SBJ/July 22-28, 2013/Marketing and Sponsorship

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  • Unrest in Brazil heightens concerns for marketers

    Momentum Worldwide CEO Chris Weil got a call from the head of his agency’s Brazilian office moments after last month’s Confederations Cup final. It wasn’t about the outcome of the match. Instead, one of Momentum’s clients wanted to postpone a World Cup marketing program that was slated to begin right after the tournament. Weeks of protests about government spending on World Cup stadiums concerned the company and convinced its marketers that promoting its affiliation with FIFA was more likely to damage the brand than help it.

    Weil wasn’t surprised. The company was the second of three Momentum clients to postpone promotions, and while he declined to name the clients because the agency promises them anonymity, he said all three are re-evaluating when they will go to market with World Cup promotions.

    Protesters want spending for schools and health care rather than soccer stadiums.
    Photo by: GETTY IMAGES
    “Anybody who is down there and on the ground understands because part of the protest is around the money being spent on stadiums and infrastructure and not being spent on the emerging middle class,” said Weil, whose agency works in Brazil with Bradesco, Nestlé, Coca-Cola, General Motors and others. “That’s the crux of where you could come out tone deaf as a supporter if you are a Brazilian company. Having said that, I don’t think it’s a complete pullback. It’s a timing issue. There’s a lot of value still there for companies. Everyone is looking at now: When do we go live in market?”

    Momentum’s clients aren’t the only ones re-evaluating the Brazilian market after last month’s jarring protests.

    The protests began June 11 when students and workers in several cities took to the street to protest a 20-cent increase in bus fares. Within weeks, the demonstrations extended to more than 100 cities and featured more than 2 million people demanding education and health care reform and questioning the Brazilian government’s decision to spend money on soccer stadiums for the World Cup. Protestors tried to reach Maracanã Stadium in Rio de Janeiro prior to a Confederations Cup match between Mexico and Italy, and they clashed with police outside the same stadium two weeks later before the tournament’s final game. Many carried signs that said, “Lower the bus fare and put it in FIFA’s check.”

    The size and duration of the protests, which spanned more than two weeks, caught government and FIFA officials by surprise. FIFA boss Sepp Blatter was so unsettled by them that he recently said the organization may have made a mistake awarding Brazil the World Cup, which begins next June.

    The demonstrations also rattled sponsors and sports executives. Many had seen the World Cup as the perfect marketing opportunity. It was soccer’s greatest event coming to the nation that loves the sport the most. But the popular uprisings jeopardized their long-planned hopes for capitalizing on the World Cup and 2016 Olympics.

    The protests have led several brands and sports marketing agencies to make adjustments on everything from increasing staff and adding security to reviewing transportation plans and evaluating marketing programs ahead of next year’s World Cup. But brands and agencies alike remain optimistic about the value and potential for sports marketing in Brazil during next summer’s World Cup, the 2016 Rio Olympics and the years that follow.

    Coca-Cola CEO Muhtar Kent captured the sentiment of many brands when he spoke at the Cannes Debate during the Brazilian protests last month. Kent said that when FIFA and the International Olympic Committee selected Brazil and Rio to host the World Cup and the Olympics, respectively, companies knew there were risks, according to The Drum, a European marketing magazine. But Kent added, “Where there’s no risk there is no reward, and the opportunities are so much greater that I am sure they are going to be very memorable, fantastic events.”

    Coke stuck with its marketing plans in Brazil during the Confederations Cup despite the protests and continues to use FIFA-related branding in the marketplace. Scott McCune, Coca-Cola vice president of global partnerships and experiential marketing, said the company continues to monitor what’s happening in Brazil but hasn’t shifted its strategy to date.

    Similarly, McDonald’s and Visa continued to run World Cup marketing and promotions in Brazil during and after the Confederations Cup, and McDonald’s and Visa spokespeople said the protests won’t affect their future promotional plans there.

    But Visa, like most sponsors and agencies, reported that hospitality programs during the Confederations Cup were affected by the protests. The company adjusted its transportation schedule to provide early arrivals and late departures from stadiums, and it changed travel routes to avoid crowds and demonstrations.

    The company wasn’t the only one to have its hospitality program affected. Hospitality organizers reported incidents where some guests of FIFA’s official hospitality program, MATCH, had to get out of their cars and walk a mile to stadiums because protestors had blocked roads, and a bus loaded with Johnson & Johnson executives wound up getting stuck in a demonstration. (Johnson & Johnson did not return calls regarding the incident.) But organizers said that the problems that arose were transportation issues, not safety issues, and the former is much easier to address.

    “It’s forced us to take a closer look at some of the things we were planning to do next year,” said Jan Katzoff, head of global sports at GMR Marketing, which works with World Cup and Olympic sponsor Visa and 14 other companies in Brazil. “Our contingency planning is always at a high level, but after watching what took place down there, we’re going to step it up a couple of levels.”

    Katzoff said GMR plans to increase the number of local staff it hires for the World Cup by as much as 15 percent to help the agency monitor social media, identify if and where protestors are aggregating and identify alternate transportation routes.

    Similarly, Octagon Worldwide, which is working with six World Cup sponsors including Budweiser and Castrol, plans to increase its 40-person staff across two offices in Rio and São Paulo by as much as 20 percent in response to the issues and spend time over the next year analyzing its transportation plans for sponsor hospitality programs.

    “It’s as important as ever to make sure you have people with local understanding of the market and Portuguese language skills to help with communication,” said Derek Aframe, senior vice president at Octagon Worldwide.

    Those types of hospitality-related adjustments were expected following the Confederations Cup, which was as much a trial run for Brazilian organizers of the World Cup as it was for hospitality organizers. But it’s far more unusual for sponsors to postpone scheduled marketing initiatives as a result of marketplace changes.

    Weil, who had three clients make that decision, said he’d never seen a pullback like that before ahead of a major sporting event. Even global protests of Chinese human rights before the 2008 Beijing Games didn’t disrupt marketers’ plans.

    “From a multinational and Brazilian perspective, there’s a wait-and-see attitude, a ‘Let’s not be out shouting about the Olympics or the World Cup right now,’” Weil said.

    IMG Head of Global Consulting David Abrutyn said no IMG client had postponed its marketing programs in Brazil, in part because they’re slated to run later this year, but he said weighing the benefits of running a program now was prudent.

    “It’s a little early from a cycling standpoint [to be promoting the World Cup],” Abrutyn said, “but if you did have a program slated to run, you’d be smart to think if now was the time to do it.”

    Despite the political unrest in Brazil, agency and sponsor executives alike remain optimistic about the opportunities there. Neither the protests nor Brazil’s declining GDP growth rate, which has fallen from 7.5 percent in 2010 to less than 3 percent this year, has tempered their enthusiasm for the market, and most see potential for sports marketing growth through the 2016 Rio Games and well into the future.

    “We all remain, long term, bullish on Brazil as a market as it remains a center for a lot of things, including sports the next three years,” Aframe said.

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  • Blackhawks set to hit top three all time in hot market sales; Heat slightly ahead of ’12

    Both the NHL and NBA are reporting an uptick in hot-market sales from their recently completed championships.

    NHL officials and retailers were calling the Chicago Blackhawks’ win one of their best-ever championship markets. Considering further the season’s lockout, which cut teams’ schedules from 82 to 48 games, league officials were pleased with the sales numbers.

    Season openers weren’t played until January because of the lockout.

    “You can’t lose the holiday season and not have an impact,” said Brian Jennings, NHL executive vice president of marketing, adding that when all the counting is over, the Blackhawks’ Stanley Cup victory will rank in the top three all-time for Stanley Cup hot markets — following the New York Rangers in 1994 and Detroit Red Wings in 2002. “Considering where we started, we’re all pretty happy where we closed,” Jennings said.

    Postseason merchandise sales in-venue were up 8 percent leaguewide for the entire playoffs compared to 2012, with the Blackhawks up 6.2 percent from 2010, their prior Cup-winning season.

    Compared to 2012, when the Los Angeles Kings won the Stanley Cup, night-of-win sales for the Blackhawks were up 101 percent, and the two-day totals after the Cup clincher were up 93 percent.

    The Blackhawks’ record start to the season (21-0-3 in their first 24 games) apparently got fans on board early. Jennings also noted fan support “across all ages and demos.”

    “We were all commenting on how many kids and young women we saw at the United Center and at their parade,” he said.

    Heat locker room T-shirt sales were flat compared with last year, but official caps fueled growth.
    Photo by: NBAE / GETTY IMAGES
    As for the NBA, licensing chief Sal LaRocca said sales were slightly up for Miami championship merchandise following the Heat’s second consecutive title. Sales of the locker-room T-shirt from master licensee Adidas were flat, but championship locker room caps and a women’s T-shirt counterbalanced that.

    Total postseason concession sales in-venue were up 12 percent for the league.

    Globally, the NBA hit a new high in total season sales, thanks in part to what LaRocca said was its best regular-season per cap ever — and the first one in which every team achieved at least a $1 or better merchandise
    per cap. The Nets’ rebranding and move from New Jersey to Brooklyn also juiced sales, with the Nets moving from being one of the worst-selling teams to No. 4 overall.

    “Teams are becoming better merchandisers, and we are generating more global demand,” LaRocca said. He added that while no lease has been signed, the NBA is close to selecting a new Fifth Avenue site for the NBA Store in New York City. The current NBA Store, a 6,000-square-foot emporium at 590 Fifth Ave., has been called a “temporary location” by the league since it opened in October 2011. The league hopes to open a larger and more permanent store around fall 2014.

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  • Farm equipment company aims straight for heartland through deals with Learfield schools

    When farmers are working in the field on Saturday afternoons in the fall, Roy Seinfeld would like to think that they’re listening to a college football game. Case IH, one of the world’s largest manufacturers of tractors and other farming equipment, is betting that they are.

    “We want to be able to take the message out to where the farmers live and work,” said Seinfeld, the executive vice president of national sales for Learfield Sports.

    Case IH’s Red Zone platform will run at football programs at 19 schools, including Iowa State.
    Photo by: LEARFIELD SPORTS
    Learfield represents the multimedia rights to close to 50 universities, and many of them are based in the heartland, where Case IH wants to take its message and appeal to — and reach — farmers.

    That’s why Case IH, with 4,900 dealers and distributors in 160 countries, has developed a portfolio of sponsorships with 19 Learfield schools. In the last month, Case IH has struck sponsorships with North Carolina State and Southern Illinois, to go with deals that include Iowa, Iowa State, Illinois, Minnesota, Mississippi State, Missouri, Texas A&M and Wisconsin, among others.

    Case IH’s first college sponsorship was bought in 2006 at Kansas State and the company has worked with Learfield to gradually build its portfolio of schools since.

    “It’s invaluable for us to be embedded with teams our customers care about,” said Kyle Russell, senior director of marketing for Case IH.

    Case IH and Learfield have worked to create a “red zone” platform that will work across each of the 19 football-playing schools.

    Case IH makes its farming equipment in red only, which lends itself to the red zone concept. Each time the home team moves inside the opponent’s 20-yard line, the Case IH Red Zone advertising appears on the video board, LED ribbon boards, and any other digital space available.

    It also has a hefty advertising buy across the radio airwaves, and each red zone appearance by the home team merits a mention on the broadcast.

    Learfield complements the Red Zone blast with Case IH ads in game programs and other signs around the stadium. While this started out as a football play, Case IH now advertises with four schools in basketball.

    It’s the kind of integrated program that Seinfeld holds up as a standard for his national sales team.

    “It seems pretty simplistic, but often we don’t link all of these concepts together,” Seinfeld said. “It’s like Allstate with the field goal nets and Case IH with the Red Zone. That’s the kind of thing that makes platforms sticky. With national sales, that’s what we’re trying to do — find creative tie-ins that hook a client and then continue to grow with the client.”

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  • NBC promotion delivers EPL to New York City

    Maps at bus shelters pair Premier League franchises with NYC neighborhoods.
    Photo by: NBC SPORTS GROUP
    To promote its debut of the English Premier League, the marketing team of NBC Sports Group is taking Manhattan.

    Beginning this week, select New York subway trains will be wrapped in artwork featuring two rival EPL clubs per car. Messages instruct riders to “Keep Calm and Pick Man City” or “Keep Calm and Pick Man United” when getting on.

    Another effort will see maps of New York City posted at bus shelters “assigning” EPL franchises to certain neighborhoods.

    Eight faux British cabs, painted in EPL club colors, will hit the streets of New York, as well, while traditional New York taxis will have toppers with NBC’s ads for EPL broadcasts.

    “We’re looking to create that New York-style, buzzy experience,” said John Miller, NBC Sports Group chief marketing officer. “We’ll start by reaching the existing fans of soccer and the Premier League by making it clear that the league is now on NBC, and we have a very compelling offer of having every game on-air and online.”

    The Brooklyn Brothers, an agency with offices in Manhattan, London and Brazil, created the concepts and design for the campaign.

    Faux British taxis are also part of the marketing plan.
    Photo by: NBC SPORTS GROUP
    The effort comes as NBC begins its three-year, $250 million deal for EPL rights. Starting next month, all 380 games of the league’s season will be made available on an NBC Universal channel (most frequently NBC Sports Network) or on the network’s overflow package of channels, Premier League Extra Time. Games also will be available online via NBC Sports Live Extra.

    As NBC replaces Fox Soccer and ESPN as the destination for EPL fans, the network hopes to win new ones by spotlighting the league’s fan culture. In Manhattan, for example, there are pubs associated with specific teams. It’s not unusual for an Arsenal fan in New York to be told to try another pub around the corner because, “This is a Tottenham bar.”

    “Keep in mind, there isn’t a traditional hometown team in the Premier League for fans in the U.S.,” Miller said. “When you’re trying to sell a league where many of the people are not as familiar with the stars, I think showing them the excitement and emotion of the fans is one good way of doing it. We want to widen the net by growing the sport and creating a rooting interest.”

    There are additional New York-based marketing efforts in play, as well:
    A Times Square billboard, measuring 5,472 square feet, debuted two weeks ago with the image of Tottenham Hotspur star Gareth Bale and the tagline “Every Match. Every Team. Every Week.” The billboard, on 48th Street and Broadway, has been rented for one year, and NBC plans to change its messaging during the course of the season. According to a source, the rate card for a space of that size in Times Square is $200,000 per month. In the weeks leading up to the Aug. 17 start of the 2013-14 EPL season, an artist — expected to be chosen this week — will work daily in public view at the Times Square site on a new ad for the billboard.

    NBC has signed a partnership with the online food-ordering service Seamless, which aggregates restaurants in select markets nationwide. For the first two weekends of the EPL season, when fans purchase breakfast from a restaurant through Seamless, the food will come delivered along with NBC/EPL promotional pieces.

    The Seamless deal will be activated in New York, Boston, Philadelphia, Washington, D.C., Dallas, Houston, Los Angeles and San Francisco.

    “It’s a marketer’s dream: a way of delivering marketing materials to someone’s home, and they’re happy to get them,” Miller said. “I guess it makes the breakfast sort of our Trojan horse.”

    The deal with Seamless was brokered by the Civic Entertainment Group (CEG), a New York-based marketing service company. (“American Idol” host Ryan Seacrest has a controlling stake). NBC Sports Group contracted with CEG in April to develop marketing campaigns and broker promotional partnerships for all of its sports properties. During the Stanley Cup playoffs, for example, CEG forged a deal between the NHL and Crumbs Bake Shop to create Stanley Cup cupcakes for the 16 playoff teams.

    While reaching Manhattan’s avid soccer fans is the goal, a positive side effect of NBC’s marketing campaign is getting the attention of the press, social media and the many advertising agencies in New York City.

    “New York is a market where activations can more easily go national through traditional media, and especially social media,” Miller said. “The concentration of ad agencies is an additional plus, but really an ancillary benefit to our consumer efforts.”

    Nationally, Miller said that he will utilize what he and his fellow NBC Universal executives refer to as the “NBC Symphony” — its 20 NBC Universal channels, 33 Comcast channels and more than 60 websites — to promote EPL broadcasts. With the EPL season running from August to May, advertising will be seen during NBC’s coverage of “Sunday Night Football,” the NHL and the Winter Olympics in February. “That’s an 18-day window [during the Olympics] to go strong before a huge audience,” Miller said.

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  • Peak credits motorsports sponsorships with sales increase

    Less than a year after signing sponsorships with Michael Waltrip Racing and the NHRA, sales of Peak Antifreeze and Motor Oil are up 5 percent to 7 percent, according to Old World Industries, which owns both brands.

    The deals have boosted distribution and promotion at retail, said Bryan Emrich, Old World’s vice president of marketing. He credited the brand’s MWR deal, which includes three primary races on Clint Bowyer’s No. 15 car, with helping it add Napa Auto Parts as a customer. Napa is a full-season sponsor of MWR’s No. 56 car driven by Martin Truex Jr.

    “Our involvement in MWR, and because of the scale behind NASCAR, has had an immediate impact for us,” Emrich said. “Motor oil is [a new product] for us, and this has allowed us to get distribution and an incremental increase for antifreeze.”

     
    Sales of Peak Antifreeze and Peak Motor Oil are up 5 percent to 7 percent in less than a year.
    The MWR sponsorship also made it possible for Peak to do a special “Duck Dynasty” promotion this fall. Bowyer, who has been a guest on the show, connected Emrich with A&E’s marketing team. Peak cut a deal with the show and Realtree Camo that allows it to issue special-edition, camouflaged, “Duck Dynasty”-branded packaging ahead of season four of the show, which debuts this fall. It also will field a Peak “Duck Dynasty”-branded MWR car at Watkins Glen on Aug. 8, and Willie Robinson, one of the stars of the show, will make appearances on Peak’s behalf at a national meeting of Dollar General managers.

    Peak plans to run a “Duck Dynasty” sweepstakes that includes a Toyota truck giveaway and a chance to meet the Robinson family featured on “Duck Dynasty,” which drew 9.6 million viewers for its season finale last April.

    “Every one of my customers is head over heels about it because the show gets great ratings,” Emrich said.

    On the same weekend the co-branded Peak-“Duck Dynasty” car runs at Watkins Glen, Speed will air a one-hour special on Peak’s primary NASCAR marketing program. The company launched the “Peak Stock Car Dream Challenge” in March. The digital promotion allowed aspiring drivers to upload videos describing their talents and explaining why they deserved a chance to race. More than 300 people entered the contest, three times what Emrich expected, and 10 were selected to do a three-day racing competition judged by Waltrip, Bowyer, Truex and others. The competition was taped for the special.

    Emrich said that promotion combined with the introductions to Napa by MWR played a big role in the 5 percent to 7 percent increase in Peak’s business this year. He added that the long-term goal is to boost business with do-it-yourself consumers who change their own oil, and he thinks that the NHRA sponsorship will drive that business.

    “Establishing the credibility of the company among motorsports fans is important because a do-it-yourself guy is 50 percent more likely to be a fan of motorsports,” Emrich said.

    Peak is working with Ketchum Sports (communications), Velvet Hammer (advertising), Borders Perrin Norrander (media buying) and Protential (sports marketing).

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  • NFL’s pre-camp commercial filming season is in full swing

    Terry Lefton
    Knowing the NFL calendar as we do, we can confirm that while training camps open in late July, the season of NFL commercial shoots has been under way since June.

    That portion of the NFL season continued in full swing last week, with NFL sponsor Gillette filming its latest round of commercials at a Los Angeles studio with Green Bay Packers linebacker Clay Matthews. Matthews will be buttressed by an impressive addition of NFL talent: New York Giants wide receiver Victor Cruz (whom Matthews is replacing in the Campbell’s Chunky Soup campaign) along with Tampa Bay running back Doug Martin and New England wide receiver Danny Amendola.

    An interesting subplot will play itself out with this campaign, since it’s the first work on Gillette by Grey Advertising since the agency wrestled the account from BBDO, New York, which had it since 1966. Procter & Gamble spends more than $125 million in measured media supporting the Gillette brand domestically.

    Robert Griffin III, Subway’s “lead NFL guy,” shot spots in Brooklyn.
    Photo by: SUBWAY
    Meanwhile, Subway shot Washington Redskins quarterback Robert Griffin III in Brooklyn for spots likely to debut on preseason NFL games. “Robert is our lead NFL guy now, and very quickly, he has established a connection and credibility with a younger audience we’re going after,” said Paul Bamundo, Subway’s director of sports marketing and partnerships. He gave no specifics on the creative.
     
    > RUNNING AWAY: Whereas regular readers of this space have known this since late last year, for those who care about formalities, sources tell us that ING officially informed the New York Road Runners last week that it is exiting as title sponsor of the New York City Marathon after a 10-year, er, run. Still, the ING nameplate will remain on the event this year. Following a tumultuous year in which the NYC Marathon was canceled in the aftermath of the damage from Hurricane Sandy, you might think sales prospects for a new title partner were slim.

    However, we continue to hear that there are a surprising number of potential sponsors kicking the tires of a new title deal, to which the NYRR has affixed an asking price of $10 million per year for a deal that would span a decade. One brand we keep hearing being mentioned in relation to this is BMW, which, we’re told, is seeking distinction in the crowded luxury auto segment and certain that many of its affluent customers are runners, or at least running aficionados. However, some parties in the burgeoning health care segment have also expressed, we’re told.

    Talks on the NYRR’s biggest-ever sponsorship deal continue as the association continues to recast its sponsorship offerings after longtime sales chief Ann Wells Crandall left for a job with Pac-12 Properties and was replaced by John Gassner. Under the new regime, NYRR is looking to sell five, low-seven-figure “Founding Partner” sponsorships, and its current roster of 40 to 50 sponsors will be winnowed to a more manageable number. The NYRR also hired Rob Prazmark’s 21 Marketing, Greenwich, Conn., as a sales consultant early this year.
     
    > TENNIS CHANNEL 2: FanVision has sold its first tennis deal, affiliating with the USTA to make its handheld video system available during the U.S. Open, an event that attracts around 700,000 people. “It’s our first tennis deal and at the Open, there are so many concurrent matches, we think it’s a unique application that fits the sport, so we are having conversations with the other majors,” said Peter Murray, a principal at Insignia, the New York-based sports marketing agency partly owned by Miami Dolphins owner Stephen Ross, who also owns FanVision.
     
    > COMINGS & GOINGS: Donna Goldsmith to LeadDog Marketing, New York City, as managing director of business operations. The former WWE and NBA marketer was last with Think Geek and the 2014 Super Bowl Host Committee. … Clara Lefton to Comcast’s Front Row Marketing Services, Philadelphia, as a market and strategy analyst, reporting to Mark Wise, Front Row’s director of strategy and insights. She’s spent the last 23 years as this writer’s loving daughter, a position in which she’ll continue. … Paul Volen, former executive at Turner Sports and the PGA Tour, to vice president, business operations for Fanatics. Volen will be responsible for new business and strategic initiatives and report to Fanatics President Jamie Davis.

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

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