Ticketing tools pay off for NBA teams The Lefton Report: Women’s cocktail hour Churchill pops cork on winner’s circle Covergirl activating for NFL draft UFC fighters' share of Reebok deal Boxing’s grand new stage Subway serves up soccer strategy Boxing's next bankable star China-based Hisense finds home in NASCAR #MyPlayoffsMoment to engage hockey fans
Upcoming Conferences and Events
SBJ/Feb. 10-16, 2014/In Depth
Marketers bet on growth in gaming deals
Published February 10, 2014, Page 18
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.
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.