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SBJ/March 4-10, 2013/Facilities
StubHub takes naming rights at Home Depot Center
Published March 4, 2013, Page 1
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Starting June 1, StubHub Center will be the new name of the multisport complex, owned and operated by AEG. The property, which includes a 27,000-seat MLS stadium and Olympic training facilities for tennis, track and field and bicycle racing, formally relaunches as StubHub Center on June 19, the date of the Los Angeles Galaxy-Portland Timbers game.
“This is the exclamation point on the efforts we’ve made over the last 10 years to basically weave ourselves into the fabric of the sports and entertainment industry,” said Danielle Maged, StubHub’s global head of partnerships and business development.
|Home Depot bought naming rights to the complex in 2003, the year that it opened. The Los Angeles Galaxy and Chivas USA call it home.
Shervin Mirhashemi, president of AEG Global Partnerships, said the value is greater than that of the deal Home Depot signed in 2003 when the facility opened. The old agreement carried a value of $70 million over 10 years.
The StubHub Center deal could surpass $10 million annually based on the Los Angeles media market and all the inventory AEG brings to the table as the vendor’s partner, said Chris Lencheski, president of Front Row Marketing, a firm that sells naming rights for teams and venues.
Lencheski did not have specific details on the agreement and was commenting purely as an observer.
For StubHub, a 13-year-old firm co-founded by two Stanford University students, putting its name on a sports facility represents another milestone for the company and the secondary ticketing industry in general, given the national exposure it will generate at the MLS stadium.
The naming-rights deal also gives StubHub exclusive marketing assets for the AEG-owned Galaxy, marking the company’s first partnership with an MLS team.
Home Depot Center is also home to Chivas USA. As a result, StubHub now forges a direct connection to the thousands of Spanish-speaking soccer fans attending Chivas home games.
“They don’t get the prime dates, but their audience is as loyal as anyone,” Lencheski said.
Without knowing the financials and deal points, it is difficult to say how deep StubHub must dig into its pockets for naming rights to the 125-acre property.
The deal comes on the heels of a massive global partnership that eBay, StubHub’s parent firm, announced in November, making StubHub the official ticket reseller for all AEG venues worldwide, including Staples Center.
Under those terms, StubHub replaced Home Depot as a founding partner at Staples Center with marketing assets at L.A. Live, the entertainment district AEG developed across the street from the arena.
Mirhashemi stressed that there was separation between the deals and that the title sponsorship
“I don’t think many people realize that StubHub is one of the largest sponsors in sports and entertainment,” he said. “It’s probably not talked about that much, their involvement in this space. This is a pure naming-rights deal.”
But the deals do cross over. StubHub plans to share data with AEG regarding Staples Center and StubHub Center as the two groups work together to better understand the experience of fans and event goers, Maged said.
StubHub is based in San Francisco, and Southern California is critical for the company as it relates to brand exposure at the arena and the stadium and “working with AEG the way we wanted to work with them,” she said.
The process began in September, soon after Home Depot decided not to renew its deal, Mirhashemi said. AEG Global Partnerships officials compiled a short list of firms they thought would be interested in taking over naming rights.
About the same time, StubHub and AEG were negotiating their secondary ticketing deal, and as the conversations deepened, the topic of naming rights came up through a natural progression, said officials from both sides.
“We literally picked one partner and took them to the finish line,” Mirhashemi said. “They embraced it very quickly, and then we went and worked toward getting it to completion.”
Nick Baker, AEG Global Partnerships’ director of sales, worked with Mirhashemi to sell naming rights to StubHub and was instrumental in getting the deal done, Mirhashemi said.
On the buy side, StubHub did the deal in-house, led by Maged; Geoff Lester, managing director of partnerships and business development; Chief Marketing Officer Ray Elias; and Chief Legal Officer Lance Lanciault.
As of last week, Maged said it was too early to share details for how the vendor will activate its deal at StubHub Center. The company has hired CAA Sports Consulting, a group headed by Greg Luckman, to help develop concepts related to activation.
“We’re going to have something that’s organic and changes in the venue itself with a focus on the fan,” Maged said. “We are all about the fan, so whatever we do is going to be compelling. That’s what we’re working with CAA to come up with.”
StubHub is the first ticketing company to put its name on a major league sports facility, according to SportsBusiness Journal research.
Over the past decade, StubHub has become the leading online ticket reseller, signing ticketing and sponsorship deals with Major League Baseball, ESPN, Barclays Premier League teams, and individual clubs in the NFL, NBA, NHL and now MLS.
As StubHub has expanded its business both domestically and overseas, it has become first choice to buy tickets for some fans searching for secondary bargains over full-priced tickets sold on team sites. It’s a dynamic that has upset some big league teams, to the point that the New York Yankees and Los Angeles Angels pulled out of the StubHub-MLB deal when it was renewed in December.
As both AEG and StubHub continue to expand internationally, Mirhashemi said there could be more opportunities for the ticket reseller to put its name on arenas and stadiums that AEG runs overseas.
“We wouldn’t have gone with StubHub unless we felt they were a trusted brand in the consumers’ eyes,” Mirhashemi said. “It was a natural fit.”
Most recent active naming-rights deals at MLS-only stadiums
|Stadium||City||Company||Total cost||No. of years||Avg. annual value||Expires||Announced
|BBVA Compass Stadium||Houston||BBVA Compass||$20 million||10||$2.0 million||2021||Dec. 2011
|Jeld-Wen Field||Portland||Jeld-Wen||NA||NA||NA||NA||March 2011
|PPL Park||Chester, Pa.||PPL Corp.||$20 million||11||$1.81 million||2020||Feb. 2010
|Rio Tinto Stadium||Sandy, Utah||Rio Tinto Group||$22.5 million-$30.0 million||15||$1.5-2.0 million||2023||Sept. 2008
|Dick’s Sporting Goods Park||Commerce City, Colo.||Dick’s Sporting Goods||$30 million||15||$2.0 million||2021||Nov. 2006
|BMO Field||Toronto||Bank of Montreal||$23.7 million||10||$2.37 million||2016||Sept. 2006
NA: Not available
Source: SportsBusiness Journal research