SBJ/20090622/This Week's News

New MSG team touts spirit of cooperation

The mantra at MSG is “change.”

Change, as in NBA veteran Scott O’Neil, who was named president of MSG Sports last July. That was followed by hiring a phalanx of new sales and marketing executives to help sell a building renovation that started at $500 million but now is at the “we won’t discuss price right now” phase.

Change, as in more and bigger sponsor inventory, with plans for a new entrance, clubs, and skyways across the top of the renovation, which is scheduled for completion in time for the 2012-13 NBA and NHL seasons.

Change, as in new suites, so luxurious that at the high-end, the choice of amenities includes a fireplace or a waterfall. Prices for the super-premium, event-level suites also aren’t being discussed publicly, though we are hearing they are in excess of a million dollars each.

Madison Square Garden renovation plans call
for a new entrance, clubs and skyways.

Forthcoming amenities aside, the spin at a recent MSG sponsor summit was an altogether “new” Garden, one willing to work more closely than ever with its corporate partners. “We need to be better at asking questions and you need to be better at giving us feedback,” O’Neil told a crowd of around 80 sponsor and agency representatives.

Those in attendance at the recent Garden party seemed to welcome the regime change, and were asked whether MSG is indeed, reinvigorated, as Vice Chairman Hank Ratner touted.

“There’s been a difference as far as the people they’ve hired and their level of expertise,” said John Cordova, Coca-Cola director of sports transactions management. “There is a lot more credibility. There is a new focus on ROI and activation, and those are our biggest hot buttons.”

Tony Schiller heads corporate consulting at Paragon Marketing Group, the agency of record for Continental Airlines, a longtime MSG sponsor. “There’s a little bit of wait and see, in terms of what the renovation will bring,” he said, “but there’s far less of the ‘you should be happy to be here’ attitude. We’ve still got a ways to go on our renewal, but so far, they are working harder to understand their partners’ businesses, and, as a result, they are coming at us with good marketing ideas.”

“We need to be better at asking
questions and you need to be
better at giving us feedback.”

“They’ve got an all-star lineup from an industry perspective, so that’s a real positive as we approach our renewal,” said Dan McHugh, vice president of media, sponsorship and activation at Anheuser-Busch. “You may see some shifting of properties with us, but MSG is a staple and from 2008 to 2009, our sports sponsorship dollars are up.”

The renovated MSG will be selling against new MLB palaces in Queens and the Bronx, along with unfinished buildings in New Jersey for the Jets and Giants, and a planned arena in Brooklyn for the Nets.

“We have so many more events, and with our teams, buildings, and broadcast outlets, if we can’t figure out a marketing solution that fits, it means we aren’t asking the right questions,” insisted O’Neil.

As for selling the renovated Garden? “It will get down to how many dominant positions we can provide for our sponsors,” he said, “because they’re all looking for more value.”

Responding to an audience question asking for better cross-pollination of MSG partners, O’Neil revealed formative plans for an “MSG Presidents Club” to unite the organization’s top business partners. “We’re looking to bring together sponsors, suite holders and season-ticket holders for cross-pollination and feedback,” he said. “We can combine them with some of the American business leaders that are in New York and add real value.”

During a session on “Sports Partnerships: Why Now More Than Ever,” former A-B sports and media chief Tony Ponturo and WMG Consulting head Gary Stevenson each had an interesting take on the recession’s ultimate impact on sports.

“There’s a lot more talk about ROI, but most of it’s corporate psychobabble,” said Stevenson, whose MSG clients include T-Mobile and American Express. “The two biggest mistakes are not knowing the full cost of a sponsorship when you buy in, and not knowing what the right metrics are up front. If you can avoid those, it’s easier to judge any program.”

Said Ponturo, “This business is transforming from one of buyers and sellers to one of marketers. That’s one of the positive things the economy is doing.”

Stevenson predicted the recession would mean the end of long-term sponsorship contracts. He also said national sports TV rights fees will not plummet, as some have suggested. “Every 10 years or so, it looks like TV rights dollars will go down, but the value is still there and fan behavior gets more tribal every day,” he said. “The value is still there and going up.”

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