SBJ/January 28-February 3, 2013/Opinion

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  • What is success for NFL in the U.K.?

    The NFL continues to test the viability of the London market, scheduling two regular-season games at Wembley Stadium next season. In addition to playing the San Francisco 49ers in London next Oct. 27, the Jacksonville Jaguars also have committed to playing regular-season “home” games there from 2014 through 2016.

    “Since we started playing regular-season games in London five years ago, we have heard very clearly from our U.K. fans that they want more football,” NFL Commissioner Roger Goodell said. “We are excited to play two games in London and take this next step in the growth of our game. We believe that more football will lead to more fans.”

    The NFL says it has a British fan base of 11 million, 2 million of them defined as avid fans. According to the league, Sunday viewership of NFL games in England is up 154 percent, and the Super Bowl audience has increased 74 percent since 2006. Participation in amateur football in the U.K. has risen since the start of the International Series, growing by approximately 15 percent per year since 2007.

    Clearly, the NFL is pushing to build its market in England. Some NFL team owners, led by the Patriots’ Robert Kraft, have been promoting the notion of a London franchise for the NFL.

    Can the NFL’s growth overseas be compared to soccer’s growth in the U.S.?

    Big sporting events will always draw capacity crowds in the U.S. and U.K. We have seen that in the sellout success of all the International Series NFL games since 2007. Likewise, FIFA’s World Cups, Olympics and major friendlies in the United States are always consistent fan magnets.

    The NFL should look closely at how soccer in the U.S. has dealt with growth issues.

    Major League Soccer is developing steady traction on many fronts, but it has taken close to 50 years for the sport to get to this point. Statistics show that 4 million youngsters between the ages of 6 and 19 play organized soccer in the U.S. Anecdotal evidence shows a visible increase of U.S. soccer-playing kids wearing jerseys of their favorite international sides. More and more sports bars are catering to international soccer viewers in our neighborhoods. NBC recently acquired the U.S. TV rights to the English Premier League, reportedly paying $80 million to $85 million a year.

    Is the NFL’s push in England more relevant than soccer’s future growth in the United States? I don’t think so. To me this expansion is tied more to growing TV revenue than growing the sport of football throughout the United Kingdom.

    It must be confusing in British pubs to listen in on debates about the merits of “Association” football versus “NFL” football.

    Next time you are in England, take a visit to British schools and playgrounds and see how many football fields you can find with helmeted young Brits throwing and running around with a leather prolate spheroid. Drop into the local pub and ask the barkeep to change the channel from the Premier League game to the Raiders vs. Chiefs matchup and see what kind of reaction you get.

    Of the four NFL teams scheduled to play at Wembley next season, only the 49ers have previously played a regular-season game there (the Vikings played a preseason game at Wembley in 1983).

    If the NFL is committed to creating a grassroots movement in the U.K., it will take significant investments and patience in building facilities. It will mean creating long-term educational platforms in coaching, education and safety and teaching young people the hand-eye coordination to go along with the foot skills that soccer has taught them. It’s always a challenge to change a country’s sports DNA.

    Just because a sport draws large, enthusiastic crowds doesn’t mean that it is about to catch on as a competitive ticket-selling, sponsorship-generating pro sport on foreign soil. The failure of NFL Europe in 2007 is a cautionary tale in thinking that the time is right for a full schedule of NFL regular-season games in London.

    Andy Dolich (andy.dolich@gmail.com) has held executive positions at the San Francisco 49ers, Oakland A’s, Golden State Warriors, Memphis Grizzlies, Philadelphia 76ers and at the NASL’s Washington Diplomats during his 40-year career in sports.

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  • Cartoon: Kings of the road

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  • Six-week series to tell Champions’ stories

    In a change since we’ve introduced the program in 2010, this year we are profiling our “Champions: Pioneers of Sports Business” in six separate issues, beginning next week with a look at the career of Ron Shapiro. The main reason for this is to allow readers to spend more time with each of these profiles. Previously, we featured all six extensive stories in the same issue, and our concern became that they were getting lost: overwhelming readers and preventing them from being able to learn about each honoree’s accomplishments.

    I believe the stories about the lives and careers of these individuals represent some of the finest pieces we feature all year. They are consistently among the stories I receive the most feedback on — from fellow colleagues who have worked with these people to young students in college looking to start a career in sports business. These are the stories we invest the most time and energy on, and we felt, at the end of the day, the presentation was short-changing the subjects, our staff and, most importantly, our readers. We can never do enough storytelling on interesting people, so we decided this year to run six extensive profiles over six successive weeks.

    We will start next week when Bill King takes you into the home of Shapiro, a longtime agent and business leader, as King was able to spend time with Ron and his wife, Cathi, at their farm in Butler, Md., followed by a day in Baltimore talking to those who know him best. The following week, John Lombardo will chronicle the career of NBA team pioneer Pat Williams, as Lombardo spent time with Williams inside the Chairman’s Club at the Amway Center in downtown Orlando. True to his promotional nature, Williams did not come empty-handed, as the prolific executive-turned-author brought a stack of his latest books to the interview.

    Our series of profiles concludes with Tripp Mickle’s look at the diverse career of Harvey Schiller in the issue of March 11. See table at right for the full schedule:

    The reason we started this program was to provide long-overdue recognition of the trailblazers of the sports industry, because without their ideas, the chances they took, and the entrepreneurial spirit they displayed, there may not even be a need for publications like SportsBusiness Journal/Daily. By profiling each of these Champions individually, we hope all of our readers will benefit from being able to spend more time learning about these people and realizing their full influence and impact.

    Abraham D. Madkour can be reached at amadkour@sportsbusinessjournal.com.


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  • How brands adapt marketing to the second-screen experience

    The traditional viewing experience continues to evolve for sports fans. Gone are the days of experiencing the game as a static spectator. Instead, fans are gravitating toward social sites to enrich their viewing experience and cultivate a deeper connection with the games they watch.

    Capitalizing on this shift towards a second-screen experience is essential for brands wanting to remain relevant, particularly with millennials. Surprisingly, many brands are coming up short.

    While major sporting events, such as league championships, generate millions of viewers and spark massive amounts of social commentary, brands are continuing to segment their strategies. A brand may sponsor the event — with its logo on the field and its advertisements airing during commercial breaks — but its social strategy is either tactically different or missing altogether. This lackluster approach does little to consolidate the team’s fan base, let alone spark engagement from fans who are tuning in remotely.

    Conversations surrounding these high-profile sporting events will occur on Twitter and Facebook, regardless of the brand’s involvement. This presents a huge opportunity. However, the challenge for brands is: How do we capitalize on these conversations while keeping our branding consistent and providing meaningful content for fans?

    While very few brands have succeeded in creating this type of experience, during Super Bowl XLVI, Coca-Cola was able to effectively pilot this type of strategy. Coca-Cola fully understood that in order to execute a successful advertising campaign, it would need to incorporate an extended social experience for fans.

    The company relied heavily on fan nostalgia and utilized the polar bears traditionally seen in their holiday advertisements. The approach was simple: The polar bears (one a Giants fan and one a Patriots fan) hosted a Super Bowl party named the Polar Bowl.

    During the game the bears would react to plays, advertisements, tweets and Facebook messages, all in real time. All of the social and multimedia content associated with the Polar Bowl was easily accessible to fans at CokePolarBowl.com.

    Coca-Cola’s strategy not only engaged fans on multiple screens, but it also created a branded ecosystem directly connected to the Super Bowl. Coca-Cola was able to integrate its brand into an interactive experience for fans while capitalizing on the buzz already created around one of the biggest events in sports.

    The campaign was a grand slam. Coca-Cola reported higher volumes of engagement over longer periods of time than it had originally anticipated. The company blazed the trail, and now it’s time for more brands to follow suit. The second-screen experience is the future of endorsements, particularly in the sports industry. However, this type of complex strategy must be executed properly in order to have the greatest amount of impact.

    Opportunities for fan activation

    The key to fully turning spectators into active participants is to establish a sense of inclusion. Fans must be exposed to the strategy from the onset, and their path to engagement must be clearly outlined. One way to execute this would be through a simple, branded hashtag.

    Let’s paint a picture. Say a sports apparel brand recognized that many fans of a particular NHL team use a simple slogan when referencing their team. The brand then decides to capitalize on this opportunity and turn the slogan into a branded hashtag.

    With the NHL and team’s cooperation, the hashtag, along with the brand’s logo, would be branded on the arena board lining the rink, as well as on towels and T-shirts given away to fans at the game.

    In order to fully support the fan experience and further incentivize fans, there would also be a sweepstakes run on Twitter as well as on a customized app on the brand’s Facebook page. Fan participation would grant them the opportunity to win exclusive prizes.

    Consistent branding

    In the aforementioned scenario, the consistency is in the branding. Taking an endorsement strategy to a second screen presents the risk of sloppy or inconsistent branding. One solution would be to create a microsite to consolidate all of the socially endorsed experiences offered to fans.

    A microsite, similar to the site used during Coca-Cola’s Polar Bowl, gives users a centralized location to access all the engagement opportunities the brand is providing. Moreover, it gives fans a more tangible location to discuss the game they are viewing, ultimately creating community feel.

    Connection to experience

    The benefit for brands executing a social endorsement strategy is the ability to connect with fans in real time. What’s more, sports fans develop a certain level of emotional attachment to their team and sport. By tapping into this connection, brands have the opportunity to link their brand synonymously with this emotional attachment. This is the connection brands should always strive to achieve when creating social endorsement strategies.

    An endorsed strategy with social media sites as the catalyst allows brands to create a more personalized experience for fans. Moreover, activating these fans on social media gives the brand, as well as the endorsed team or event, a pulse on fan conversations. This critical information can then be repurposed and used to their benefit. By understanding what topics and mediums fans are most willing to engage on, brands and teams can then develop targeted content that they know will resonate with fans.

    Creating a campaign that aggregates social endorsements in conjunction with traditional endorsements is the future. This strategy is the key to maximizing exposure and fortifying extremely high levels of fan engagement for brands. Targeting sports is the perfect segue for brands to begin piloting integrated social endorsement strategies using a second-screen experience as a catalyst.

    Crystalyn Stuart (CrystalynS@5Loom.com) is vice president of social marketing at IMRE Sports.

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  • Waiting for the fallout: How sponsors weather scandal’s storm

    Are ethics, morals and personal character more important in today’s business environment?

    While scandals may be interesting from a tabloid perspective, leagues, teams and management understand these issues have a negative impact on brand reputation and hurt current and future sponsor relationships. When drafting and trading for players, personal character is often mentioned as a critical factor; off-field and off-court distractions hurt not only performance but also team perception.

    The greater the fiscal investment, the more important intangibles become, as there is increased accountability, scrutiny and more to lose. Ethics, morals and personal character go beyond investment, however, and can never be overlooked, given the considerable efforts made by teams and sponsors to grow reputation. One wrong decision can wipe out positive brand associations built over years.

    The shift in ethics perception is also seen in business. Since 1994, the Ethics Resource Center has fielded a National Business Ethics Survey of Fortune 500 companies, and the 2012 report identified several trends — one of which is that ethical workplace conduct tends to move with the economy. When the economy is down, workers and companies become more scrupulous. A 2011 Aspen Institute survey of business schools revealed that 79 percent of the schools required a course in ethics or a related topic versus only 34 percent in 2001.

    How does this affect brands and their sponsorship deals?

    The sponsor reaction to Lance Armstrong’s admission of doping was swift and widespread.
    Photo by: GETTY IMAGES
    Companies look to borrow brand equity from properties and emotionally connect with their avid, far-reaching fan bases. Sharing a common passion point is the valuable commodity that makes sponsorship so appealing. When vetting these types of partnerships, significant value is put on the opportunity to engage fans in a meaningful manner.

    Icons such as Tiger Woods, Kobe Bryant and Lance Armstrong, once considered can’t-miss athletes, were surrounded by scandals that wouldn’t go away. Collateral damage put associated companies in a “must-react” situation to define their future endorsement plans. By conceding guilt to Oprah Winfrey and stepping down from Livestrong, Armstrong moves into the embryonic phase of brand rehabilitation; with the ultimate goal of competing again and mitigating further damage. Although we live in a forgiving society, the damage is done and the road to redemption will be difficult and long. In a matter of days since news leaked of his interview, the Livestrong name came off of Sporting KC’s stadium and the IOC stripped Armstrong of his Olympic medal. Additional impact is forthcoming; this is just the beginning.

    It’s no coincidence morals stipulations have intensified in personal services agreements. But tougher clauses may be forthcoming.

    Sponsors have a right to be concerned about the highly visible scandals in New Orleans and Happy Valley. These involved multiple individuals, and the black eye extended far beyond individuals. Should sponsors of teams have the same rights as companies that have added morals clauses to their endorsement agreements? Could the timing of these teamwide scandals be the tipping point needed to better integrate morals stipulators into team agreements?

    Even with strong morals stipulations, terminating any relationship is not black and white. It’s important to know the differences between allegations and facts, as well as the depth and breadth of the scandal.

    If the scandal is an isolated incident and contained to a small number of individuals, swift actions can be taken to stop negative perception from touching corporate sponsors. When the wrongdoing is more widespread, broader actions can be considered.

    When to say when
    A few examples of when a sponsor should back out:

    Public perception of the organization is extremely negative, and it will take longer to repair than the term of the deal.

    Inability to leverage trademarks to motivate target audience to buy your products or services.

    Sharp drop in demand for and/or perceived value of tickets (especially critical for sponsorships focused on business-to-business opportunities).

    Recent history and trends of scandals coming from the organization.

    Strong negative perception of coaches, players, executives when appearances and meet-and-greets are a big piece of a relationship.
    Is the sponsorship a brand-building platform centered around signage, rights to marks/logos, etc., or a revenue-generating deal that could include licensed products, on-site sales, etc.? For example, at Penn State, State Farm pulled ad support from home football games while Pepsi continues as a campus beverage provider. If significant revenue is generated from a relationship, changes to deal points, if any, may be less dramatic.

    With a relationship on the ropes, another important consideration is who will be affected by throwing in the towel. Team members, executives, schools, even entire cities can be affected by the ups and downs of a team. Understanding this impact should be considered, as backing out could cause further harm, creating backlash for a sponsor.

    If the relationship is maintained, monitoring the value of assets to ensure they meet expectations is critical. If the relationship no longer makes sense from a branding perspective and/or the deal will no longer deliver its original value, it’s vital to disengage gracefully and with reason — reputation and future deals depend on it.

    It is important to protect brand reputation, but still make a solid commitment to the rights holder. Negotiate the right mix of assets so that if a scandal surfaces, there are a variety of activations to generate value. If morals clauses become more widely used, it’s not necessarily recommended to terminate a relationship the moment a scandal hits. Instead, sponsors should pause, do their due diligence and discuss the original objectives of the sponsorship with key stakeholders. Then determine the next steps.

    A good morals clause should allow for asset reallocation to provide the value and positive brand impact. For example, move benefits away from business-to-consumer components, such as TV-visible signage, and on to business-to-business components, such as tickets and hospitality. This way the relationship can continue to generate visibility and value, while still protecting the sponsor’s brand reputation.

    Sam Mogilner (smogilner@scoutsande.com) is director of sports, entertainment and events for Scout Sports and Entertainment.


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