SBJ/Oct. 7-13, 2013/Marketing and Sponsorship

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  • GoPro cameras buy Ironman title sponsorship

    The World Triathlon Corp. has signed a multiyear deal with camera manufacturer GoPro for title sponsorship of the Ironman World Championship in Kona, Hawaii.

    Financial details of the deal were unavailable.

    Andrew Messick, CEO of the World Triathlon Corp., said the partnership would boost the race’s media footprint. He said both parties are still ironing out inventory details, though footage from GoPro cameras would likely be used in the event’s two-hour broadcast, which traditionally airs on NBC several months after the race.

    “We’re a company whose financial DNA is in race operations, but this will accelerate the journey towards being a more professional media organization,” Messick said. “We want to have a broader reach, and this is an important first step.”

    Leanda Cave won in Hawaii in 2012, a year the event went without a title sponsor.
    Photo by: AP IMAGES
    The deal comes one year after the WTC was unable to secure a title deal for its marquee property for the first time since 2004. Ford held the title position at the race from 2005 until 2011. Previously, the WTC had title deals with Gatorade, Timex and Bud Light.

    WTC officials called 2012 a “rebuilding year.”

    Ironman is the latest property to join GoPro’s expanding sports portfolio. The camera maker owns a global sponsorship deal with ESPN’s X Games, title sponsorship of the Vail Mountain Games, presenting status with the Mavericks International big-wave surfing contest, and category-specific deals with the AMA Supercross series and the Grand Prix of Sonoma IndyCar event.

    Todd Ballard, director of sports marketing for GoPro, called the Ironman deal a “last-minute opportunity,” and said the company had been searching for ways to step into endurance sports in an “authentic” capacity. He said Ironman’s affluent customers and the WTC’s broadcast relationship with NBC attracted his company.

    “The core sports we’ve been in are a little more natural because of the quick-action type of content you see in surfing or motocross,” Ballard said. “We’ve wanted to step into endurance for some time and this was the first opportunity that made sense.”

    GoPro is finalizing its on-site activation for the Oct. 12 race. Ballard said the company would bring signage and sales booths to the event and would promote its latest product, the Hero3 Plus camera.

    GoPro has an existing personal sponsorship with Australian triathlete Pete Jacobs, who won the Kona race in 2012. Ballard said Jacobs and American triathlete Chris Lieto are currently using the cameras during their training, and the footage will be incorporated into the broadcast. Whether athletes would wear the cameras during the race, however, is yet to be determined.

    “We want to show fans a perspective they’ve never seen of their sport,” Ballard said. “This first year is an experiment. We want to grow into it as time goes by.”

    Fred Dreier is a writer in Colorado.

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  • Penske seeking revenue growth

    Roger Penske arrived at last year’s NASCAR awards banquet in Las Vegas eager to talk to MillerCoors CEO Tom Long. A few weeks earlier, Brad Keselowski gave Penske Racing and Miller Lite their first NASCAR championship, and Penske wanted to extend both the driver’s and sponsor’s contracts.

    “We need to take this success with Brad and package it for the long term,” Penske told Long. “I’ll get to Andy and work it out.”

    Last year’s NASCAR championship spurred Penske’s new long-term deal with Miller Lite.
    Photo by: GETTY IMAGES
    Over the next eight months, Penske and MillerCoors Chief Marketing Officer Andy England hashed out a new agreement that takes Miller Lite’s sponsorship of Penske Racing through 2017 and includes an option for 2018. It ensures Miller Lite, which began sponsoring Penske Racing in 1991, will remain one of the sport’s longest-running team sponsors.

    “The key thing here is we want to be partnered with Roger Penske long term,” England said. “Secondly, we want him to be successful. We want to enable that success.”

    To help make Penske successful, Miller Lite is joining the ranks of other sponsors and ending its full-season primary sponsorship of the No. 2 car. It will be the primary sponsor of 24 races next year and allow Penske to sell the remaining 12 races to one to two other sponsors. Penske asked Miller Lite to either increase its investment, which is valued at more than $13 million a year, or free up races for Penske Racing to sell so that it could bring in more money to invest in improving the No. 2 team.

    Coming off last year’s Sprint Cup title, Keselowski has struggled in the No. 2 Miller Lite car this year. At press time, he had failed to win a race, and he became only the second defending Cup champion to fail to make the Chase for the Sprint Cup championship.

    Penske believes the combination of a long-term deal with Miller Lite plus two other sponsorships will boost the No. 2 team’s revenue and allow it to invest in improving the car in coming years. That’s why he gave Miller Lite the option of reducing the number of races it sponsors.

    “When you have a relationship for 23 years [like Penske Racing had with Miller Lite], this isn’t a case of poker,” Penske said. “It’s a case of sitting down and saying, ‘What’s reasonable? What can we do?’ As the costs have gone up for us, we can’t expect we can dial up the sponsor and expect them to cover it.”

    Miller Lite is the latest in a string of sponsors in recent years to cut back the number of races it sponsors. Budweiser, UPS, The Home Depot, Napa and others have made similar decisions. The moves reflect both the rising cost of sponsoring NASCAR teams, which mushroomed in recent years, declines in attendance and TV viewership over the last decade, and a glut of available primary sponsors with top teams.

    There will be just four full-season sponsors in 2014: Lowe’s, Menards, Furniture Row and Aaron’s. (Lowe’s brand Kobalt sponsors nine races on the No. 48 car.) And industry observers anticipate there will be a day when no more full-season sponsors remain.

    “It will happen in the next three years,” said Darren Marshall, executive vice president of consulting and research at rEvolution, which has studied the correlation between fan awareness of a sponsor and the number of primary races a brand sponsors. “We wouldn’t advise anyone to do a full season anymore. You can [sponsor] two-thirds of a season now and get the full benefits of a season.”

    Keselowski, who Penske also signed to an extension, said that concentrating on whether Miller Lite sponsors 36 races or 24 races misses the point.

    “This is going to increase revenue in the sport because we’re going to bring in a new sponsor and Miller is going to stay,” Keselowski said. “This is a win across the board.”

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  • EA Sports’ athlete relations director exits company amid executive changes

    Sandy Sandoval, longtime senior director of athlete relations for EA Sports, has left that position to pursue other opportunities.

    “I left,” Sandoval said in a brief telephone interview last week. “We just parted ways. I am 57. I just decided to do my own thing. I don’t know what that is yet. But I am going to figure it out.”

    Sandoval maintained EA Sports’ relationships with athletes, agents and players unions and was involved in decisions and negotiations on player deals, including which players would be featured on the covers of EA Sports games. Sandoval first joined EA Sports in 1995.

    David Tinson, EA Sports vice president of communications, said, “Sandy is no longer with the company. He left to pursue other opportunities.” Tinson declined further comment. EA Sports had not replaced Sandoval as of last week, and it was not clear whether the company would do so.

    Sandoval said he had left the company in the last month. He said that he did not know whether he would join another firm or start his own, but that whatever he did next would involve athletes and marketing.

    “Those are two of my strengths, obviously,” Sandoval said. “My expertise is securing athletes and relationship-building and I learned it at EA. They gave me a great platform, and I am going to take it into a new venture.”

    Sandoval said last week he planned to spend some time exploring potential opportunities. “Right now I plan on enjoying some [free] time,” he said.

    Sandoval’s exit comes during a period of change for the video game publisher. Andrew Wilson, formerly head of EA Sports, last month was elevated to chief executive of EA Sports parent Electronic Arts Inc., and Patrick Söderlund was appointed to take Wilson’s old spot while also running EA Games.

    EA Sports also recently announced plans to shut down production of its “NCAA Football” game franchise, in large part because of turbulence in college sports licensing and the pay-for-play debate. The company intends to retain most of its personnel involved in the game, but the move will inevitably result in some job losses due to consolidation.

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  • Sporting goods organization regrouping to battle inactivity

    Terry Lefton
    What was labeled a “pandemic of physical inactivity” served as a call to arms at a recent conference of the Sports & Fitness Industry Association.

    The trade association of sporting goods retailers and manufacturers (formerly the Sporting Goods Manufacturers Association)
    hadn’t held its own conference since 2006. Still, they gathered 200-plus for a “leadership summit” and debated the ills facing the industry. Sports and exercise equipment, apparel and footwear remain healthy businesses, tracking last year at $79 billion in wholesale sales, an increase of 2.4 percent over 2011. But the threat of an increasingly inactive populace was as frightening to the audience as if every American high school suddenly banned sneakers and T-shirts.

    Association President Tom Cove fired a warning shot the size of an ICBM when he presented research forecasting that if unchecked, a third of the U.S. population will be inactive by 2018 — resulting in $28 billion less in athletic footwear, apparel and equipment sales.

    Photos by: DAVE MCINTOSH (3)
    “Growing participation is the single best thing any of us can do for all of us,” Cove said. And if there was not yet consensus on a solution, the industry group took the gathering as a positive sign.

    “The engine for change has to come from our industry,” said Mitchell Modell, CEO of the Northeast sporting goods chain that bears his name. “This is a problem that affects all of us — retailers, manufacturers and the leagues.”
    Noting their symbiotic relationship, Under Armour founder and CEO Kevin Plank was one of many urging the sports and fitness business to forge alliances with the burgeoning health care industry.

    “It’s not just about playing sports, but keeping
    fit,” Plank said. “The challenge I will give to anyone here is how can we be proactive in the health care industry. Building bigger hospitals and the costs that come with them is not financially sustainable. … That’s our goal, that’s our opportunity, not just selling more basic T-shirts.”

    The association’s research also showed that those participating in physical activities, so-called active Americans, were more likely to support some of the largest sports properties. For example, 37.8 percent of inactive Americans identified themselves as NFL fans, compared with 54 percent of active Americans.

    “On a fundamental level, the most important thing is that people play or do something physical,” said Eric Grubman, NFL executive vice president. “If they do, we’ve got a fair shot at making them into a football fans, baseball fans, NBA fans.”

    One by one, the major problems plaguing participatory sports were vetted, if not solved, including the growing specialization of youth athletes in one particular sport at the exclusion of others.

    “I’ve seen too many kids get turned off to sports, simply because they didn’t make the travel team,” said Tim Brosnan, MLB executive
    vice president of business. “There are no more pickup games of anything. It’s incumbent upon us to get the concept of ‘play’ out there again.”

    Also cited as problematic were the marginalization of the recreational player, a lack of funding and trained coaches, the lack of physical education in schools and, of course, the concussion issue.

    “America without football scares me a hell of a lot more than America with football,” said Plank, a walk-on at the University of Maryland, before citing Under Armour’s recent Head Health Challenge with General Electric Co. and the NFL, which is offering up to $10 million to stimulate innovation in head and brain protection. “Many of the lessons that I learned in building this company were first learned from playing on a team. … It’s not just a football issue. Football can and should take a leadership position, but every sport out there has this issue.”

    After six years without a conference, the industry association rebranded and repaired some splintering. “We’ve come a long way just to identify and agree what the elephant in the room is [inactivity],” said Mizuno USA President and SFIA Chairman Bob Puccini.

    With a plethora of programs advocating physical fitness — including the PEP bill, which helps fund sports equipment for school districts and community organizations; the association’s own PHIT America social media and marketing campaign promoting an “Active, Fit and Healthy America”; and the NFL’s Play 60 program — focus is a concern.

    “There are all these different initiatives, but how do we coalesce?” Puccini said. “That’s the role of the SFIA now.”

    > SELLING PROPERTY: An impressive group of top property execs — including Brosnan and Grubman; U.S. Olympic Committee Chief Marketing Officer Lisa Baird; Brian Jennings, NHL executive vice president of marketing; and Sal LaRocca, NBA executive vice president of global merchandising — debated the biggest issues at the top of the sports pantheon. Some interesting figures emerged when they were asked about the growing impact of social media. Jennings noted that sports represents about 1 percent of TV programming but accounts for more than 50 percent of Twitter conversations.

    “Search engine optimization and sharing links is today’s word of mouth, and that’s how fans are consuming our games,” Jennings said. Grubman said the most recent “Hard Knocks” HBO show attracted 7 million viewers but catalyzed 80 million tweets. As for monetizing social media at a sports property? “The ad world is still learning how to make money off it,” Grubman said. “I doubt it is going to dramatically increase the amount of ad dollars that are spent, but it will shift them, so if a sports franchise or league can be on the receiving end of that, that’s better.”

    > TED TALK: During his keynote, Monumental Sports Chairman Ted Leonsis chided those in attendance for not being more reflective of their increasingly multicultural consumer base. “It’s very important for all of your enterprises to be holding up mirrors to the communities you serve,” he said. Leonsis also
    advised association members to prepare for a continuing wave of changes based on technology, including mobile payments becoming predominant, and the abundance of big data necessitating further corporate investments in that area. Also forthcoming: a boom in local business, fueled by a combination of mobile commerce and social media. “This is the biggest new business opportunity for you,” he said, “and it goes to your sweet spots: stores in neighborhoods.”

    > CALLED FOR ICING: While there will be six NHL-sanctioned outdoor games this season, Jennings said the league is not yet looking at having al fresco hockey outside North America.

    This year’s schedule includes a Los Angeles Kings-Anaheim Ducks game at Dodger Stadium on Jan. 25. “A lot of people have questioned whether we can make ice in L.A.,” Jennings said, laughing. “So tune in.”

    Quipped Grubman: “Ice in L.A. is quite a trick. Could you build an NFL stadium there, too?”

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

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