SBJ/Feb. 10-16, 2014/In Depth

Print All
  • The marketers speak: Growth categories and the best activations

    From digital activations to using athletes as social media brand ambassadors, those are some of the trends sports marketers are watching. They also have their eye on the gaming space, technology, content and health and wellness. To take the pulse of the sports marketing business, SportsBusiness Journal asked several marketers to identify growth categories, the trends they’re watching, and the most effective platforms for activation. We also asked them to share the advice they would give to properties on how to build better sponsorships. Here are highlights of their responses, which were submitted via email.

    What do you see as an emerging category in sports sponsorship?

    KIT GEIS, GENESCO SPORTS ENTERPRISES: It’s not exactly new, but athletes are more important than ever to a sponsor’s marketing mix because they are the access point to digital social media. We not only use Q Scores when evaluating players, but how many Twitter and Facebook followers they have. They are the stars of popular viral videos like the Manning brothers in DirecTV’s “Football on Your Phone,” Pepsi’s “Test Drive” video featuring Jeff Gordon and the Pepsi Max “Uncle Drew” spots with Kyrie Irving. [Editor’s note: Pepsi is a Genesco client.] And the more that sports intersect with music, the more we’ll see pairings like Russell Wilson and Macklemore, Jay-Z and Robinson Cano, Calvin Johnson and Eminem. We need the players to make digital and social work.

    MARC BLUESTEIN, AQUARIUS SPORTS: Technology is always an emerging category in the sponsorship industry. There are so often new technologies being developed and manufacturers are looking for ways to be forward facing. A recent example in this area is GoPro and their sponsorship with the Winter X Games.

    MICHAEL NEUMAN, SCOUT SPORTS & ENTERTAINMENT: Health care (hospitals, diagnostic, training and wellness), gaming/online gambling and wearable technology.

    Health care reform and the growing health crisis in our country has forced relevant companies to think differently about how they market themselves to target audiences and become consumer brands. … Recent deals like Quest Diagnostics with the New York Giants, Atlantic Health with the New York Jets and the partnership between HealthCorps (Dr. Oz’s company), the California Endowment and four California-based NBA teams are prime examples.

    Leagues are loosening the noose on gaming and online gambling. Already a big team revenue driver in Europe, the category is heading toward $7.4 billion by 2017 in the U.S., and three states already allow online gambling.
    PartyPoker’s deal with the New Jersey Devils and the Philadelphia 76ers will blaze new paths, and more and more casino licenses are being granted each year to support the need to shore up education and infrastructure deficits at the state level.

    At CES last year, 1 in 4 products were fitness related and that number rose 30 percent this year. By 2017, industry experts predict 170 million fitness products will flood the market. Wearable technology will motivate, inform and educate weekend warriors and sponsorship will be a perfect fit, especially for fans who take great interest in athletes’ workout routines, nutritional insights and overall health regimen. Google Glass, Nike and Under Armour could be the leaders in this space.

    JEFF SHIFRIN, OCTAGON: Technology would be the easy answer, but we’re seeing more and more clients in
    Time Warner Cable Studios, staged in New York City during Super Bowl week, was  singled out as an innovative use of branding that was embraced by consumers.
    Photo by: Getty Images
    our marketing business that aren’t part of the traditional “power” categories. Companies that haven’t traditionally participated in our business are now seeing sports and entertainment as an important part of their marketing mix — everyone is trying to take advantage of the passion consumers have for sports, music and entertainment.

    JEFF FILIBERTO, CAA SPORTS: Global soccer in the U.S. Between the impending World Cup and the emergence of foreign games now easily available for most Americans to access on TV in real time, the global soccer wave is crashing onto U.S. shores with a vengeance. Messi was recently ranked one of Americans’ favorite athletes.

    Cristiano Ronaldo, the Ballon d’Or winner, has movie-star good looks and a tremendous U.S. fan base. The U.S. national team is more relevant and exciting than ever. U.S. fans finally have unfettered access to the best. Our clients are getting involved in big ways, from Intel to Mondelez. It’s soccer’s time here.

    DENISE DURANTE, WASSERMAN MEDIA GROUP: Technology has created both brand and revenue opportunities through various platforms like the new fan experiences that are now available within the game and well beyond the game. For example, Xbox has created a new platform for NFL fans to connect to the game through differentiated content and personalized interactivity, and enhanced the way fans can consume the sport. [Editor’s note: Xbox is a WMG client.]

    DAVID ABRUTYN, IMG: Online gaming is one category to watch. Historically, the World Series of Poker did big business with these companies, then U.S. laws changed and the category basically collapsed. The legal environment is changing and this will lead to a rebirth in certain markets. … Internationally this has been an active category for years where online gaming is part of their culture. As U.S. laws change and open this form of entertainment to consumers, sports will be used to drive awareness and business to these companies. The benefits of a lifelong customer are substantial, and competition with bricks-and-mortar entities with their own off- and online business will create competition for the key properties and assets.

    What are the top trends you’re watching when it comes to brands sponsoring and activating around sports?

    GEIS: Sportsbook in New Jersey — if that passes, it will be a domino effect throughout the nation; pay for athletes in college sports; real-time marketing or “planned spontaneity” — Oreo did it well during Super Bowl XLVII when it created a viral video about the blackout in real time.

    DirecTV made use of social media channels with its viral “Football On Your Phone” spot featuring the Manning brothers.
    BLUESTEIN:
    Several of the brands we are working on activations for include product sampling, and we are exploring ways to utilize social media to prompt and encourage product sampling, creating unique hashtags and other call-to-actions which provide experiential rewards for folks who are becoming social brand ambassadors.

    NEUMAN: Sponsors (brands) seeking to curate, create and own content that can be shared across multiple media channels that also gets fans (and consumers) engaged in a conversation, driving organic advocacy.

    Brands and their agencies are digging deeper to those who are Internet relevant to fan bases. More and more bloggers are being tapped to connect brands with the “hyperpassionate” fan as many bloggers maintain the same credibility as their print counterparts.

    Nothing sparks a conversation with media-savvy fans like a compelling, innovative and memorable sponsorship activation. Fuel that conversation by integrating hashtags into print, broadcast, on-site, digital, talent and experiential channels.

    Shifting spending priorities from brand dominating presence to building experiences that enhance the fan experience.

    SHIFRIN: Brands are focusing on fewer properties, but doing more to leverage their current partnerships. Brands
    are taking more of a 360-degree approach than they ever have. What BMW did for Team USA and the U.S. Bobsled Federation through their USOC partnership is a perfect example of a 360-degree program that delivers on the brand’s objectives. [Editor’s note: BMW is an Octagon client] Now, brands can truly create a holistic program because the Internet and mobile provide an unlimited delivery system to reach the consumer. Brands are only limited by their creativity, their imagination, and budget.

    KERN EGAN, HAYMAKER: Sponsorships are being held more accountable to deliver against purchase funnel objectives. Historically, many activation programs were developed and executed to simply be in front of fans and add to their experience, with the key success metric being general brand lifts against the designated fan base.

    Strong brands understand the key brand equities that drive consumer behavior at each point of the funnel and, today, the most effective sponsorship activation programs are designed to specifically strengthen these equities.

    FILIBERTO: Content creation is a big one. It’s easier than ever for anyone, anywhere to distribute content, and brands have this incredible opportunity to create and distribute some of the most impactful and talked-about content in pop culture. This is due to the fact that sponsorship deals can provide brands access to the most compelling athletes, teams, and celebrities. …

    DURANTE: Digital: Brands are getting smarter with the use of digital to leverage sponsorships, including branded content — but there is plenty of room for greater success.

    ROI: They are also under more pressure to justify spends before entering deals — further increasing their need to validate their marketing goals, metrics, and ROI.

    Collaborative partners: Brands increasingly are looking for more than sponsorship, but a brand story with the sport (property or team, even player). They are looking for joint initiatives — community, technology, multicultural, etc. — where they can meaningfully contribute.

    ABRUTYN: The passion and consumption of sports in all forms is driving all kinds of innovation in activation. Content is king like never before for many reasons. These are two that come to mind where ideas, content and communications are intersecting to drive trends.

    1. Digital rights converging with sponsor rights — the ubiquity of personal devices, quality, quantity of video and desire for content as simple as stats to complex as locker room video. Sponsors and brands are working hard to find the authentic connection points, and those that do it well are being rewarded with great returns.

    2. Platforms vs. promotions — integrating communications with sponsorship activation is essential to maximizing activation opportunities and returns. We have evolved from a world of traditional advertising, consumer sweeps/promotions windows and disconnected in-venue promotions to year-round integrated marketing of sponsorship investments. Said another way: Integrated sponsorship, communications and media is the new rule of thumb. The NFL/USAA military appreciation platform and the Kia Performance Awards platform are two partners that have worked with properties to create custom programs that are carried through all channels throughout the year. [Editor’s note: USAA and Kia are IMG clients.]

    What specifically have you seen change when it comes to effective platforms or channels of activation?

    GEIS: The biggest change has been in advertising creative. The big-budget 30-second spot created by a well-known ad agency is being replaced by the long-form viral video that goes up on YouTube. And if it gets a lot of hits, we’ll cut the 30-second spot from that.

    BMW used its sponsorship with the U.S. Bobsled Federation to highlight its innovation.
    Photo by: Getty Images
    BLUESTEIN:
    Media partners developing off-air platforms for brand engagement. We are currently working with a national radio partner who has always done their pregame show from in-studio and it now will be in a fan-friendly area that can include sponsor branding, special events, talent appearances and more.

    NEUMAN: How brands are inserting themselves into the fan’s conversation via the most fan-relevant social media touch points, including but not limited to Facebook and Twitter. This is driven by shareable and “ownable” content as well as “data driven by design activations” created to capture email and cell information so social media listening analytics can be utilized. Smartphones and social media environments allow fans to share their opinions seconds after it happens. Sports and live content will continue to be the ultimate catalyst for social media growth.

    SHIFRIN: Today, properties are doing a better job of giving brands the tools they need to reach the consumer, including content vehicles and activation platforms.

    FILIBERTO: Brands are helping to change the landscape. Borders are being pushed. Cookie-cutter deals are a thing of the past. Brands are pushing properties to embrace and try new things. From Intel’s sponsorship of the inside of FC Barcelona’s jersey to Time Warner Cable’s first-of-its-kind step inside the cable box at Time Warner Cable Studios around Super Bowl, fans are much more accepting of brand presence than ever before, as long as the presence is authentic and brings something cool, creative, or meaningful to the game [Editor’s note: CAA consulted on those programs].

    DURANTE: Access to specialized data and new technologies have allowed for greater targeted marketing efforts, providing not just additional new channels through the likes of social media, but more means to authentically communicate with the brands’ targeted fan. This is driving greater depth of activation — and some real-time learnings.

    ABRUTYN: The ubiquity of social media has empowered influencers in the digital community. Our recent fan engagement study … showcased the reality of this new channel and the importance of engagement versus simple exposure. It is critical to have a plan to find your brand voice and connect with each layer of this segment in meaningful and consistent ways if you want to make the most of your investments.

    In fewer than 20 words, what advice do you have for properties selling — or looking to renew — sponsorship inventory today?

    GEIS: Understand your client’s objectives and customize a proposal that meets those objectives. No more “off the shelf” “find-and-replace sponsor logo” proposals. And as sponsors increasingly want experiential assets and consumer engagement elements, properties are going to have to staff up to support what they have sold.

    BLUESTEIN: Ask what the brand’s goals and objectives are with the sponsorship before telling the agency/brand
    Health and wellness should be a growing category based on product rollouts at this year's Consumer Electronics Show.
    Photo by: Getty Images
    their property is the perfect fit.

    NEUMAN: Brands don’t have three- to five-year plans anymore; enter agreements knowing that changes will be made to support ever-changing brand strategies.

    SHIFRIN: Figure out return on objectives.

    EGAN: Remove ambiguity and subjectivity. Partner with your sponsor on specifying program objectives. Then deliver against and measure those objectives.

    FILIBERTO: Demonstrate an authentic, creative and/or unique passion for the brand by the property.

    DURANTE: Find ways to create partnership. Listen, and identify platforms where sponsors can truly create impact and a brand story.

    ABRUTYN: Agencies are not the sales prevention department. Use them to help build what works for their clients. They know.

    Print | Tags: In-Depth, Marketing and Sponsorship
  • Veteran sports execs form BlueCap agency

    Three veteran sports business executives have teamed up to start BlueCap Marketing, a Charlotte-based firm targeting companies and properties seeking event and sponsorship advisory services.

    Dockery Clark, De Cordell and Sarah Davis are joint, equal partners in the venture, with Clark serving as managing partner. Each has extensive experience in the sports industry.

    Clark worked on Olympics-related campaigns and team sponsorships in the NFL and MLB during an 11-year stint as Bank of America’s top sports marketing executive. She went from there to a similar role at MillerCoors before making stops with Professional Bull Riders and the 2012 Democratic National Convention.

    Cordell’s résumé includes work in sales and marketing in the Atlantic Coast and Southeastern conferences during his years at Raycom Sports. Among Raycom’s, and Cordell’s, key ACC clients: Bank of America and Clark. Other roles included five years in the early to mid-1990s with Home Team Sports, then the TV rights partner of the Baltimore Orioles. Most recently, Cordell spent a year with a NASCAR team in sales, and then worked outside of sports in retirement benefits and wealth management.

    Davis, with a law degree and MBA, met Clark during Clark’s Bank of America days, where Davis helped her with legal advice on sponsorship contracts. She went on to negotiate contracts with race promoters and sponsors at the Indy Racing League and IndyCar from 2006 to 2012. She returned to Charlotte with GMR Marketing in 2012.

    The three partners got the business started in September 2013 and are now beginning a formal rollout. During a recent interview in Charlotte, they emphasized a strategy of what they described as adding rocket fuel to the traditional agency roles of advising on and landing a rights deal.

    “We have known each other in business for a very long time,” Clark said. “We think we have complementary skill sets, and the backgrounds we each bring to the table can give a potential client a great representation on how to weave through this sponsorship space … Hopefully, the phone will ring.”

    Their experiences inspired the “Cap” in the company name, an acronym for the partners’ work on behalf of clients (BofA, MillerCoors and so on), agencies (GMR Marketing) and properties (the NASCAR team, Raycom’s ACC properties).

    The firm’s first client is The V Foundation, the nonprofit cancer-research organization formed in honor of late college basketball coach Jim Valvano. V Foundation hired BlueCap as an adviser on strategy and pursuing additional sponsor deals.

    BlueCap’s partners have spent the past several months talking to industry friends in hopes of landing future clients. None of the principals would discuss financial projections. They said the firm has three years’ worth of seed funding.

    Companies’ increased emphasis on justifying sponsorship investments and the need for more creativity should help BlueCap because of the varied and collective experience the partners have, the firm’s principals said.

    Clark talked about how even small changes can make a difference in the fortunes of a sponsorship — and the incremental gains companies seek. At Bank of America, she recalled, the investment advisory group improved its response and attendance rate for wealth-management sessions to 30 percent from 3 percent by using sports tie-ins.

    Rather than stage the sessions in a hotel ballroom, the bank tested a program with an assist from the Carolina Panthers. Potential customers received invitations to wealth-management seminars at the NFL team’s stadium in downtown Charlotte, where they went on behind-the-scenes locker-room tours, ate dinner in the club lounge, and heard remarks from George Seifert, then the Panthers’ coach.

    Soon, similar programs were created using the bank’s sponsorships with other pro franchises in other cities important to Bank of America.

    As for challenges, Cordell said, “It’s a cluttered marketplace. [The hard part is] earning that first opportunity when [business] relationships exist.”

    Although the agency calls Charlotte home, the principals said they anticipate regional and national companies to be on their client roster.

    Erik Spanberg writes for the Charlotte Business Journal, an affiliated publication.

    Print | Tags: In-Depth, Marketing and Sponsorship
  • Marketers bet on growth in gaming deals

    When Tulsa Shock season-ticket holders received their stubs for the 2013 campaign, they weren’t just getting access to games — they were also receiving $5 to $10 in free vouchers to spend at the nearby Osage Casino.

    That activation, part of Osage’s marquee sponsorship with the Shock that includes jersey naming rights, might have been next to impossible to pull off before the turn of the 21st century, when gaming sponsorships in American sports were widely seen as taboo. But these days, with rampant online gaming, three times as many states allowing commercial casinos when compared with two decades ago, and sports teams seeking additional sponsorship categories, the gaming space has seemingly morphed from a third rail into a hot commodity.

    Jordan Schlachter, executive vice president of sports at The Marketing Arm, said he has seen the transformation take place over the last 10 years.

    Osage Casino has a jersey deal with the WNBA’s Tulsa Shock.
    Photo by: NBAE / Getty Images
    “You’ve seen leagues relax their standards because you’ve seen teams lobbying the leagues to do so — to give them the opportunity,” Schlachter said. “When the league says, ‘No, no, no,’ after a while, they’re going to have to really examine the reasons they’re saying no, and start allowing them to say yes — because it’s for the benefit of the league, too.”

    All four major U.S. leagues now allow some variety of deals with gaming companies that don’t offer sports betting, though to different degrees.

    Ed Kiernan, founding partner and president of Engine Shop, has facilitated such deals for more than 15 years. He said the sea change in attitude by the leagues has taken place in incremental steps over the last two decades.

    That’s led to a point where, in leagues such as the NBA and NHL, team-level deals with casinos and lotteries are not far from ubiquitous. All but one NBA team has a deal with a gaming entity this season, and 70 percent of NHL teams have the same, according to Resource Guide Live. The deals typically range from $250,000 to $2.5 million, depending on the level of integration, Kiernan said.

    Still, despite the new outlook on such deals, many leagues remain reticent to discuss them publicly. Several leagues and governing bodies turned down requests to discuss the topic in depth.

    Regardless, experts said that if the trends continue, and the recent deal between online gaming outfit PartyPoker and the Devils, 76ers and Prudential Center — the first of its kind in the U.S. — proves more harbinger than exception, the gaming category could be one that’s poised for considerable growth in the coming years.

    Kiernan estimated that $300 million is being spent on gaming sponsorships in the U.S. and thinks the category could rise to $500 million in short order.

    In the major leagues that allow such deals, the pacts tend to be restricted to solely brand exposure in the form of in-venue signs plus media buys, hospitality in the form of suites, traffic drivers like the Shock’s ticket strategy, or kiosks to rein in new customers. This works out for casinos, who have diversified into areas such as hospitality and retail as they face increasing competition. Just getting people in the doors is increasingly integral.

    Such is the case with the Columbus Blue Jackets in their deal with Hollywood Casino Columbus. The team and the casino set up a promotion in which fans who sign up for a texting-based program receive alerts over a four-month period with keywords in them. The fans then need to go to the casino to enter the words at designated locations.
    Those who do successfully over the four different times the keywords are sent out get to play in a poker tournament at the casino with Blue Jackets players at an event at the end of February.

    “Certainly with Hollywood, their primary focus was driving residents of Central Ohio to their facility — just getting people in there to see what it was all about, and hopefully eat at one of their restaurants or play games, but get them in the door,” said A.J. Poole, Blue Jackets vice president of corporate development.

    Furthermore, the hospitality events that are part and parcel of the deals allow the companies to entertain their “whales” — industry parlance for their most lucrative clients — and other key guests in a setting in which the company is associated with a renowned U.S. brand, something that remains important for an industry still seeking nationwide acceptance.

    The scope of gaming deals is generally limited and must not be connected in any way to sports betting, lest leagues and their franchises be affiliated with something that could call results into question. And, for now, most of the properties want it that way, according to Kiernan.

    “Candidly, I think everyone that’s involved on all the sides of the equation is very cognizant of the sensitivity in this space,” Kiernan said. “As a result, I don’t think anyone really tries to push the envelope. These sorts of deals are very low key, and I don’t think casinos are looking to do anything above and beyond and brash. I think they’re just happy to be involved.”

    However, one league that has run contrary to the theme of wariness is UFC. The Las Vegas-based organization has unabashedly embraced gaming sponsorships since Day 1 — perhaps because of its location as well as its ties to the Fertitta brothers, who started UFC and also run casino and online gambling businesses. Some of the most frequent gaming-related activation in the UFC involves the online poker site Ultimate Poker. The UFC will make its fighters available for Ultimate Poker events and promotions, and will allow ticket giveaways through the site to UFC bouts.

    “I will simply state that we don’t have any restrictions on our deals with gaming people,” said Mike Mossholder, UFC senior vice president of global marketing partnerships. “The only thing that we have to watch is if a television partner in a certain market doesn’t allow gaming. Since we’re a global entity, we have to be aware of that. But we as a brand, we don’t have any problem with the online gaming product and feel very confident in promoting it.”

    Mossholder said the league’s long-held embrace of gaming solely comes down to the reality of its demographics.

    “We’re one of those brands that has a young, active fan base … and anything that they enjoy, we’re going to support,” Mossholder said. “We’ve seen research for 10 years that shows our fan base is highly engaged in online poker.”

    Adam Stern writes for sister publication SportsBusinessDaily.com.

    Print | Tags: In-Depth, Marketing and Sponsorship
  • PartyPoker sponsorship with 76ers, Devils raises stakes in gaming category

    The home pages of the Philadelphia 76ers and New Jersey Devils now dedicate space to their newest sponsor: nj.partypoker.com.

    Inside the Wells Fargo Center in South Philadelphia, two signs promoting the online poker company occupy prime real estate on the floor between the court and the front-row seats. During the game, instant replays are sponsored by nj.partypoker.com.

    At the Prudential Center in Newark, N.J., fans attending a Devils game can visit booths to learn how to play poker online.

    PartyPoker’s deal includes promos on the Wells Fargo Center scoreboard.
    Photo by: John George
    Those are some of the traditional ways — along with arena signs, tickets and hospitality opportunities, and radio
    and television advertising — that the Sixers and Devils have activated their multiyear marketing partnership involving Bwin.Party Digital Entertainment, which operates nj.partypoker.com.

    But Scott O’Neil, CEO of the Sixers and Devils, said the deal is anything but traditional.

    “This deal is much more about digital media,” said O’Neil, noting the organizations meet regularly to discuss ways to tie the brands together through mobile apps, social media and other online activities. “One of the great things about doing promotions online is if it’s working, you can double down on it. If it isn’t, you scrap it and move on to something else.”

    The financial terms of the multiyear sponsorship are being kept confidential, but O’Neil said the value tops $10 million.

    One of the cornerstones of the partnership is the “Dream Seat Series,” a chance for New Jersey residents playing poker at nj.partypoker.com to compete for what O’Neil describes as experiences that money can’t buy.

    “It could be a trip with one of the teams on the road, a ‘meet and greet’ before practice, dinner with one of our legends, or courtside or VIP suite seats,” he said.

    Already awarded were seats to a recent Jay-Z concert at the Prudential Center.

    “We are excited to be working with the Devils and 76ers and to be able to offer their fans great digital content and unique game-day experiences,” Norbert Teufelberger, CEO of Bwin.Party Digital Entertainment, said last month when the deal was announced. “There is an affinity between playing in online poker tournaments and sports — winning is about having intense focus, stamina and a great competitive spirit.”

    The Sixers and Devils are the first two major professional sport teams in the United States to sign a sponsorship deal with an online gaming company. The two teams, both owned by groups led by Josh Harris, draw fans from different parts of New Jersey — which late last year became the third state in the country to legalize online gaming.

    O’Neil said they did not encounter any major obstacles from either the NBA or NHL to get the deal done, but he noted minor adjustments were needed.

    “The NBA and NHL are both progressive leagues and worked with us throughout the process, to the point that both leagues made changes to their guidelines in order to recognize and accommodate the legalization of online gaming,” he said.

    Mark Tatum, the NBA’s deputy commissioner and COO, said no monitoring of the partnership will be required going forward. “As long as the gambling site doesn’t include sports gambling or sports betting, it’s now allowed within our rules,” Tatum said.

    Eric Smallwood, senior vice president at the Philadelphia-based sponsorship evaluation firm Front Row Analytics, said he wasn’t surprised to see an online poker company partner with a professional sports team — or in this case, two teams — in the United States.

    “I think it’s been a matter of when, not if,” Smallwood said, noting that teams already have sponsorships with casinos. “Think of the lotteries. You can look across all four major sports and find many teams that have relationships with state lotteries.”

    John George writes for the Philadelphia Business Journal, an affiliated publication.

    Print | Tags: In-Depth, Marketing and Sponsorship
  • North America 2020: The land of opportunity revisited

    It is not often in these pages you read about the United States or Canada as trailing markets in any aspect of sports business. Today, however, we’ll explore one area of the sports business where we are rightfully considered “Third World” territories — sports wagering.

    The fact is when it comes to sports wagering, we’re woefully behind mature markets like Europe and Asia. Just look at the English Premier League, where football clubs reportedly average more than $600,000 a year in sponsorship from legal sportsbook operators. Football fans all over the world, except of course here in North America, are able to place a wager on their favorite club right at the stadium or from the comfort of their home on a mobile device.

    And it isn’t only “European” owners capitalizing on the financial windfall of sportsbook sponsorships. Our own Shahid Khan, owner of the Jacksonville Jaguars and Fulham FC, has a shirt sponsorship deal with Marathonbet for a reported $3 million a year. Two other U.S. ownership groups, Fenway Sports Group’s Liverpool FC and Stan Kroenke-owned Arsenal, have secured two official sponsors in the space for their Premier League clubs — Paddy Power sponsors both teams in the U.K., Ireland and Italy while 188BET (Liverpool) and Bodog (Arsenal) have official status in Asia.

    In the U.K., the saying goes that sports wagering and football go together like custard and English pudding. In North America, it is more like oil and water. Until sports wagering is legal beyond Nevada and Delaware and U.S. leagues adjust their policies accordingly, North American sports executives are prohibited from pursuing the millions of dollars that sportsbook sponsorships could represent.

    That is not to say sports wagering isn’t already a big business in the United States or Canada. Recent estimates by the American Gaming Association place legal and illegal sports wagering at $380 billion a year. Nevada, the only mature and highly regulated single-game sports wagering market in North America, should approach $4 billion in legal wagers in 2014.

    No, we in North America like a little action on games just as much as our friends across the pond. It’s just that as
    The English Premier League fully embraces the gaming industry, as evidenced by these in-stadium betting posters at a match this year.
    Photo by: Getty Images
    sports marketers, we can only glance wistfully at our colleagues overseas.

    So kudos to the highly respected and innovative Scott O’Neil for his multimillion-dollar sponsorship deal with PartyPoker for the Sixers, Nets and Prudential Center. In announcing the deal, Bloomberg quoted O’Neil as saying, “This is our flag in the ground that we do things differently. We’re looking for groundbreaking opportunities with companies willing to take chances.”

    What strikes me about this deal isn’t just the reported $10 million in sponsorship revenue O’Neil is collecting from the recent legalization of online gambling in New Jersey. Rather, it is the partner he chose in PartyPoker parent Bwin.Party Digital Entertainment that has me believing this was truly a watershed moment in the U.S. market.

    For those of you unfamiliar with Bwin, it is one of the most aggressive sportsbook operators in the world, with business relationships spanning top-tier soccer properties including Manchester United (owned by Tampa Bay Buccaneers owner Malcolm Glazer), Juventus, Bayern Munich and Real Madrid. By partnering with Bwin, O’Neil in fact planted two flags in the ground, not just one. The obvious flag will drive current-day sponsorship revenue from a legalized online gambling provider in New Jersey. The second, and equally important flag in my opinion, will be the knowledge and insights gained as to best practices globally when the walls to sports wagering inevitably come crashing down here in North America.

    Fulham FC’s jersey deal with Marathonbet is worth a reported $3 million a year.
    Photo by: Getty Images
    Exactly when those walls come down and how, either through the Supreme Court in the NCAA v. New Jersey case or through legislative changes to the Pro and Amateur Sports Protection Act of 1992 in Washington, D.C., are topics for another day.

    Rather, let’s close with a hypothetical look ahead to a more robust U.S. and Canadian market for sports wagering in 2020, when Juniper estimates that 164 million people worldwide will gamble on their mobile devices. Imagine these following headlines in SportsBusiness Journal off “theoretical” sponsorship deals done by two U.S. clubs with an advanced understanding of the market potential based on their English Premier League experiences.



    BOSTON, Feb. 16, 2020 – Red Sox ink three sponsorship deals for official betting relationships.

    In the first deals of their type in the United States, the Boston Red Sox today announced three agreements for the rights to official sports wagering status with the 11-time world champions.

    In North America, including all wagering signage and kiosks at Fenway Park, the Fenway Sports Group has signed a long-term exclusive agreement with Las Vegas-based Southpoint Sports Book, owned and operated by Gaming Hall of Fame member Michael Gaughan. In Europe and Asia, Fenway Sports Group extended its current relationships with Paddy Power (U.K., Ireland and Italy) and 188BET (Asia). All three relationships carry with them exclusive mobile wagering rights with live data feeds within their respective territories.

    Terms for the deals were not disclosed, but industry estimates place the collective haul at more than $15 million a year for the Red Sox.




    JACKSONVILLE, June 4, 2020 – Jaguars sign Marathonbet to stadium naming-rights deal.

    Marking the first stadium naming-rights deal with a sportsbook operator in North America, the Jacksonville Jaguars announced today the signing of a 10-year agreement with Marathonbet to sponsor their home stadium and practice facility.

    In announcing the deal, Marathonbet’s president and chief executive, Graham Luke, noted, “Shahid Khan and his people have been tremendous partners to work with in England around Fulham FC. They will be the ideal partners and platform from which we can introduce ourselves to North America as the sportsbook ‘where the world comes to play.’”

    The naming-rights and sponsorship deal has been estimated to be worth $7.5 million a year and will allow Marathonbet to place its wagering terminals throughout the stadium in Jacksonville. While the team won’t participate in proceeds off the wagering handle, the premium paid on the deal is significant.




    I realize many of you may be rightfully skeptical of these aggressive prognostications. But if I had asked you five years ago whether marijuana would be legal anywhere in the U.S., would you have answered yes? It should leave you something to consider while we await word from the Supreme Court on its intent regarding the NCAA v. New Jersey case.

    Jeff Price is the former president of Sporting News and founder of Acorn Sports Ventures.

    Print | Tags: In-Depth, Marketing and Sponsorship, Opinion
  • Lotteries still a scratch and win for sports?

    New England’s teams keep winning and their fans keep scratching. Lottery tickets, that is.

    A SportsBusiness Journal analysis of the 44 state-run lotteries (43 states plus the District of Columbia) shows that sales of instant lottery games, or scratch-off tickets, bearing a New England Patriots, Boston Red Sox, Boston Bruins or Boston Celtics logo have topped $1.63 billion in the nine years since such tickets were introduced. More than half of the revenue generated by all licensed sports lottery tickets come from sales associated with Boston’s four teams.

    Since Massachusetts and Maine each launched a Red Sox scratch-off in 2006, the six-state region has fielded 32 team-logoed games, with more on the way this spring.

    The number of big league teams with lottery deals was down last year compared with the past few years.
    More than 95 percent of those sales have come from the 16 games produced by the Massachusetts State Lottery, accounting for 302 million team-logoed tickets. The state’s commission is considered to be one of the most successful in the world: Lottery ticket sales represented 1.4 percent of the state’s 2012 GDP, nearly triple the average of other U.S. states. The state sold $3.25 billion worth of instant tickets in 2012, just behind New York’s $3.58 billion, despite having a population just one-third the size of New York.

    In general, the lotteries do not contract directly with the MLB, NBA or NHL teams to use their logos, and though the teams receive licensing fees, they do not receive any proceeds from the sale of the games bearing their marks.
    Atlanta-based MDI Entertainment holds the licensing rights to use the team logos on lottery products and negotiates directly with the teams and leagues on usage. NFL teams are permitted to broker deals directly with the state commissions. Many of them do, although some hire MDI to act on their behalf.

    The art of deciding when, or even if, to field a team-logoed ticket requires constant attention to data.

    “We monitor our weekly game sales, forecast how long each game will be in market, and that helps us to develop and build our annual marketing plan,” said Beth Bresnahan, the Massachusetts State Lottery’s assistant executive director and director of marketing and communications. “For example, there was quite a bit of Red Sox-branded inventory across many price points when we were developing our 2012 and 2013 marketing plans. While the brand is undoubtedly one of the strongest in the league and region, it would not have been beneficial to the lottery’s game portfolio to flood the marketplace with another ticket until we moved existing inventory. As such, we did not release a Red Sox game in either year.”

    Bresnahan acknowledged that the on-field success of Boston’s teams makes things a little easier than most. “We
    have found that there is a direct correlation between a team’s performance and the success of a lottery ticket bearing its logo,” she said.

    Alex Traverso, assistant deputy director of the California Lottery, said that like most lotteries, his group is always looking for ways to connect with the younger demographic. He cited internal research that shows that although the scratchers category accounts for the vast majority of annual lottery spending among 18- to 34-year-olds, that age group does not spend as much on the games as others, and when it does, it is not on sports-themed games.

    “We always keep our options open, but we have found that other games or themes in our portfolio tend to perform better for whatever reason,” he said.

    The group sold a combined $31 million for Oakland Raiders, San Francisco 49ers and San Diego Chargers tickets that launched at the beginning of the 2010 NFL season, and paid a total of $1.73 million in licensing fees to those teams, but has not had a sports ticket since. The state also had an NBA-level deal during the 2003-04 season that featured multiteam campaigns. California Lottery had two MLB tickets in 2007, one with the A’s and Giants logos, and a second one with the Dodgers, Angels and Padres marks.

    Even some games that have sold well find themselves replaced in the display window by more popular images, such as Monopoly and Wheel of Fortune.

    For example, despite in 2010-11 selling more than $47 million combined in Pittsburgh Steelers, Philadelphia Eagles and joint Philadelphia Flyers/Pittsburgh Penguins tickets, a spokesperson for the Pennsylvania Lottery said the state “has no plans for any professional sports tickets at this time.”

    This doesn’t mean the state is abandoning sports as a sales hook, though. Pennsylvania is one of 18 states taking place in the first “Powerball Pro Football Hall of Fame” promotion. Sponsored by the Urbandale, Iowa-based Multi-State Lottery Association and run by MDI, 200 winners in the contest will be treated to a four-night trip to Cleveland, May 1-5, including round-trip airfare, hotel rooms, meals, ground transportation, admission to the Pro Football Hall of Fame and Rock and Roll Hall of Fame and Museum, as well as admission to a Powerball winners-only Ultimate Tailgate Party event.

    “It’s not surprising that there was a slowdown with licensed sports games,” said Steve Saferin, president of MDI. “There are very few brands who are strong enough to support an annual game.”

    Saferin said the areas of growth for the genre lie outside traditional markets. He cited the “Take Me Out to the Ballgame” scratch-off game run by the South Dakota Lottery (MLB owns the rights to the song, and the league’s logo was on the front of the ticket), and an NHL-licensed Hartford Whalers ticket in Connecticut, which is selling well.

    While the number of big league teams with lottery deals was down last year compared with the past few years, scratch-offs made a foray into uncharted territory in 2013. For example, the Florida Lottery last fall released the nation’s first college sports-themed game.

    “The Florida State-Florida scratch-off game was the first time that collegiate licensing rights were secured in this category,” said Andrew Giangola, vice president of strategic communications at IMG College. IMG College’s licensing affiliate, CLC, brokered those rights on behalf of the schools. “As far as other scratch-off games, we are very positive on the concept and on replicating the success we had in Florida,” Giangola said.

    Other games of note:

    In exchange for a $45,000 licensing fee that the Kansas Lottery paid directly to the Kansas City Chiefs, the state lottery commission printed 630,000 tickets, priced at $5 each, and offers more than $2 million in prizes. The game began July 31 and had generated $1.3 million in retail sales as of mid-January.

    The Georgia Lottery and Atlanta Falcons celebrated their fifth annual scratch-off, printing 5.4 million tickets and generating more than $27 million in sales through mid-January. As it did in 2012, the team received a $250,000 licensing fee in 2013.

    The Louisiana Lottery Corp. renewed its annual sponsorship agreement last May with the New Orleans Saints and issued its fifth consecutive Saints-themed game before the 2013 season. The lure of second-chance prizes has become a high-profile marketing tool for Louisiana, as it has for most of the other state commissions. Customers who failed to win instantly in Louisiana, for example, could enter their losing tickets for a chance to win merchandise, game-day experiences and season tickets.

    The NHL jointly approved, with the NHL Players’ Association, a series of tickets in Slovakia featuring Tomas Kopecky, Zdeno Chara, Andrej Meszaros and Marian Gaborik, current NHL players from that country. That game launched in January.

    MLB has licensed 16 Red Sox instant games throughout New England, with New Hampshire and Massachusetts each in discussions to issue one this spring.

    Print | Tags: In-Depth, Marketing and Sponsorship
Video Powered By - Castfire CMS Powered By - Sitecore

Report a Bug