SBJ/October 24-30, 2011/Marketing and Sponsorship

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  • NCAA keeps AT&T as corporate champion

    AT&T, the NCAA’s longest-standing partner, has extended its corporate champion sponsorship.

    The three-year agreement keeps AT&T on board as the NCAA’s official wireless service provider and a heavily integrated sponsor of CBS’s basketball broadcasts, including “At the Half.”

    Terms of the deal were not released, but NCAA corporate champion deals in the past have sold in the low eight figures annually. Coca-Cola and Capital One are the other corporate champions.

    The NCAA lists 10 companies under its second tier of sponsors, called corporate partners. Those deals go for high seven figures to low eight figures annually.

    The NCAA’s corporate sponsor program is managed and sold jointly by Turner Sports and CBS Sports.

    “AT&T has been a partner for a long time and it really has become about finding more incremental opportunities for them,” said Chris Simko, CBS Sports’ senior vice president for sales and marketing, “With the partnership we have with Turner, it’s all about maximizing all of the pieces, both from the standpoint of the media platforms we have available and all of the NCAA’s 89 championships.”

    AT&T in the renewal has committed to more activation against the NCAA’s championships in women’s basketball, baseball and lacrosse.

    There is not an exclusive content play for AT&T because of the NCAA’s TV Everywhere approach of putting all of the men’s basketball tournament games on March Madness on Demand, but AT&T will have the opportunity to pass through some rights to its handset partners.

    There also exists a possibility for AT&T to work with LG, an NCAA corporate partner, on marketing programs as well, said Will Funk, Turner’s senior vice president of NCAA partnerships.

    AT&T came on board with the NCAA when it acquired Cingular and eventually merged those brands into one in 2007. Cingular’s deal with the NCAA goes back to 2001, a year before Coca-Cola came on board.

    AT&T was represented by Team Epic on the deal. Media Edge works on AT&T’s media buying, while CSE in Atlanta handles AT&T’s creative integration into the CBS broadcasts.

    Moving forward, Funk and Simko said they plan to limit the corporate champion program to the three current brands, but intend to expand the partner program from the 10 categories represented now.

    Coca-Cola’s lengthy deal is up in 2013, but there are options to extend.

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  • USA Basketball signs MetroPCS as sponsor

    MetroPCS has signed on as the latest sponsor of USA Basketball, with a deal running through the 2012 London Olympics.

    The sponsorship gives the cellular service brand some Olympic equity and its first national sports platform, fitting well with MetroPCS’s recent marketing, which touts its coverage across the country. MetroPCS is the fifth largest cellular service brand in the U.S. based on its more than 9 million subscribers.

    Financial terms of the deal were not disclosed. The Dallas-based company becomes the official wireless partner of USA Basketball. AT&T was the last brand with USA Basketball wireless rights. Those rights expired after the 2008 Olympics.

    MetroPCS will activate in 14 markets next year with a USA Basketball legends tour, along with in-store promotions and courtside signage. The tour will begin in Tampa and proceed then to Dallas.

    “The two specific purposes are to elevate our brand and connect it with a nationalistic platform,” said Tom Keys, president of MetroPCS, which has been an active sponsor of late. MetroPCS is a founding partner of the New Jersey Nets’ Barclays Center, which is set to open in Brooklyn next year, and it has a team deal with the Orlando Magic.

    The NBA handles marketing and sales for USA Basketball, which is chaired by Jerry Colangelo. Richards Sports & Entertainment brokered the deal and is handling activation for MetroPCS.

    The NBA recently replaced T-Mobile with Sprint in the wireless category (SportsBusiness Journal, Sept. 5-11 issue). Sources said MetroPCS was also negotiating for NBA wireless rights and did not leave those negotiations with positive feelings for the league after Sprint emerged with the deal. So MetroPCS securing USA Basketball rights is curious, as is Sprint not including them in its extensive NBA/WNBA package.

    Still, sources said initial discussions about the USA Basketball package with MetroPCS started at the NBA All-Star Game in Los Angeles in February, well before negotiations for the league packages heated up in June.

    “These are separate deals, bifurcated down different hallways,” Keys said.

    Other USA Basketball partners are Cisco; Nike; Gatorade; State Farm Insurance; Tiffany & Co.; JA Apparel Corp., owner of the Joseph Abboud brand; the Milk Processor Education Program, better known for its national “Got Milk?” campaign; and Las Vegas Events.

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  • Clay finds two new sponsors after losing Nike

    Less than two months after losing his most financially supportive sponsor, Nike, Olympic decathlete Bryan Clay has found two new sponsors, BP and The Century Council, to help underwrite his campaign for a third Olympic medal.

    GETTY IMAGES
    Clay, a two-time Olympic medalist, had been with Nike for eight years.
    Clay, who won silver in the decathlon at the Athens Games and gold at the Beijing Games, will be one of about nine athletes featured in Olympic-related promotions by U.S. Olympic Committee sponsor BP in its marketing efforts around the London Games. BP declined to disclose the names of the other athletes, who are being announced by the company this week. The energy company’s endorsement of Clay is a multiyear agreement valued in the low to mid-six figures.

    The Century Council, which signed Clay to a multiyear agreement valued in the low to mid-six figures, will make Clay the centerpiece of its print ad campaign discouraging drunken driving and underage drinking. The nonprofit organization, funded by spirits companies, featured Olympic speedskater Apolo Anton Ohno in a campaign during the Vancouver Games and is using Shaquille O’Neal as a spokesman discouraging binge drinking on college campuses.

    The deals Clay signed give him 10 endorsers ahead of the London Games. His partners include Oakley, Polo Ralph Lauren, BMW, BP, The Century Council, Zico Coconut Water, Deloitte, Bioenergy Ribose, Wheaties Fuel and Visa. All of those deals except for Visa and Wheaties Fuel were signed in the last six months.

    “We’ve been networking as hard as we can and we’ve had some really good opportunities come to fruition,” said Clay, whose marketing deals are managed by Jeremy Snyder, founder of The Factory Agency, which launched early this year and also represents Paralympic swimmer Mallory Weggemann.

    Clay said that Snyder has been more aggressive in searching for opportunities since August. The decathlete and Nike, which had sponsored him for eight years, parted ways that month. The split followed a move by Clay to sign with Polo Ralph Lauren, a USOC sponsor that serves as the official outfitter of Team USA.

    At the time, Nike was Clay’s biggest patron and losing the deal was so unsettling that he worried about how he would pay his mortgage. He said the financial uncertainty became a distraction during his training. Clay decided not to compete in the track and field world championships in late August and underwent surgery. But he now believes that parting with Nike has helped open other opportunities like the deals with BP and The Century Council, which have given him financial security ahead of the London Games.

    “With me not having a Nike contract anymore, it’s freed me up to do a lot of other things and allowed me to work with companies that want to use me rather than one that wants to tie me up from being used,” Clay said.

    Snyder said he is in discussions with two to three more companies about endorsing Clay. He anticipates he will sign at least two more deals, and he is particularly focused on finding another shoe and performance apparel partner for Clay. He is focused on finding partners who are attracted to the way Clay’s been positioned.

    “We’re really looking at the Bryan Clay brand as these four pillars — you have the athlete, you have the speaker, you have the giver, which is the philanthropist, and you have the family man,” Snyder said. “All of the deals we look at are with companies that support his foundation, understand he has three young kids and understand he is an athlete who has to train first.”

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  • Groupon more interested in breadth of offerings than exclusive deals with sports teams

    Ticketing executives undoubtedly have watched the rise of social commerce websites like Groupon and Living Social within sports business. The “daily deal” websites promote sharply discounted tickets within their social network. Staff writer Fred Dreier caught up with Greg Rudin, general manager of Groupon’s live events division, to discuss where the potential lies for social commerce.

    What do you think the true value of social commerce websites is to sports?

    GROUPON
    Rudin
    GRUDIN:
    We believe we are introducing opportunities to attend sporting events to people who would otherwise not go. We think we are becoming a catalyst for more people going to watch sports. And we allow a social feature that allows people to buy in groups, and that is important for sports. If I can get five or 10 people together and we have a deal to go to a Cubs game, they are more likely to go than if someone was going independently.

    Which league has given you the most success?

    GRUDIN:
    We have the greatest number of frequency with the NBA but we’ve worked with all of the major leagues, with the NFL showing the least representation to date, but not for lack of interest on our side. A lot of it depends on the relationship between the team and our specific sales rep. We’re not creating a ton of awareness for the sports that are mature in terms of exposure, such as MLB or NBA. But with MLS, for example, we have a unique opportunity to create awareness amongst people that maybe don’t know about the league.

    The sharpest criticism I’ve heard of Groupon in sports is from executives who fear ruining the price integrity of tickets. How will you get past that hurdle?

    GRUDIN:
    We recognize that issue, which is why we don’t do deals with that much regularity, maybe once a month. We don’t want to upset season-ticket holders, and we don’t want people waiting around for the Groupon deal to buy. We want to maintain pricing integrity while broadening the population. But I think everyone realizes there is a fan who wouldn’t otherwise go unless they were presented with an offer that was fleeting.

    Do you see more teams signing exclusive partnerships in this category?

    GRUDIN:
    We’re not averse to doing exclusive deals, but honestly we’re more interested in breadth and variety. I don’t know if it’s in the team’s best interest to do that kind of deal with a single partner. Then what, all of the fans with that team consistently look around for the deal? We are interested in surprising the customer and not necessarily saying we have this exclusive sponsorship with five teams and look out for deals with them.

    Many teams see social sites primarily as a way to unload distressed inventory. Do you see the business evolving past that point?

    GRUDIN:
    We already have. We’re focused across the whole ticket sales cycle, not just distressed inventory and late-stage ticket sales. Teams use Groupon to create buzz in the marketplace even in the presale and midstream stages. We can package in unique experiences like access to warm-up. When we do pre- or midsale deals, we see full-priced ticket sales positively impacted.

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  • With NFL sales strong, lockout seems a long, long time ago

    Terry Lefton
    Earlier this year, there was much hand-wringing from brand marketers on the buy side and from NFL team sales executives about how the league lockout was going to damage them.

    While we don’t enjoy “rich get richer” stories any more than those occupying the park on Wall Street, from a sales perspective, the truth is the four-month lockout hurt the average NFL team’s sales no more than a dismal season on the field.

    “We had all kinds of dire contingency plans and budget scenarios, but they never came into play,” said Jim Ross, Cleveland Browns senior vice president of business development. “Sure, it slowed things down, but pretty much all, if not all, of our measurables are in the right directions. The fans are caught up in wins and losses, and for us now, [the lockout, which] was causing lots of anxiety for three to four months, seems like long ago and not very impactful.”

    Added Jim Pisani, president of the licensed sports group for longtime NFL licensee VF, “We took a bit of a risk going long on inventory during the lockout, but now we are looking at one of our best NFL years ever, if not our best.”
    That’s the same optimism we heard last month from Reebok, now in its last year as the NFL’s master on-field apparel licensee.

    As for why the impact was negligible, there are different theories. Many have to do with the strength of the NFL as a sports property, something that could withstand almost anything.

    “The league and teams managed communications so well that on the business side, I never heard any doubt that there was going to be a season,’’ said Dan Belmont, president of The Marketing Arm, which has clients including Hewlett-Packard and AT&T with NFL stadium and team sponsorships. “Some properties would take time to recover, but the NFL doesn’t appear to have missed a beat.’’

    After the collective-bargaining agreement was reached, the shortened period for free agency signings engendered even more fan interest and seemed to prompt a flurry of business.

    “We had fewer deals from March [the lockout began March 12], followed by the most deals ever from July to October,’’ said Bob Reif, CMO of the St. Louis Rams, which renewed Anheuser-Busch for five years along with Charter Communications, and signed Geico to a new sponsorship. “Everyone had our attorney on speed dial. So in a weird way, it helped speed things up.’’

    So call it a lesson in reignited demand, and there’s no demand like pent-up demand.

    “That short time window created such a compressed, high-intensity buzz for us that what you had was this intense spotlight when training camp opened that we couldn’t have created ourselves,’’ said Houston Texans President Jamey Rootes. The Texans posted double-digit growth in sponsorship renewals and secured new deals with Sonic, Conn’s, BBVA/Compass, First Community Credit Union, BMW, Gallery Furniture and Houston Community College. Season-ticket sales are at a new high.

    The Arizona Cardinals had many deals up for the first time since University of Phoenix Stadium opened in 2006. The team renewed them at a 95 percent rate.

    “We didn’t know what to expect, but as it turned out, the lockout did not affect renewals for corporate sponsorships or suites, and we knew that within a month after the [July 25] settlement,’’ said Steve Ryan, vice president of business development for the Cardinals, which renewed A-B and Geico, among others. “No one was rushing to sign during the lockout, but it just seemed there was no doubt among our partners the thing was going to get resolved.’’

    As you might expect, some teams’ new business efforts foundered, since it’s hard to sell a program when all the news around your property involves the lack of a CBA.

    “We did not generate a lot of new business,’’ said Kevin Rochlitz, Baltimore Ravens vice president of national sales, who counted Taco Bell and KFC among his new sponsors. “Our renewals were fine, and I don’t think we are missing out on any activation, so we kept things intact and gained a little bit of new business.’’

    Chris Hibbs, Chicago Bears senior director of sales and marketing, said: “I would call our sales year successful, but developing anything new and different with sponsors was difficult. Overall, we’re looking back and saying it wasn’t the disaster that a lot of people forecast.’’

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

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