SBJ/January 9-15, 2017/Marketing and Sponsorship

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  • BodyArmor signs rising star in snowboarder Mastro

    Sports drink BodyArmor has made its first foray into action sports, signing a multiyear deal with teenage snowboarder and U.S. Olympic team hopeful Maddie Mastro.

    Mastro, 16, will be featured on in-store and outdoor advertising in certain mountain West and Northeast markets, and also will anchor experiential promotions, said Michael Fedele, BodyArmor marketing vice president. She debuted her snowboard and helmet stickers in December.

    Maddie Mastro will be on BodyArmor advertising in the West and Northeast.
    Photo by: COURTESY OF BODY ARMOR
    The exact duration and financial terms were not made public, but it extends at least through the 2018 Pyeongchang Olympics. The deal includes performance incentives for making the Olympic team and winning medals for Mastro, who finished third at the season-opening U.S. Revolution Tour in December. It does not include an equity stake.

    The contract is new territory for BodyArmor, which has a blue-chip stable of young star endorsers (some with equity stakes) in basketball, baseball, football and recently golf, but has until now stayed out of Olympic and action sports.

    Action sport’s beverage sponsorships are dominated by energy drink brands Red Bull, Monster and Rock Star, along with PepsiCo’s Mountain Dew soda brand. BodyArmor will promote itself as a healthy alternative to those drinks, Fedele said.

    “When you think about action sports athletes, they’re true competitors and super conscious about what they put into their bodies,” Fedele said. “Everybody notices that energy drinks rule the action sports, but the day of processed foods and energy drinks are gone, and you’ve got these young athletes who are excelling in their sports and are looking for better-for-you options.”

    Mastro’s agent, Tom Yaps at Evolution Management & Marketing, said Mastro liked the deal because she can stand out better than she could with a traditional action beverage. After BodyArmor’s team convinced her they are committed to snowboarding for the long term, she signed. “She and her family are really big San Francisco Giants fans, so Buster Posey being an endorser too certainly didn’t hurt,” Yaps said.

    Yaps helped get BodyArmor a place in the athlete lounge at X Games Aspen later this month, where Monster is the official event sponsor. Mastro expects to compete there and at the Toyota Grand Prix the following week.

    The deal and campaign were both handled internally for BodyArmor.

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  • Courtside Ventures has active first year of dealmaking

    Courtside Ventures, the venture capital fund headlined by Cleveland Cavaliers owner Dan Gilbert, George Pyne’s Bruin Sports Capital and WPP, spent its first year investing in 14 early-stage companies, including LiveLike VR, The Athletic and the Drone Racing League.

    The idea behind the $35 million fund, which launched in January 2016, was to dive deep into the intersection of sports, media and technology, something it did with investments that ranged from $200,000 up to $1.5 million across the 14 businesses. In most cases, the companies were just a year or two old and they were seeking Series A or seed funding. The investments hit across a number of categories, from audio technology to sports content, gaming and virtual reality.

    The Drone Racing League is among 14 investments made by the venture capital fund.
    Photo by: THE ID AGENCY
    “There’s no shortage of companies in this space — innovation is at its highest point,” said Deepen Parikh, a partner at Courtside who along with Vasu Kulkarni runs CV’s day-to-day business. “A lot of them are focused on the in-stadium experience or selling to teams or leagues, but they’re also looking beyond traditional sports.”

    One of Courtside’s investments, LiveLike VR, found its footing quickly in the highly fertile and increasingly competitive virtual reality space. A VR tech platform, LiveLike worked with Fox Sports in 2016 to deliver three college football games, Premier League soccer matches and other events to Android and iOS devices with no headset required. The VR technology makes the broadcasts available in traditional VR as well.

    Courtside Ventures was one of several investors — David Stern and Evolution Media Partners, among the others — that helped LiveLike raise $5 million last year.

    Courtside also made a big bet on a sports website, The Athletic, which has begun operating in Chicago and Toronto. Courtside is the lead investor in The Athletic’s first round of fundraising, which produced a total of $2.3 million from CV along with Advancit Capital, Bertelsmann Digital Media Investors, Luminari Capital and others.

    COURTSIDE VENTURES

    Leadership
    Ownership group: Bruin Sports Capital, Dan Gilbert, WPP
    Non-executive chairman: George Pyne (Bruin Sports Capital)
    Partners: Vasu Kulkarni, Deepen Parikh
    Advisory board: Brian Bedol, Doug Perlman

    First-Year Investments
    The Athletic: Subscription sports content
    Beam: Live streaming platform for eSports
    Drone Racing League: Racing series
    ENSO: Wearable pain relief device for daily use
    GameCo: Video games for real money in casinos
    Kite & Lightning: Virtual reality gaming studio
    Lisnr: Ultrasonic authentication technology
    LiveLike VR: Live streaming virtual reality platform
    Percepto: Computer vision technology for drones
    Rebelmail: Interactive email platform
    StockX: Stock market for physical goods
    Tappp: Prepaid distribution network
    Unmute: Live group calling
    VSporto: Sports podcasts

    The Athletic uses a subscription-based revenue model, charging $5 to $10 per month, rather than advertising. With newspapers cutting back in most markets, The Athletic is looking to fill the void with intense coverage of local sports teams.

    Courtside hopes to see The Athletic expand into five or six new markets in 2017.

    “They’ve proven to us very clearly that people who are hard-core sports fans are willing to pay for quality local content,” Parikh said.

    One of Courtside’s first investments, Beam, a live-streaming platform, has already flipped. Microsoft bought Beam in August.

    “We see several opportunities a week — there’s a tremendous amount of deal flow — so we can be highly selective,” Pyne said. “We’ve already seen a good result with Beam.”

    Another Courtside investment, the Drone Racing League, has enjoyed coverage on ESPN and Sky Sports for its global series. Pilots wearing goggles that provide a view from the drone fly around courses that grant points based on speed and maneuvering through or around certain targets.

    In Courtside’s second year, Parikh said the fund will continue to look for eight to 10 new investment opportunities, while also evaluating deeper investments into businesses with which it already works.

    Courtside continues to work from the $35 million that was originally raised and has not sought additional funding yet.

    “We’re not volume-driven, so much as we’re looking for the right opportunities where we can provide value,” Parikh said. “The main thing is to stay at the forefront of innovation.”

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  • In Phoenix, the youth movement starts in the GM’s office

    At 27, Arizona Coyotes General Manager John Chayka is younger than nine players on his own roster. Some of the NHL’s most senior GMs, like Toronto’s Lou Lamoriello or Nashville’s David Poile, are roughly 2 1/2 times Chayka’s age. But don’t tell him that youth is an impediment when you’re the league’s youngest general manager.

    “GMs like Lou Lamoriello and David Poile, sometimes we’re all still trying to figure each other out,” Chayka said with a chuckle, sitting a level above the ice before a recent Coyotes practice, “but it’s still like we share a common bond.”

    The NHL’s second-youngest GM is a decade older than Chayka. Still, Chayka maintains that youth counters experience.

    “Age is not a weakness for me — I think it’s a help,” said Chayka, who was promoted from assistant GM to GM last April after the Coyotes axed Don Maloney, their GM for nine years. “I’m certainly not biased or jaded by any type of experience. I’m still asking ‘why’ about a lot of things we do, sometimes to the point where people wonder if I have a real answer myself.”

    Arizona Coyotes General Manager John Chayka, 27, is younger than nine players on the Coyotes’ roster.
    Photos by: GETTY IMAGES (2)
    When Coyotes ownership was making the decision to fire Maloney last year, team execs looked at some of the usual suspects as candidates. The name of Chayka, who earned his B.A. in business administration from the University of Western Ontario in 2014, kept coming to the top of the list.

    “Initially, we had the expected reservations about hiring someone of his vintage,” said Gary Drummond, a minority owner of the Coyotes, who became the team’s president
    of hockey operations about a month after Chayka was hired. “He checked every box except experience, which is not a small one, but eventually we decided that not hiring John would impede our growth. And we were convinced that other career opportunities were going to come to a person of his ability. So at the end of day, it was a pretty easy decision.

    “Since then, there hasn’t been any material thing he’s done or said that made me question and think that if he had more experience, he would have done it another way.”

    Along with Drummond’s new role, Coyotes coach Dave Tippett took the additional role of executive vice president of hockey operations, the day after Chayka was named GM.

    An Ontario native, Chayka was a top scorer for a New Brunswick team in Tier II Junior A, and seemed headed for an NCAA hockey scholarship at a minimum before a back injury ended that dream.

    With a hockey playing career no longer viable, Chayka turned to hockey camp, training and video analysis for hockey prospects. Instead of simply compiling and assessing video clips, Chayka quickly understood the real value was in the data provided by the video. He could quantify where players most often touched the puck, what they did and how they did in specific situations and against specific matchups. Once his analytics revealed what players should work on and where they weren’t scoring from, “then we began to get some real buy-in,” he said.

    The customers for Stathletes, founded by Chayka and partner Neil Lane in 2010, quickly changed from NHL prospects to NHL teams, and talent evaluation was added to the company’s mix. As it grew, a dozen NHL teams were customers, and Stathletes was bringing in outside investors, but Chayka wanted to put his reams of analytics to work.

    “As the business got more complex, I just felt that if there was an opportunity to put this stuff into action in a practical way, that’s what I wanted,” he said.

    Chayka joined the Coyotes before the 2015-16 season as assistant GM for analytics, when he was 26.

    Analytics are a buzzword pervading nearly every business, but neither Drummond nor Chayka see it as a panacea. “We’re dealing with human beings,” Chayka said. “How a coach deals with the human side of things is as huge as anything else.”

    Drummond insists that Chayka should not be pigeonholed as an analytics geek. “John has an exceptional mind for analytics,” he said, “but they are just one tool.

    “Another thing that comes naturally to him is relating to the young people on our roster. I’m 60, so it doesn’t matter how much respect I get from an 18-, 19-, or 20-year-old; they are going to relate to John Chayka a whole lot better than to their grandpa,” Drummond said with a laugh. “In that area, among others, he has quite an advantage.”

    At press time, the Coyotes had the fewest victories and one of the worst records in the NHL. So, as is often the case, patience with youth will be paramount.

    “It still feels a bit like a startup, because we’re going through the hardest part now,” Chayka said. “But if we do it right and can find value where others don’t — well, that’s the whole point of a business, isn’t it?”

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

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  • Richmond brings ticket focus home

    Sensing a missed opportunity in its own backyard, Richmond International Raceway has crafted a new sales strategy this year that will see the track reallocate its marketing spend closer to home.

    RIR, one of 12 speedways owned by International Speedway Corp., lists Richmond as its biggest market for ticket sales and Washington, D.C., about 100 miles away, as its second biggest. But the track has focused more efforts on gaining market share in the D.C. region in recent years.

    However, after conducting hundreds of calls with current customers following the 2016 season, and hearing why some fans had become lapsed customers, track executives realized they could benefit by refocusing efforts back to Virginia, where racing has a richer heritage than in more stick-and-ball-centric D.C.

    Richmond International Raceway has recently focused more sales efforts in the D.C. area.
    Photo by: GETTY IMAGES


    “These are folks who, in a matter of a 10-mile car ride or a 30-mile car ride, can get back to the track pretty easily,” said RIR President Dennis Bickmeier.

    RIR has homed in on what it calls its golden triangle, with Fredericksburg being the northern tip, Lynchburg being the western point and Virginia Beach being the eastern point. “If you put a point on the map at Fredericksburg, and you take it over to Lynchburg and then over to Virginia Beach … Richmond sits almost in the center of that triangle,” Bickmeier said. “And we feel like from a strategy standpoint ­— from a lapsed-customer standpoint ­— if we can get some wins in that golden triangle, that’ll help get the turnaround that we want to see in moving tickets for our NASCAR races.”

    Bickmeier said RIR is not abandoning its efforts in D.C. but will make inroads there more so through digital media and an elevated public relations campaign. RIR is working with two agencies, St. John & Partners and PCG SportsDesk Media, for its marketing and branding projects.

    Sparking a turnaround is a key goal for RIR, which opened in 1946 and has been earmarked by ISC for renovations. While attendance figures per track are not released in NASCAR, ISC in its third-quarter 10-Q filing cited RIR’s decreased attendance and admissions last season as factors driving ISC’s admissions declines for the nine months ending Aug. 31. The track, which had a 33-race sellout streak from 1992 to 2008, now has about 59,000 grandstand seats following a number of reductions, and also has 40 suites.

    Another part of RIR’s plan to spark a turnaround is a recently announced booking partnership with AEG Live, which has a wider deal with ISC. RIR executives have taken note of the budding cultural scene in Richmond, with its restaurants, craft breweries and music establishments, and want to leverage that to bring more concerts to the track’s 6,000-seat amphitheater, which has been around for 25 years but has been used sparingly of late. Bickmeier said RIR is eyeing six to eight shows annually for the venue.

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  • PBR expands list of licensees to 25 with addition of seven new partners

    PBR continues to enjoy new connections under its new owner, WME-IMG.
    Photo by: GETTY IMAGES
    Professional Bull Riders has signed seven new licensees heading into 2017, as the bull-riding series continues to enjoy newfound connections under WME-IMG.

    The Colorado-based PBR, which will announce the news this week, signed deals with a range of companies, from bobblehead maker BobbleBoss to man-cave decor maker Open Road Brands. Some of the deals are in categories in which PBR already had a partner, such as with apparel licensee Affliction. Others will become the first in their categories, such as Bullhide Hats, a maker of cowboy hats. Other new brands are emblem maker Aminco USA, life-size poster maker Advanced Graphics, and hat company Outdoor Cap Co.

    The addition of seven licensees takes PBR’s tally to 25 licensees.

    John Sohigian, who became vice president of consumer products at the PBR last year, said the property leveraged its improving television ratings and growing social media following to attract licensees with more ability to scale at a national level.

    “As those things continue to rise and our viewership continues to rise, we’re able to make a case that this is a mainstream sport,” Sohigian said. “From a broad perspective, we want to be in most categories, but we want partners who are established companies that, if they don’t control their space, they’re a major player in that space.”

    Licensee Affliction offers this PBR-branded T-shirt.
    Sohigian cited Affliction as an example.

    “While we had T-shirt licensees, our folks we had were in one particular channel of distribution; one that was in mass, one that was in fashion retail,” he said. “We want to be upstairs, figure out a way to cross over and have a higher-quality good.”

    In addition to the seven new licensees, PBR this week also is announcing renewals with Two Horns Wine and Midwest Glove. Sohigian said now that PBR has a more rounded-out stable of licensees, the next step is to strike deals with more retailers to get the products in stores. He declined to put a maximum number of licensees that PBR would like to have.

    WME-IMG acquired PBR in April 2015 for a reported $100 million.

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  • Saddled with potential demographics problem, equestrian federation rides new rebranding campaign

    Seeing the first warning signs of an aging membership, the U.S. Equestrian Federation is changing its name and launching a rebranding campaign in hopes of shedding its elitist reputation.

    In a strategic overhaul spearheaded by the incoming board president, retired Lorillard Tobacco Co. CEO Murray Kessler, the governing body — now known as U.S. Equestrian — will undertake steps to offer more services for members, create a new $25 fan-only membership tier, and more effectively promote its sports in general.

    The organization will kick off a series of print and digital/social ads with the theme “Discover the joy of horse sports.” Based in Lexington, Ky., U.S. Equestrian fields the Olympic team and manages and governs domestic competitions across 29 disciplines and breeds.

    Kessler, a longtime horse owner and father to 2012 London Olympian Reed Kessler, says he thinks the governing body has ample room for growth by better serving and marketing to existing enthusiasts. The group counts around 80,000 members, but 3 million Americans own horses and 27 million say they ride, according to federation research.

    “This is a CEO’s dream,” Kessler said. “It became clear to me there is an opportunity here, not to get people to love horses — there’s a huge number of people who touch and love horses already — but to convert people who love horses into people who love horse sports, and eventually become a competitor.”

    Equestrian is a relatively obscure Olympic sport in the U.S., but its governing body has one of the American Olympic community’s largest budgets. In the last full year prior to the Rio Games, when it won one silver and two bronze medals, the organization posted a $256,000 surplus on $29.1 million in revenue. But there are signs that membership is starting to age up.

    Kessler was elected board president in June, after he’d begun the strategic review that led to this new campaign. A few months later board member Vicki Lowell resigned to become CMO and lead the work.

    Both said the organization has focused on governance and regulation to the detriment of serving members and growing equestrian sports. One key part of the coming changes is a digital “learning center” on its website, which will start with 30 instructional videos about horse ownership, leasing and riding basics.

    Those will be available to anybody with one of the new $25 fan memberships, which Kessler notes is about one-seventh the cost of a single private riding lesson.

    The print and digital video ads emphasize a lifetime connection to equestrian, from the simple joys of a child learning to ride up to an Olympic medal. While their goal is growing the organization and expanding the grassroots, Lowell said their efforts, if successful, eventually will lead to more medals, too. “By broadening the entry point, we’re going to strengthen the pipeline, by definition,” she said.

    Kessler said they were inspired by the Dutch equestrian team and USA Swimming, both organizations that have excelled at serving all of their constituents, from managing domestic competitions to fielding an elite Olympic team, while also effectively marketing their sport.

    The rebranding had support from agencies Allison & Partners, AFG, Gary Goldsmith, Noelle Floyd, Post Time Production Studios and EQ Sports Net.

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