SBJ/October 16 - 22, 2006/SBJ In Depth

Host makes comeback by staying on campus

When Tom Stultz took over Host Communications as president and CEO, his guide was a simple piece of advice he’d been given years ago.

“The best way to make money is to quit losing it,” Stultz said. He also leaned on an old saying: Go back to the basics.

When Stultz joined Host in July 2004, it was a company that had lost its way. Despite a rich history of marketing college athletics, Host, then owned by Bull Run Corp., which had bought it from founder Jim Host, tried to add other sports to its plate. However, its college savvy didn’t convey to managing rodeo events, basketball and soccer tournaments or NASCAR. The company was losing money.

Host President and CEO Tom Stultz (center) leads the Host Communications management team in a strategy session.
Host’s Steve Early (left) discusses marketing opportunities with University of Tennessee Athletic Director Mike Hamilton (center ) and Chris Fuller, assistant athletic director for sales and marketing.
“Those four lines of business were not part of the core and they were strapping the resources of a great company,” Stultz said. “We were struggling from a cash standpoint.”

Two months into his tenure, Stultz ended Host’s involvement with those other operations and returned the marketer’s focus to college athletics.

“It sent the right message to our universities,” Stultz said. “They were concerned about our emphasis on things that weren’t in their best interests. We decided we were going to sink or swim with what we do best, and that’s worked out very well for us.”

In the fall of 2004, Host signed a landmark 10-year, $80 million multimedia contract with the University of Kentucky, which was the largest of its kind at the time. Host’s previous contracts normally ranged from three to five years.

The deal did more than secure the rights to a longtime partner — Host is based in Lexington, Ky., the home of the university — it signaled the company’s commitment to returning to its core business of marketing college athletics.

In 2005, Bull Run merged into Triple Crown Media Inc., a publishing and association management business. Host now is a subsidiary of Triple Crown.

“Tom has done a marvelous job of transforming Host in the last two years,” Kentucky Athletic Director Mitch Barnhart said. “Kentucky was the original property that Host owned, and, with what Tom was doing to take the reins, it was a perfect fit for us. But when the bid went out, we did have some major concerns.”

Kentucky was the first of a handful of schools to bundle all of their media and sponsorship rights into a long-term deal with Host. Texas and Tennessee followed, both signing 10-year deals worth $80 million or more, and Arizona expanded its rights deal with Host on Oct. 2 to include corporate sponsorships, signage, Web sites and more through 2019.

Host recently purchased Pinnacle Sports Productions, which owns limited multimedia rights to Nebraska. Stultz hopes to sell the Cornhuskers on a similar all-encompassing deal.

Other Host partners include Michigan, Oklahoma State, Florida State, the Southeastern Conference and NCAA championship programs.

“The strength of Host is the lineup of schools we represent,” Stultz said. “We have some of the premier properties in the country. We may not have the most, but we feel we have the best.”

Host’s rebound has been especially satisfying for Jim Host, who now consults with Stultz.

“I was concerned when I sold it [to Bull Run],” Host said. “But I’m so pleased with the comeback it has made, especially since this is a business that wasn’t started with family money. It was started from scratch. It’s all a credit to Tom Stultz. He’s very passionate about college sports, and he’s done an amazing job with it.”

Down the road, Stultz said, he’s developing a midmajor strategy that will “put some lesser-known schools on the map from a marketing standpoint.” Host is in the process of identifying which midmajor schools it might target.

Stultz said a midmajor property would provide an invaluable training ground. “That gives us a chance to identify key people. Then they’re more prepared to move into a bigger job when there’s turnover.”

Such a strategy also would help Host develop relationships with athletic directors on the fast track.

“We know that many of the athletic directors at the major programs came from programs at the midmajor level,” he said. “We want to build those relationships for the long term and grow with the ADs as they move up the ranks.”

3. Host Communications

Founded: 1972

Office: Lexington, Ky.

Executives: Tom Stultz, president, CEO; David Bertram, general manager, NCAA football; Tim Campbell, vice president, sponsorship sales; Steve Cornwell, executive vice president, operations; Mike Dodson, vice president, broadcast services; Mark Meikle, executive vice president, CFO; Lisa Fluty, vice president, technology

Recent highlights: Surprised? Don’t be. The college marketing company that many people had written off after a horrendous period only a few years ago now appears to be back with a vengeance. To wit: The Southeastern Conference and the universities of Kentucky, Tennessee and Texas all recently signed 10-year deals worth a total of more than $300 million. September’s acquisition of Pinnacle Sports gave Host marketing rights to University of Nebraska athletics. In May, Host won a five-year contract to manage the American Volleyball Coaches Association, and extended an agreement to operate the annual NCAA Trade Show through 2008. Acquired last winter by Triple Crown Media, Host’s new business model has vastly improved its margins, and accounts for more than half of Triple Crown’s sales.

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