SBJ/August 7-13, 2017/Opinion

A new look at outsourcing your marketing rights

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The first notable instance of a professional sports organization providing sponsorship sales and consulting services to a college athletic program occurred in 2001 when Fenway Sports Group agreed to represent Boston College and assume control of the marketing rights related to athletics. Now named Fenway Sports Management (FSM), this group specializes in sponsorship sales, consulting and special events representing some of the most storied properties and brands in sports including the Red Sox, Liverpool FC and LeBron James. This long-standing partnership enabled Boston College to tap into FSM’s experience and network while also presenting unique opportunities to showcase BC athletics via high-profile football and hockey games at iconic Fenway Park. According to a managing director at FSM, “Our experience representing properties of this caliber, coupled with our network of connections within the sponsorship community, particularly in Boston, enables us to strategically connect BC athletics with brands looking to engage its passionate network of alumni and fans in New England and across the country.”

Speed forward 16 years and on April 17 of this year, the University of South Florida announced that it had reached a 10-year agreement for Tampa Bay Entertainment Properties LLC (TBEP) to have full control of their marketing rights for athletics. TBEP was formed in Tampa by Tampa Bay Lightning owner Jeff Vinik in 2017, as a firm specializing in partnership sales, consulting, marketing and operations with a focus on creating world-class experiences. The significance of the move is that for the most part it makes collegiate athletics a local/regional opportunity buy with some national partnership opportunities — represented by a seller who is not only experienced, but heavily connected locally and regionally with an enviable track record of success. The partnership grants TBEP the exclusive rights to all commercial multimedia sports marketing, sponsorship and respective inventory possessed by the athletic department. (Note: The author, a faculty member at USF, has advised on this project but is not compensated nor does he directly benefit from this agreement, and Lightning owner Jeff Vinik supports the USF sport business program and the USF medical school).

Boston College has tapped into Fenway Sports Management’s expertise.
Photo by: GETTY IMAGES


So, exactly what does that mean? When viewing the combined assets and opportunities, it offers a variety of possibilities that could be significantly lucrative for both parties:

Offers a 12-month platform for sponsorship activation and exposure.
Provides a much more experienced and larger group of sellers for athletic assets.
Offers increased compensation opportunities as well as career advancement opportunities for current TBEP staff.
Provides a guaranteed revenue stream for athletics and incentivizes a partnership relationship that could grow the revenue even higher.

USF Athletic Director Mark Harlan describes the partnership as a “unique opportunity to partner with an organization that has been recognized nationwide as one of the best in sports and to utilize their leadership, creativity and relationships to continue to elevate USF athletics.”

In a similar vein, Steve Griggs, president and CEO of both the Tampa Bay Lightning and TBEP, describes the new relationship as “a perfect partnership that allows us to expand our existing relationship with USF and help grow the USF brand while selling and activating future partners and existing partners in an exciting new space.”

While I have been excited abut this possible relationship for some time, I have always focused my attention on the national implications of similar opportunities. First of all, when it comes to college athletics, I have always been a proponent of outsourcing for several reasons:

College athletic programs usually lack adequately trained personnel and lack the number of trained personnel to effectively sell tickets and property assets and marketing rights.
College athletic programs are not equipped to offer sales incentives such as commissions and bonuses to achieve sales and revenue goals.
Outsourcing marketing rights first pioneered by Jim Host has become the norm and athletics departments have become very comfortable accepting guaranteed payment for their marketing rights and focusing their staff and efforts in other areas — primarily development.

That being said, the larger sport marketing agencies are very successful leveraging athletic programs in the power five conferences and somewhat less so at colleges and universities below that — the financial incentives and opportunities aren’t the same. Therefore this model of a local/regional approach might be very enticing to other professional sport organizations looking to expand their impact and revenue streams. In fact, the size of the market and the schools in those markets might be very compatible to organizations in MiLB, the NBA G League, the AHL and several others.

For example, Elon College, a member of the Southern Conference located in North Carolina, is a non-power five school with a wide rage of athletic programs and facilities. Located nearby in Burlington, N.C., are the Burlington Royals, a Class A rookie league team owned by Miles Wolff that has been in the market for more than 30 years. This team has experienced ticket sellers and sponsorship sellers and existing relationships in both areas that could be solicited for similar related sales opportunities related to Elon athletics. The sales team has plenty of time to take on projects in the offseason, and the opportunity to make additional compensation would be very attractive to them and at the same time could act as a significant incentive to retain talent for the Burlington Royals.

While this scenario is purely fiction, at least at this point, the opportunities and implications are obvious, and the message is crystal clear: Concentrate on what you do best, and seek help and expertise for your weaknesses. It would require a significant investment by collegiate institutions to hire an adequate sales team and build the sales infrastructure necessary to generate the revenue that could be provided by outsourcing ticket sales, sponsorship sales or both. I’m sure most athletic directors and college presidents could find much better ways to allocate those funds. Outsourcing is here to stay — the question that remains is what type of outsourcing can best assist college athletic departments to grow their revenue.

Bill Sutton (wsutton1@usf.edu) is the founding director of the sport and entertainment business management MBA at the University of South Florida and principal of Bill Sutton & Associates. Follow him on Twitter @Sutton_ImpactU.

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