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SBJ/Dec. 9-15, 2013/Marketing and SponsorshipPrint All
Editor's note: This story is revised from the print edition.
The University of California broke new ground by signing naming rights for Kabam Field at California Memorial Stadium, the first college sports facility named for a video game company.
Last week, Cal-Berkeley officials announced a 15-year, $18 million agreement with Kabam, a 4-year-old San Francisco technology firm. The company generates more than $350 million a year from people paying to play its fantasy video games.
Jesse Ryback, director of business development for Premier Partnerships, the firm selling those rights for the school, played a key role in the deal. After observing his nephews’ fascination with playing Minecraft, a popular video game, it got Ryback thinking about Bay Area tech startups and a potential fit in a new category for naming rights.
Through research, he found Kabam, whose investors include Google, Intel, Warner Bros. and MGM. (Kabam pays the studios licensing fees to produce video games revolving around films “The Hobbit,” “The Godfather” and “Fast and Furious.”)
Most important for Cal and its consultant, they discovered that three of Kabam’s four co-founders are Cal graduates: CEO Kevin Chou, general manager Michael Li and chief of staff Holly Liu.
The core group at Kabam recognized a unique opportunity to do something special for their alma mater, said Chris Carvalho, Kabam’s chief operating officer. Carvalho, also a California graduate, did play-by-play as a student for Cal Bears sports on the campus radio station.
“Premier reached out and it was an incredible honor,” Carvalho said. “So many of our people went to Cal and were shaped by it. There were so many synergies.”
Cal and Kabam had a deal in place four months after officials began discussions at the start of football season, said Jeff Marks, Premier Partnerships’ managing director.
The school talked with more than 350 companies and had meaningful discussions with 50 firms before giving in-depth presentations to 10 candidates, said Solly Fulp, Cal’s chief operating officer and deputy director of athletics.
In addition to the emotional tie-ins with the company’s owners, the deal makes sense for Kabam because it hits the firm’s target market — young men age 18 and up, Carvalho said. Men make up 65 percent of all Kabam video game players.
All told, its consumer base plays Kabam games an average of two to three hours a day. The basic games are free to play. For a premium experience, consumers pay $5 to $50 a game for additional content. Every day, up to 5 million people are engaged with Kabam products, Carvalho said.
The company spends more than $50 million a year on advertising, including spots on ESPN. “This is a further progression of a different model that targets an audience we’re looking for,” Carvalho said.
In addition to the cash value, the terms call for Kabam to develop a Cal-based internship program and fund a scholarship at the school, which increases the agreement’s value to slightly more than $1 million a year.
In-stadium activation includes Kabam logos placed on the 25-yard lines at Memorial Stadium, an interactive gaming area in the stadium, and digital messaging on a new LED video board at field level.
For Premier Partnerships, the challenges to getting the deal done included Cal’s 1-11 finish this season, the worst record in school history, and the NCAA releasing the news in October that the Pac-12 school's football program has the worst graduation rate among BCS conferences, Marks said.
“Our thought was that if we don’t do this now, when would we do it?” said Tim Lynde, the ACC’s senior associate commissioner for brand marketing.
Photo by:ICON SMI
The ACC assignment is the first big victory secured for the joint venture between SME and IMG that was signed in May. The repositioning
The project involves talking to constituents, including students and fans.
Photo by:GETTY IMAGES
Cory Moss, senior vice president and managing director of IMG’s Collegiate Licensing Co., said the strategy is to mine IMG College’s large client base for more business by adding a marketing capability that has been absent. CLC has been the licensing agency for the ACC itself, and most of its member schools, for years.
“The idea is to combine our experience and marketplace presence in college with SME’s expertise in branding,” Moss said. “There’s just a huge opportunity there, both in sports and university-wide.”
SME partner and Chief Creative Officer Ed O’Hara noted that the top 100 Division I schools spend more than $600 million annually, with marketing for the academic side of their institutions themselves dwarfing athletic spending by three to four times.
“For the ACC, this is just a great opportunity to stand up and say, ‘Here’s what we stand for,’” O’Hara said. “As far as the [joint venture], there’s a huge market for development campaigns, reaching alumni and prospective students that’s just a huge opportunity.”
> ICE-POWERED LAUNCH: Sponsorship 101 says targeting is the reason sponsorship trumps a general media buy for everything but products with broad sales targets, like soda, beer or autos. When you are trying to build awareness for the first over-the-counter bladder-control product, it is even more critical.
Disson Sports and Entertainment handles and is producing the shows at the Pegula Ice Arena in University Park, Pa.; Veterans Memorial Arena in Jacksonville; the Izod Center in East Rutherford, N.J.; and the Jamestown Savings Bank Arena in Jamestown, N.Y. The taped shows will be broadcast on various Sunday afternoons on NBC.
Initiative Media handled for Merck.
Terry Lefton can be reached at firstname.lastname@example.org.