Sherwin-Williams signs with IndyCar MLS, SNHU sign new partnership The Lefton Report: Playing it Safelite Going out on top Precourt thoughtful in remaking Crew Challenging schools on cheating DraftKings closes on $300M funding round NBC readies year-out efforts for Games Best opportunities outside of teams Fanatics' new era of racetrack retail
SBJ/20100913/This Weeks IssuePrint All
Each of the 12 ACC schools is turning over prime inventory to the conference for a marketing initiative designed to strengthen the ties between itself and the Orange Bowl.
The champion of the ACC has been locked into the Orange Bowl for the last five years, so the relationship is relatively new compared with the Rose Bowl and the Big Ten/Pac-10 or the Sugar Bowl and the SEC, both of which have decades of history.
Through a program called “Represent” that emphasizes the ACC’s tie-in with the Miami-based Orange Bowl, schools will run advertising this fall with their LED scoreboards, websites, game programs and radio broadcasts. The creative is delivered to the schools from the conference.
The value of the inventory differs from school to school, but it’s likely in the mid-to-high five figures for each school, industry insiders said.
“We’re talking about very prime territory,” said Ryan Pensy, director of digital media at Florida State. “But we also understand how important this is to the conference.”
At Seminoles.com and many of the other ACC school sites, advertising will run down the side and across the top of the page as well as in the video player. Florida State also is contributing two to three radio spots per game broadcast.
Each of the schools also has access to Orange Bowl tickets to use with promotions.
“There’s a real strong collective effort to connect the brands of the ACC and the Orange Bowl so that the public perception is that when you think ACC, you think Orange Bowl and when you think Orange Bowl, you think ACC champion,” said ACC Commissioner John Swofford. “Because our relationship is relatively new, we need to do a little more to connect the brands.
“It simply came out of meetings with the Orange Bowl and asking, ‘How do we enhance the partnership?’ If we’d had this tie for 20 years, the connection would happen naturally. We’re trying to expedite that process.”
The ACC in the past has centered its football marketing on its championship game, with advertising called “The Road to Jacksonville” or “The Road to Tampa,” depending on the location of the game. This fall’s program seeks to establish the link between the championship game and the Orange Bowl.
The seed for the idea germinated last spring, when Swofford called together the athletic directors and multimedia rights holders from each of the 12 schools at the women’s basketball tournament.
Swofford went around the room and asked each AD and rights holder what inventory they’d be willing to offer to the Orange Bowl initiative in an effort to combat some negative trends. The matchups have not been as desirable as some of the Orange Bowl’s BCS brethren in recent years.
Iowa and Georgia Tech on Jan. 5 earned a 6.8 rating and 10.9 million viewers, the smallest audience of the four BCS games. Previous games have matched Virginia Tech-Cincinnati, Virginia Tech-Kansas, Wake Forest-Louisville and Penn State-Florida State. The 2009 game between Virginia Tech and Cincinnati drew a 5.4 rating and 9.3 million viewers, the lowest numbers ever for a BCS game.
The Orange Bowl promotion also is intended to get more fans to travel to Miami. In the past, with the ACC title game being played in Jacksonville or Tampa, a repeat trip to Florida for the Orange Bowl just weeks after a trip to the ACC championship game asked a lot of the winning school’s fans. The championship game moves to Charlotte this season.
The 2006 Penn State-Florida State matchup drew 77,912 to Sun Life Stadium, but recent contests have drawn 66,131 last year and 57,821 the previous year.
“The relationship between the Orange Bowl and the ACC has evolved over the last four years, and every year we’ve gotten more involved with each other,” said Eric Poms, CEO of the Orange Bowl, which will sport a new title sponsor, Discover, this season. “We’re at a level with the conference now that we’re working very closely together. We have a lot of promotions throughout the year.”
After guiding Women’s Professional Soccer through four years of planning and two full seasons, Tonya Antonucci will step down as league commissioner later this month.
Antonucci, who will retain a nonvoting chair on the seven-seat WPS board of directors, said the decision to leave the league is her own. Her last day will be Sept. 26.
“My intention was to focus on the startup phase of the business, and when the league was in a more regular phase, I would likely move on,” Antonucci said. “After six years of carrying it, I’m ready for something new.”
A former executive at Yahoo! Sports and standout soccer player at Stanford University, Antonucci began laying the groundwork for the WPS in 2004, a year after the demise of the Women’s United Soccer Association.
Antonucci drafted a WPS business model with franchises valued at $2 million to $2.5 million, and a yearly operating budget of $20 million to $25 million, roughly half that of the WUSA. She wooed team ownership groups in nine cities, secured a sponsorship deal with Puma and negotiated a national television deal with Fox Soccer Channel as well as a regional deal with Comcast. After three years of planning the league she was named commissioner in 2007, and oversaw the league’s launch on March 29, 2009, in Los Angeles.
“Tonya single-handedly brought women’s professional soccer back to life in this country,” said Joe Cummings, CEO and executive director of the National Soccer Coaches Association of America.
But Antonucci faced a series of challenges in her two-year stint as commissioner. The league hoped to attract six primary league sponsors for 2009 but ran into recession-stripped marketing budgets and found only three league sponsors. Sources close to the league said clubs lost between $1 million and $2 million in 2009, which was 50 percent higher than Antonucci’s initial projected losses.
The WPS expanded its season from 20 to 24 games in 2010, and despite a 17 percent growth in season-ticket sales, average attendance dropped 18 percent from 4,600 spectators per game to 3,800.
The Los Angeles Sol folded in January, and the St. Louis Athletica abruptly shut its doors midway through the 2010 season after its London-based primary investor pulled out. The league also was forced to trim its budget, as it dismantled its marketing division in July and parted ways with Chief Operating Officer Mary Harvey last month.
WPS Board Chairman and Atlanta Beat owner T. Fitz Johnson said the league’s general counsel, Anne-Marie Eileraas, will fill Antonucci’s position, and that the board has no plans to hire a new commissioner. Johnson said team owners would take charge of trimming costs while marketing their clubs locally.
“The first-year losses far exceeded what folks thought they’d be,” Johnson said. “We’ve done more work this year and we’re still not there. I don’t think you can lay the blame squarely on [Antonucci’s] shoulders.”
At a time when U.S. corporations remain conservative in sports sponsorship spending, the IndyCar Series has looked abroad and found a title partner from Brazil for its final race of the season.
The Oct. 2 season finale at Homestead-Miami Speedway will be known as the Cafés do Brasil Indy 300. The Brazilian coffee industry’s title deal is its first major sports sponsorship in the U.S. and is designed to raise the profile of the country’s coffee industry, which produces more coffee than any other nation worldwide.
Terms of the deal were not available, but IndyCar race title sponsorships are typically valued between $300,000 and $500,000.
The sponsorship is one of the first significant partnerships signed by Cafés do Brasil as it looks to raise consumer awareness for its name and logo. The deal gives the Brazilian coffee industry 2,500 grandstand tickets, retail promotional rights and the opportunity to do sampling at the event. Coffee growers hope the deal helps raise the profile of Brazilian coffee, which trails Colombian coffee in terms of consumer awareness.
“We never promoted this logo, and they wanted to put their name out there,” said Silvia Pierson, the operations manager in the U.S. for the Apex-Brasil agency, which signed the agreement on behalf of Brazil’s coffee growers.
The agreement developed through IndyCar’s partnership with Apex-Brasil, which promotes natural resources and investment opportunities in Brazil. The government-funded agency got involved with IndyCar in 2009 to promote Brazil’s ethanol industry.
Through its partnership, Apex-Brasil is able to pass on its hospitality rights to Brazilian companies and industries. As many as 350 Brazilian companies attend IndyCar races and entertain up to six guests each, who are typically U.S. buyers. The effort generated $370 million in new business last year and is projected to generate more than $600 million in new business this year, Pierson said.
The agency hopes to renew its partnership with IndyCar at the end of the season and extend it through 2012.
“We never sponsored a sport before,” Pierson said. “For us, it’s been amazing.”
The 2011 PGA Championship has nearly sold out its hospitality space and is looking to other areas of the Atlanta Athletic Club for new inventory.
The tournament hit the streets with its hospitality sales in October 2009 and 33 of the 35 units have been sold, according to Ryan Cannon, the PGA of America’s championship director.
Hospitality packages begin at $90,000 for the week and go up to $300,000. All 20 of the largest chalets, which hold 50 to 100 people, have commitments, while 13 of the 15 other units are sold. Some of the units have been reserved by single companies, and others are a mix of companies with smaller groups.
Response has been good from several categories, including consumer products, industrial equipment and financial services. Mercedes-Benz, Pepsi and RBC are among the national buyers of hospitality, the PGA said.
The PGA is looking to add to its inventory by about 25 percent, or an additional eight to 10 units around the golf course, and those areas will be identified in the next six weeks. That would bring the number of units to about 45, which is slightly more than the 40 from the 2001 PGA Championship at the Atlanta Athletic Club.
“In a little under a year’s time, we’ve seen a tremendous response from the community,” Cannon said. “We’ve seen about 30 to 40 percent come from the national side, and the balance has been from metro Atlanta.”
A new incentive plan has helped spur sales. Companies were given financial incentives to commit early and a down payment of 10 percent was required, whereas 25 percent was required in the past.
“What you find is that the larger companies that use golf for client entertainment and hospitality like to plan well in advance and the earlier you buy, the better choices you get on locations,” said David Dorman, the championship’s executive chairman for marketing and the former chairman and CEO of AT&T. “We went out marketing heavily to the large national and international firms with the larger chalets. … Our budget for hospitality was set slightly higher than the 2001 actual numbers and, frankly, I expect we’ll exceed projections.”
The ACC and Raycom Sports have launched an application for iPhone and iPod Touch devices for the first time that will carry select conference football and basketball games live, as well as unique content throughout the school year.
The app, priced at an introductory annual cost of $1.99, was produced by Silver Chalice, in conjunction with Raycom Sports and the conference. Raycom has the league’s digital rights and sold the presenting sponsorship of the app to Havoline, which is an ACC corporate partner and a heavy advertiser on TheACC.com, the Raycom-run website.
Users can download the app from iTunes and customize it to highlight their favorite ACC team. The price could increase once basketball season hits because Raycom will carry 40 to 45 basketball games, compared with just 12 weekly football games. Programming on the app also will include “ACC Live,” a feature that tracks games with live stats, scoring summaries and updates.
Colin Smith, Raycom’s vice president for new media and distribution, said he hopes to have apps ready for the iPad and Droid devices by the end of the year.
— Michael Smith
The Chicago Cubs and a community coalition from Mesa, Ariz., have started an aggressive campaign aimed at keeping the club in its spring training home city.
The push, led by a group called Keep the Cubs — Yes on 420, is being launched in advance of a crucial November stadium vote. The goal is passage of a proposition that would allow Mesa to spend up to $84 million on a new spring training stadium for the MLB franchise.
The Cubs, who boast the best average attendance in the Cactus League, contend that they have outgrown their current home of Hohokam Stadium in Mesa, about 20 miles east of Phoenix. They are aiming to create a large, mixed-use development dubbed Wrigleyville West adjacent to a new ballpark.
Hohokam Stadium in its current form opened in 1997 but has been a spring training site since the mid-1970s.
Tactical efforts in the campaign include a series of public events, including a youth clinic scheduled for today with Cubs hall of famer Ferguson Jenkins, speaking appearances by Cubs owner Tom Ricketts, traditional media, and a full-throttle digital media push, with a website (KeeptheCubs.com), a Twitter feed (@keepthecubs), and a Facebook destination.
“We want to stay in Mesa and we need the voters’ help,” said Mike Lufrano, Cubs senior vice president of community affairs and general counsel. “We’re looking forward to providing information to the voters and obviously are hopeful of being successful on Nov. 2.”
The coalition is being led by public affairs and political strategy outfit HighGround Inc. The Mesa Convention and Visitors Bureau and the local Little League organization are also involved, along with other local entities. The Cubs and Hunt Construction are providing major funding, but financial specifics were not available.
Hunt Construction, with its corporate office in Scottsdale, 15 miles northwest of Mesa, has been active in several Phoenix-area sports projects, including Chase Field and US Airways Center.
Proposition 420 includes a proposed increase in Mesa hotel taxes and seeks authorization for the city to use municipal economic development funds for the ballpark. The surrounding development, designed as a year-round destination, would be funded by the Cubs and private investors.
The Cubs’ presence in Mesa for spring training is estimated to provide more than $130 million in annual economic impact. Not only are Cubs home spring training games a consistently strong draw, but the club’s broad popularity also helps fill other Cactus League parks for Cubs away games.
The Cubs have trained in Arizona since 1952 with the exception of the 1966 season. They have been in Mesa since 1979 and from 1952 to ’65 before that.
“Voters definitely get the economic impact. They know the Cubs are a major force here,” said Robert Brinton, Mesa CVB president and chief executive and former Cactus League president. “What they don’t get right now is that these spring training facilities are now truly year-round hubs, between rehab assignments, tryouts, draft preparation and a whole host of other activities, so there’s education on our part that needs to be done.”
Last year, the Cubs negotiated on a similar spring training project with Naples, Fla., before electing to devote their energies to Mesa. It is expected that if the vote fails, Naples will mount a revived bid. The Cubs, in a memorandum of understanding with Mesa, can keep playing at Hohokam Stadium if the vote fails but are not locked in for a set time, according to industry sources. A successful vote would create a new long-term agreement for the Cubs to remain in Mesa.
The locally driven financing plan from Mesa replaces a failed state-driven effort that would have generated funds in part by taxing tickets on other Cactus League games. That measure was strongly opposed by the other MLB teams that train in Arizona, as well as by MLB Commissioner Bud Selig.
The sculpture collection at PepsiCo’s headquarters in Purchase, N.Y., has long been a source of corporate pride and is one of the hidden treasures of Westchester County. But on a recent, sweltering late-summer afternoon, things were decidedly different around the Donald M. Kendall Sculpture Gardens.
Complementing the works by Calder, Miró and Rodin were four, 5-foot-tall inflatable representations of players from the New York Jets and Giants. Inside the corporate building, a sculpture loosely based on the human body was dressed in a Brandon Jacobs Giants jersey. Across the lobby was a new addition to the collection, though not one that will necessarily join the exhibition permanently: a life-sized football player, fashioned entirely from Pepsi and Diet Pepsi cans.
Two days before the NFL started its season in New Orleans, Pepsi was doing its part to support the NFL’s new Back to Football platform, with kickoff rallies matching those at around a dozen headquarters of the league’s corporate sponsors.
In Purchase, the presence of NFL dignitaries including Commissioner Roger Goodell and hall of famers Emmitt Smith and Harry Carson was enough to produce an overflow crowd five rows deep in the corporate amphitheater. Other Pepsi units, like Gatorade in Chicago, an NFL sponsor for the last 27 years, and Frito-Lay, in Plano, Texas, were holding their own events while tying in electronically.
“I’ve seen a quote from [NFL CMO] Mark Waller about the need for more NFL women’s apparel, where he said their jerseys fit women like a sack of potatoes,” said PepsiCo Chairman and CEO Indra Nooyi, to a crowd waving foam fingers and NFL flags. “But here,” she laughed, “we like potatoes,” referring to the company’s highly profitable Frito-Lay salty snacks unit.
Across the landscape of corporate America last week, NFL business partners staged something akin to high school pep rallies to celebrate the start of the 2010 season (SportsBusiness Journal, Aug. 30-Sept. 5). Pennants and T-shirts were distributed, jerseys of favorite teams were donned, footballs were tossed, and teams and brands were cheered — all in an effort to celebrate NFL Kickoff.
Goodell joined Giants and Jets owners John Mara and Woody Johnson, along with Carson, Smith, and Jets running back LaDainian Tomlinson to rally an appreciative crowd of employees. The goal? “What we are trying to do is bring back the season with the emotion that is football,” said Goodell, who subsequently offered to get Nooyi a better-fitting jersey of her choice. “We use football to build your business, sure, but we also want to help build your [corporate] culture.”
To that end, NFL Tailgate events were held at Barclaycard locations in Delaware, Maine and Colorado last week, with raffles and prizes to the best-dressed fans. Inside EA Sports’ headquarters in Redwood, Calif., free Papa John’s pizza and Pepsi in the lobby were accompanied by additional NFL raffle prizes. At Papa John’s headquarters in Louisville, Ky., and at other NFL sponsor sites, employees were encouraged to wear NFL jerseys on Back to Football Friday. Papa John’s added its own Town Hall Pep Rally along with tailgating and its own version of a training camp.
Rights holders bought into the Back to Football platform as well, even outside of sports programming. CBS’s “The Early Show” and NBC’s “Today” took turns doing their own NFL-themed shows.
For the sponsor companies, the efforts also had a competitive significance. The sponsor registering the highest percentage of headquarters-employee support via Web registration and deemed to show the most NFL pride last week will be rewarded with Super Bowl tickets and a prize at the heart of the NFL’s business model — national commercial recognition. The most creative sponsor, as determined by photo submissions of employees expressing their NFL loyalties and decided by the league, will be rewarded with a 30-second thank-you promo filmed by NFL Films that will be shown during a game before the end of the season.
“Our goal was to get more activation than ever to start the season, and I believe we have done that,” said Peter O’Reilly the NFL’s vice president of fan strategy, marketing and media. “Adding the corporate challenge element is a way for sponsors to add value, because they can use the NFL to get their whole organizations energized.”
After fielding questions ranging from the origins of the Gatorade coaches’ victory shower, the appropriateness of a Super Bowl in New York City and what two issues keep the commissioner awake at night (“I wish there were just two,” he said), 70 minutes into the Pepsi rally, the most important issue facing the NFL was finally broached: labor.
“We’ve got to get it done,” said Goodell, when asked how confident he was that there would be no work stoppage. “I always believe that we will reach an agreement that works for everybody.”
Rose Bowl officials have selected IMG-Legends to sell new premium seats tied to a $170 million renovation of the historic stadium, according to sources familiar with the process.
The deal, pending contract negotiations, has IMG-Legends, a joint venture between IMG and Legends Hospitality Management, marketing suites, club seats and loge boxes for the next three to four years in Pasadena.
It is the first deal for IMG-Legends since principals from IMG and Legends, a group representing the Dallas Cowboys and New York Yankees, announced the joint venture in October 2009.
The IMG-Legends business model relies on IMG’s relationships in the college world, where it holds many multimedia rights deals, producing leads for the overall group. After IMG-Legends signs a deal, the Cowboys deploy members of their sales staff on campus to sell premium seats.
IMG-Legends responded to a request for qualifications and proposals issued in July by the Rose Bowl Operating Co., landlord for the 88-year-old home of UCLA football and the Rose Bowl game. The facility also plays host to the BCS title game every four years.
The proposal calls for the winning bidder to sell 44 suites, four group skyboxes, 1,428 club seats and 32 four-seat loge boxes, a key part of financing for the project.
City officials must approve a bond sale to support funding before a three-year construction schedule can start in January. They are expected to act on that measure in October, the RFP said. The plan is to complete the improvements by the beginning of the 2013 college football season.
IMG-Legends’ deal would be split into two phases. The first is preparation of sales, establishing pricing, producing collateral materials and a website, and taking refundable deposits for premium seats through Dec. 31 of this year. That is the deadline for bonds to be issued.
The second phase is the sales period itself, stretching through Feb. 1, 2014. That year marks the return of the BCS national championship game to Pasadena.
Rose Bowl general manager Darryl Dunn would not confirm that his group is negotiating a deal with IMG-Legends.
This year’s U.S. Open Tennis Championships could set a revenue record for the event, even as the tournament for the first time in four years will see an attendance decrease.
With sponsorship, hospitality, concessions and merchandise all trending up at the end of last week, and ticket price increases making up for an expected drop of 5,000 in attendance, the roughly $208 million revenue record set in 2008 was being threatened.
“We are gratified that fans flocked to our event,” said Chris Widmaier, an Open spokesman. “For any event, it is tough to set four consecutive attendance records, and this year we will still be the third- or fourth-best attendance ever.”
Last year set the high-water mark for attendance, at 721,059. Speaking last Thursday, ahead of the tournament’s final weekend, Widmaier said the Open would fall about 5,000 short of that, but the total still makes the Open the best attended annual sporting event for paying customers in the world.
BUSY Bollettieri: Nick Bollettieri, the famed tennis instructor, remains a busy man these days even at age 79. On-site at the Open, he was doing radio interviews and online commentary for CBSSports.com and promotional work for American Express. He has an autobiography coming out next year, on Sept. 1, from Grand Central Publishing that he hopes he will sell the movie rights to. He even got five of his eight wives to be interviewed for the book, he said. An entire chapter of the book will also be dedicated to Andre Agassi, who famously blasted his experience at the Bollettieri Academy. Bollettieri is still active at the IMG Academies, which bought his tennis academy and expanded it into now seven sports.
: Not much to report on big deals brewing in the tennis apparel and footwear category at the Open this year, but agents did say Under Armour and Reebok are looking for some signings. Nike is mainly looking for junior players, with its crop of top players (Roger Federer, Rafael Nadal, Juan Martin del Potro, Serena Williams and Maria Sharpaova) more than sufficient. Melanie Oudin (Adidas) and Mardy Fish (K-Swiss) have apparel deals up at the end of the year. … Speaking of Fish, who will be in the top 20 when the latest rankings are unveiled this week, he was a feel-good story of the Open, with it becoming almost obligatory to mention in the same breath that he had lost 30 pounds and was playing the best tennis of his life. But few, if any, of those stories mentioned a company he endorsed at the start of the tournament: Generation UCAN, a weight-loss powder. The Woodbridge, Conn.-based company launched earlier this year, and Fish, whose coach introduced him to the product, will become the company’s face, wearing the name of the company on his shirt. He received a high five-figure fee plus 7,500 shares in the private company. Fish is represented by Lagardère Unlimited.BASELINE DEALINGS
Wasserman Media Group consulting chief Gary Stevenson is leaving the firm, effective immediately. The move comes a little more than three years after he sold the OnSport consultancy he founded to WMG.
Senior vice president Malcolm Turner will assume Stevenson’s title as principal of WMG Consulting, and will remain in New York City.
“I sold the business because at some point in time, I wanted to make a transition,” Stevenson said. “I felt like this was a good time and I’ve been talking about this to [WMG founder and CEO Casey Wasserman] for some time. The agency business is not where I want to finish my career.”
Stevenson said he feels comfortable leaving his unit, which he noted has grown a minimum of double digits every year. The group consults with media and sports properties, representing 30 percent of its revenue, along with corporate consulting, the remaining 70 percent. Stevenson added that the consulting group now encompasses 80 people and is well-integrated with clients that came in from the WMG side, like T-Mobile.
Other large consulting clients include American Express, Nationwide, Northern Trust and Travelers. Project work for the unit has included securing RadioShack’s relationship with Lance Armstrong, while properties using WMG consulting include MLS, the College Football Hall of Fame and Major League Soccer.
“I’m a longtime member of the Gary Stevenson fan club,” said Wasserman, adding that it was the consulting unit’s best year to date. “But we didn’t buy the business just to get Gary. We bought it because he built a business that was much more than just Gary Stevenson. It’s a great culture, with talented people besides him. Frankly, those are the only kinds of businesses you would want to buy.”
The latest reshuffle at WMG comes soon after it hired MLB sales chief John Brody to head a new sales division. However, both Wasserman and Stevenson said the moves were unrelated, though they both anticipate Brody will work closely with the consulting practice.
Through his 30-year career, which included being president of the marketing and media group at NBA Properties, executive vice president for business affairs at the PGA Tour, and chief operating officer of Golf Channel, which he helped launch, Stevenson has shifted directions every eight or 10 years.
“I’m a big believer in change. I think there should be term limits on commissioners,” he said. “New ideas are good for sports and clients. Everyone benefits from a new perspective.” As for his next stop? “I’m going to whatever’s next,” said Stevenson. “I don’t have an exact plan. But I am not retiring.”
Stevenson said he will continue to teach the Business of Sport at Duke University.
Both Wasserman and Stevenson speculated that they might work together again. Stevenson mentioned a possible Los Angeles NFL franchise (a project to which Wasserman has sometimes been linked) and a potential U.S. World Cup bid as two intriguing projects.
The LPGA’s first-year commissioner Mike Whan and his chief marketer Jon Podany will stage their first sponsor summit on Wednesday in New York, where they’ll tell a story of a tour on the mend.
A room full of more than 100 marketing executives from current sponsors, prospective sponsors and marketing agencies have RSVP’d, Podany said.
“We’re rebuilding relationships that maybe were broken in the past,” Podany said. “We’re finding that we have the ability to get meetings and consideration and there is a rising intrigue with the tour that maybe it’s a property to think about.”
The LPGA has hosted sponsor summits periodically in the past, but Whan was not on board in time for the function last fall, which was held on the heels of former Commissioner Carolyn Bivens’ ouster in the summer of 2009.
Podany said the story lines he and Whan will tell revolve around the tour’s global appeal, the new era of competition after the departure of Annika Sorenstam and Lorena Ochoa, and a financial entry point far more economical than the PGA Tour.
The LPGA also has several categories it is hotly pursuing, including auto, finance, credit card, technology, consumer electronics and soft drink.
“It’s true that we have a lot of opportunities now,” Podany said. “We don’t have a lot of the major categories filled.”
LPGA tournament title sponsorships tend to run in the low seven figures annually, while title sponsorship of PGA Tour events run in the middle to high seven figures.
“While we don’t want to necessarily position the LPGA as a lower-cost model, there is a good value story to tell,” Podany said.
Podany, formerly a 15-year veteran of the PGA Tour, was hired by the LPGA in February shortly after Whan took over. The two were college roommates at Miami (Ohio) University and the LPGA presented Podany with the opportunity for greater responsibility beyond business development, including TV, digital media and the tour’s U.S. tournaments.
After spending the better part of the year beating on doors, Podany said hosting Wednesday evening’s event at the Hard Rock Cafe in Times Square will enable the LPGA to put its best foot forward with a program that will highlight as many as a dozen players.
Whan will start the program with a “state of the tour” and take questions to begin the program. Four players, Cristie Kerr, Morgan Pressel, Amanda Blumenherst and Jimin Kang, will then speak as part of a panel discussion. Natalie Gulbis and Michelle McGann will be among the others mingling with the crowd.
“The idea is to get people excited about the LPGA and where we’re headed,” Podany said. “It’s an opportunity to present the commissioner to the business community in New York and showcase some of our top players and personalize them.”
The biennial Minor League Baseball affiliation dance will formally begin Thursday, when major and minor league teams can sign player development contracts with new partners. But this year’s process overall is expected to be quieter than the 2006 and 2008 cycles, when about two dozen teams in the affiliated minor leagues changed partners each time.
The last two cycles were marked particularly by significant movement at the Class AAA level, as six clubs at that highest minor league tier switched in 2008, and five did so in 2006.
At press time, seven Class AAA player development contracts will expire with the conclusion of the minor league teams’ 2010 seasons, but only two affiliations are certain to change: The Texas Rangers, now owned by Chuck Greenberg and Nolan Ryan, are not renewing their deal with the Oklahoma City RedHawks and are strongly expected to align with the Round Rock (Texas) Express, co-owned by Ryan. The Express has been partnered with the Houston Astros.
The movement this time is likely to be concentrated more at the Class A level, Minor League Baseball executives said. “We had a lot of two-year deals the last time, teams trying each other out, that have since been renewed, so I’m not anticipating the kind of wholesale changes we’ve had in the past,” said Tim Purpura, MiLB executive vice president and chief operating officer.
Over the past decade, the affiliated minor leagues have taken on much greater importance not only from a player development standpoint, but also as marketing assets and sources of media content. Additionally, there has been a push among many major league clubs to group their minor league affiliates in tighter geographic clusters, yielding benefits with regard to marketing, travel and, in some cases, joint ticket and sponsorship sales.
Teams are typically not allowed to comment publicly on their affiliation intentions until a contract is signed and approved. But Reid Ryan, president and chief executive of multiteam operator Ryan-Sanders Baseball, which owns the Express, said a deal with the Rangers would be popular with Round Rock fans.
“Our fans love Nolan,” Ryan said of his father. “We have filed that we are not renewing [with Houston] and we’re going to see what our options are and let the process play out. It really had nothing to do with the Astros. But if it happens that we’re able to align with the Rangers, it would go over very well with our fan base.”
In an effort to promote the first line of Nike 6.0 winter outerwear this year, Nike has signed on as the title sponsor of the Winter Dew Tour’s Breckenridge, Colo., event this December.
The three-year deal, which is valued in the low seven figures annually, deepens Nike 6.0’s relationship with the Dew Tour, which began with an associate sponsorship of the Summer Dew Tour in 2008. The agreement also furthers the brand’s strategy of not just sponsoring but attaching its name to action sports events. In addition to the Breckenridge event, it was the title partner of the Summer Dew Tour’s BMX event in Chicago, a Huntington Beach, Calif., BMX event in August and the U.S. Open of Surfing in August.
“We’ve been committed to the Dew Tour, but sometimes we’ll elevate things to shine the light a little brighter,” said Zach Boon, Nike 6.0 North American brand manager. “We’re cranking up the kilowatts a bit. It’s a statement around this new, [outerwear] product line.”
Nike replaces Totino’s Pizza as the title partner of the Breckenridge Open. Totino’s decided to discontinue its spending on action sports and became the only 2009 Winter Dew Tour partner to cut ties with the tour. Toyota, which signed a two-year Winter Dew Tour renewal, will be the title sponsor of the tour’s last stop at Utah’s Snowbasin Resort in February, and Verizon Wireless, Paul Mitchell, Ball Park, Matador and PowerBar all return as associate partners.
Alli Sports, the company behind the tour, continues to look for a title partner for its January event at Killington, Vt. It remains in renewal negotiations with Wendy’s, which title sponsored a similar stop on the calendar last January. The tour is at 90 percent of its sponsorship goal financially, said Alli Sports President Wade Martin.
“We have one position left to sell,” Martin said. “I’m not sure if we’ll sell that position or not, but I’m confident there will be more deals between now and December. The winter tour is in a good place.”
In addition to the title rights, Nike 6.0 receives on-site and retail activation rights, and advertising during NBC, USA Network and MTV2 broadcasts. The brand plans to hash out its activation plans, which will emphasize its new outerwear line, in the coming months, Boon said.
Nike previously offered winter sports outerwear under the label of its ACG brand. It rebranded the line under the Nike 6.0 label this year in an effort to continue to expand the reach of its premier action sports brand, which is the fastest-growing category at the company. Nike 6.0 and Nike SB currently combine for an estimated $390 million in business.
In addition to title sponsoring the Breckenridge Open, Nike 6.0 has signed several freeskiers and snowboarders to wear its new line of outerwear. It has signed snowboarders Mason Aguirre, Greg Bretz and Matt Ladley, and freeskiers TJ Schiller, Jossi Wells and Andreas Hatveit. It hopes to sign female athletes in the future, Boon said.
After going a year without a bank sponsor, Fox Sports Net’s Pac-10 Properties signed Bank of the West as the conference’s official bank.
The two-year deal will run the course of FSN’s media deal with the Pac-10, which expires at the end of the 2011-12 school year.
FSN would not attach a specific dollar figure to the deal, but sponsorships like this generally approach $1 million annually.
The bank will have a presence at most Pac-10 events, such as the men’s basketball tournament. It will be presenting sponsor of the Pac-10 Hall of Honor, which is part of the conference’s basketball tournament.
But neither the bank nor the conference has made any plans for a football championship game, which is expected to be played once the conference expands to 12 teams next year.
“We left that open,” said Mitch Huberman, a senior vice president at FSN, who manages Pac-10 Properties and sells the inventory. “We’ll look at that once it becomes a reality.”
As part of the deal, Bank of the West will have broadcast and print media spots, plus on-site signage. Bank of the West will also provide corporate banking services to the conference.
“Anywhere the Pac-10 is on FSN, you’ll see Bank of the West,” Huberman said.
The deal is a natural fit for Bank of the West, which already sponsors the athletic programs of two conference schools (Cal and UCLA), plus a third that will enter the conference next year (Colorado). The company has a presence throughout the entire Pac-10 footprint. Based in San Francisco, it is the third-largest commercial bank in the western U.S.
Pennzoil has spent nearly two decades as a primary team sponsor in NASCAR and has never really come close to seeing its brand name and signature yellow paint scheme win a championship.
Now, with Kevin Harvick’s No. 29 Shell-Pennzoil car sitting atop the series points heading into the Chase for the Sprint Cup, the longtime sponsor finds itself as one of the favorites to clinch the title, if not the favorite.
But the position is bittersweet.
Shell-Pennzoil’s relationship with Richard Childress Racing and Harvick officially ends Dec. 1, just 10 days after the end of the season. Should Harvick maintain his points lead and win his — and the sponsor’s — first Cup championship, Shell-Pennzoil will have minimal opportunity to activate around it, or to utilize the champion driver during the offseason and buildup to the 2011 Daytona 500 in February.
Instead, the sponsor will become the primary partner on Penske Racing’s No. 22 car driven by Kurt Busch. It’s the first time since the Chase for the Sprint Cup was launched in 2004 that a primary sponsor has found itself backing one driver atop the standings while transitioning to another team and driver for the following year.
“It’s definitely awkward,” said Heidi Massey-Bong, Shell’s senior business adviser for NASCAR sponsorships. “We’re leaving somebody who I very much respect and appreciate what they’ve done in the sport, and going to somebody else.”
Shell-Pennzoil decided to leave RCR in late 2009, in the midst of a two-year winless streak for Harvick. It put out a request for proposals and wound up signing a new deal with Penske Racing because of the business-to-business opportunities that will result from providing oil and gas to Penske’s car dealerships and truck leasing companies.
That decision puts Shell-Pennzoil officials in the challenging position during this season’s Chase of making the most out of what could be a championship run with Harvick and RCR, while simultaneously preparing for the first season with Penske and Busch.
Harvick’s No. 29 car will be sponsored next season by Budweiser.
“The only negative is next year when they can’t use the equity of winning a championship,” said Trip Wheeler, president of the motorsports agency The Wheeler Co. “Right now they should be screaming from the rooftops about Kevin Harvick. They spent years trying to build an association with the guy, and when they do their marketing now the smart thing would be to brand themselves with a picture of the car and not Kevin. … The colors are going to stay the same.”
Harvick’s success has led Shell-Pennzoil to increase its activation plans during NASCAR’s 10-race Chase. It is adding point-of-sale promotions in the Fort Worth and Phoenix markets to encourage participation in its Shell Grocer Rewards Program. Participating customers at Kroger and Fry’s grocery stores will be encouraged to use their Kroger Plus Card and Fry’s V.I.P. Card to earn points that can be exchanged for discounts of 10 cents per gallon at participating Shell stations.
The Shell-Pennzoil pit crew will make an appearance at a Kroger Grocery Store in Fort Worth and Fry’s Food Store in Phoenix where they will hold a Pit Crew Bagging Challenge to foster participation in the program, as well.
“[Harvick’s] success has really created an interest from Shell and the partners to take advantage of their NASCAR asset,” said Todd Stonis, general manager at Sport Dimensions, which manages Shell-Pennzoil’s NASCAR activation. “It’s a natural fit. Who wouldn’t want the points leader and their car in their stores?”
In addition to the Grocer Rewards Program, Shell-Pennzoil will complete its seasonlong “Key to Clean” sweepstakes during the Chase. The promotion will award one of five finalists a customized Camaro SS that was up-fitted by the RCR Street Performance group.
In the midst of seeing all of those promotions to their conclusion, Shell-Pennzoil officials have been planning for the future. The marketing team has been speaking to officials at Penske Racing regularly and reviewing everything from transporter designs to trackside branding for the No. 22 car that Shell-Pennzoil will begin to sponsor after this season.
The biggest challenge it will face, Massey-Bong said, will be converting employees who became RCR and Harvick fans into Penske and Busch fans.
“I’d like to think we’ve done a good job of converting our employees and turning them into passionate race fans,” Massey-Bong said. “We got them to throw their weight behind RCR and Harvick, and we now have to say, ‘I know you did that, but we’ve made this change and I need you to trust us.’”
Massey-Bong admitted that should Harvick win the Cup championship, that conversion becomes more difficult. So does promoting the sponsor’s affiliation with a potential champion. Under a Harvick championship scenario, if Shell-Pennzoil were returning with Harvick, Massey-Bong said the sponsor would blow out its affiliation with his title run during the 2011 Daytona 500. Instead, it will have less than two weeks to promote its ties to the driver and enjoy the spoils of sponsoring a championship team.
“We knew we would lose some opportunities when we put out the RFP, and this would be one of them,” she said. “We’ll make up for it in business-to-business [at Penske], and when we look at it in terms of return-on-investment, we’ll be whole.”
The Detroit Tigers have refinanced $130 million, signaling that sports finance continues to rebound from the depths of the national recession.
The Tigers’ refinancing is also the first such deal since the resolution of the Texas Rangers’ contentious bankruptcy and franchise sale process, though the Tigers’ refinancing had been in the works for some time. There have been worries that MLB’s adversarial position against the lenders in the Rangers’ saga could prove problematic for future baseball financings.
Indeed, there was a great deal of negotiation between MLB and the Tigers’ main lender, Sumitomo Mitsui, over the rights the league has in the event of a default by the team. These rights, outlined in what is known as a consent letter, took up 13 more pages than they did in the original loan 12 years ago.
It could not be determined what is in those 13 extra pages, but MLB in the Rangers’ process asserted its rights to push through the sale of the club to its preferred buyer over the objections of lenders. Ultimately, a bankruptcy court ordered an auction, which resulted in a sale last month to the MLB-preferred ownership group led by Chuck Greenberg and Nolan Ryan.
“It is a particularly good sign that a deal in MLB is getting done following on the heels of the Texas Rangers situation,” said Rob Tilliss, a former sports lender and founder of boutique Inner Circle Sports.
Sumitomo’s top sports financier, Jim Weinstein, said the deal, which closed Aug. 13, was oversubscribed. That means that when Sumitomo cut up the loan into smaller pieces and syndicated them to other banks, the demand for the loan pieces exceeded the supply.
“This speaks to the confidence in ownership and management of the team and how they are viewed as hands-on and engaged by those who follow the business,” Weinstein said. “It is also clearly a reflection of the stability of the organization, their strong management track record of success over the long term and positive projections into the future.”
The Tigers are owned by the Ilitch family, which also owns the NHL Red Wings and is considering buying the NBA Pistons. The family historically has been guarded about saying anything about its teams’ financials, so it is somewhat noteworthy the team approved public comments from its banker.
Despite the hope that the successful Tigers deal may mean the acrimony of the Rangers situation is behind baseball, there are some important distinctions in the transactions.
The Tigers’ deal is what is known as an operating company loan, meaning all of it is lent directly to the club. In the Rangers’ deal, most of the debt was lent above the team, and MLB and the team were arguing that the lenders were entitled only to the amount directly lent to the club. In the Tigers’ case, if the team were to go into bankruptcy, the matter would be more straightforward because the lien held against the team is the same amount as the loan.
A truer test of the baseball lending market, sources said, will emerge when a deal arrives with money lent to the team and a holding company that is not secured by a lien.
The Tigers’ deal is priced at 325 interest points over the London Interbank Offered Rate, market sources said. That rate last week was trading at 0.29 percent, making the loan 3.54 percent.
The other banks in the deal are Charter One, Wells Fargo, Comerica, Fifth Third Bank, PNC Bank and US Bank.
The NFL Players Association has begun handing out voting cards that would allow players to authorize the decertification of the union, a move that could prevent the NFL from locking players out when the collective-bargaining agreement expires in March.
The NFLPA plans to ask the players on all 32 clubs to vote to authorize decertification when NFLPA Executive Director DeMaurice Smith visits each club on his annual fall tour of locker rooms, sources said. New Orleans Saints players have already voted to authorize decertification at their union meeting last week, a source said.
“We have started to hand out voting cards to players authorizing us pursuant to the CBA to take action with respect to the NFLPA’s bargaining status prior to the CBA’s expiration on March 3, 2011,” states a letter sent to players and obtained by SportsBusiness Journal. “The cards will allow us to maximize the protection of your interests and rights when the CBA expires.”
If the NFLPA were to decertify, it would, in effect, operate as a trade organization but cease to be a union. If the league then tried to lock out players, the NFLPA could sue the NFL under U.S. antitrust laws and contend the league was conducting a group boycott, which is illegal. It could not sue the NFL if it remained a union with collective-bargaining authority for its members, under the labor exemption to antitrust laws.
The NFLPA’s letter reveals that union leadership continues to believe the league is poised to lock players out as soon as the CBA expires in March, and wants the option to act.
The letter says decertification “does two things for us: First, it gives a very firm deadline to the NFL to reach a new CBA with us before the current one expires, and before we end our status as a union. Second, it allows us to file an antitrust challenge against the lockout they are likely to impose the day after expiration.”
The letter does not present decertification as a fait accompli, but rather as giving the union the option to use that leverage if the need arises.
It also indicates that the union wants the option to decertify before the CBA expires. The letter states that if the NFLPA were to wait until after the CBA expires to decertify, it could not sue the NFL for six months.
If the union were to try to decertify, the league would likely sue the NFLPA, challenging the decertification as a “sham” and saying the NFLPA was still acting as a union but only filing to gain access to the antitrust laws. A source close to the league has told SportsBusiness Journal in the past that the NFL would have a strong case, because the NFLPA decertified in 1989, only to become a union again in 1993, after it won a jury trial in the Reggie White v. NFL case.
But the union has long contended that it has the right to decertify under the White settlement. That settlement was the basis for the current CBA, which was first agreed to in 1993 and has been extended several times.
NFLPA officials could not be reached for comment for this story.
Because the union has decertified before, the move cannot be considered a surprise. But Smith, although he has indicated publicly in the past that decertification was an option, has not leveled the strategy as a threat. That stands in contrast to his predecessor, the late Gene Upshaw, who, before he died in August 2008, said loudly and repeatedly that if the NFL were to try to lock players out, “We won’t be here.”
Decertification would also allow the union to legally challenge any NFL plan to unilaterally implement a new labor system. If the union won in court, the NFL could be forced to pay treble damages to the union.
Although there are advantages to the union decertifying, namely allowing it to gain access to the antitrust laws, there are disadvantages as well. Not only would the NFLPA not be able to collectively bargain for its members, it could not bring grievances for them and could not compel them to pay dues or control their marketing rights. When the union decertified in 1989, the league and the NFLPA, acting as a trade association, competed with each other for players’ marketing and licensing rights.
NBA owners are expected to vote on the sale of the Golden State Warriors by the end of October. A vote to approve the deal would finalize the $450 million price, which would stand as a record for an NBA franchise.
The Warriors’ sale, to a group led by venture capitalist Joseph Lacob and including Mandalay Entertainment Group Chief Executive Officer Peter Guber, was announced in July, with no timetable given for NBA ownership approval. But a source familiar with the deal said Lacob and his group should have financing completed by October, clearing the way for a vote by the NBA board of governors at meetings set for Oct. 20-21 in New York City. At least three-fourths of the NBA’s 30 owners must approve the deal
The group led by Lacob, managing partner for the venture capital firm of Kleiner Perkins Caufield & Byers, outbid three other suitors for the team. The sale is structured to include $300 million in equity put up by the partnership, with $150 million in debt assumed by the new owners, according to a source.
Sal Galatioto, whose Galatioto Sports Partners represented outgoing Warriors owner Chris Cohan in the sale, refused to comment on the deal. Cohan paid $115 million for the Warriors in 1995.
The $450 million sale would far eclipse the NBA franchise sales record of $401 million paid by Robert Sarver for the Phoenix Suns in 2004.
Lacob, who owns a minority stake in the Boston Celtics, must either sell that stake or put his interest in escrow, in order to win NBA approval.
There forever has been talk about the blending of sports and entertainment marketing, with few real successes. Will Vince Lombardi’s name be enough to bridge the gap?
Whether the forthcoming Broadway production based on the life of the legendary coach is an artistic and critical success has yet to be determined. From a marketing perspective, “Lombardi,” which opens in rehearsal at Circle in the Square Theatre in New York on Sept. 23 and officially opens Oct. 21, faces the same issues that come when any marketer tries to expand a base of loyal consumers.
“It’s a straightforward issue,” said Tony Ponturo, one of the show’s producers, after having similar roles in the musicals “Memphis” and the revival of “Hair.” “The question is whether sports fans will come to see a Broadway play and whether Broadway fans will come to see a sports-themed Broadway production.”
Having the NFL’s blessing to use its intellectual property, and some of its marketing clout, is probably something only Ponturo could have pulled off after his years with Anheuser-Busch. Ponturo described the arrangement with the NFL as a revenue share after the play breaks even.
For its part, the NFL is showing a “Lombardi” TV ad on some of its asset media; sending e-mail blasts to its fan base; running banner ads on NFL.com; and supplying the play with a Times Square billboard next month. With the cooperation of the Pro Football Hall of Fame, the league also is filling the theater lobby with Lombardi memorabilia, including a player bench from the 1967 Ice Bowl NFL championship game between Lombardi’s Green Bay Packers and the Dallas Cowboys, as well as a football used in the initial AFL/NFL championship. The Lombardi NFL Championship Trophy also will be displayed at some performances.
The cast and others involved with “Lombardi” went to Green Bay to meet with Packers fans, and that trip was turned into a five-minute feature on the NFL Network. There also will be jointly licensed merchandise at the theater and on NFLshop.com.
Since Lombardi was an assistant coach with the New York Giants before taking over in Green Bay, the New York team is helping with in-game marketing at New Meadowlands Stadium, including via scoreboard advertising. During the Giants’ final home exhibition game, cast members made appearances at the stadium.
Ponturo’s Leverage Agency is selling sponsorships to the play, mostly centered on opening night involvement, along with additional tickets, hospitality and possible incremental content opportunities.
A successful theatrical production about sports is unusual, but it is not unprecedented. “Damn Yankees” ran for more than 1,000 performances after its 1955 Broadway opening.
While Lombardi is a singular character, another intriguing issue is whether the play’s success could create a new theatrical genre. Would life stories of John Wooden, Jackie Robinson or Muhammad Ali play on Broadway?
“Of course it gets down to how compelling audiences feel the play is,” said Gary Stevenson, an investor in the play (one of a group of investors from the sports and marketing community, according to Ponturo, who would not reveal any other names). “There is a feeling among everyone involved that we are pioneering something.”
Recall that Disney didn’t push its well-protected intellectual property onto Broadway until 1994. Now, it’s almost automatic for any new and successful Disney film to be considered for the stage.
“I’ve had very preliminary discussions with people from some of the other big leagues,” Ponturo said. “With a nod and a wink, they tell me that if ‘Lombardi’ is successful, maybe they’re next.”
“I don’t see it as automatic that if you’re a sports fan you will go to a Broadway play about sports,” said Meg Meurer Brossy, senior vice president of new business development at BrightLine iTV and the former managing director of new business development for the League of American Theatres and Producers, a consortium of theater owners. “However, the NFL connection adds a lot of credibility for NFL fans, and if it’s successful, producers will be more likely to back similar productions.”
“Lombardi” debuts during a renaissance of interest in the coach, who won five NFL titles, some 40 years after his death. In addition to the play, an HBO/NFL Films documentary about Lombardi is scheduled to debut in December. ESPN Films has a Lombardi film starring Robert DeNiro in development that is slated to premiere in 2012.
“Lots of NFL fans don’t know anything about the man whose name is on the Super Bowl trophy,” Ponturo said. “Lombardi’s story is one about hard work and succeeding without shortcuts, and we are at a time when back-to-basics just resonates.”