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Volume 21 No. 2

Marketing and Sponsorship

In what might be described as the ultimate “up sell,” the Powershares QQQ exchange-traded fund is increasing its support of the Champions Series tennis tour from an event sponsorship in Chicago to title sponsorship of the entire 12-city tour of players over the age of 30, beginning in 2012.

An average of 5,000 to 7,000 came out to see Andre Agassi and others on the U.S. tour.
“They were very excited about their Chicago event [on Oct. 20], so we were talking to them about [sponsoring] other cities as a way to expand their visibility and things just snowballed,’’ said four-time Grand Slam men’s singles champion Jim Courier, who along with former SFX executive Jon Venison owns and operates the six-year-old tour through their InsideOut Sports & Entertainment company. “They just got revved up with what they were doing locally and saw there was an opportunity nationally, especially with our TV package.”

Courier described the package as a seven-figure deal annually.

With their three-year title sponsorship, Powershares QQQ gets net-post, player-chair and umpire-chair signage at each event, along with tickets, hospitality, player access and four ad units in each two-hour weekly telecast of the tour on Fox Sports Net. Those are taped broadcasts that begin after the tour’s last stop, which is Saturday, and run for 12 weeks.

The association with the Champions Series, which includes Courier competing with the likes of Andre Agassi, Pete Sampras and John McEnroe, is the first major sports marketing platform for Powershares QQQ, although its parent Invesco had naming rights to the Denver Broncos’ home field until recently, when Sports Authority took over the deal.

Outback Steakhouse was the tour’s last title sponsor, from 2007 to 2009.

The Champions Series U.S. tour includes 12 one-day stops. Courier said that while scaling host venues for only their lower bowl, the tour was drawing between 5,000 and 7,000 per night “which is excellent for us,” he said. “We are very happy with that.”

Veteran sports marketer Chris Lencheski has been named president of Front Row Marketing Services, the Comcast-Spectacor venue marketing, premium ticket sales and analytics company.

Lencheski’s 20-plus years in the business include experience in sales, event management, media and motorsports. Most recently, he ran the agency Phoenicia Sport and Entertainment, and before that he was owner of the Central Hockey League’s Quad City Mallards hockey team, as well as founder and CEO of the sports marketing firm Ski & Co.

“We’ve got a nice business with a great infrastructure,” said Comcast-Spectacor President Peter Luukko. “Chris is a rainmaker who can help lead us to the next level with great contacts on the client side, and experience outside of North America. If you look at our history, we grow much more than we acquire, and we see Chris as someone who will continue that growth.”

Lencheski fills the slot left open by Dick Sherwood, who founded Front Row in 1998 and sold it to Comcast-Spectacor in 2001. Sherwood retired in July 2010.

Front Row sells naming rights, advertising/sponsorships, concession product rights, premium seating and hospitality elements. Other than selling for venues tied to Comcast-Spectacor properties, about 30 percent of Front Row’s approximately $38 million in annual revenue is from outside clients. Its current niche is in secondary markets and the college space.

Front Row claims to have more seats under its aegis than AEG, but for it to challenge AEG, it will need to land major market deals and expand its overseas capabilities.

However, since Comcast-Spectacor parent Comcast now owns NBC, and with it the rights to the next four Olympics, the opportunity for global expansion is apparent. Global Spectrum, Comcast-Spectacor’s facility management firm, manages the Singapore Sports Hub complex and Zayed Stadium in Abu Dhabi, while it looks for other opportunities in the United Arab Emirates. Elsewhere, Global Spectrum Europe, a partnership with England-based NEC Group, signed a deal in March to manage a new arena under development in France.

“When you look at the connections this company has around the world, that’s really what got me excited — whether it is building management, TV programming, cable TV or Internet. There’s so many possibilities and not many companies have this kind of firepower,” Lencheski said.

Staff writer Don Muret contributed to this report.

Luukko identified Front Row’s analytics business as an area ripe for growth, along with the collegiate market. Front Row sells for the Colonial Athletic Association, Indiana University of Pennsylvania, Saint Cloud State and Drexel.

In 1998, when the Beanie Baby craze was at its height, MLB offered a bear as a gate premium at its All-Star Game. The fervor surrounding the limited edition “Glory Bear” was so ardent that fans exiting Denver’s Coors Field that night were accosted by men thrusting multiple hundred-dollar bills at them, seeking to buy the treasured collectible. Published reports had the bears resold outside the stadium for $500 apiece.

The rise and swift fall of various Beanie Baby sports premiums — last week, a “Glory Bear” was listed on eBay for as little as 99 cents — was the last time sports merchandisers got overly enthusiastic about stuffed animals. But now, they are excited again, as the sports-licensed Pillow Pets, a new plush offering, are this season’s “it” item.

Like so many licensing hits, Pillow Pets is a deceptively simple idea that has become a rage. Jennifer Telfer, a San Diego mother, saw her son using a stuffed animal as a pillow, inspiring her to create a plush and cuddly puppy in 2003 that flattens out to become a pillow when a strap is unfastened. Buoyed by a direct-response TV campaign with a jingle that drove home the point that “It’s a pillow, it’s a pet,’’ sales exploded. After $300,000 in first-year revenue, Telfer’s CJ Products sold $3 million worth of Pillow Pets in 2008, $7 million in 2009 and more than $300 million last year.

Assuming, conservatively, that just the ones purchased over that period sold for $10 each wholesale (many were sold direct-to-consumer), that’s more than 30 million generic Pillow Pets sold before any sports licenses were attached.

With that kind of lead-in, sports-licensed Pillow Pets have been easily able to corroborate a licensing maxim that says any hit gift or novelty item will eventually end up at retail adorned with a sports logo.

A tribute to the widespread success of the original Pillow Pets is that officials from Manhattan-based licensee Fabrique Innovations first saw them at a trade show for hardware retailers. Rationalizing that the only bigger passion for sports fans than their teams is their children, Fabrique owner Sy Garfinkel immediately saw the possibilities in a Pillow Pet using sports logos and team mascots, and reached a deal with CJ Products to obtain the rights to license the products to sports brands.

Fabrique’s first retail test at Wal-Mart stores in Alabama, Arkansas and Oklahoma confirmed his initial enthusiasm: 1,500 pieces sold out in 48 hours.

The race to fill orders began, and it hasn’t stopped.

“We knew there’d be demand because of how many had been out there,’’ said Garfinkel, surrounded by licensed Pillow Pets at his Garment District showroom. “Look at any game, and it’s the father and son watching together. We’re just tapping into that connection.’’
No one is suggesting that Fabrique has the next Beanie Baby, but it does appear to be this year’s hit. The company is tight-lipped when it comes to sales specifics, but Garfinkel acknowledges selling “multiple, multiple’’ millions of licensed Pillow Pets so far this year.

MLB-licensed versions were first to market in April, and more than a million have been sold since then, causing Fabrique to increase original production plans for 2011 by tenfold, according to MLB officials. Even so, Garfinkel says sales of MLB Pillow Pets will finish far behind those of NFL and college versions, which hit retail in late summer. The NFL saw enough potential that a child hugging a Pillow Pet appears in a current TV ad (see photo) showcasing the breadth of its licensed offerings. IMG’s Collegiate Licensing Co. already counts Fabrique as its third-biggest licensee behind perennial top dog EA Sports and Wilson, which sells the most endemic of products: an NCAA-embossed football that does not carry school logos.

The NFL featured team-branded Pillow Pets in a TV ad about its licensed products.
As for pricing, generic Pillow Pets sell for $15 to $20 compared with the licensed Pillow Pets price points of $25 to $30, giving an indication of how much a sports license adds to an item’s price. Even so, the licensed versions are sold at an attractive price point for a gift, and while kids are the primary target, Pillow Pets have an appeal that cuts across ages. Consequently, they’re being sold across a remarkable variety of retailers, including Wal-Mart, Walgreens, Modell’s, QVC and Hobby Lobby.

“It’s not just plush; it’s plush with a schtick,’’ said MLB licensing chief Howard Smith, when asked to explain Pillow Pets’ success. “With any hit, it is always tough to say exactly what nerve they are hitting, but as a licensor, you want to offer fans anything tied in to what’s popular, and this is a prime example.”

There’s also the utility that made Pillow Pets a hit in the first place.

“It’s simple,’’ explained Bryan Swallow, vice president of marketing and sales at online retailer, “Adults like them because they’re a connection to their favorite team. Kids need pillows for car rides, nap time or whatever, so they won’t be dropped in the toy chest and forgotten.’’

Brian Jennings, NHL executive vice president of marketing, said that while NHL-licensed Pillow Pets have only been sold since August, they’re already in the top three of sales of among league-licensed nonapparel items. Jennings compared the licensing success around Pillow Pets to other licensed phenomena, like Crocs and bobbleheads. “They hit a great combination of the right emotional chord and the correct price point,’’ he said. “Their universal appeal is impressive and they run the gamut as far as multiple channels of distribution.”

Also working in favor of licensed Pillow Pets is the quality of the product, generally acknowledged as an improvement upon the generic versions, along with Fabrique’s industry expertise. Last year, Fabrique handled the first licensed sports versions of Snuggies, another TV-fueled hit that turned out to be the ideal preparation for a company that began selling licensed fabric but more recently has turned to selling finished goods.

“After Snuggies, Fabrique understands how to identify an opportunity and really come after it,” said Dave Kirkpatrick, vice president of nonapparel marketing at Collegiate Licensing Co., which has licensed more than 50 schools for Pillow Pets. “It’s a strong product, shipped on time, and we’re looking for really big holiday sales.”

As with any licensing hit, whether it’s Crocs or Silly Bandz (last year’s one-trick pony), the question of sustainability is paramount.

Fabrique has a number of extensions in the works for next year, including mini Pillow Pets and a plush piece that reverses from a ball of the type used in the sport to a team mascot.

“It’ll be strong through the holiday, and then we’ll see where it settles,” said FootballFanatics’ Swallow.

Garfinkel sees Pillow Pets eventually becoming a staple item.

“Every hit goes this way and that way,” he said, gesturing left and right, before pointing downwards. “Hopefully, it doesn’t go that way too soon.”

In her first structural change since she was named president of Soccer United Marketing, Kathy Carter has shifted the company’s business development operations under the wing of David Wright, SUM’s vice president of partnership marketing.

The move was sparked by the departure of the company’s former vice president of business development, Michael Gandler, who joined IMG College in April.

“I needed somebody who could oversee the commercial space and Dave has done a great job with partnerships, so it made sense to expand his role,” said Carter, who was named SUM president last December. “He’s been our lead guy with renewals, so we added the new business piece to his responsibilities.”

Wright, who joined Major League Soccer in 2000, will now hold the title of vice president of global sponsorships. In addition to the 11 employees in SUM’s partnership marketing division, Wright will oversee the five-member business development team. The business development staff was bolstered in July with the addition of Mark Foxton, who stepped into Gandler’s former position after leaving Madison Square Garden, where he was vice president of marketing for the New York Rangers.

A source familiar with SUM said its success during the last half-decade in bringing new corporate partners to MLS, the U.S. national teams and the Mexican national teams has shifted the company’s focus from developing new partnerships to renewing existing ones. In the last 10 months SUM has renewed MLS partnerships with Panasonic, Visa, Makita, Pepsi, NAPA Auto Parts, Starwood Hotels, Continental Tire and Anheuser-Busch, and signed new deals with Bimbo bakeries, Allstate Insurance, Jeld-Wen windows and doors and El Jimador Tequila.

Carter acknowledged that partnership renewals have grown in importance, but said the new broadcast partnership between MLS and NBC and Univision has created opportunities for new business.

“We’ve done well, but you’re never sold out,” Carter said. “Our philosophy is you either evolve or you are stale.”

Doug Quinn, former president of SUM, said Wright’s background in business and soccer, both as a coach and player, make him a natural fit to oversee partnerships. Wright’s new position, Quinn said, will be similar to the one held by Carter before she stepped into the role of president.

“The structure remains the same, it’s just that the players are rising up,” Quinn said. “Kathy needs to be freed up to be more involved with the strategic parts of the business and not bogged down with the day-to-day stuff.”

Betty Noonan, head of marketing for Panasonic North America, said Wright’s knowledge of the business goals of SUM’s partners has helped him manage the company’s sponsorships. Panasonic recently renewed its partnership with MLS and added the U.S. national team to its soccer portfolio.

“During the negotiations he steadfastly stuck to our goal of getting Panasonic products into stadiums,” Noonan said. “He understands what Panasonic needs to sell.”

Terry Lefton
Geico is close to completing a renewal of its NHL sponsorship for an additional three years. The Berkshire Hathaway subsidiary has been a league sponsor since the 2010 Winter Classic in Boston and has inserted its caveman spokescharacters into NHL-themed advertising.

The deal includes digital inventory on and TV units on NBC and Versus/NBC Sports Network, which this season will televise 100 regular-season games, up from 64 last year, and the entire Stanley Cup playoffs nationally.

Geico, a voracious media buyer that usually spends well in excess of its market share, also supports the league’s jewel events like the Winter Classic, and ties in locally with sponsorship/media deals across 20 NHL teams. Horizon Media’s Scout Sports & Entertainment negotiated the league deal.

With the season under way, sources tell us the renewals for incumbent NHL sponsors Bell Canada, Discover, McDonald’s, Verizon and Visa are also close. Without commenting directly on the pending renewals, Keith Wachtel, the NHL’s senior vice president of corporate sales and marketing, said things were “moving well in that area,” adding that new categories being targeted include autos in Canada (Honda has U.S. rights), along with spirits, men’s grooming, and pharmaceuticals.

IS EVERYTHING UP TO DATE IN K.C.?: Absent a sports championship since the Wiz won the MLS title in 2000, Kansas City gets few shots at the national sports limelight outside of a NASCAR race or two and the occasional Chiefs NFL playoff game. Next year’s MLB All-Star Game is another chance — and will be just the third time Kansas City has hosted the game. That calls for a new sales approach, right?

“It’s about selling more nationally or at least regionally,” said Mike Bucek, Royals vice president of marketing and business development. “We may be the No. 31 or 32 DMA but we draw from the region, and when you roll up Topeka, Wichita and other nearby markets, you’re talking about 6.5 million people. Then people get a lot more intrigued, so it’s important for us to sell that way.”

While Bucek says there’s not a lot more inventory being added to take advantage of the All-Star Game, the club is taking a look at naming rights. Wasserman Media Group has been retained for what Bucek called an analysis assignment. However, marketers at other Kansas City sports properties say Wasserman is also actively selling naming rights. No comment from Wasserman on this.

Whatever the case is, Bucek said a corporate name on the 38-year-old Ewing M. Kauffman Stadium, which opened as Royals Stadium but was renamed for the Royals’ original owner shortly before his death in 1993, is no slam dunk. As it stands, Kauffman Stadium is the last American League ballpark named after a person.

“We haven’t settled on it and we know Ewing Kauffman is beloved, so it would have to be a brand that was a good match, a deal that made sense monetarily, and not just some company that wants to plaster signs with their name on it all over a stadium our fans love,” Bucek said.

Kansas City has been a challenging market for naming rights. Sprint put its name on a new downtown arena in 2004, but the Chiefs have been unable to sell the name to Arrowhead Stadium, and MLS’s Sporting KC opted for a cause-related tie that resulted in the name Livestrong Sporting Park.

COMINGS & GOINGS: Renie Anderson has been promoted to vice president of business development, sponsorship and media sales at the NFL after six years with the league, most recently as director of business development. League officials had been looking for an outsider to head new business, but “we looked around the marketplace and didn’t find anyone that measured up to her, so we’re building a team around her,” said Keith Turner, NFL senior vice president of media sales and sponsorship. He added that Anderson, a former Arena Football League sponsorship saleswoman, was instrumental in landing a number of new league sponsors, including USAA, Castrol and Marriott. Additional categories being targeted include airlines, rental car, technology and timing, Turner said. … Elizabeth Scott joins Lincoln Center as chief media and digital officer, a new position, after 12 years with MLB Properties, most recently as vice president of programming and business affairs.

Terry Lefton can be reached at

Six months after announcing plans to turn the X Games into an integrated, six-stop global property, ESPN is preparing to go to market with an exclusive, worldwide sponsorship package that covers all of its action sports events.

The deals will give sponsors a suite of assets that includes TV, digital and print advertising elements as well as the potential for branded content development. The sales effort will begin in late October, and executives at ESPN are still determining sponsorship prices.

Brazilian skateboarder Pedro Barros won a gold medal at the 2010 X Games in Los Angeles.
ESPN’s sales force has identified 14 categories and is looking to secure six to eight sponsors in areas ranging from technology to quick-service restaurant, and beverage to credit card services. Those deals will be complemented by local deals sold by either ESPN’s sales team or the local organizing committee that hosts international X Games events.

The sales structure mirrors the one the International Olympic Committee developed 25 years ago to support the Olympics. The organization sells 10 to 12 worldwide sponsorships in its The Olympic Partner (TOP) program and complements those deals with local sponsorships in select categories sold by organizers of specific Olympics, like the 2012 London Organizing Committee.

ESPN executives are in the process of reviewing 29 bids from 20 cities interested in hosting X Games events. Final bids are due by Jan. 2, and ESPN plans to sign three-year agreements with three cities early next year as X Games summer and winter hosts alongside Los Angeles, Aspen, Colo., and Tignes, France. The new events will join Los Angeles, Aspen and Tignes in 2013, and ESPN is committed to holding six events a year for two years after that.

“We believe there’s a gap in the marketplace for a globally significant, youth-relevant event,” said Scott Guglielmino, senior vice president of programming and X Games for ESPN. “We think that X Games with its history, mainly in the U.S. but also in events around the world like Shanghai, is a great steppingstone to growing this out in a global manner.”

Guglielmino said that the move to convert the X Games into a global property is causing several changes in the way ESPN approaches action sports internally. Historically, the same sales team of 120 people that worked on the NBA, NFL and other properties handled X Games sales and sold the property alongside other ESPN inventory. But the company is hiring a vice president to run X Games sales.

The vice president will report to Eric Johnson, ESPN executive vice president of multimedia sales, but will be a member of a team of senior executives focused on the X Games. Other members of that team include Phil Orlins, coordinating producer; Tori Stevens, vice president of operations for X Games; and Ron Semiao, senior vice president, content development. They will all report to Guglielmino.

“We’re creating a company-wide team at a high, executive level to make sure that as the league and the distributor we’re knocking this out of the park,” Guglielmino said.

Taking X Games global is going to result in other changes to how ESPN approaches the property. Guglielmino said it’s likely that ESPN will move its Web content from to a new, stand-alone website that will be accessible in several languages. He added that the domain name of the site would probably be

The company is considering creating a separate video portal and app for X Games content that would rival WatchESPN. It also is considering adopting a new distribution strategy in some markets that would see it either sell content to broadcast networks or buy time on those networks to further the reach of the property in countries like Brazil and China.

“Everything around the business plan for this involves good content, distribution and revenue,” Johnson said. “We’re going to push the boundaries with this that we’re not normally able to do with an ESPN product because we are the league.”

Tignes, France, will see the X Games return; ESPN is reviewing other bids.
As it goes global, ESPN wants to expand the scope and length of the X Games in each market. It wants to turn each event into a lifestyle festival rather than a sports competition, Guglielmino said. In that vein, it is considering creating a film festival for its Summer X Games stop in Los Angeles, adding live performances with more bands, or hosting a surf competition in Brazil.

The lifestyle elements will vary from market to market and reflect the interests in the regions where the events occur, Guglielmino said. Business terms with local organizers will vary, as well.

The date of the events will be finalized after the bids are selected. ESPN plans to make each event a stand-alone X Games, rather than weave them into a series comparable to the NBC-owned Dew Tour.

Most bids to date have come from local or regional sports marketing companies that partner with a city. Some bidders are offering to pay to acquire local sponsorship rights, which they will sell independently, while others are offering ESPN incentives to host an event in their market and letting ESPN retain rights for local sponsorship sales.

“The bid process is about finding the right partners around the world,” Guglielmino said. “Each event will have the X Games DNA but it will look and feel different. It may have different sports. It may have different music.”

Guglielmino said ESPN’s production team will play on that in their coverage of the various events. The company plans to offer 130 hours of X Games television plus countless hours of digital content, and the idea is to approach it the same way that ESPN approached its coverage of the FIFA World Cup from South Africa, where it wove stories about the history and culture of the country into its shoulder programming around the World Cup.

“Imagine, if you will, let’s just say Brazil,” Guglielmino said. “If we were in Brazil, how cool would it be to pick a couple of athletes — say Bob [Burnquist], Pedro [Barros]. How cool would it be to have them be hosts, to tell you what their sports mean to them? That’s where you can really start to have a lot of fun.”

Guglielmino said there is no hard date for selecting the three global host cities for X Games events in 2013. The bids will be judged based on the market, the size of a group’s financial commitment, the appeal of action sports in the region and other factors. His group has already begun visiting cities and evaluating the criteria of submitted bids.

“We’re trying to do as much of that work as up front as we can, so that we can get out there and announce it as quickly as we can,” Guglielmino said. “That will give everybody more time — the sales side, the staging side, the marketing side.”