The Super Bowl’s Hidden Pay-Offs

For a city, hosting the Super Bowl can be a bigger win than a victory on the field.

The biggest sporting event in the country spurs business for local hotels, restaurants, and other establishments; but the New York Giants and Jets are hoping it could do a little bit more.

Winning the Super Bowl bid could boost interest in naming the New Meadowlands Stadium. (Image via Syracuse.com)

The two teams entered a bid to host the 2014 Super Bowl at their new $1.7 billion stadium.  As the New York Post reports, “if the sales pitch is successful– and many observers believe it will be — the teams would suddenly have a nice carrot to dangle in front of corporate sponsors.”

The carrot trick just worked for the Miami Dolphins, who used the Super Bowl to lure Sun Life Financial into paying a $5 million annual fee for the naming rights to Miami Dolphins Stadium.  So it is likely to work for the New York teams.

“There is no question that if they are awarded the duties, it enhances their chances of getting a naming-rights deal,” Kevin Adler, president of Engage Marketing, told the New York Post.

The two NFL teams initially expected to receive a $30 million, 20-year naming-rights deal for its News Meadowlands Stadium.  But with the recession, they have not been able to find a sponsor to pick up the reduced $20 million price tag.

If the Jets and Giants do win the Super Bowl bid, sponsors will be crawling over each other for a chance to get naming rights for the stadium.  During the 2010 Super Bowl, Sun Life Financial received more than $26 million in media value.

With The Exception of Tiger Woods, Sponsorships Remain A Good Business

Tiger Woods and his sponsors have had a rough few months, but as a whole, the sports sponsorship market did considerably well last year.

Gatorade dropped Woods, but overall sports sponsorships are strong (image via tigerwoodsaccident.com)

While Nike and EA Games have stood by Woods’ side throughout his drawn out ordeal, Gatorade, Accenture, and AT&T dropped their sponsorship deals with the number one golfer.

But according to The World Sponsorship Monitor Annual Review,  sports sponsorships remained relatively stable between 2008 and 2009, Sports Business reports.

The report states that athletic sponsorship deals are still the most popular, accounting for 88% of all endorsements.

Including McDonald’s recent deal with LeBron James,  sports sponsorships actually rose 15% in 2009 compared to 2008.

And despite the Woods fatalities, the number of dropped endorsements remained the same at 8%, according to Sports Business.

Taking into account the decline in advertising due to the recession, these numbers indicate a strong market that could surge in the next few years.

For athletes looking to supplement their athletic endeavors with extra income and for corporations seeking to build their brand to a broader base, this speaks well for the future.

Sun Life Wins Big at Super Bowl

Super Bowl XLIV was a big hit for Sun Life (http://bit.ly/bDFajm)

These year’s Super Bowl ads were weak – at best. Each company paid over $3 million for a 30-second spot and then floundered when it came to creative execution.

For most advertisers the $3 million was a wasted investment that won’t lead to good returns.  But one corporation got it right.

Sun Life Financial recently paid a $5 million annual fee for the naming rights to Miami Dolphins Stadium. The deal was made just before the stadium played host to the Pro Bowl and Super Bowl XLIV, and is already paying off, Media Week reports.

With a slew of “verbal mentions, on-screen text and stadium signage,” Sun Life received more than $26 million in media value, according to FrontRow Analytics.  The deal, which encompasses everything from stadium signage to logo promotion, is expected to last for at least five years.

Olympics: A Full-Time Side Job

Shaun White, one of few Olympians to hold endorsements (http://bit.ly/cuKt66)

The recession has assaulted the sports world, affecting everything from ticket sales to advertising deals.

Endorsements were hit particularly hard, and no one felt this more than Olympic athletes.  The shortage of deals has resulted in an increasing number of Olympians picking up side jobs to keep their dreams alive.

Olympic freestyle skier Shannon Bahrke, for example, started her own company, Silver Bean Coffee, to stave off a forced retirement.

Bahrke told the Miami Herald:

We used to get a lot of money through our equipment and apparel companies, but now we’re lucky to get a pair of skis.  I’ve been on the ski team for 12 years and this was the first season I had to invest my own money in the sport. It was either pay my own expenses or retire.

Unfortunately, Bahrke’s story is the norm for Winter Olympians.  With the exception of snowboarder Shaun White and speedskater Apolo Anton Ohno, Olympic athletes have been absent from TV commercials and print advertisements this year.

Peyton Takes Over Tiger’s Role

Peyton Manning voted the next Tiger Woods (http://bit.ly/5mtlEG)

Here are two sports business posts I wrote today over at Business Insider:

Peyton Manning Is The New Tiger Woods

With Tiger Woods still in hiding and dealing with his sex addiction, Peyton Manning is stepping up to be the country’s favorite athlete. Read More…

Fox, ESPN, Time Warner Wrestling NBC For Olympics Rights

NBC will lose its decade-long stronghold on rights to the Olympics if Fox and ESPN get their way.  Read More …

Check them out!

National Championships Move to High School Level

March Madness and the Bowl Championship Series are two huge industries with serious fans and serious money.  So why not take the national championship action to the high school level?

With the help of IMG, a Pennsylvania-based high school coaches’ association is working on it.

This high school team could be coming to a TV near you (http://bit.ly/b2N8LJ)

From the USAToday:

The venture comes as the National Federation of State High School Associations, the umbrella organization for state high school governing bodies, gives its first serious consideration to the establishment of sanctioned national championships. More than half the state associations signaled their interest in exploring the issue during the NFHS’ winter convention in San Francisco earlier this month, and its eight-person board of directors could deliver a recommendation in April.

At first glance, this appears to be a win for everyone.

According to Steve Wieberg’s article, “IMG starting high school national championships,” IMG is expecting these games to be nationally televised and picked up by big-name sponsors.

If they are right, IMG will be able to show off its 350-acre Bradenton, Fla. athletic facility, high school athletes will have more exposure to college and professional recruiters, and sports fans will have more games to watch.

Here’s how it would work, according to Wieberg:

The national high school federation is weighing national championships at the end of each sport’s traditional season. Qualifying high school teams would advance from their respective states.

The board is looking at the feasibility in a limited number of non-team sports — golf, tennis, perhaps cross country— as soon as the end of the next school year, with the promise of expanding the menu to all sports but football (which has too long of a season already).

But not everyone’s too hyped about it.  There are obvious drawbacks.  Most importantly: the fact that football will be absent. Who – besides the athletes’ parents – is going to tune in to watch high school cross country or golf?

No one!

And of course there is also the missed school, increased pressure to perform, and excessive monetization of student sports.

“How much longer is it,” said Dan Lebowitz, executive director of Northeastern University’s Center for the Study of Sport in Society, to the USAToday “before we’re at the middle school level?”

Lebowitz brings up a good point.  I guess we’ll just have to wait and see.

EA Games One of Few to Stick with Woods

In my last post of 2009, I argued that Tiger Woods’ sponsors and true fans would not abandon him because of his “transgressions.”

Luckily, I included this disclaimer: unless – that is – his personal life starts affecting his professional life, because only two of his sponsors have faithfully stood by him.

If Woods had immediately hit the course, he would have reminded his fans – and his sponsors – why he was their favorite in the first place: the guy can golf.

But Woods is M.I.A. and the majority of his sponsors responded by ditching him.  As I said in my last post, this is a bad move because Woods will be back.  And when he is, corporations will be lining up to sign deals.

EA Sports' Tiger Woods PGA Tour 11 to be released in June (http://tinyurl.com/yjtsn2r)

Nike and EA Sports seem to be the only original sponsors who will still be with Woods when he decides to step back onto the course.  Since the golfer’s Thanksgiving accident, the two brands have continued their sponsorship deals.  EA Sports is continuing its plans to release its Tiger Woods PGA Tour 11 in June.

EA Sports president Peter Moore recently talked to USA Today about the company’s decision to stick with the Tiger Woods brand, as well as the impact of Tiger’s absence on the PGA:

Tiger the golfer is what this is all about and we recognize some of the personal challenges he is having right now because he is very important to us. He is the world’s greatest golfer of this current era. He is (the Associated Press’) greatest athlete of the decade. We stand by him for everything he has done to build our franchise. And this latest announcement both of the new console games, Tiger Woods PGA Tour 11, which we announced in conjunction with our open beta of Tiger Woods Online, which is a strategic imperative for the company not just EA Sports — it all comes under the brand of Tiger Woods and we continue to stand by him as the world’s greatest golfer.

The video game’s release will be the first true gauge of Woods’ fan appeal.  If the game lives up to previous tours’ sales, fellow sponsors will likely lighten up, and – hopefully – Woods will hit the course.



NASCAR Turning Green

“Going green” is one of the most popular trends in the country, and NASCAR is racing to catch up.

As the professional sport with the largest ecological footprint in America, the racing community is modifying certain technologies and procedures to transform into a cleaner and greener system.

NASCAR attempts to be more environmentally friendly (http://tinyurl.com/yg3fwzn)

According to an article in USAToday, the “federal government has begun prodding the racing industry to become leaders in efficiency.” For example, “the Department of Energy says it would prefer NASCAR change the gas to a bio-based fuel.”

So what is the industry, its teams, and its racetracks doing?

• By 2011, NASCAR hopes to have replaced all of its carburetors with a more efficient fuel injection
• NASCAR teams are exploring the use of alternative fuels
• God of  Green, Al Gore, advised NASCAR on how to reduce the carbon footprint of tracks across the country
• Racetracks are planting trees to offset carbon emissions
• Solar farms are also sprouting up at racetracks, in order to power air-conditioned suites (http://tinyurl.com/ycg4cs3)

While all of these efforts are admirable, they are (of course) not purely altruistic.  In contrast, NASCAR only stands to gain.  By actively participating in these measures, the professional racing industry is positioning itself as a leader in the revolutionizing of automobile technologies – and an attractive partner for green sponsors.

Take NASCAR sponsor Carfax, for example.  Rather than plastering their name on a panel of a racetrack or on the hood of a car, the source of vehicle history reports decided to put their money to good use: they “made an environmental donation to offset more than 4,200 tons of emissions for Nationwide Series race at Michigan International Speedway.”  Not only does this type of sponsorship tap into the coveted loyal NASCAR fans, but it also seeps into the green community in a noticeable and powerful way.

Record Sponsors for NBA International Games

A record number of sponsors will join the National Basketball Association overseas this preseason for its international games.

The five professional basketball games will be played across Europe, Asia, and Mexico this fall, giving worldwide sponsors access to a comparatively untapped fan base.

adidas: Official Sponsor of NBA International Games (http://tinyurl.com/y8dxpyx)

“The event experiences — being able to touch and feel our product — are among the most valuable things we offer sponsors, and overseas partners are realizing how valuable that can be in reaching specific audiences,” said Emilo Collins, NBA Senior BP/International Development & Partnerships in today’s Sports Business Daily.

Three global brands are taking advantage of the NBA presence on all three continents – adidas, Coke, and EA Sports – while the majority of corporate partners are geographically tailoring their overseas sponsorship.  These partners include popular companies such as Hewlett-Packard, American Airlines, and Toyota, said Terry Lefton in his article linked above.

Sponsors such as these have been committed to the NBA as it tries to raise its brand awareness and increase its fan base overseas.  The preseason games are a part of the NBA’s increased efforts to take their game around the world –  which they attempted by hosting more than 345 international events in 158 cities and 24 countries since the start of the 2008-2009 season, according to NBA.com.

As professional basketball sweeps across countries such as China, Spain, and Taiwan, transforming fans into consumers as they go, more and more global brands will be sure to jump on for the ride.  This will be especially true as revenues from advertising in the United States continue on a downward trend.

“Like us, the NBA recognizes that there are many ways to communicate with people and that the landscape is changing every day,” said John Hackett, senior vice president, Marketing, Coca-Cola North America in a Coke press release.  “Our relationship offers the freedom to anticipate and adapt to new opportunities so that we are always on the leading edge.”

Tiger Woods first Athlete to Earn $1 Billion

Woods became the first athlete to earn $1 billion after receiving a $10 million bonus for winning the 2009 FedEx Cup this weekend.

According to Forbes.com, the golf star has earned his record-breaking billion not only in prize money, but also in endorsements, appearance fees, and the creation of three courses under his golf course design business, Tiger Woods Design.  These courses, located in North Carolina, Dubai, and Mexico, are a source of $10 million each.

Though substantial, the income from his design pales in comparison to that of Woods’ endorsements.  Since stepping onto the golf scene more than 13 years ago, he has entered into more than a dozen sponsorship deals that have brought in tens of millions of dollars for both the athlete and his corporate partners.

Woods receives $30 million a year from Nike for being the face of their golf brand, which now earns more than $80 million annually.  The golf superstar is also in agreements with AT&T, Gatorade, EA Games, and Gillete -  to name a few.

Woods Leads Endorsement Pack (http://tinyurl.com/yhryq4k)

Since 2002 Woods has been the highest paid athlete in the world, passing six-figure income earners like retired basketball player Michael Jordan and German Formula One racer Michael Schumacher.  

The global star power and fandom of these two athletes shows the magnitude of Woods and his commercial prowess. 

“The most stunning part is that Woods is 33 years old – he might have 15 years of competitive golf left in him, and 30-plus years of designing courses.  This is only the first billion for Woods,” said Kurt Badenhausen in Sports’ First Billion-Dollar Man.