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Corporations aren't just slapping logos on arena marquees
It's the latest corporate fad. With new stadiums going up faster than quarterbacks' salaries, Corporate America is rushing at a record pace to slap its logos on them. From Nynex Arena in Manchester, England, where the phone company owns cable properties, to GM Place in Vancouver, the rights to arena names now belong to the highest bidder. Even Boston Garden has given way to Fleet Center, courtesy of a Fleet Bank sponsorship.
Why the sports craze? Because for just $1 million or so a year, marketers can buy the chance to reach tens of thousands of consumers at every sports event and concert held, week in and week out. That looks pretty good next to alternatives such as 30 seconds on Seinfeld for $400,000 or a half-minute on the Super Bowl for $1.2 million. Besides, if the hometown team makes it to a championship, marketers can get a national TV audience at no additional cost.
FREEBIES. "Companies are always looking to increase their public exposure, and this is a pretty good way to do it," says Timothy Orchard, a vice-president at stadium manager Ogden Entertainment Services. "The number of impressions is almost unlimited." The free tickets to spread among customers and employees and the chance to show good corporate citizenship don't hurt, either.
Corporations have had their names on stadiums in the past, of course. Anheuser-Busch Cos. owned the St. Louis Cardinals and the arena they play in--Busch Stadium--for more than 40 years before agreeing to sell both last month. But now, there's an explosion of new opportunities, thanks to a boom in stadium-building and renovation. Team owners and cities, pressed to attract fans in the face of mounting competition, have pushed for fancy new digs to house their teams, complete with executive suites that can pull in big profits. The new Fleet Center, for example, will have 104 suites that go for $200,000 annually. That's $20.8 million, split between the team and the center's owners.
The new sponsors are far from shy about exploiting their deals. GM is showing off its new line of cars at GM Place and has set up kiosks that answer product questions. MCI Communications Corp. is planning to wire up its Washington arena with all manner of high-tech communications gadgetry, including video screens at every seat. Fans will be able to watch the hockey action from the point of view of the players, who will have tiny video cameras mounted on their helmets. And 3Com Corp., which now has its name on the old Candlestick Park in San Francisco, has installed eight "Internet Spoken Here" video kiosks equipped with its networking software. Fans can use them to cruise through cyberspace between innings.
Such deals are not without their headaches. New Jersey's Brendan Byrne Arena announced a name change to Continental Airlines Arena just weeks ago and has already being sued by the National Basketball Assn., which claims its right to sell ad space was infringed upon. Last summer, Canadian Airlines International Ltd., which was in the middle of slashing expenses by $125 million, was blasted by the International Association of Machinists after it announced a $400,000-a-year deal over 20 years to put its name on Calgary's Olympic Saddledome. Says union President David Park: "That money should have gone to buying new airplanes." Meanwhile, when 3Com put its name on legendary Candlestick Park, apoplectic fans derided the change as an example of gross commercialism.
THE TAX CARD. That kind of reaction has companies treading carefully. A group of corporations interested in the naming rights to the new Boston Garden commissioned a survey to gauge public sentiment before submitting bids. A fifth of those polled opposed a corporate name for the new arena but softened after learning that the alternative was higher taxes and higher ticket prices. In the end, Shawmut Bank won with a $2 million-a-year, 15-year bid, but then handed the rights to Fleet when it was acquired by Shawmut in March, 1995.
As the lines between business and civic enterprises blur, corporate logos could encroach further. The Walt Disney Co., whose Mighty Ducks hockey team is already named after a Disney movie, made a pitch to put its logo right on the team uniforms, but the National Hockey League nixed the plan. Disney, which didn't want its name on a stadium that could host less-than-wholesome rock concerts, sold the stadium naming rights to a bottled-water company. But why stop at sports arenas? What about the Random House Public Library of the Ronald McDonald Municipal Airport?By Mark Lewyn in WashingtonReturn to top