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JPMorgan limits U.S. Open hospitality
Published August 17, 2009
JPMorgan Chase & Co. will operate its corporate hospitality at the U.S. Open Tennis Championships for only the final six days of the two-week event this year, finance and tennis sources said, becoming the latest example of a bank minimizing its entertainment in sports.
While JPMorgan is considered among the healthier companies in the troubled financial sector and in June repaid the $25 billion it borrowed from the federal government’s Troubled Asset Relief Program, financial institutions collectively remain under the public microscope.
Both the bank and U.S. Open declined to comment. The tournament begins in two weeks.
JPMorgan in 2007 signed a six-year, $90 million extension of its Open sponsorship. The company long has been the largest consumer of corporate hospitality at America’s premier tennis event, entertaining thousands of clients in what is the bank’s backyard.
“If I am out there spending money, people will think I am doing well, and there will be a lot of negative publicity,” said Robert Tuchman, president of Premiere Corporate Events, which arranges corporate hospitality at major sporting events, including the Open. “I am sure they [JPMorgan] are saving money, but the reason that they are doing it, I am convinced, is perception.”
Ever since congressmen late last year began bashing banks for wining and dining at sporting events, companies have been pulling back out of fear of public derision. A source close to JPMorgan said cost-cutting was the primary reason for the move. Neither the bank nor the U.S. Tennis Association, which owns the Open, would say how much the company spends on corporate hospitality.
That’s a complicated question, because some of the outlay is tied into the company’s sponsorship, which the bank is obligated to pay anyway. The bank will save on food and beverages with the hospitality reduction, though, and one tennis insider estimates the financial institution would save at least in the high six figures for going dark over eight days, which covers 16 sessions.
JPMorgan has cut back on its Open exposure this year in other ways, as well. In the last four years, the bank has offered free tickets through in-bank promotions, and over the last two years, it has had seven-figure print and TV ad campaigns touting the giveaway. Some ATM receipts were redeemable for free tickets. Last year, the bank gave away 16,000 tickets; the year before, it gave away 8,000.
This year, free tickets are available only for bank customers who have a qualifying checking account and make qualifying new-money deposits into a savings account. The bank advertised the offer in-branch only, and a bank spokesman said he did not have a figure for the number of tickets given away.
Even with the reductions, the bank will still have a strong branding presence on-site for the Open, and it plans to keep its Arthur Ashe Stadium double suite, which can host up to 40 people a day.
JPMorgan is not the only financial institution cutting back on its Open exposure. American Express, the event’s official credit card provider, is not sponsoring the giveaway of handheld TV devices as it did the last two years. Fans could use the devices to view action on other courts.
AmEx is adding new features this year, including offering free on-site hitting with tennis pros for card members and an online audio broadcast of the event. Its sponsorship, however, has largely revolved around providing card members experiences and services, not corporate hospitality.
The USTA opens its new indoor corporate hospitality center with this year’s tournament, showcasing a building that includes the indoor courts AmEx will utilize. Despite JPMorgan’s retrenchment, the USTA still expects a fairly healthy showing. The group has said that since Wimbledon, sales have picked up, and the event could equal last year, when the tournament pulled in about $5 million in sales.