Money can win a company the right to put its name on a stadium. But a lot can be lost if the deal is made without considering a variety of PR facets.
As sports fans buy peanuts and Cracker Jacks this summer, corporate sponsors hope they're also in the market for orange juice, airline tickets, computers, ketchup, and office supplies.
Add naming rights to the list of 1990s phenomena now facing scrutiny.
Plastering corporate lo-gos on sports facilities became the norm in the late 90s as finicky teams demanded ever-grander stadiums. Some negotiated deals worth $6 million to $10 million annually. More recently, high-profile bankruptcies left some clubs scrambling for sponsors - the Baltimore Ravens dumped PSINet, and the Tennessee Titans exited a deal with Adelphia Business Solutions.
Fans now accept corporate names, even if they don't always embrace them.
But if businesses, teams, and venues don't look beyond debt payments and pouring rights, they risk making fans feel taken.
"There are too many examples today where companies only think of naming, not of branding, says Peter Wise, GM of Landor Associates in Irvine, CA. Without a strong dose of brand strategy, naming rights equate to little more than logo placement, he says. A smart strategy establishes a venue brand distinct from, but related to those of the team and corporate sponsor.
Although some may view naming rights deals primarily as advertising or marketing transactions, the PR implications are many and varied.
Building brand recognition
Some say naming rights can be the most cost-effective form of marketing communication. The numbers are impressive. Lincoln Financial Group, which just bought rights to the Philadelphia Eagles' under-construction stadium, says that 75% of Americans watch pro football; 10 million to 12 million see an average game; and the Eagles' conference includes teams from four of the US' top eight media markets.
Such exposure obviously is more valuable in building brand recognition than delivering targeted messages, and it can raise a company's profile dramatically.
"Prior to them naming the stadium, if you'd stopped 10 people on the street and asked them who Enron was and what they did, they wouldn't be able to tell you, recalls Rob Matwick, operations and communications SVP for the Houston Astros. Enron CEO Ken Lay helped secure land for a new stadium to keep the Astros from searching for greener turf. Lay not only wanted to position Enron as a major-league player, he saw pro sports as a quality-of-life drawing card to attract employees to Houston, Matwick explains.
The Astros' new corporate partner, Minute Maid, also wants to raise its local profile. Few Houstonians realized the company was based in their backyard until it bought the stadium-naming rights Enron ceded.
The Astros also illustrate one danger of helping boost a corporate partner's profile sky high: If it falls, it falls hard.
"The Astros disassociated themselves pretty quickly and pretty efficiently, praises Dr. Larry McCarthy, a Seton Hall University professor. "If you can't get out of the contract, obviously you should set in motion a PR campaign that says 'We are not involved in this controversy,' McCarthy advises.
Naming-rights deals also can present more garden-variety media relations challenges. New names often receive a lukewarm response from sportswriters, and a few hard-liners won't use them.
Egging on the malcontents is Commercial Alert, fighting the perceived evils of commercialism. The organization asks people to use non-corporate nicknames for arenas. "I think many sportswriters resent acting as lackeys for corporate PR and corporate advertising, says executive director Gary Ruskin.
Commercial Alert's message found sympathetic ears at the Denver Post, which decided not to routinely call the Broncos' new stadium Invesco Field at Mile High because most local residents didn't like putting a corporate name on a facility 75% funded by tax dollars. "In this case, we adopted the language of the public, says former editor Glenn Guzzo.
Denver is more the exception than the rule. Even though reporters often shorten Phoenix' Bank One Ballpark to BOB, for example, the nickname is congenial and not used exclusively.
In Dallas, the LeMaster Group talked up American Airlines Center early and often, beginning when the facility wasn't much more than a pile of dirt. PR operatives sent reporters notebooks printed with the slogan, "Say whatever you like, as long as you get the name right."
Doing the right thing
Research by McCarthy and University of Memphis professor Richard Irwin found community goodwill ranked high on the list of reasons corporations enter naming-rights deals.
Companies often up the ante for stadium projects to attract or retain hometown teams. Expediency in such cases may mean partners don't think enough about whether teams and corporate brands fit together. Those seeking naming-rights partners today say they focus much more on alignment of goals and values.
On that basis, sportswear maker Pro Player may have seemed a perfect fit for the Miami Dolphins. But its subsequent bankruptcy illustrates why venues now pay more attention to the potential partners' fiscal health.
The link between Minute Maid and baseball might be less obvious, as reporters and fans joke about squeeze plays and Harvey Wallbangers, but juice-company execs see synergy. "We are both about healthy life-styles, says Minute Maid's communications VP Dan Schafer. As a part of the 28-year, $170 million-plus deal, Minute Maid will give $100,000 annually to a local youth baseball program.
That kind of team-sponsor community relations builds value in naming-rights deals, and is why most venues look to local companies first. "If you don't activate the naming rights on the local level, then no positive PR things will happen, says Jim Smith, GM of Major League Soccer's Columbus Crew, a team shopping rights for its stadium.
Doing the deal
The most vital consideration in naming a venue is community sentiment, opines Jed Pearsall, president of Precision Research in Newport, RI. "The building is for the community, he says. "That has to be the top priority."
Local sensibilities seemed forgotten by United Distillers and Vintners and SFX/House of Blues in Dallas a couple of years back, when the former Coca-Cola Starplex became the Smirnoff Music Center. The deal irritated local officials who had no say in the process, although the amphitheater sits on city-owned land, and it riled neighbors trying to shed the area's liquor-store-infested image. Now, Smirnoff drops its name when marketing youth-focused concerts.
Experts say it's much easier to put a corporate name on a new facility than an old one. A Performance Research poll found 37% of those surveyed opposed renaming existing stadiums. But in tradition-loving Boston, even putting a corporate name on a new building didn't sit well. "The realization is you can't replace the old Boston Garden, admitted Jim Delaney, director of marketing and PR for Fleet Center.
Clear Channel Entertainment (formerly SFX) has done more naming-rights deals for sports and music venues than anybody, and PR SVP Howard Schacter says it's key to communicate public benefits, usually sponsor-funded facility upgrades. "That must be a component of the announcement, or else it's strictly commercialism, Schacter says.
He also encourages all parties to involve their PR people early. He often gauges a community's likelihood to accept naming rights by discussing the subject hypothetically with music critics.
PR pros discouraged by less-than-enthusiastic responses to stadium names can take heart, says Delaney. Time may heal all wounds, but he thinks positive experiences in a new venue really do the trick. The Fleet Center pursued a "making a house a home strategy in winning over Bruins and Celtics fans. The fact that both teams' win-loss records have improved also didn't hurt.
Boston Globe columnist Dan Shaughnessy stubbornly refused to type the arena's proper name, but finally relented this year. "Whether he slipped or not, who cares? He wrote the words 'Fleet Center,' says a delighted Delaney. "It took us seven years to get there, but we made it."
PR CHECKLIST FOR NAMING RIGHTS
"Hastily pursuing or accepting naming rights fees without comprehensively assessing the situation is a public relations nightmare waiting to happen, Dr. Larry McCarthy and Dr. Richard Irwin wrote in their academic treatise Name in Lights: Corporate purchase of sport facility naming rights.
The professors say deal participants should ask themselves questions such as:
- How will the public react to a corporately named, publicly financed facility?
- How will the corporate identity impact the facility's image?
- What are the implications if the naming-rights holder changes?
- What are the motives/goals of the rights holder and the venue owner?