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Volume 21 No. 1

Marketing and Sponsorship

The Minnesota Vikings have hired Van Wagner Sports and Entertainment as the sales and marketing agency for the team’s new $975 million stadium in downtown Minneapolis, slated to open in 2016. The project is the first naming-rights assignment for Van Wagner, which launched a team and venue services division in February, with the hiring of veteran naming-rights consultant Jeff Knapple.

In addition to naming rights, Van Wagner will be developing a revenue plan for the stadium.

Image by: HKS
Knapple pioneered the role of the third-party naming-rights sales rep, in which he has more than 20 years of experience. His past sales include Target Center, also in downtown Minneapolis, along with Staples Center in Los Angeles and MetLife Stadium in New Jersey.

“We like the experience Jeff

Jeff Knapple will lead efforts to sell the naming rights for the Vikings new stadium, scheduled to open in 2016.
and Van Wagner bring as far as naming rights and creating a revenue plan,” said Vikings CMO Steve LaCroix, adding that neither Van Wagner nor the Vikings had made any sales presentations yet.

Neither LaCroix nor Knapple would comment on pricing for the naming rights. One source close to the Vikings, however, said the asking price was $10 million to $12 million a year over a 25-year term.

“We want to get farther along in the design of the building before we have a full sales plan,” LaCroix said. “The goal is to create opportunities where potential partners can have a part in designing aspects of their partnerships with the facility.”

Design and technology enhancement are places where Knapple wants to take his nascent Van Wagner unit. So at a time when NFL officials from the commissioner on down are saying that improving the venue experience is the priority, Van Wagner is extending its capabilities beyond sales.

Accordingly, Van Wagner has acquired Venue Research and Design, the consulting practice of Bob Jordan, former MetLife Stadium vice president of design and construction, to serve the burgeoning technical needs of sports venues (see related story). Additionally, Van Wagner has fashioned a joint venture with venue content specialist Big Screen Network, which operates video boards and content for some of the biggest sports events, including the Olympics, Final Four and more than 20 consecutive Super Bowls.

“Fan experience is an area every owner is looking to address now, and we are looking to serve those needs,” said Knapple. “Look at what [parent out-of-home ad sales company] Van Wagner did in Times Square, where advertising became an enhancement. We’re looking to do the same kind of thing in stadiums. We’ll still do sales, of course, and build sponsorship architectures for teams, but we’re getting deeper into the stadium business per se.”

The Vikings in September selected HKS as stadium architect, a firm that also designed Cowboys Stadium in Arlington and Lucas Oil Stadium in Indianapolis. Groundbreaking for the Vikings’ new stadium, being built on the site of what opened in 1982 as the Hubert H. Humphrey Metrodome, is slated for next year. Taxpayers will fund $498 million of the $975 million stadium cost, and the team has already applied to host the 2016 Super Bowl.

While an NFL naming-rights opportunity always attracts interest, as one of the largest and most expensive pieces of sports marketing inventory, those deals have not bounced back to pre-recession levels. CAA is selling naming rights for the San Francisco 49ers’ stadium due to open in 2014, but it has yet to close a deal. Industry sources said that deal is priced at $15 million a year. Cowboys Stadium opened three years ago and still has no corporate name. Outside the NFL, the Miami Marlins opened their futuristic MLB ballpark in April without a corporate name.

Minnesota is also a relatively small market, which has nonetheless supported two naming-rights deals (Target Field, home of the Twins, and the University of Minnesota’s TCF Bank Stadium) and other large pieces of venue sponsorship inventory over the past four years.

“An NFL deal is still very attractive and at some point those naming-rights numbers will have to account for the fact that the NFL’s [TV] rights holders have added a lot of viewers over the past few years,” said Front Row Marketing President Chris Lencheski. “Any NFL naming deal should have a basement of $15 million to $17 million a year.”

Despite an abrupt, four-game sweep and Hurricane Sandy-related supply chain disruptions, the hot market for San Francisco Giants World Series merchandise has drawn essentially even with the one following the club’s 2010 title.

MLB executives and league licensees say the current Giants hot market is comparable to two years ago, when the club won its first World Series since relocating from New York after the 1957 season. The Giants led all 10 MLB playoff teams in sales of caps affixed with postseason logos, despite the presence of dominant brands such as the New York Yankees and St. Louis Cardinals and the arrival of upstarts Baltimore and Washington to October play.

“There were a lot of obstacles on paper sort of against us,” said Howard Smith, MLB senior vice president of licensing. “The sweep, certainly the weather, this being sort of a repeat market, the fact there was basically no time between the end of the NL Championship Series and the start of the [World Series].

VF Majestic trucked gear to Nashville to make its flights.

“But to basically have parity with 2010, what this shows is that San Francisco has developed into a truly top-tier market for us. The fans there have grown very sophisticated. We’re now getting numbers back more or less commensurate with Yankee-type figures.”

The true test of the current Giants merchandise hot market, however, will be its stamina. The 2010 market “just wouldn’t go away and kept going and going,” Smith said. “It was like a cold. But this one’s not done either, and we plan to keep pushing throughout the holidays and into the new year.”

Supplying the rabid San Francisco market with product contained challenges before, during and after the World Series. Game 1 against Detroit on Oct. 24 started a mere 44 hours after the Giants wrapped up the NL pennant against St. Louis. Licensees rush-printed and shipped product after the victory over the Cardinals, some of which was sold straight out of the shipping boxes at AT&T Park during Games 1 and 2 of the World Series.

Then after the World Series victory and the arrival of the storm Oct. 29, apparel licensee VF Majestic trucked gear more than 800 miles from its Easton, Pa., manufacturing plant to Nashville, where it could be safely flown to San Francisco. VF Majestic normally ships gear out of Lehigh Valley, Pa., or Philadelphia, but both of those options, as well as Pittsburgh across the state, quickly vanished as the storm approached and airports closed.

VF Majestic was able to maintain electric power to the manufacturing plant, but more than 70 percent of company employees did not have power to their homes during the initial production run of Giants championship gear.

MLB cap licensee New Era, based in Buffalo, was less affected by Sandy, but similarly rerouted championship merchandise.

San Francisco-area points of purchase were fully stocked in time for the club’s championship parade Oct. 31, even with more labor-intensive, cut-and-sew products such as jackets, sweatshirts and decorated fleece.

“We felt pretty good about being able to serve that championship market in some of the most difficult conditions,” said Jim Pisani, president of the VF Licensed Sports Group.

Terry Lefton
The four-game World Series sweep by the San Francisco Giants provided little in the way of drama, but there was some intriguing off-field news coming out of the Fall Classic. State Farm Insurance is out as an MLB corporate sponsor and title sponsor of the annual Home Run Derby, held the evening before the All-Star Game.

That means MLB heads into the offseason minus a sponsor of six years and with the pressure of having to sell one of its largest sponsorship packages: the ESPN-televised Home Run Derby, which State Farm had titled since 2007. Before that, Century 21 had a seven-year run.

MLB faces both positives and negatives in the hunt for a new Home Run Derby sponsor.
The good news is that the broadcast is always one of the highest cable ratings of the summer — a time when it’s difficult to achieve any kind of ratings success. This year’s Home Run Derby posted a 4.1 rating and 6.9 million viewers on ESPN, up slightly from the prior year’s event.

The bad news for those selling a package that one agency source pegged at an “asking price” of $10 million a year is that both the All-Star Game, to which the Derby is inevitably tied, and the World Series registered historic lows in terms of ratings and total viewers on Fox. We realize the need for perspective here, so let’s add that the audience for the July 10 All-Star Game still allowed Fox to win the night, and that the four-game average World Series numbers of a 7.6 rating and 12.7 million viewers was the most-watched programming for Fox since its May “American Idol” finale.

Still, there’s more distressing news for those selling MLB rights. While sponsorship buys are infamously difficult to compare head to head, State Farm already has voted with its pocketbook, renewing with the NBA for an additional four years while dropping its MLB rights. Multiple sources tell us the insurer will keep its MLB team deals while spending more on the NBA, which offers a younger audience.

“They are doubling down on the NBA,” said a senior marketer familiar with the negotiations. Under its NBA renewal, State Farm, a league sponsor since 2010, will take an ownership position of the NBA draft, continue as presenting sponsor of TNT’s Thursday night NBA package and All-Star Saturday night sponsorship, along with a raft of new social media initiatives.
Offered another involved marketer: “State Farm’s sports spend isn’t dropping at all; in fact, it may be going up. They got a lot out of MLB and the Home Run Derby, but you can make a good case that it has run its course for them. And the MLB Advanced Media exclusivity the deal started with had lapsed, so the value was diminished.”

Given the arms war as far as marketing spend by insurance brands, MLB will continue to mine that category for another Home Run Derby sponsor.

Elsewhere on MLB’s offseason sales agenda is a renewal with Pepsi, which had held baseball marketing rights since 1997. Pepsi’s “Field of Dreams” marketing platform during the past two seasons was some impressive activation, and the longtime nature of the relationship makes us believe that deal will get done. However, management and marketing strategy are anything but focused at Pepsi currently, and the beverage/salty snacks giant spent a fortune renewing its NFL deal. Additionally, while All-Star Game balloting rights were once valuable enough that Pepsi passed them through to Wal-Mart, now they’re not so much.

More than one rights buyer tells us there’s a need for MLB to package more effectively and more effectively demonstrate the value of its offerings, whether by combining its efforts with those of MLBAM or some other new sales ploy.

“Beyond the jewel events themselves, the challenge for MLB is for them to show what they have that is unique, proprietary and so precious that you just have to buy it,” said a source at an agency that has worked on behalf of its clients with MLB for decades.

“As a fan, you know what you like about baseball, but they need some innovation or packaging to communicate what makes baseball a great marketing vehicle. As for the Home Run Derby, it has become like the [NBA] Slam Dunk Contest. You just can’t be sure that year after year the biggest stars will compete. That does not make for an easy sell.”

MLB also is continuing to push for a deal in telecom/wireless, a category in which MLBAM’s overlapping rights render things confusing at best. Accordingly, MLBAM has a number of cell phone brands as sponsors, while MLB Central’s last telecom sponsorship was 14 years ago with MCI, a brand later acquired by WorldCom and, subsequently, Verizon.

> TAKING THE SUBWAY: It’s not often that a car door can swing both ways, but such was the case in Pepsi’s recent re-up with Hendrick Motorsports. With Pepsi’s reduction in its NASCAR spend, conventional thinking was that there now is an opportunity for another brand to firmly align itself with Dale Earnhardt Jr., American motorsports’ most popular driver.

Hendrick’s re-up with Pepsi may have already cost Dale Earnhardt Jr. a new deal.
However, sources tell us the recent Pepsi re-up has already cost Junior one new partner — a $750,000-a-year deal with Subway that one involved source described as being “a few feet from the goal line” was killed at Pepsi’s insistence. Pepsi was well into its negotiations with Hendrick before finding out about Junior’s pending Subway deal and the soda giant did not take kindly to what it considered late notice of a possible conflict. Coke is the primary pour at Subway’s 25,000-plus domestic restaurants.

A lap through a nearby Subway location confirmed another likely pressure point, which had been referenced earlier to us by a marketer involved in the negotiations.

“There’s an awful lot of Frito-Lay product sold in those doors, and you know who owns them,” he said, referring to PepsiCo.
Both sides indicate they are still working on a deal for next season and beyond, but there’s a further complication in Hendrick’s marketing garage: Junior’s people are now looking at a private-label chip deal. That ought to engender even more love from Frito-Lay, eh?

For Subway’s part, it already has a deal with NASCAR star Carl Edwards.

Terry Lefton can be reached at

Editor’s note: This story is revised from the print edition.

Pocono Raceway has hired Comcast-Spectacor’s Front Row Marketing to sell race title sponsorships, sign sponsors and manage sales analytics for the facility’s NASCAR and IndyCar races.

The move is expected to bring an end to Pocono’s practice of forgoing title sponsorships for its marquee NASCAR races. It also gives Front Row its first motorsports facility client.

After selling naming rights to NASCAR races for years to Coca-Cola, Sam Goody’s and others, Pocono’s owner, the late Dr. Joe Mattioli, decided to stop selling them in the mid-1990s. It wasn’t until Sunoco and the Red Cross approached the raceway in 2008 and offered it a cause-related deal — the Sunoco Red Cross Pennsylvania 500 — that the facility began selling them again. It’s had a half-dozen title sponsorships over the last four or five years, according to Pocono Raceway President Brandon Igdalsky.

“My grandfather got rid of entitlements because he got tired of looking at the schedule and seeing four races with the same name,” Igdalsky said. “It lost the identity of what Pocono was. But entitlements are part of the game now, and it’s important to brands and the sponsors around us to have that visibility.”

Front Row President Chris Lencheski said his company will concentrate on finding race sponsors and facility sponsors who are new to motorsports.

“Brandon and his team know the sponsors in the garage,” Lencheski said. “They don’t need our help with that. We’re talking to people that aren’t involved in the sport — a lot of folks who may know the NASCAR story, but they don’t necessarily know the Pocono story.”

Pocono will continue to work with FullCircle Ventures, which it hired earlier this year to represent it for corporate sponsorship sales.

Front Row, which will be its primary agency of record, will be on a retainer.