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SBJ/Oct. 28-Nov. 3, 2013/Marketing and SponsorshipPrint All
Sebastian Coe (right), chairman of Chime-owned CSM Sport & Entertainment, and JMI’s Zak Brown
Photo by:HARRY PAGE IMAGES
The deal is the largest sports-related acquisition Chime has made since creating a sports subsidiary, CSM Sport & Entertainment, in 2007. JMI, which is headquartered in Indianapolis, is CSM’s first U.S.-based company and its fifth company overall. It will work alongside the sports activation and hospitality agency iLuka and sports branding agency Icon and report to CSM Chairman Sebastian Coe, who chaired the London Olympics, and CEO Jim Glover.
The deal brings an end to a sales process begun earlier this year by JMI’s majority owner, Spire Capital Partners. The private equity firm, which also owns the Professional Bull Riders, has owned 50 percent of JMI since 2008. It sold its share of the company, and the other owners — Credit Suisse (10 percent), WPP (20 percent) and JMI CEO Zak Brown (20 percent) — sold their stakes, giving CSM full control of JMI. (WPP will retain an interest in JMI because it owns 20 percent of Chime Communications.)
Coe said in a statement that he expects the deal to strengthen CSM’s business by bringing the company into two new markets simultaneously: motorsports and the U.S.
Brown, 42, will remain CEO of JMI and become group head of business development for CSM. He will work out of JMI’s new London office, which he opened in August.
He said the agency will continue to focus on motorsports, but it will work with other CSM companies to bring their clients into motorsports and bring some of JMI’s clients, which include UPS, Subway, Crown Royal and others, into other sports.
“It’s business as usual, but we now have a very good strategic partner with complementary clients,” said Brown, who founded JMI in 1995. “We’ve been looking at other sports for a long time, and now we’re plugged into this larger group that can offer that.”
Spire hired Rothschild Group earlier this year to put together a sales book on JMI and approach potential buyers. Sources familiar with Rothschild’s sales book said JMI last year claimed earnings before interest, taxes, depreciation and amortization (EBITDA) of $8 million. The company’s sales price of $76 million is slightly less than a multiple of 10 times EBITDA.
Bruce Hernandez, a partner at Spire and the chairman of JMI’s board, said it took nine months to sell the company. He said a half-dozen companies looked at the business, including agencies, media companies and private equity groups. Chime began expressing serious interest in June. Its chairman, Evan Davies, knew Brown and was familiar with JMI.
“We found a good home for the business, for the employees and Zak, and a fair transaction for the equity holders,” Hernandez said. “It’s not a metal-stamping business you could sell to anyone. We feel strongly there’s a good cultural fit here, a good strategic fit, and a good business fit.”
JMI employs more than 130 people in the U.S., U.K. and Hong Kong. The company has succeeded in building its international business in recent years, particularly in Formula One, where it brokered a five-year, $200 million deal for UBS to become a series sponsor in 2010. The overseas growth allowed JMI to offset any revenue losses in the U.S. when NASCAR and IndyCar began to struggle to attract sponsors during the recent recession.
Brown relocated to London to continue to expand the company’s international business, and he expects the CSM acquisition to help with that.
“It’s very strategic and has a lot of synergies,” Brown said of CSM. “It allows us to expose our clients to other sports in the family. It allows us exposure to their clients to pull into motorsports. And there are good career growth opportunities for staff, which has been a challenge for us only in motorsports.”
The NBA goes into the 2013-14 season with a number of sponsors rolling out activations and unveiling new creative.
While league partners have traditionally debuted ads on the NBA’s Christmas Day games, they are more than ever rolling out new ones this week.
Kia is taking over sponsorship of TNT’s “Inside the NBA” postgame show from Hyundai and will air a new spot with endorser Blake Griffin. Adidas will feature new creative with Derrick Rose, while State Farm will expand its campaign with Chris Paul. Look for Paul to tout Nike’s Jordan Brand line, while Nike and Sprite have new spots with LeBron James. Spalding will introduce a marketing effort centered on its 30th anniversary with the NBA.
A few partners launched programs in the preseason: BBVA debuted creative with Kevin Durant and James Harden; 2KSports did so with James.
League media partner ESPN will continue its “RV campaign” behind its NBA telecasts featuring its on-air talent this season.
On the sponsorship side, Under Armour, an NBA partner since 2011, has renewed its league rights, which complement its recent signing of Golden State Warriors guard Stephen Curry. Sears is back for another year at the promotional partner level and will continue to title sponsor the All-Star Saturday Night Shooting Stars competition. It also will use NBA experiences as rewards for its Members Only frequency/loyalty program. Also renewed in the offseason were Taco Bell and American Express.
Bacardi, which in 2010 became the first spirits marketer to sign a sponsorship with one of the big four professional stick-and-ball leagues, did not renew.
New on-the-ground activation in New York sees TNT along with Samsung setting up an event Tuesday near Madison Square Park as a precursor to the league’s opening-night doubleheader. TNT, which will broadcast the two games, will host its pregame show live from that site.
2KSports also sponsors the event on behalf of its recently released “NBA2K14.” The event will feature game kiosks and a scavenger hunt, along with giant screens for fans to watch the Chicago-Miami and Los Angeles Lakers-Los Angeles Clippers doubleheader.
With the NBA season tipping off this week, Samsung is close to completing a major sponsorship deal with the league that will include rights across the company’s line of smartphones, tablets, televisions, Blu-ray players and streaming video boxes.In addition, Samsung will sponsor elements at All-Star Jam Session, the Celebrity Game at All-Star Weekend and the NBA draft, and it will become presenting sponsor of the relaunched “Inside Stuff’’ show on NBA TV.
The multiyear deal encompasses the United States, Canada and Mexico, and includes the NBA, WNBA and D-League. There’s also a major commitment for advertising with the NBA’s TV rights holders.
On-court integration will see Samsung monitors at courtside for replays, while NBA referees will use Samsung tablets, but in what capacity is uncertain at this point.
Agency sources said there will be a handful of team sponsorship deals, as well, including one with the champion Miami Heat, whose LeBron James has been endorsing the Samsung Galaxy for the past year, most notably with a Super Bowl ad. At least one NBA team, the Phoenix Suns, already has coaches using Samsung Galaxy tablets at the bench.
Samsung, locked in a marketing battle with Apple for smartphone and tablet supremacy, will tip off its deal with a big presence on TNT’s opening night NBA programming this week.
The NBA has long positioned itself as the digital leader among sports properties, making it a nice fit with Samsung, which leads the globe in smartphones sold.
“We like this partnership because we’re bringing together two technology leaders [NBA and Samsung], and it’s not just about marketing rights,” said Mark Tatum, the NBA’s executive vice president, global marketing partnerships. “You’ll see our marketing and programming distributed across all of Samsung’s platforms and across all of our media partners. It’s well-integrated, and as technology develops, we’ll develop a lot more initiatives with our teams, players and coaches.”
Samsung is part of fellow NBA sponsor Sprint’s portfolio of smartphones, and the two are planning co-marketing ventures using NBA rights. Sprint’s NBA activation also has included a heavy media presence on TNT and all of the NBA’s programming.
The Samsung sponsorship grew out of a small deal the company did with the NBA earlier this year, when it used NBA intellectual property during a highly publicized, three-minute ad promoting Jay-Z’s latest effort, “Magna Carta Holy Grail,” that aired during the Finals in June.
Haier was the NBA’s last corporate partner with TV hardware rights. Those rights expired before last season. Nokia had NBA cellular handset rights in a deal that expired eight years ago.
Samsung, which is among the International Olympic Committee’s TOP sponsors, has been looking at a big U.S. sports property deal for some time. It was in talks over the past several years for an NFL league rights deal and looked at naming rights for various new NFL stadiums.
That’s what makes the most recent ad from Guinness one of the most arresting on television.
With a media buy set against NFL, MLB and across ESPN programming, the ad depicts a gritty, aggressive, sweaty and wildly competitive game of … full court wheelchair basketball among friends. Competitors fall out of wheelchairs onto the floor, elbow for loose balls and aggressively jockey for position under the boards. It’s a contentious combination of street ball and motorsports.
A week after the ad's Sept. 5 debut, it had 4 million YouTube views.
Like any good advertising, it imbues emotion where there really isn’t any: for example, like into a glass of beer. “Dedication, loyalty, friendship. The choices we make reveal the true nature of our character,” states the voice-over in the copy from agency BBDO. There’s the obligatory finish with a “beauty shot” of an artfully drawn pint and the wheelchair hoops group raising glasses at a pub.
Update the numbers of last week and there were 13 million YouTube views, quite a testimonial. Still, if you’ll pardon a mercenary question: Does it sell beer at a time when most beer brands are losing share to spirits? Some friends, who consider themselves experts in both sports marketing and beer, kicked the issue around one night on Facebook. Yeah, this was a conversation that could never be truncated to fit across 140 characters: art versus commerce. There was as much contention among our group as there was among those wheeled basketballers.
Turns out, it was all about dimensionalizing brand attributes to an audience of 20-something beer drinkers. The wheelchair basketball ad, now also running in Canada, Jamaica and the U.K., was the first in the U.S. under the Guinness “Made of More” campaign.
“There are so many beer ads with numbers or with only shots of beer being poured,” Campbell said. “Research told us that the bond of friendship over Guinness is what makes it special, so we made a conscious decision to go with more of an emotional impact and try to emphasize the bond of friendship in a different way.”
The concept tested well against drinkers of Guinness and other brands, and it was filmed over the summer in a Los Angeles gym after a day in which the wheelballers got to know each other’s games.
Any marketer would get excited about procuring a viral hit. As for the ad’s efficacy? While not revealing any specific numbers, the brand says its early research indicates that the ad is changing consumer attitudes about Guinness.
“We test whether you are giving consumers new information about the brand and whether we are provoking an emotional reaction that will drive memorability,” said Campbell, adding that both those measures are strong.
So how long can the viral hit play and still remain effective? “At least until the end of the year,” Campbell said. Remember, Guinness competes against some of the biggest marketing budgets in sports.
“The message has to do the work for us,” Campbell added. “In this category, we are not going to blow anyone away with our spend.”
Thankfully, we’re promised that this creative triumph won’t be spoiled by a wheelchair basketball sequel. We’ll drink the beer of your choice to that.
> SON OF BEACH: Looking to support its sponsorships of the U.S., Canadian, and Chinese Olympic committees, Hilton Hotels is staging a beach volleyball tournament among the world’s top players at its Hilton Hawaiian Village resort in Honolulu on Nov. 16-17. The Hilton HHonors Beach Volleyball Challenge round-robin tourney will include top performers, such as Kerri Walsh Jennings and April Ross on the women’s side and Phil Dalhausser and Sean Rosenthal on the men’s. In the U.S., it will be broadcast in early December on NBC Sports Network and Universal Sports, along with Canadian and Chinese TV outlets.
Hilton owns the property and has made it self-liquidating by bringing in other sponsors, including Citi, Visa, Enterprise Rent-A-Car, Hawaiian Airlines, Bud Light Lime, Vitaminwater and the Hawaiian Tourism Authority. USA Volleyball and the FIVB sanction the event.
Disson Sports & Entertainment of McLean, Va., created the event and handled the TV negotiations. The Marketing Arm stages the event. It’s an expansion of last year’s tourney, which included only the U.S. and China.
“We’ve been able to boost awareness of our Olympic sponsorships and we’re also looking to open up Hawaii to Chinese travelers on their way to and from the U.S.,” said Scott Brennan, Hilton’s vice president of global strategic partnerships.
Hilton will support with digital and email campaigns.
3M wants its tape to get on a roll with NFL fans.
Kathy Magill, 3M marketing manager for stationery products, said that with little growth in the core office market, 3M was looking for “more expressive tape products.” A dispenser shaped like a high-heeled shoe, launched in 2010, was a huge hit among women. 3M was looking for a similar dispenser for men; a football helmet tested No. 1.
3M signed an NFL license in August.
Coming next year are football-shaped, team-logoed Post-It dispensers at the $14.99 price point. Also under consideration is team-logoed Scotch Tape and Scotch Duct Tape.
Terry Lefton can be reached at email@example.com.