SBJ/Sept. 1-7, 2014/Marketing and Sponsorship

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  • Busch, Boykin shake up business model with new marketing agency

    Former GMR Marketing executives Greg Busch and Mike Boykin are launching a new sports marketing agency called Bespoke Sports & Entertainment. 

    The agency will be based in Charlotte and look to distinguish itself in a crowded, competitive field by building a small team of experienced executives who will be involved in everything from pitching new clients to servicing their business. 

    Mike Boykin and Greg Busch chose the name Bespoke to signify customized marketing advice.

    In describing it, Busch and Boykin characterized Bespoke’s structure as an upside-down pyramid where there will be more senior staff and few junior employees rather than the typical agency model that features senior staffers who rely on junior and entry-level employees to manage clients. They conceded that structure would reduce profitability but said that it was feasible because the agency is designed to be smaller and less focused on profit margins than its peers. 

    “There is a trend in the marketplace with brands moving away from large agency models toward more service and attention — higher-level counsel,” Busch said. “Brands increasingly want agencies that can provide ideas and concepts, and the agencies that do that have more top-level relationships and deeper relationships, which allows them to remain on the roster if there’s any attrition.”

    In addition to investing their own money in the agency, Busch and Boykin attracted investments from former PepsiCo President John Compton and former Host Communications CEO Gordon Whitener. Compton and Whitener, who declined to share the size of their investments, will serve in advisory roles and have monthly meetings with Busch and Boykin. They’ll also assist with business development. 

    Both Compton and Gordon said they were motivated to invest because of their interest in sports and their knowledge of Busch’s and Boykin’s work at past agencies. 

    “I thought, ‘These are people who remind me of PepsiCo people, they’re going to be doing brand work, and they’re involved in the most important area of marketing, sports and entertainment,’” said Compton, who spent 29 years at PepsiCo and led an agency review at the company before he departed in 2012. 

    Whitener, who said his relationship with Boykin goes back 15 years, added, “I always think you out-people the competition, and I can’t think of two better guys to saddle up with.” 

    Busch and Boykin expect the majority of their work to involve advising brands on sponsorship strategy and assisting them in developing marketing, creative and promotions to support those sponsorships. They anticipate roughly 25 percent of their business will be project-based work consulting for properties interested in evaluating their sales and marketing structure and operations. But the agency will not sell on behalf of properties.  

    They have retained one client but said they couldn’t name it because the work is tied to a product launch. They are pitching for a handful of other pieces of business. 

    “We want the right clients,” Busch said. “We’re not going to take strictly execution work. We’re going to look to be involved in strategy.” 

    In addition to securing client business, they are hiring a senior strategist to assist with operations and someone to assist with administration. They also plan to hire a digital strategist and creative chief. They plan to subcontract execution, digital and other work. They estimated the overall staff could swell to nearly 20 depending on business.

    Bespoke will have to differentiate itself from other sports marketing consultancies. It joins a crowded field of established agencies such as IMG, GMR, CAA, Team Epic, The Marketing Arm and Wasserman Media Group, and a number of smaller independent agencies such as Glideslope and Excel Sports Management. 

    Former IMG Consulting executive David Abrutyn said there’s room for another independent agency but said Bespoke’s success will come down to how well its business model works. 

    “I would never bet against smart, talented people, and both Mike and Greg are good at what they do,” Abrutyn said. “They’ve shown they can build a business. Even thought it’s a tough environment, I would give them a leg up. It will come down to who their clients are and how they differentiate themselves.”

    Busch and Boykin chose the name Bespoke because they want to offer customized marketing advice and thought “bespoke,” which is usually reserved for custom-made clothing, captured that aspiration and also provided “a little intrigue,” according to Busch. 

    “We found you either understood the term and what we wanted to do or didn’t understand it and that immediately led to a discussion of what we wanted to do,” Busch said. 

    The duo has worked together on and off for 20 years. They first met when Busch was head of research and consulting at Joyce Julius and Boykin was with the Charlotte-based agency Morris International. Boykin hired Joyce Julius to do research on behalf of Craftsman brand. 

    They subsequently started an agency called Sports Plus International. Boykin left to join GMR in 1998 and Busch joined him there. Over the course of 15 years, they helped build GMR’s sports practice. They worked with brands ranging from Lowe’s and MillerCoors to Visa and Procter & Gamble on properties ranging from NASCAR and college sports to the NFL and Olympics. 

    Both departed GMR early this year. Their departures followed GMR’s merger with SportsMark. 

    They spent the last five months meeting with agencies and potential investors before deciding that they wanted to launch their own business. They decided they would prefer working together, independently, over joining another agency or existing company. 

    “We’re a good team. Very complementary. We have great debates and great trust and respect,” Boykin said.

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  • Startup water brand uses NFL star power

    While PepsiCo’s Dasani water and Gatorade’s isotonic beverage have NFL marketing rights under the company’s massive league deal, startup bottled water brand Formula Four is hoping the star power of New Orleans Saints coach Sean Payton and other NFL players will help it gain retail distribution and brand awareness.

    The New Orleans Saints’ Sean Payton is among Formula Four’s endorsers.

    Formula Four, a “functional beverage” that positions itself as something that hydrates and is an oxygen supplement, is pushing into the Southeast U.S. with distribution at retailers such as Albertsons and the 548-store Winn-Dixie grocery chain.

    Activated Stabilized Oxygen (ASO) is added to Formula Four in the bottling process. The supplement, consisting of a hybrid oxygen molecule called O4, is proprietary to parent company Glas Water. Product benefit claims range from improved stamina and mental acuity to a better immune system and even a cure for hangovers. It features the tag: “Created by science. Proven by Athletes.” The “oxygenated water” launched in Canada last year, using a handful of NHL personalities, including Wayne Gretzky, as spokesmen.

    In the U.S., Payton, along with the NFL Network’s Michael Irvin and Cincinnati Bengals quarterback AJ McCarron, will appear in point-of-sale and digital/social testimonial ads. Brand CMO Allan Klassen said Formula Four’s endorsers receive a percentage of profits for sales in their home markets. 

    Formula Four is priced at about $2.50 a bottle, more than most waters, but competitive with isotonics such as Gatorade.

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  • Sponsors kicking off activation

    NFL business partners are prepping for this week’s opening kickoff in Seattle.

    Eleven league sponsors will activate at the Thursday night opener, where a concert with Pharrell Williams and Soundgarden precedes the game between defending champion Seattle and Green Bay to start the season. A Game Day Village outside CenturyLink Field will include nine partners.

    Pepsi's Tostitos brand's "Party Challenge"
    Photo by: NFL
    Pepsi’s Tostitos brand, now activating behind the NFL after dropping its 18-year title sponsorship of college football’s Fiesta Bowl, is launching a seasonlong campaign called “Party Challenge.”

    Anheuser-Busch will sponsor both a VIP beer garden at the concert and a post-concert party. The brewer is expected to continue its “Up For Whatever” reality campaign from the last Super Bowl as well.

    Pepsi will push out an “All For Football” campaign via digital, at points-of-sale and with restaurant partners Buffalo Wild Wings and Papa John’s. Its “Get Hyped for Halftime” Super Bowl campaign has been moved to a November launch.

    Tracie Rodburg, group managing director of sponsorship and media sales for the NFL, said she expects as many as 15 football-themed spots from league sponsors to break during the season’s first few weeks.

    The most apparent change among league sponsors this season will come on the sidelines, where branded headsets (from Bose) will return after a two-year absence. In addition, Microsoft will have its Surface tablets on sidelines for the first time.

    League marketers have long dreamed about the amount of support they are getting this season from McDonald’s, which is holding three season-opening promotions, including one tied to the recent launch of the latest “Madden” video game. All of that is before McDonald’s gets behind Pro Bowl balloting for the season.

     
    Microsoft, Bridgestone in the mix for Kickoff; NFL's continuing style push
    Photos by: NFL (2)
    Also new to the sponsorship ranks this year is Nationwide Insurance, which will debut TV ads with Peyton Manning this week.

    After advertising during the 2012 and 2014 Super Bowls, Dannon is now a league sponsor in the heretofore-unexploited yogurt category, but its activation won’t begin until the playoffs.

    Mars is now leveraging against its Skittles brand, while Procter & Gamble will extend its NFL rights to its Braun electric razor brand, with an assist from Seahawks quarterback Russell Wilson.

    “It’s going to be very obvious this season which are the NFL sponsors,” said Renie Anderson, NFL senior vice president of sponsorship and partnership management. “They’re the ones exercising their rights more than ever with integrations, along with player [and] team relationships.”

    As for potential new sponsors, Anderson said the league is continuing to look at financial services, especially banking/wealth management; timing/timepiece; and within the travel category, especially rental cars and airlines.

    In the licensing business, Seattle’s Super Bowl victory last season has propelled the Seahawks in leaguewide sales, with three Seattle players (Wilson, Richard Sherman and Marshawn Lynch) along with a 12th Man jersey among the NFL’s top-25 sellers. Also on that list are rookies Johnny Manziel (ranking first) and Michael Sam (No. 7).

    NFL consumer products chief Leo Kane said he’s looking for solid single-digit growth this season, with the most growth expected among “home gating” and other hard goods, as well as women’s and “tween” apparel, now starting to make a mark in retailers such as Target and Kohl’s.

    There’s also a sideline change worth noting in apparel. Players and coaches will have a choice of New Era’s 39Thirty flexfit cap on the sidelines, along with the traditional fitted 59Fifty.

    New marketing initiatives include an NFL Fan Style truck tour that will carry a 2,000-square-foot consumer products display to 26 cities.

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  • Young sponsorship sellers learn new ways to ‘yes’ at 5 Star

    Some people insist that great salesmen are born, not made. On a sultry June day at Citi Field in Queens, about 50 young sales types from companies ranging from ESPN and the New York Yankees to USA Swimming and the Western Unlimited bull-riding circuit have gathered because they believe the opposite. 

    They, or their organizations, have paid $1,600 for them to attend the two-day 5 Star Sponsorship Academy. So they’re an engaged audience when a leader on the buy side of sponsorship is showing them how they can improve their skills.

    Steve Pamon, who heads sports and entertainment at JPMorgan Chase, tells the young sellers that while the sponsorship proposals piling up in his office always include details on rights and pricing, “what I normally don’t see is a rationale of why I would buy it — what it would do to advance the cause of the bank, and talking points I could use to sell it internally. … Unfortunately, I’m looking for ways not to do your deal, because from an activation perspective, we don’t have enough scale to do the right things by all of our [current] partners.”

    Bill Sutton, Scott O’Neil and Chris Heck, partners in 5 Star Sponsorship Academy
    All photos by: TERRY LFTON / STAFF

    Perhaps to the exclusion of all others, selling is a business of maxims. Everyone knows ABC (“Always Be Closing”) from “Glengarry Glen Ross.” Scott O’Neil, who launched the academy last year between jobs with MSG and his current job as Philadelphia 76ers/New Jersey Devils CEO, makes sure a litany of other sales mottos are indelibly stamped on the audience during the two-day forum. They come from partners Bill Sutton, who heads a consultancy and founded the University of South Florida’s graduate program in sports and entertainment business management, and the 76ers’ chief revenue officer, Chris Heck.

    Among those maxims: 

    Be a storyteller.

    Don’t rush to answer; rush to listen.

    Big ideas win.

    The objective of your first [sales] meeting is getting a second meeting.

    Differentiate yourself and your product.

    Be able to talk to anyone — from the janitor to the CEO.

    Don’t accept “no” from someone who can’t say “yes.”

    Even those selling Girl Scout Cookies know salesmanship is about overcoming objections, so there’s role playing and solutions developed for countering the most routine ways clients say no. 

    “Too expensive? Can I tell you about another company, which made the same objection, and how we increased its sales 10 percent?”

    Sutton: “Without an analytics department, you will be totally lost.”

    “The budget cycle’s over or in the distant future? Are there other budgets still available?”

    “Somebody else needs to approve this? Let me help you sell this inside.”

    “You’ve never spent that much money in sports? Let’s start small and grow.” 

    That advice from Heck comes from testimonials that are drawn from clients that grew their businesses using that approach. 

    It’s a process of “isolating,” or seeking the reason for the “no.” O’Neil counsels that the more you learn about why they say “no,” the closer you’ll be to a deal. 

    “You’ve got to fish for objections, hunt for them,” he says.

    The lessons seem to be having an impact. O’Neil later plays the role of a Yankees sponsor and rabid fan of the team being pitched by Preetam Sen, premium partnerships senior manager at the Barclays Center. 

    “Derek Jeter handed my kid a signed bat,” O’Neil gushes. 

    “The Yankees are a great brand with a great demo for 81 games,” answers Sen, “but we’ve got 200 events a year in a developing market [Brooklyn] that are going on when the Yankees aren’t in season. We just want you to come down and see the arena.”

    (Think back to those mottos: The objective of your first meeting is getting a second meeting.)

    Sen’s peers applaud the counter. Later, he calls the exchange with O’Neil “the best part of the whole experience.”

    Heck offered counters to routine ways that clients say no.

    Based on the stories they’ll tell later, it’s clear that other young sellers have taken their lessons home with them. They’re already figuring out how to make what they learned work in their own individual ways.

    “We work in an industry that can provide unique and memorable experiences, and these ideas can all be easily implemented,” says Sean Moore, manager of business development for the Chicago Bulls, talking a few weeks after the academy. “A great example where we’ve seen success already is making presentations in the locker room.”

    Stressing the value of team selling, Heck counsels the students to tag along on calls with their team’s best sellers — or at least to listen to their phone pitches. O’Neil recalls that MSG’s $500 million sponsorship deal with JPMorgan Chase included no fewer than 35 people.

    Of course, there were plenty of less-successful pitches (both made and received) before that Chase/MSG deal. 

    Among the war stories O’Neil relates is one about an early meeting in which he read a Sony sales executive vice president his entire 40-page pitch. The idea of presenting, rather than reading, is a concept that wasn’t impressed upon him until later (unfortunately for that Sony executive).

    On another sales call, instead of going to EDS, a colleague drove to Ed’s Auto Body. And there they pitched Ed — as he was installing a new windshield.

    Noting that the best sales leads come from their own industry networks, Sutton and the others encourage the group to share and socialize in between sessions, so the connections will endure in a business where there is usually no more than one degree of separation.

    Sales leads can originate anywhere. During a panel discussion on prospecting, Premier Partnerships’ Uzma Rawn reveals that the initial lead that resulted in her selling a $40 million naming-rights deal for the Portland Trail Blazers arena came from a Portland Business Journal story about ODS Health rebranding to Moda Health. Subsequent research revealed that in its annual report, ODS used the word “trailblazer” five times. 

    The sale was a 90-day slam-dunk.

    Danielle Maged, Steve Pamon and Shawn Morrissey described whom to look for as buyers and what buyers look for in proposals.

    Danielle Maged, StubHub’s former global head of business development and partnerships, tells the group to look for new money from “business disrupters,” like Uber and Airbnb. Rawn, and later Matt Soloff of the New York Mets, advise the audience to call top execs — even when pitching blind. 

    “The C-level has to respond quickly, so even if you get knocked down, start at the top,” says Soloff, the Mets’ executive director of corporate sales and partnerships. 

    In a demonstration of conflicting realities, Pamon later advises the sellers to work through his agency, CAA Sports.

    As the two-day event nears its conclusion, having shifted to the Prudential Center in Newark, participants ask where the business is headed. Sutton answers quickly. “Without an analytics department, you will be totally lost,” he says.

    Heck sees fundamental changes coming. 

    “Everything is going to be database marketing,” he tells the group. “The collection of data [we have on our fans] is what we’re going to be selling in five or 10 years. It’s not going to be about TV eyeballs as much as who those eyeballs belong to, how much money they make and where they live. That’s where the business is going, and we have to prepare.”

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

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