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Volume 21 No. 2

Leagues and Governing Bodies

NBA teams, seeing the push for lucrative jersey advertising shelved, are getting two new areas inside their arenas as sources of revenue starting next season: on the court and atop the backboards.

League officials have approved teams selling on-court advertising for the high-profile space in front of team benches as well as the camera-visible areas on top of the backboards.

The courtside space had been limited to club brands.
A league source said no specific valuation has been assigned to the new sales areas, but multiyear, multimillion-dollar deals are expected, with teams signing package deals that would provide an advertiser with visibility in both places. One team executive said the deals could range anywhere from mid-six figures to around $2 million annually, acknowledging that the value of the signage will vary widely by market.

Until now, the league had mandated that these areas be limited to team branding.

The deals would be sold locally, but any corporate branding of the areas would be removed during national TV broadcasts; the floor advertising would be via decals. Similar to rotational signage at the scorer’s table, the league controls certain inventory for national broadcasts, and these new areas would fall into that realm — though no leaguewide sales efforts for the space are immediately planned.

Teams will use next season as a trial for the new inventory. Multiyear deals can be signed, but those deals would be subject to review after the 2013-14 season if the league wants to make any changes to the program after seeing its results in the coming season.

NBA officials would not comment on the sales opportunities, but sources said that when the subject of the new sales inventory was raised at the April league presidents meeting in New York, it found quick support among league officials.

“This will be a tremendous opportunity for our teams,” said Alex Martins, chief executive officer of the Orlando Magic. “This platform to grow inventory of camera-visible signage will allow us all to continue to grow our business for our teams and players. I applaud the league for opening up this opportunity for our teams and our clients.”

This new courtside signage opportunity serves as the latest effort by the league to give teams more in-arena sales inventory. Many teams already include on-floor signage, toward center court, as part of their arena naming-rights deals, but officials close to the league feel the new signage will not clutter up the court.

“The location of [the new signage] is elegant in that it will get a lot of exposure without cluttering the court itself,” a league source said. “It is a very pure local issue.”

NBA teams this season had new local sales opportunities, as well. About 15 teams sold new LED signage on their basket stanchions, an area that previously had been unavailable to them for sales. Additionally, a few teams — Boston, Cleveland and Minnesota among them — reconfigured their scorer’s table to allow for more courtside rotational signage.

“It is hard to say what the value will be,” Martins said of the new areas for sales. “It should be sold as part of a big sponsorship package, and that is the way we would sell it. To me, it needs to be part of a premier-level type sponsorship because of the great value of exposure.”

Coming from the depths of the controversial and sudden cancellation of last year’s ING New York City Marathon in the wake of Hurricane Sandy, some would say there was really nowhere to go but up for event organizers the New York Road Runners. Accordingly, about 60 business partners at last week’s NYRR Partner Forum for the 2013 marathon were reminded time and again how last year’s events, when the race was canceled just two days before it was scheduled to be run, combined with the tragic bombing at the Boston Marathon this spring have produced an unprecedented focus on the NYC Marathon’s renaissance.

So as those partners who gathered at the Parker Meridien hotel were frequently told, that means this year’s marathon will be even more notable than usual.

“Without question, last year was tough,’’ said Peter Ciaccia, NYRR executive vice president, event development and broadcast production. “Then came Boston.”

“It sounds horrible,” said a marketer involved in ING’s original deal to title sponsor the marathon, “but the tragedy at Boston has unquestionably elevated the sport to something that now gets more attention outside of the world of runners.”

Consequently, after its most trying year, the NYRR must take advantage of an opportunity that will be unique. “This is a once-in-a-lifetime opportunity,” said Ronnie Tucker, vice president of marketing for the group. “We know the world will be watching.’’

The marathon, perhaps the most cause-related major sports event this side of the Olympics, is looking to increase its focus on charity. With so many runners tithing their marathon efforts to charitable fundraising, around $25 million was raised during the 2011 marathon. NYRR officials spoke confidently about doubling that to $50 million within a few years. “That social mission, and the fact that we’re a participatory sport, has always made our events different, and we know we’re leaning more in that direction,” said Mike Capiraso, NYRR executive vice president of administration, operations and strategy.

Wittenberg said NYRR has been humbled, encouraged by response from marathon participants.
It’s also notable that the NYRR recently added Michael Rodgers as vice president of development and philanthropy, a title we doubt you’ll find at the NFL.

NYRR Chief Executive Officer Mary Wittenberg described the organization as “greatly humbled, but at the same time encouraged” by responses that show 60 percent of runners declining a refund of their entry fees from last year’s aborted race in favor of entering in a future race — for which they will have to pay an additional fee. “I never again want to say that the New York City Marathon is ‘returning’ [after a cancellation], but it’s a heck of an opportunity,” Wittenberg said.

As for lessons learned from last year’s cancellation?
“New York City’s DNA has always been about rebounding and resilience,” Wittenberg said. “But it turned out, that was a moment to pause. As we learned, what’s different about a hurricane is that things get worse afterwards. If we’d had that perspective from the beginning, we wouldn’t have talked about holding the race.”

TITLETOWN: After a decade, this is the last year for ING as the race’s title sponsor. Following last year’s problems, one might think that title sponsorship sales would be a slow process, but we’re told by multiple sources that is not the case.

Wittenberg said confidently there will be a new title sponsor secured by race time, though that new deal won’t take effect until 2014. She added that Rob Prazmark’s 21 Marketing was brought on as a sales consultant to the group before former ESPN executive John Gassner was hired earlier this year to lead business development and strategic partnerships.

Prazmark said he advised the NYRR to charge at the top of the market, because “there just aren’t many global opportunities for global brands.”

Neither Wittenberg, Gassner nor Prazmark would reveal pricing, but other sources familiar with the title negotiations said assertively that NYRR will get eight figures [$10 million-plus] a year, with one adding that “People are buying wholeheartedly into the marathon comeback story and they want to be a part of that.”

We’re hearing there is considerable interest from the luxury car category, which has had its own renaissance, and from a number of health care concerns. Outside of the title sponsorship, the NYRR is looking for partners in the telecommunications/technology, pharmaceutical companies and other health care categories. “We’re working to have big events in every borough through the year and giving partners year-round reasons to work with us,” Gassner said.

MAKING IT SECURE: As one might expect after the bombing in Boston, event security has taken on newfound importance. The NYRR’s official line was that security has forever been a paramount concern. “It has always been top of mind,” Wittenberg said. However, after Boston, things can never be the same when it comes to the near-impossible task of making a race through all of New York City’s boroughs completely secure.

“We’ve been awfully busy since Boston [April 15],” acknowledged Jim Heim, NYRR vice president of event development and operations. “There’s a bit of a new normal out there that we are working through.”

Wittenberg said that even in the NYRR’s smaller races since Boston it has been spending around $10,000 to $15,000 more per race on security. For the prime, Nov. 3 event, she estimated security expenses will increase by at least 20 percent.

RUNNING ADS: BBDO, New York, has quietly been selected as the creative agency for this year’s marathon. “We were looking for some new thinking because of our feeling this is a unique opportunity; we have to get it right,” Tucker said. “From the beginning, BBDO showed a lot of passion for the marathon.”

While reluctant to discuss the specifics of this year’s campaign, which won’t break until fall, Tucker shared some highlights from online polling research, conducted in May by Turnkey Sports & Entertainment. Runners and fans revealed a high level of anticipation for the 2013 marathon. Focus-group research showed the same sorts of findings — and showed runners did not want to dwell on last year’s cancellation.

“They all told us to be forward-thinking and not remind them of the past,” Tucker said. Accordingly, two campaigns linked to last year’s cancellation and centered on messages of resiliency and perseverance were shelved. “[People said] ‘Take me forward, not back,’” Tucker said.

BBDO’s multimedia campaign will launch the last week of September.