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SBJ/August 27-September 2, 2012/CollegesPrint All
College-licensed food products have met only marginal sales success in the past, but a new program featuring Kellogg’s Pop-Tarts has schools optimistic that the concept can work.
By early September, Pop-Tarts featuring the marks of five colleges — Arkansas, Florida, Georgia, Michigan and North Carolina — will hit grocery store shelves in those markets.
The college-licensed Pop-Tarts are one of a handful of new products hitting the market just in time for this week’s start to the college football season, according to Collegiate Licensing Co., the IMG company that serves as the licensing agent for close to 200 colleges, conferences and bowls.
Toms has shoes with the colors of 33 schools, but no school logos.
The new line of Toms shoes, priced at $48, launched on its website, Toms.com, last week and will hit store shelves in October. The shoes come in the colors of the school, but do not feature the actual logos. A licensing deal with schools such as Arizona, Florida, Georgia, Kentucky, Michigan and Texas was necessary, even without the marks on the shoes, for Toms to use the precise color codes for each school. Toms also will use the marks in its promotion.
“Toms is one of the hottest brands out there,” said Dave Kirkpatrick, CLC’s vice president of non-apparel brand management. “They’ve already got a great presence on college campuses because of their popularity there, and beyond.”
Toms has gained a measure of its popularity because of the message behind its shoes. For every pair sold, Toms donates a pair to a child in need across 20 countries. That same commitment will apply to the school shoes that are sold. The company has donated more than 2 million pairs since it began in 2006. That mission has created a unique following for the shoe brand, which sold 10,000 shoes in its first year and typically is sold in boutique shops or stores that cater to younger consumers.
The Toms shoes will be available at Nordstrom, Journeys, Jack’s Sports Shop and campus retailers, among other retail outlets.
It’s the kind of deal that integrates licensing and sponsorship into a unified effort. CLC is working with its multimedia rights cousin, IMG College, to do more deals that combine licensing and advertising, where it has the rights to both. Arkansas is a CLC school with IMG College handling its multimedia rights.
If sales go well with the Razorbacks, the integrated licensing and sponsorship program could grow to include more schools.
While licensed food has a sketchy sales history, Kirkpatrick said licensees have seen some success with Russell Stover college chocolates, bottled water and ice cream, but distributors for grocery chains often struggle to get the right licensed product to the correct market.
“But it does look like there’s a growing level of sophistication with distributors that make us think programs like this can be very successful,” Kirkpatrick said.
Also new for the football season are two separate licensees in the hard cooler space. Igloo brand hard-sided coolers on wheels debuted this month with the marks to 20 schools. Those will retail for $20 to $50. Yeti, the maker of higher-end hard coolers for $250 to $350, will feature the marks of a dozen schools.
Ever since the “kickoff” neutral-site games came back into vogue in 2008, the highest combined payout for two schools has been $5.5 million, but the Crimson Tide and Wolverines will share a hefty $9.4 million payday for their participation in the prime-time ABC game called the Cowboys Classic.
The richest payout previously went to LSU and Oregon in the 2011 edition of the Cowboys Classic that featured a matchup of preseason top-five teams. LSU’s guarantee last year was $3.5 million, while Oregon took $2 million.
But Michigan and Alabama will walk away with $4.7 million each after Saturday’s game.
The simple explanation is that both the Crimson Tide and Wolverines gave up a home game in order to meet in Arlington, Texas, this week, a Michigan official said. Michigan makes about $5 million in revenue from each of its home games in 109,101-seat Michigan Stadium, and Alabama collects roughly the same at 101,821-seat Bryant-Denny Stadium.
Alabama has seven home games this season, while Michigan has six. The Crimson Tide has twice previously played in Chick-fil-A Kickoff games in Atlanta. This is their first appearance in the Cowboys Classic.
“For us, these games fit Coach [Nick] Saban’s philosophy of playing high-profile opponents at neutral sites,” said Shane Lyons, Alabama’s deputy athletic director. “It gives the players something to look forward to all summer and something to build toward. And it’s good for recruiting. We’re playing big games on a big stage, and we’re going into some major cities like Dallas and Atlanta where there are lots of recruits.”
The Cowboys, who stage the game at their stadium and pay the teams, would not comment on the financials of the game, but they stand to make more revenue this year from higher ticket prices to cover the higher guarantees. Tickets last year topped out at $250, while this year’s top end is $285. Some standing-room-only tickets are going for $89 as part of a LivingSocial promotion.
Attendance for the Michigan-Alabama game is expected to challenge last season’s mark of 87,711. Both the Crimson Tide and Wolverines sold out their allotment of 25,000 tickets each.
Sales of the 300 suites also have gone well, Cowboys’ spokesman Brett Daniels said. Suite owners had the opportunity to buy the Alabama-Michigan game and most did, he said, while a handful of suites were sold to the public.
Each participating school receives two luxury boxes and a field-level suite.
The return of the kickoff concept started in 2008 when Chick-fil-A Bowl officials and the Georgia Dome teamed up to create a neutral-site game on the season’s first weekend. The idea was to give two teams a bowl-like experience and game atmosphere in order to provide more excitement to the start of the season.
The Georgia Dome has been the site for the Chick-fil-A Kickoff each season since 2008, and the Cowboys started their Cowboys Classic in 2009.
FedEx Field also has hosted big early-season matchups in the past, and will bring in West Virginia and James Madison in the third week of the season. Soldier Field is the site this season for Northern Illinois and Iowa — again, later in the season — in what is technically a home game for the Huskies. They are paying Iowa a $1 million guarantee to appear.
At the Georgia Dome this weekend, the Chick-fil-A Kickoff features two games — Tennessee-North Carolina State on Friday night, and Clemson-Auburn on Saturday night, both on ESPN — for the first time since it introduced the game four years ago. The total payout for each game will be more than $4 million.
The Chick-fil-A Kickoff’s payout has remained relatively flat since the first game, but those figures are expected to increase in coming years. Alabama is playing Virginia Tech next season in Atlanta, with each school earning $2.65 million for its appearance. The Crimson Tide returns to Atlanta in 2014 against West Virginia in a game that is expected to pay both schools about $3.2 million, so the fees are escalating in Atlanta, too.
Gary Stokan, the bowl’s chairman and organizer of the Chick-fil-A Kickoff, said the payout is simply the amount of money that remains after taking expenses, including a management fee, from revenue, which take into account Chick-fil-A’s title sponsorship and some secondary sponsorships.
Tickets for the two Chick-fil-A Kickoff games aren’t nearly as costly as the Cowboys Classic. They range from $60 to $150 in Atlanta, compared with $125 to $285 in Arlington. That, and the additional number of seats in Cowboys Stadium, puts the Cowboys Classic in position to pay higher guarantees.
Ticket sales for Clemson-Auburn have been slightly ahead of the pace for the Tennessee-N.C. State game this week. Both Clemson and Auburn sold out their allotment of 31,500 tickets each and the Georgia Dome has announced a sellout. Their combined payout, which is partially based on tickets sold, will be about $4.6 million, or $2.3 million for each school.
Tennessee sold 27,000 tickets compared with 15,500 by N.C. State. Their combined payout will be about $3.5 million.
The Tennessee-N.C. State game is expected to draw a crowd of about 60,000. Auburn-Clemson will likely exceed 72,000.
These season-opening games also provide a strong selling platform for ESPN. Dick’s Sporting Goods will be the umbrella sponsor for the opening weekend with promotional association across TV, digital and radio. The Alabama-Michigan game also will launch a new sponsorship by Microsoft Windows, the new presenting sponsor of ABC’s Saturday night prime-time games throughout the season.
Legends Sales and Marketing has formed a unique partnership with Ohio University tied to selling tickets for the school’s sports teams.
The three-year deal calls for the Dallas sports marketer to help subsidize a staff of two graduate students and one full-time intern to sell season tickets for Ohio football and basketball and four other sports.
Legends Sales and Marketing will subsidize a staff of students selling tickets to Ohio athletics.
Photo by:OHIO UNIVERSITY
Ohio can use the Legends connection to attract students for enrollment in its Center for Sports Administration. In turn, those students participating in the Ohio ticket sales program gain experience that could lead to full-time jobs with Legends at other sports properties, said Jim Kahler, the center’s executive director. “It provides a wonderful incubator,” Kahler said.
Legends does not generate revenue at Ohio, compared with its four other college deals, where the company typically hires staff on campus, pays commissions and shares in ticket income.
The primary benefit for Legends is the recruiting connection, said Chad Estis, the company’s president. Estis, an Ohio graduate who played basketball at the school, worked with Kahler when both were employed with the Cleveland Cavaliers.
The Ohio staff consists of two graduate students, David Neumann and Madelyn Robinson. Tanner Bond, assistant director of ticket sales, is the third member of the staff and is a full-time intern hired by the athletic department.
Under terms of the deal, Legends will pay Neumann’s $8,000 stipend, the fee Ohio pays graduate assistants working in athletics. The Center for Sports Administration will pay Robinson’s stipend. Both Neumann and Robinson get free tuition for the coming school year, a $20,000 value.
Bond is paid by Ohio’s athletic department for his 10-month commitment.
Legends has assisted in training the staff with monthly sessions scheduled over the course of the school year, said Drake Bolon, Ohio Athletics’ director of marketing.
All three, under Bolon’s supervision, are making more than 75 phone calls a day and scheduling multiple in-person appointments.
The program kicked off in May. To date, the group exceeded last year’s total revenue of $200,000 in football season-ticket sales. The goal is to bring in $100,000 in new revenue for football and basketball, said Dan Hauser, Ohio’s senior associate athletic director for external relations.
Ohio began researching outsourcing ticket sales about three years ago and explored business models proposed by The Aspire Group, IMG, Mandalay Sports and Collegiate Consulting.
In a small college market in Athens, where 27 percent of the city’s residents lived below the poverty level during the recession, the growth in ticket revenue required to support a partnership with one of those firms did not match up with the school’s expectations, Hauser said.
Athletic officials met with Kahler to brainstorm a new ticket sales model, and Kahler reached out to Estis to form the partnership. The Ohio model is most likely a one-off deal considering the close relationship between the two, Estis said.
The decision to outsource ticket sales coincides with the recent success of Ohio, a member of the Mid-American Conference, in its two revenue sports. The football team won the 2011 Famous Idaho Potato Bowl, and the basketball team reached the Sweet 16 in the 2012 NCAA men’s tournament.
Separately, Legends has announced outsource ticket deals with Stanford for one year and Nevada for three years.
In Palo Alto, Legends has a six-person staff selling tickets for all sports under the supervision of Ted Lopez, its ticket sales and service manager. Lopez previously worked for the San Francisco Giants and the San Jose Sharks.
In Reno, Legends’ general manager Ricardo Ramos heads a seven-person staff. Ramos was most recently director of ticket sales for the Colorado Rapids after stints with the NBA and the Detroit Pistons.
StubHub and Paciolan are introducing mobile ticketing at four colleges this football season, giving fans the ability to complete a purchase on the secondary market and scan a ticket at the gate, all with their phone.
North Carolina, Purdue, Tennessee and Texas are the four schools using StubHub’s mobile ticketing for at least a portion of their football games this season.
StubHub said its mobile sales now account for 10 percent of its overall sales, and that 20 percent to 25 percent of its total traffic comes from mobile users.
“Mobile is a seamless experience that allows fans to buy a ticket on their phone, receive a new barcode for that ticket and then scan it at the gate and get your seat,” said Greg Ivry, StubHub’s business development manager. “We’ve seen mobile commerce take off. It’s something, as a company, that we’re very focused on.”
As more schools embrace the secondary ticketing market, they’re interested in ways for their fans to make transactions easily. If all goes well at the first four schools, several more will roll it out for basketball season.
StubHub originally tested its mobile ticketing last year with the San Francisco Giants, and the program was received well enough that the company decided to take it to the college market.
“The college space has been an area that we’ve invested heavily in,” Ivry sad. “The last two years, we’ve seen it take off.”
StubHub’s 30 college relationships differ from campus to campus. Some are straight sponsorship deals that include stadium signage and advertising. But most of their school relationships — 18 in all — allow buyers on the secondary market to make a purchase, receive a new barcode for the ticket, and either print at home or scan from the phone at the gate.
There’s no waiting for tickets to arrive in the mail or email from the seller. It also enables a fan to make last-minute buying decisions without concern over delivery of the tickets.
“What you’re seeing is that schools are realizing that the secondary market is going to happen with them or without them,” said Dave Butler, Paciolan’s CEO. “Fans like it, and if you want to serve the fans better, you’ve got to engage in the secondary market and make it as safe as possible.”
Paciolan, which provides the ticketing software for 105 schools, partnered with StubHub last year and developed a program that allows fans to buy a ticket at StubHub and receive a completely new barcode for the secondary transaction. The initial barcode is erased.
StubHub said it reduces the risk of fraud and brings ancillary benefits as well. Schools that partner with StubHub now are able to see who buys that ticket on the secondary market and collect the buyer’s information for their database.
Paciolan said roughly 80 percent of their schools have the scanning equipment in place to scan barcodes off the phone, so they expect adoption of mobile ticketing to be higher for basketball season and next football season.
“If we all agree that mobile is the future, this is a great fit for the secondary market,” Butler said. “This makes mobile sales and delivery seamless for the phone.”