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SBJ/July 22-28, 2013/Events and Attractions
All-Star Game cuts through the noise in NYC
MLB Network renewal talks part of business push
Published July 22, 2013, Page 1
According to the network’s opening offer, MLB is looking to double its license fee to about 50 cents a subscriber per month. It now gets 27 cents a subscriber per month, according to SNL Kagan.
Sources say there has been no movement on the talks thus far, not a surprise since negotiations are in the early stages. Typically, these types of deals are cemented closer to end of the current deals, which in this case wraps up at the end of this year.
MLB Network signed five-year affiliate deals when it launched Jan. 1, 2009. That means that the bulk of those deals are expiring at the end of the year.
MLB Network President and CEO Tony Petitti and MLB’s senior vice president of broadcasting, Chris Tully, have handled the talks so far. Petitti and Tully report to Tim Brosnan, MLB’s executive vice president of business.
■ ‘IT’S JUST BECOME A MACHINE’: MLB’s return to New York for the All-Star Game did not generate the same kind of exponential year-over-year business growth as the 2008 event as Yankee Stadium. But what this year’s festivities at Citi Field did show was a continued, steady maturation of baseball’s midsummer classic into a finely tuned operation.
Nearly across the board, All-Star metrics showed modest to solid growth compared with last year in Kansas City. Citi Field posted a record attendance of 45,186. TV ratings for the All-Star Game itself on Fox and the Home Run Derby on ESPN were essentially flat, for Fox in particular stemming a decline in recent years. FanFest attendance grew 9 percent to 129,849, that event’s second-best total behind the 2009 draw in St. Louis. Social media activity was up 8 percent for the derby and 5 percent for the All-Star Game.
Executives marveled at how well the complex, multiborough logistics of a New York All-Star Game were executed. Aside from a subway track issue after last Monday’s Home Run Derby, far out of the control of the league, events essentially went off without a major hitch even as the city grappled with a significant heat wave.
“It’s just become a machine,” said Dave St. Peter, president of the Minnesota Twins, who’ll host next year’s All-Star Game at Target Field. “There is now a very established program of events, and I just marvel at how it’s unfolded.”
After changing and expanding the All-Star Game festivities during the 1990s and early 2000s, MLB in recent years has settled into a more consistent program that includes the three days of ballpark events, charitable and legacy components, FanFest, corporate hospitality, security, transportation and other elements.
“We thought the ballpark would play well for this, and it completely has,” said Jeff Wilpon, chief operating officer for the host Mets.
“But I give the league a ton of credit. They’ve run the show on this. There is now a very refined program we’ve plugged into for this.”
■ HEAVY HITTERS: MLB was surely thrilled with marketers like T-Mobile and Chevrolet not only breaking new creative but also using the All-Star Game to launch new products.
|Chevrolet and T-Mobile were active activators in New York City, putting their brands in front of fans and launching new products.
T-Mobile, leveraging the event to launch its new Jump offering, supplied its magenta shirts to the All-Star 5K run, while giving offers at Fan Fest that
Curiously absent from the branding festivities was Citi, which has naming rights at the park in which the game was played. And while MLB corporate sponsor Taco Bell again was title sponsor of All-Star Sunday and ran in-game ads, their effort seemed to lack the high level of activation we’ve seen from them elsewhere.
Marketing around any event in New York City means competing with the din that’s endemic to the nation’s biggest metro. Given that the Super Bowl in New Jersey will compete for the same share of mind, as will the NBA All-Star game after that, marketers had various thoughts on how to compete for consumers’ eyes and ears.
“You have to pick your spots when it comes to creating a presence in New York, so I would describe what we did as a pretty typical All-Star Game,” said Blaise D’Sylva, vice president of media, sports and entertainment marketing at Anheuser-Busch. “For Super Bowl, you will see exponentially more from every marketer and it is where we try be more over-the-top in our on-the-ground marketing — even in this market. Still, New York is so different, to make a dent even in the outdoor ad market here, you’d have to spend millions.”
■ BIG-CITY STRATEGIES: Last time the All-Star Game was in New York City, longtime MLB sponsor Bank of America sponsored the Saturday-night Bon Jovi concert. This time around, it wrapped itself in the flag supporting veterans’ causes in tandem with its MLB rights. “You can’t own New York, so we bought four units in the game,” said Charles Greenstein, senior vice president of sponsorship marketing at BofA, which is an MLB and Super Bowl Host Committee sponsor. “For us and many others for Super Bowl, you will see more client engagement and client education than you ever have. Then you at least know you are impacting a really influential constituency.”
Marketers are looking for balance: big or little, trade or consumer? “These kinds of events get lost in cities like New York, but can dominate cities like Kansas City last year or Minneapolis next year,” said John Cordova, Coca-Cola director of sports transaction management. “The common thread is making sure you take care of your best [trade] customers, regardless of what the budget is in terms of consumer activation, which will vary.”
Procter & Gamble’s Head & Shoulders activated with sampling and batting cages at Fanfest, in-park signage, a Fox in-game enhancement and three TV spots with Angels pitcher C.J. Wilson, who also took over the brand’s Twitter account during the All-Star Game.
“Our approach was to have continuity with the program we’ve been running all season and just amp it up here with a combination of social and traditional media, which feed off each other,” said Head & Shoulders brand manager Tom Duncan, adding that MLB ties have helped launch the Head & Shoulders With Old Spice line extension to sales of 20 percent better than forecast.
“Everyone’s worried about ‘How are we going to own New York City?’ said Elizabeth Lindsey, co-president of consulting at Wasserman Media Group, which consults for MLB sponsor Scotts. “Every city has some kind of logistical problems, so the key is just to worry about owning your brand in the mind of your consumers.”
■ MERCHANDISE MANIA: By all accounts, All-Star Game merchandise sales were boffo, exceeding even the standards one would set when merchandising in the nation’s largest market.
“We’ll do five times what they did last year in Kansas City,” said Modell’s CEO Mitchell Modell, inside his “Mo’s Zone” right-field suite during the game. “We went from thinking, ‘This is something we have to do, because it’s in our home market,’ to exceeding our [overall] forecast by the end of Sunday night.” MLB said total All-Star Game merch sales were second only to the 2008 game at Yankee Stadium.
|MLB’s Clubhouse Store at the FanFest reset the bar for All-Star retail presentation.
Aramark’s MLB Clubhouse Store in the cavernous FanFest at the Javits Center played to great reviews. We’d never confuse New York with Kansas City, but for those seeking comparison to the 2012 game, per caps were up 60 percent. At 14,000 square feet, the FanFest shop was the biggest FanFest merch store ever. How that justified licensee Tommy Bahama charging $100 for an All-Star Game T-shirt was beyond our comprehension. Of course, the same “Paradise blend” T sells for $78 sans logo, so …
Overall, the store was well “boutiqued” by MLB licensees and, as MLB licensing chief Howard Smith unceasingly reminded us, easily the best retail presentation we’ve seen at FanFest in more than two decades of covering the commercial side of the midsummer classic.
“The overall storytelling at retail has been great and sell-throughs at retail were strong across all categories,” said Jim Pisani, president of VF’s Licensed Sports Group, whose Majestic Athletic brand was debuting batting practice jerseys with new fabrications.
Nike dedicated its Niketown 57th Street retail windows and the inside atrium area to the All-Star Game, and Nike global sports marketing chief John Slusher was also ebullient about sales result and activation across the game, especially Saturday’s 5K run in Brooklyn. “As a whole, it was our best All-Star Game effort, and I’m hearing sales results consistent with that kind of effort,” he said.
Beneath all the exuberance about sales, licensees and retailers were quietly talking about a general softening of the market for licensed MLB product, although it picked up somewhat in June. The usual suspects were rounded up and made culpable: weather, which was horrific in the early season (first-half rainouts increased from 21 to 34); an attendance decline of 3 percent across MLB, which included eight teams with double-digit drops; and underperforming teams in big markets such as Chicago, Los Angeles and Philadelphia.
Meanwhile, licensing industry sources indicated that with MLB on-field rights up after next season and uniform manufacturers preferring a year’s lead time, renewal talks are well under way. Sources indicated that incumbent suppliers — VF’s Majestic for jerseys, New Era for caps and Nike for underlayer — are likely to continue, with New Era’s renewal still the most distant. MLB officials would not comment.
■ MINNESOTA ON THE CLOCK: The Minnesota Twins will serve as next year’s All-Star Game host club, and sent a 30-person contingent to New York to shadow the Mets during the week. The traveling group also included representatives from the club’s concessionaire, Delaware North, and the Minneapolis convention and visitors’ bureau.
The Target Field All-Star Game, scheduled for July 15 next year, will mark a return to a tightly concentrated downtown footprint, seen most recently for 2009 in St. Louis, 2007 in San Francisco, and 2006 in Pittsburgh. Almost every All-Star event next year will be held in a roughly 10-block area covering a square mile in downtown Minneapolis.
“We’re going to have a very tight critical mass,” St. Peter said. “We want to try to capture a bit more of that urban feel to the All-Star Game.”
Minnesota last held the All-Star Game in 1985 at the Metrodome, and was the site of the first Home Run Derby.
Target Field itself has won widespread raves from fans and architecture critics in its three-plus years of operation. But it also presents some hurdles for a large-scale event such as the All-Star Game. The Twins have a fairly large season-ticket base of about 20,000 full-season equivalents, but also MLB’s seventh-smallest seating capacity at 39,021, a number that will drop further because of seat kills common with staging the All-Star Game.
The Twins also don’t control any of their own parking, and don’t have vast amounts of space to offer for a large TV production compound.
“Space and capacity are definitely going to be a challenge,” St. Peter said. “There’s going to be less ticket availability for the public. It’s something we’re working through now.”
Running point for the Twins’ All-Star preparations is Matt Hoy, their senior vice president of operations.