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Volume 21 No. 1

Events and Attractions

USA Cycling, the sport’s national governing body, and the Louisville (Ky.) Sports Commission have collectively contributed a mid-six-figure payment to save the Feb. 2-3 UCI Cyclocross World Championships race in Louisville.

A sponsorship issue had threatened the UCI Cyclocross World Championships. The sport combines bikes, mud and obstacles.
The event, which has a budget of approximately $2 million, was dealt a nearly fatal blow when presenting sponsor Exergy Development Group skipped payments and had its contract terminated.

“When we realized there was a funding gap and the UCI was knocking on the door, we agreed to backstop the event,” said Micah Rice, vice president of national events for USA Cycling.

Cyclocross is a non-Olympic event in which participants race bicycles on dirt tracks and navigate barriers and other obstacles on foot. In Europe, the sport supports a multimillion-dollar racing series with tens of thousands of spectators. In the U.S., the sport is smaller and largely participant-driven.

In 2010, U.S. promoters Joan Hanscom and Bruce Fina won a bid to host the 2013 World Championships in Louisville from the sport’s international body, the UCI (Union Cycliste Internationale). It was the first time in the 63-year history of the event that the UCI had chosen a non-European venue. The two promoters began selling sponsorships in 2010. Hanscom said sponsorship outside of the bike industry was slow to materialize.
“When you see cyclocross, you get it,” Hanscom said. “It’s never been televised in the U.S. so we were selling an unknown commodity.”

In 2011, Hanscom sold a presenting sponsorship worth $400,000 to Idaho-based renewable energy company Exergy. Exergy sponsors other major U.S. cycling properties, including the USA Pro Cycling Challenge, the Exergy Women’s Tour and its own pro team. But in January 2012, Exergy missed its first payment of $100,000. By November, Hanscom terminated the contract after the company had paid only $50,000 of its total obligation.

In August, the Associated Press reported that Exergy owed $37.9 million to a wind turbine vendor. That month CEO James Carkulis admitted he was late on payment for the Exergy Women’s Tour. In November the company cut sponsorship of its pro team.
Carkulis did not respond to requests for comment for this story.

With sponsorship cash running short and Exergy missing its payments, Hanscom and Fina also missed an undisclosed number of payments to the UCI. According to Rice, USA Cycling stepped in and negotiated with the UCI to relax the payment schedule. It also negotiated TV rights, contributed a mid-six-figure payment and helped with sponsorship sales.

“It’s no longer an issue of losing the event,” Rice said. “It’s now about making it run smoothly.”

Currently the race’s sponsors include Sierra Nevada, WD-40 and Greenware food packaging, among others. Activation includes dasherboard signage along the course, space in the expo and TV spots, depending on the packages, which range from mid-five to low six figures. It also has sold 35 smaller sponsorships for spots in the event’s expo.

While the race’s TV package is not finalized, a source said it had purchased two one-hour spots on NBC Sports Network for tape-delayed airing on Feb. 2 and 3. The race also will be shown live during prime time in Europe.

Fred Dreier is a writer in New York.

Delta Air Lines and Brand USA, an arm of the U.S. Tourism Board, are in as sponsors of the World Baseball Classic, which resumes in March and concludes March 17-19 at AT&T Park in San Francisco. Sponsor assets include venue and virtual signage, along with media on MLB Network, the exclusive English-language television outlet for the WBC.

The Giants’ Pablo Sandoval, a Fan Cave visitor, is set to play for Venezuela in the Classic.
Meanwhile, MLB is using the third edition of the WBC as a platform to launch a global version of its two-year-old Fan Cave in Greenwich Village. One fan from each of 16 participating WBC countries will participate, with those selected being eliminated as their countries are. MLB will move a version of the Fan Cave to San Francisco for the semis and finals.

MLB is soliciting video and written submissions for the “Cave Dweller” positions between now and Jan. 11. Thirty-nine games will be played in seven venues in four nations and territories from March 2 through March 19.

“We’ve had a lot of success generating content and tying into social media with our Fan Cave, so a World Baseball Classic edition was the next logical step,” said Tim Brosnan, MLB executive vice president of business.

Delta had been used as a WBC travel provider previously, but this is its first time with sponsorship rights for the WBC, won by Japan in its first two iterations in 2006 and 2009.

With foreign tourism down in the U.S. since 9/11, Brand USA is looking to leverage the power of baseball, especially in Asia, to promote visits to the U.S. For the WBC, overall sponsorship revenue is “as robust, if not more so, than the first two tournaments,” Brosnan said. And with countries like Brazil, China and Japan in the WBC field, “we’ll look for some good sponsorship growth from outside the U.S.”

Despite a drop in its TV rating and far from Chamber of Commerce weather, the 2012 MLS Cup was deemed by league executives to be a successful live event in this first year of its new format.

For the first time in the league’s 17-year history, the finalist with the best record hosted the championship game instead of having a predetermined, neutral site. The result for the Dec. 1 final was Los Angeles hosting Houston at the Galaxy’s Home Depot Center, with more than 30,000 fans, including hundreds of MLS executives and partners, in attendance.

“The new format is here to stay,” said David Wright, MLS senior vice president of global sponsorship. “The atmosphere was incredible. I thought the ultimate proof was when everyone was still in the stadium long after the match was over.”

That was the case even though, except for a brief burst of sun during the match’s first half, there was a steady, soft rain throughout the league’s three days of events in Los Angeles.

Rainy weather didn’t dampen spirits onsite at the Home Depot Center for this year’s MLS Cup.
Wright could point to other evidence, as well: the sellout crowd, even after adding 3,000 temporary seats to meet the demand; the packed suites, with guests including the NBA’s Kobe Bryant and actor Gerard Butler; the more than 400 credentials issued to the media; and the hearty activation by many of the league’s corporate partners. Among the sponsors at the league’s Soccer Celebration pregame activation space were Volkswagen, Quaker Oats, Castrol, Budweiser, Makita, National Guard, Continental Tire, Quaker and El Jimador.

“We felt this year’s Cup was a much richer experience than the previous neutral-site games,” said David Pekush, senior product manager for EA Sports Soccer, who made the trip from the company’s Vancouver office. “The home crowd made a huge difference, and from what we could see, there were a lot of casual MLS fans there, too. That worked for us. We find that if we can get ‘FIFA 13’ in a casual fan’s hands, they become a convert to our game and pro soccer.”

After the match, an ebullient Tim Leiweke, president and CEO of AEG, which owns both the Galaxy and Dynamo, said the newfangled MLS Cup will be a springboard for the league as it heads into the three-month offseason.

“Today was a perfect example of where this sport and MLS are headed,” Leiweke said. “It has unlimited potential. We’re going to get better. We’re going to grow the league. We’re going to add franchises. We have a lot of momentum.”

BOARD MEETING: The league convened a board of governors meeting the day before the title game. Commissioner Don Garber long has discouraged team owners and executives from detailing specifics of board meetings, but Portland Timbers owner Merritt Paulson said he could discuss the league’s top objective for 2013.

“There’s going to be a commitment to a higher standard of play,” Paulson said. “There will be an influx of players, perhaps a few on the marquee level, but also the acquisition of a core of younger impact players, along with enhanced development of our players. MLS understands that the game is everything. As our quality improves, as I expect it will quickly, we’re going to generate enormous interest.”

AEG KEEPING DYNAMO: Leiweke said after the championship match that the company plans to retain ownership of the Dynamo. At the urging of the league — which would like to see the end of entities owning multiple MLS clubs — AEG attempted this year to sell the Dynamo to Houston Rockets owner Les Alexander. The desired sale fell through, though, and now Leiweke seems adamant about moving on.

“We did what the league asked us to, which was to consider diversification,” Leiweke said. “But we feel no obligation now. I’m proud of the Dynamo and what we have at [one-year-old] BBVA Compass Stadium. We’re not going to sell that team.”
Did MLS tell Leiweke that it understands AEG’s position?

“Yeah,” Leiweke said. “We tried to do the right thing for the league, but it didn’t work out. They ought to leave us alone now.”

RATINGS REPORT: The TV rating for this year’s MLS Cup, broadcast by ESPN, was a dispiriting 0.5, down from a 0.6 a year ago. Last year’s MLS Cup, also a Houston vs. Los Angeles matchup, was on ESPN in prime time on a Sunday night. This year’s game not only was on a Saturday afternoon, but it also was up against the Alabama-Georgia SEC football championship game. Still, league executives were hoping for far more than the estimated 797,000 viewers who tuned in for this year’s title game, which also was the Galaxy finale for international icon David Beckham.

ESPN’s John Skipper (center) with studio host Max Bretos (left) and SVP Scott Guglielmino
Garber acknowledged before the game that the league’s biggest need for overall improvement was in attracting more viewers on television. “We’re up, but it’s not enough,” he said.

The ESPN/ESPN2 average of 311,000 viewers a game this season was up 8 percent from the nets’ average in 2007, the year Beckham entered MLS.

ESPN President John Skipper attended the match and visited with Garber, among others. Garber also on Saturday had a 20-minute meeting with David Nathanson, general manager of Fox Soccer, after an earlier Saturday appearance by the commissioner on the network’s English Premier League pregame coverage. Nathanson declined to comment on the meeting.

The good news came in Spanish: On TeleFutura, MLS Cup delivered 485,000 viewers, a 58 percent jump from 2011.

Jimmy Nielsen (left) and Tony Meola (right) took a photo with a fan at the Allstate tent.
SCENE AND HEARD: While strolling through Soccer Celebration, Univision vice president of sports sales marketing Rick Resnick said he was glad he made the trip from New York for the game. “We had an opportunity this weekend to connect with several potential new sponsors of our soccer portfolio,” Resnick said. “Any time there’s a big soccer event, you want to be there. It’s been worthwhile.” Among Univision’s many soccer properties is the 2014 World Cup in Brazil. … Also at Soccer Celebration, many sponsors used all-stars not in the championship match to sign autographs and lure fans to their promotional tents. D.C. United’s Chris Pontius signed for Xbox, while Sporting Kansas City’s Jimmy Nielsen and former U.S. men’s national team goalkeeper Tony Meola signed for Allstate. San Jose’s Chris Wondolowski, the league’s 2012 MVP, took part in a public question-and-answer session for Volkswagen. Wright said MLS has at least three key sponsorship categories it would like to fill in 2013: airline, technology and banking. … While in L.A., Garber met with Gerard Houllier, head of global soccer for Red Bull, in part to address the recent comments from newly installed New York Red Bulls general manager Jerome de Bontin, who was less than positive about a second MLS franchise in the New York area. A site in Queens is under review. Garber said Houllier and his organization were on board with MLS’s plans for a team in Queens. “Gerard very much believes that rivalries are a real driver of fan passion and marketing success,” Garber said. The commissioner added that if a deal for a second team in New York isn’t made, the league would consider markets such as Miami, Orlando, Atlanta and Minneapolis.

Looking to grab some equity from the 2013 NBA All-Star Game being in its home Houston market, Reliant Energy has signed on as a sponsor.

As the largest energy provider in the country’s most competitive energy market, Reliant will support the NBA Jam Session, along with a 5K race and community outreach programs, including participation in the All-Star Day of Service on Friday, Feb. 15.

Reliant will team up with the league around the All-Star Jam Session fan fest, being held at the George R. Brown Convention Center. Reliant’s assets under the deal include tickets for the Jam Session, which will be opened an hour early for Reliant customers on Feb. 15. Reliant will have hospitality around other All-Star Weekend events.

“There are 65 energy companies in Texas and not many have the resources for this,” said Reliant CMO Karen Jones. “We’ve had our deal with the Houston Rockets, so this is a way to tap into that greater NBA affinity and use it as a way to build customers’ affinity and loyalty. You have this big event coming to town and we just wanted to attach ourselves.”

IMG, now agency of record for Reliant, helped negotiate the deal and will activate against it.

Reliant’s sports sponsorship portfolio also includes naming rights to the home of the Houston Texans, a partnership with the Texas Rangers, and NFL team deals with every club in the NFC East, along with the New England Patriots, New York Jets and San Francisco 49ers.

The Reliant one-off marks the league’s first deal with an energy company. Jones said the deal started at last year’s CES in Las Vegas where she had a chance meeting with IMG Consulting chief David Abrutyn and Mark Tatum, NBA executive vice president of global marketing partnerships.

Will this grow into a larger league deal? “They’ve already tried to sell us that, of course,” Jones said. “So to some extent, this is a test drive.”