketing platform. Looking to grab high net-worth individuals who can afford Marquis’ hourly private jet service, purchased via cards offering a minimum of 25 hours of air service starting at $115,900, Marquis has been cutting team sponsorship deals that get it signage inside visiting locker rooms. The newest deal, a two-year agreement with the Boston Red Sox, is helping to spur renovation of the antiquated visitors clubhouse at the 93-year-old Fenway Park. Marquis will receive signs, branded towels and more, as well as a presence within Fenway’s premium EMC Club, along with public address ads and spots on the Diamond Vision. In return, the Red Sox commit to use an agreed-upon number of hours on Marquis Jets.

    A recent three-year deal with the New Jersey Nets (which didn’t win friends with Continental Airlines, which pays for naming rights at the Nets’ arena and didn’t find out about the deal until late in the game) got Marquis locker-room signs, branded towels and shaving kits, and arena signage, branded front-row seats and access to the Nets’ well-heeled ownership consortium.

    As for the results? “We’re not getting any direct
    response, but we’re getting to the point where every player that goes into that locker room knows us, and by the end of the year that will be almost every NBA athlete,” said Peter Feigin, a former vice president of marketing for the New York Knicks and currently vice president of corporate development at Marquis Jet. He said more than 35 NBA athletes are currently customers. With an eventual goal of reaching every athlete in the major leagues, Marquis has also signed a similar deal with the New York Mets.

    Details of MasterCard’s new Yankees deal
    include several signs at Yankee Stadium.
    NEW CARDS: A few details are beginning to emerge from MasterCard’s sponsorship with the New York Yankees, which was first reported in this space (see SBJ, Dec. 19-25). The three-year deal that replaces Visa does not include rights to the new Yankee Stadium on the drawing board, so look for Visa and others to get back in the hunt before then. As for the deal that makes MasterCard the “Preferred Card of the Yankees,” it also includes permanent, baseline-level signage, two concourse signs, an inning of rotational signage per game, use of Yankee marks in the local market, an affinity card program, installation of the Pay Pass “swipeless” payment system at the stadium, a one-page ad in the Yankees’ game program and four field-level tickets.

    Meanwhile, we’re told the New York Mets have renewed with MasterCard, meaning MasterCard has both of the Big Apple’s MLB teams for the first time.

    TOE IN THE WATER: USA Diving has signed a new three-year deal with health-care provider Kaiser Permanente, which is making its initial foray into sports sponsorship. California-based Kaiser hopes the interest in the Beijing 2008 Olympics will help it target a variety of consumers, especially Asians. Kaiser also hopes to integrate its medical expertise within the national governing body. Paragon Marketing, Skokie, Ill., is the health-care provider’s new sports marketing agency and negotiated the deal.

    COMINGS & GOINGS: Atlantic 10 sponsorship chief Jeff Long has left the conference to join the Philadelphia Eagles as director of corporate sales. The A10 is close to outsourcing its sponsorship and television rights to CSTV. … Passage Events vice president of business development Larry Weil is leaving to put out his own shingle in San Antonio as Weil & Associates, a sponsorship sales and consulting firm. His first client is AirShip Management, which operates blimps for Fuji Film and Ameriquest. … Paul Bamundo has joined the NBA as a director of marketing partnerships. He was with IMG. … Former NFL corporate sponsorship manager Chris Jogis has joined MasterCard as vice president of U.S. brand development. Jogis also served for six years in Pepsi’s sports marketing department. … Ed Lynch has left Florida-based All Access Sports & Entertainment Marketing to spend more time with his family. The former MLBPA and Sports Illustrated marketer is now seeking a Boston-based position. … Brian Fitzgerald joins the NFL as manager of database marketing. He was with the NHL for the past five years as director of commerce and development in the league’s CyberEnterprises Division. … Longtime Gatorade marketer Andy Horrow relocates to the New York area for a job with the parent company as director of marketing platforms for Pepsi International. He’d been with Gatorade for nine years.

    Terry Lefton can be reached at tlefton@sportsbusinessjournal.com.

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  • NHRA collars 3 multiyear renewals

    The NHRA is set to announce this week multiyear renewal deals with three event title sponsors.

    Lucas Oil Products, Summit Racing Equipment and O’Reilly Auto Parts have all signed new contracts with the series that provide the companies with title sponsorship of individual race weekends.

    The NHRA Powerade Series’ 23-event
    season will begin in February.

    Terms of the deals were not released, but industry insiders peg them in the low-to-mid six figures per year. Jerry Archambeault, an NHRA spokesman, would not discuss details of the deals but did say they come with a three-year minimum and that “some extend up to five years.”

    California-based Lucas Oil Products, a lubricant and fuel treatment company, has renewed its multiyear agreement to remain the title sponsor of the NHRA Powerade Drag Racing Series event at Brainerd International Raceway in Minnesota in August.

    The company, which is also the title sponsor of a developmental series and an associate sponsor for several teams, including two-time Top Fuel world champion Larry Dixon, has been involved with the NHRA as an event sponsor since 2001.

    In addition to renewing its sponsorship of this event, Lucas Oil will debut its Morgan Lucas Racing Top Fuel team in 2006 under the direction of driver and General Manager Morgan Lucas, son of Lucas Oil Products’ CEO Forrest Lucas.

    Ohio-based Summit Racing Equipment, a catalog and Internet-based automotive parts and equipment company that has been involved with the series since 2000, signed a multiyear renewal deal with the NHRA to remain the title sponsor for the Southern Nationals at Atlanta Dragway on May 4-7.

    Summit Racing also is the title sponsor for the first of two events in Las Vegas, as well as the presenting sponsor for the Pontiac Excitement Nationals held in Hebron, Ohio, in May.

    In addition to event sponsorships, Summit Racing title sponsors an NHRA grassroots racing series and three-time and defending Pro Stock champion Greg Anderson.

    O’Reilly Auto Parts, an NHRA sponsor since 1999, also signed a multiyear deal with the NHRA to remain the title sponsor of the Mid-South Nationals at Memphis Motorsports Park in Tennessee. The event will be held Aug. 18-20.

    In addition to the Mid-South Nationals, Missouri-based O’Reilly Auto Parts is the title sponsor of four other NHRA Powerade Series events in Houston; Bristol, Tenn.; Topeka, Kan.; and Dallas.

    Archambeault said the NHRA is trying to finalize title sponsorship for its events in Richmond, Va., and Gainesville, Fla., but expects to have all 23 events covered by the end of the month. The season begins Feb. 9 in Pomona, Calif.

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  • Phoenix Suns to tout value of cheap seats

    The Phoenix Suns are planning a major branding effort around US Airways Center’s cheap seats, the only seats still available for the team’s games.

    The team is averaging 17,009 fans a game this
    season. US Airways Center seats 18,422.

    With 10,000 lower-bowl seats sold out through season-ticket sales, the Suns want to push their upper-bowl seats with a new strategy that will include a brand name for the upper bowl, the addition of at least two sponsors and more entertainment components to go along with an already aggressive marketing effort aimed at the far corners of their arena.

    “We want to make the upper bowl more of a season-ticket destination,” said Suns President Rick Welts.

    Since Robert Sarver bought the Suns last year for $401 million, the team has targeted premium-seating customers with new courtside clubs and additional courtside seating. This year, the team is turning its attention to the far reaches of its arena. The team has already added a 10,000-square-foot playground dubbed “The Jungle” sponsored by Verizon Wireless in the upper-level concourse geared toward children. Now comes the upstairs branding plan.

    Welts would not disclose how much the sponsorships would cost, but Verizon reportedly paid $1 million for its three-year sponsorship of “The Jungle.”

    Trying to drive fans upstairs is standard operating procedure for NBA teams with strong season-ticket sales. The San Antonio Spurs, Miami Heat and Chicago Bulls, teams at the top of the NBA’s attendance list, all offer upper-level concourse entertainment.

    “We have always been pretty full in the upper bowl and accordingly have always tried to pay attention to the fans who sit up there and let them know we appreciate them and don’t take them for granted,” said Steve Schanwald, executive vice president of business operations for the Bulls. “Accordingly, we seek to provide as much entertainment value to them as we do to fans downstairs.”

    The Spurs have branded their entire 8,000-seat upper bowl in the SBC Center, calling it Club 200 sponsored by the HEB grocery chain, which is also the Spurs’ season presenting sponsor.

    “Most teams have the inventory in the balcony and the challenge is that they feel left out,” said Bruce Guthrie, vice president of marketing for the Spurs. “We have brought up former players and our general manager to meet with those fans and we have special giveaways, and we find that it is working.”

    The Miami Heat also provides upper-level arena entertainment, including a band and a radio station broadcast from the 300 level of AmericanAirlines Arena during games.

    The Suns are averaging 17,009 fans a game this season at the recently renamed, 18,422-seat US Airways Center, up 2 percent from last year. Suns upper-bowl tickets are priced between $10 and $45 a game. The upper-bowl deals could be in place later this season.

    “We are tweaking the name and are putting the various plans together,” Welts said. “We will have some pretty neat new inventory focused on the geography of the upper bowl. There is such a misrepresentation on the value proposition of NBA tickets in the upper bowl. We haven’t done a terrifically good job of it.”

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  • U.S. skating signs Burger King

    As its national championships unfold this week to help determine Olympic team qualifiers, U.S. Figure Skating is launching a promotional partnership with a direct competitor of U.S. and global Olympic sponsor McDonald’s Corp.

    Burger King will link itself to Sasha Cohen
    and other top U.S. skaters in the next month.

    U.S. Figure Skating and Burger King Corp. are joining forces on an in-store program that involves distributing four handheld electronic skating games to children ages 6-12 who purchase BK Kids Meals. The promotion in 7,500-plus restaurants begins today and runs through Feb. 5, five days ahead of the opening of the 2006 Olympic Winter Games in Turin, Italy.

    Retail food services competitor McDonald’s is a worldwide Olympic sponsor and, by extension, a U.S. Olympic Committee sponsor of the category, and recently renewed its contract through 2012.

    It is not uncommon, or illegal, for U.S. Olympic sports federations to do deals with competitors of sponsors, but the USOC generally discourages the practice because it is often used by companies as a so-called ambush marketing strategy to confuse consumers about a brand’s sponsor status.

    Global sponsors’ rights fees are about $65 million for the 2005-08 cycle.

    According to U.S. Figure Skating, Burger King intends to use national TV advertising spots to drive customers to the promotion, which also includes cross-marketing with four NFL-branded electronic games.

    “We think this promotion is an excellent way to begin the New Year and a fitting lead-in to the climax of the 2006 figure skating season,” said David Raith in a written statement. Raith became figure skating’s executive director last fall after heading broadcasting for USA Track and Field.

    A federation spokeswoman, Lindsay DeWall, said in an e-mail that the timing of the promotion is geared to January’s designation as National Skating Month. “Burger King is helping U.S. Figure Skating generate interest in this program,” DeWall said.

    Jim Grice, chief marketing officer for the USOC, said the organization was committed to promoting marketing opportunities between McDonald’s and the national governing bodies.

    McDonald’s officials could not be reached for comment by deadline for this story.

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