Friday, January 30, 2009
Stadium naming rights - PR or goodwill?
I read an article today regarding Citigroup's deal to to have the new Mets baseball stadium named Citi Field. In 2006, they agreed to pay $400 million over 2o years. So I started thinking, is naming rights to a stadium PR or simply goodwill?
I think it depends on the market and the venue; however, in smaller markets I think it's mostly goodwill. Let's take Minneapolis, for example. The Minnesota Twins are building a new stadium, which will be called Target Field. Rumors going around had it between 3M, General Mills and Target. Although, later on there was rumbling of a US Bank & General Mills tandem. Nonetheless, all of these companies are large, Fortune 500 companies. So none of these companies need the publicity. I'm pretty sure most people in Minnesota are aware of these organizations. As it turns out, Target ending up getting the naming rights and will now have Target Field, which is near the Target Center. So what is Target gaining by having their logo plastered atop the new field?
A lot of it has to do with the amount of money that is thrown toward the naming rights. Polaris or Caribou Coffee probably can't afford the money that would be needed, so I understand the economic portion. However, in Target's case, why the additional stadium? Measuring ROI on this is darn near impossible.
Let's take another example here in Minneapolis. The new Gopher stadium will be called TCF Bank Stadium. Is TCF gaining additional market share because their name is on top of the new stadium? Most people in the metro are aware of TCF, so it's not like someone is going to be driving by, see the stadium and say "hey, I think I am going to change to TCF." Again, I think this comes down to Goodwill. Smaller dollar amount required, so take out the major corporations, and bam, you have the new park. Throw in Polaris, throw in Medtronic, throw in SuperValu. All would get the same benefit that TCF is getting - minimal.
Take a look around at the different stadium names (outside of Yankee Stadium, Fenway, Soldier Field, etc) and you'll see that a lot are simple goodwill on behalf of large corporations that have some significance to that particular region.
I think it depends on the market and the venue; however, in smaller markets I think it's mostly goodwill. Let's take Minneapolis, for example. The Minnesota Twins are building a new stadium, which will be called Target Field. Rumors going around had it between 3M, General Mills and Target. Although, later on there was rumbling of a US Bank & General Mills tandem. Nonetheless, all of these companies are large, Fortune 500 companies. So none of these companies need the publicity. I'm pretty sure most people in Minnesota are aware of these organizations. As it turns out, Target ending up getting the naming rights and will now have Target Field, which is near the Target Center. So what is Target gaining by having their logo plastered atop the new field?
A lot of it has to do with the amount of money that is thrown toward the naming rights. Polaris or Caribou Coffee probably can't afford the money that would be needed, so I understand the economic portion. However, in Target's case, why the additional stadium? Measuring ROI on this is darn near impossible.
Let's take another example here in Minneapolis. The new Gopher stadium will be called TCF Bank Stadium. Is TCF gaining additional market share because their name is on top of the new stadium? Most people in the metro are aware of TCF, so it's not like someone is going to be driving by, see the stadium and say "hey, I think I am going to change to TCF." Again, I think this comes down to Goodwill. Smaller dollar amount required, so take out the major corporations, and bam, you have the new park. Throw in Polaris, throw in Medtronic, throw in SuperValu. All would get the same benefit that TCF is getting - minimal.
Take a look around at the different stadium names (outside of Yankee Stadium, Fenway, Soldier Field, etc) and you'll see that a lot are simple goodwill on behalf of large corporations that have some significance to that particular region.
Comments:
<< Home
Agree, not a whole heck of a lot of value in the stadium naming rights game. However, there are a few benefits for companies like Target and TCF. In TCF's case, it really does make good business sense if you ask me. After all, a big chunk of the folks that are going to fill that stadium every Sat. this fall are between the ages of 18-23. That' the prime age for setting up that first checking account. This is where TCF makes their living. That's their key audience. Gotta believe they see it as an opportunity to extend their brand further into this key market.
On the Target side, it's a little fuzzier. Without knowing their exact strategy, I'd probably say it aligns more closely with their community relations strategy than a hardcore marketing strategy (although I'm sure it's a hybrid approach). From a community standpoint, there's a lot to be gained by pasting your name on what is sure to be the best outdoor facility in MN. How many families will attend each Twins game (the Twins seem to be the most family-friendly of the major leagues sports franchises in town)? Isn't that Target's key audience? Seems like a great way for them to reach out into the community and engage one of their key demographics.
But again, like I said, not a ton of value in these sponsorships from an ROI perspective, I'd agree with you on that. Used to work for a professional services firm that sponsored two PGA tour players and a major PGA of America event. Great internal pride builder for the organization, but we really struggled tying the sponsorships back to business results. I'd be very interested to hear how Target, TCF and others measure success in this area.
On the Target side, it's a little fuzzier. Without knowing their exact strategy, I'd probably say it aligns more closely with their community relations strategy than a hardcore marketing strategy (although I'm sure it's a hybrid approach). From a community standpoint, there's a lot to be gained by pasting your name on what is sure to be the best outdoor facility in MN. How many families will attend each Twins game (the Twins seem to be the most family-friendly of the major leagues sports franchises in town)? Isn't that Target's key audience? Seems like a great way for them to reach out into the community and engage one of their key demographics.
But again, like I said, not a ton of value in these sponsorships from an ROI perspective, I'd agree with you on that. Used to work for a professional services firm that sponsored two PGA tour players and a major PGA of America event. Great internal pride builder for the organization, but we really struggled tying the sponsorships back to business results. I'd be very interested to hear how Target, TCF and others measure success in this area.
Subscribe to Post Comments [Atom]
<< Home
Subscribe to Posts [Atom]
Post a Comment