Patrick Isacsson

Professor Liptrap

11/29/17

Sports Marketing

The Mutual Exchange of Benefits Created from Sponsorship & Partnership Contracts

Nike goes big, broad with new NFL Campaign

According to Lefton (2017) Nike is putting the NFL in the driver’s seat when it comes to

attracting a different demographic of non-consumers. Nike has put a huge emphasis on the NFL

to help attract a different demographic by linking stars from different industries with former

NFL players and putting a major investment in their Nike jerseys to wow the fans. The tagline

Who You With was created to show how important NFL jerseys are as a social and cultural

totem (p.22). Nike Senior Director of Marketing for the NCAA and NFL, Marc Reeves, discussed

the link of all of these stars to the NFL, “We’re using the NFL to drive the Nike brand forward

and attract not just those who are watching the NFL, but goes more cross culturally and takes

us beyond the field of play” (P.22) They have used combinations of stars such as Odell Beckham

Jr, Joe Namath & BMX legend Nigel Sylvester, Jamal Anderson with rap group Earth Gang,

SchoolboyQ & Jerry Rice, the list goes on (Page 22). The campaign is supported by multiple

boutiques across the country that have the capability to offer limited-run jerseys as well as the

option to customize them (P. 22)

For MLB, a murderer’s row of playoff teams

According to Fisher (2017) Major League Baseball has arguably its greatest

collection of brand names for the playoffs in league history (Pge4). This postseason features

some of the most highly notable and respectable franchises in the league such as the Los

Angeles Dodgers, New York Yankees, Boston Red Sox, etc. When it comes to social media

networks such as Instagram, Twitter, etc, these franchises hold the highest collectives (Pge4).

As well holding the top rankings when it comes to merchandise sales, opinion polls, and much

more. This postseason has league executives and business partner optimistic for this playoff

series featuring some of baseballs newest stars and household names such as Aaron Judge,

Cody Bellinger, Bryce Harper, and Clayton Kershaw (Pge4). Each team has an equal chance of

making a memorable postseason run and that is what has the fanatics excited, even comparing

the drama of this postseason to last year when the Cubs broke their 108-year-old curse of not

winning a championship. It is being talked around everywhere by major networks such as Fox,

Jimmy Kimmel, NBC, a lot of major networks providing a league high in playoff ad revenue.

(Pge4).

Wasserman’s recent NBA contracts, shoe deals top $600M

According to Mullen (2017) Wasserman’s NBA sports agents from around the league

accumulated more than six million dollars from their players endorsement and playing contracts

(Pge12). Breaking down the analytics even further half of it came from shoe contracts alone. The agents

involved with bringing in this massive income in to the company included Thad Foucher, B.J. Armstrong,

Darren Matsubara, and Greg Lawrence including executive vice president and COO, Jason Ranne (Pge

12). Players that were represented by these agents consisted of big names such as Carmelo Anthony,

Paul George, Russell Westbrook, and Norman Powell (Pge 12). The list goes on, getting eleven deals

done worth $134.9 million by the end of free agency period, however with all the extensions that were

made on their players contracts they sky rocketed reeling in $383.7 million for fifteen deals (Pge 12).

Nike deal only part of NBA licensing story

According to Lefton (2017) The latest deal between Nike and the NBA has been the

biggest story of the offseason leading into the regular season while other company’s such as 47’ Brand

and Mitchell & Ness have benefitted from this as well being able to expand their rights to sell on court

apparel (Pge 6). With Nike leading the way with their impressive debut of the new jerseys each team will

be wearing, the brand itself will bring jersey sales to an all-time high (Pge 6). “Most teams will have four

different [authentic] jerseys; the question is, how often will they wear them”, NBA consumer products

chief Sal Larocca spoke about the addition of the alternative jerseys which will ultimately also increase

NBA apparel sales revenue by an estimated sixty percent (Pge 6). Not only for Nike, but other companies

who have older NBA apparel will benefit like Adidas the former provider of jerseys for the NBA (Pge 6).

With the continued expansion of video games, Nike apparel, and increased participation in other

countries revenue should skyrocket not only for the league, but for the more notorious teams in the

league like Golden State, Los Angeles, Oklahoma City, the list goes on (Pge 6).

Mercedes kicks the tires on college football

According to Smith (2017) With the addition of moving their Headquarters to Georgia

and the Mercedes-Benz Stadium in Atlanta, CEO Steve Gannon is still figuring out how they can expand

even further (Pge 4). This season Mercedes and the NCAA established a relationship in which they will

be a major sponsor for the Division I College Football Playoffs putting them in the company of the other

two companies, Nissan and Ford (Pge 4). This contract not only brings more money and notoriety to the

company, but also allows them to get more involved with the broadcast aspect eventually leading to

possibly more relationships to come. Some have even seen a correlation with Mercedes and The

University of Alabama being the official luxury car of their athletics perhaps planting another seed in

Tuscaloosa like they did in Atlanta, both teams have had extreme success over the years (Pge 4).

Jersey patch deals average $9.3 million annually

According to Lombardo and Lefton (2017) About half of the league has benefitted from

the league allowing companies to use their jerseys for advertisement purposes (patch on the jersey)

with contracts averaging near to $9.5 million with contracts starting at $8 million all the way to $20

million (Pge 21). Most teams don’t have a sponsor yet because they are still looking for the right one.

Associating your franchise with a brand name puts you in the same category as them, you represent

them and they represent you so teams are in no rush to be signing contracts whereas others have

jumped the gun Like Golden state and a tech company based in Japan called Rakuten (Pge 21). Owner of

the Brooklyn Nets, Brett Yormak, described this partnership,” This isn’t just a signage, branding, or

exposure story, it has to be a bigger play, and obviously the expense is much bigger. You can’t sell the

patch like everything else. It requires more thoughtfulness; there’s fewer potential companies. It’s a

bigger story and a deeper connection between the team and the brand” (Pge 21). Some franchises have

opted to make a connection with a big-time company for examples we have the Celtics with GE, the

Cavaliers partnering with Western Union, and then you have teams opting to go with the smaller

sponsors like Toronto and Sun Life or Detroit and Flagstar Bank (Pge 21). Both sides can benefit

extremely from their contracts, but it is also a huge risk if both cannot do what is asked of the other. At

the end of the season revenue made at the end of the season will be distributed to the players, teams,

as well as all 30 NBA teams’ due to revenue sharing (Pge 21).

NCAA seeks guidance for its role in collegiate video gaming

According to Fischer and Smith (2017) the NCAA is searching for an esports

consultant to help determine if they should play a role in evolving collegiate video gaming space

(Pge 6). Over forty colleges from every division field esports teams (Pge 6). The big question is if

these two can go hand in hand considering the NCAA’s policy about student-athletes receiving

profit and prize money is usually the man incentive for competing in these tournaments. The

only governing body for college esports is the National Association of Collegiate Esports (Pge 6).

A quote from Executive Director Michael Brooks concerning the merge between the NCAA and

Esports,” Our members and publishers have long believed that substantial changes would have

to be made to the NCAA’s bylaws for them to fit in Esports” (Pge 6). The NCAA requested firms

to submit a plan and to collaborate on a presentation to the board of governors at their next

meeting this October, the governing body is composed of presidents and chancellors from

schools in all divisions (Pge 6). Bryce Belum, executive vice president of esports at Catalyst

Sports & Media said,” Collegiate Esports has so much potential, and with the right guidance the

NCAA could have an enormously positive impact on its development” (Pge 6). Esports could

attract a whole new crowd and fan base, one that would be loyal and consistant with the sport.

The NCAA would be able to align with a firm whose manner aligns with that of the NCAA (Pge

6).

Stadium Upgrades for 2017

According to Muret (2017) this offseason NFL stadiums are reaching their peak

when it comes to renovations and improvements. Bank of America Stadium first opened its

doors in 1996, 21 years later during this offseason the Panthers put $47 million into Stadium

upgrades which included new club layouts and bars as well as new fronts to concessions stands

for a more firm and cleaner look (Pge 16). The Steelers added a brand new $3 million

Daktronics video board to Heinz Field, which opened in 2001, while adding more seating to

their clubs and general admission (Pge 16). Baltimore added a brand-new Samsung 4k quality

video board to M&T Bank Stadium which costed around $30 million (Pge 16). These are just a

few examples of the serious money that is being put down to enhance the gameday experience

at their respective stadiums.

DraftServ installs QR code-activated soda dispensers

According to Muret (2017) Delaware North Sportservice is testing new self-serve

technology at Bank of America Stadium to increase speed of service and efficiency for Panthers

games. (Pge 37). The vendor signed a deal with DraftServ to supply the technology at multiple

soft-drink dispensers on the club level (Pge 37). This is DraftServ’s first major installation in a

big-league sports facility (Pge 37). Fans pay $8 for a special souvinor cup at the club lounge

concession stands on the stadiums north and south sides. The cups come with unlimited refills

and contain a QR code to be scanned at the soda dispensers, patrons scan the QR code, which

activates all dispensers and taps for about 20 seconds (Pge 37).A study was done, and it was

found that 17% of all soda pours in the stadium were done at DraftServ units (Pge 37). Todd

Smoots, Sportservice’s on-site general manager spoke about the technology used to support

these dispensers,” The advtange to this system with the technology is that overtime we can

learn which products they’re buying, because we know how many ounces are being poured

out” (Pge 37). Not only will this technology reduce lines, but reduce the space that is taken up

in the stadium with behind the counter dispensers for not only efficiency, but creating more

space for my jobs.

Coca-Cola returns to Derby in five-year deal

According to Mullen (2017) Coca-Cola and Churchill Downs Inc. agree to a five-

year deal that makes Coca-Cola the official soda of the famous Kentucky Derby. Specially made

bottles will be produced for the next Kentucky Derby in May of twenty-eighteen. Beyond their

title of as the official soda, Coca-Cola plans on having promotions and events throughout the

week of the Derby. The details to the finances of this deal were not revealed to the public, but I

could imagine it is in the millions. This contract struck following the construction of a

distribution center in the Kentucky region employing over 350 civilians. After discussions

between Heather Hucks (Senior Director of Brand Marketing of Coca-Cola) and Kristin Warfield

(Vice President of Partnerships for Churchill Downs Inc.) Warfield reflected on the agreement

made with Coca-Cola,” We had a wonderful Partnership with Pepsi, it’s just sometimes change

is somewhere you need to go. And we found a fantastic partner in Coca-Cola”. (Pge 6)

Bud, Coke continue to rule the diamond

According to Broughton (2017) Budweiser is going on thirty-eight seasons in the

MLB as their most recognizable beer sponsor noticed by forty-eight percent of fans according to

a survey done by Turnkey Sports & Entertainment (Pge 8). These studies were done throughout

all sports to determine the most recognizable beer sponsor and Budweiser stood on top, but it

wasn’t the only drink that was notorious. Coca-Cola which is the official soft drink of the MLB,

was right in the rankings with Budweiser being recognized by forty-one percent of fans (Pge 8).

Besides beverages, T-Mobile was recognized by a third of MLB fans seeing how they spent just

about eleven-million dollars in advertising costs throughout the playoffs. The MLB’s tire sponsor

seemed to have fallen out of the race as a recognizable sponsor. Falken was only noticed by a

measly thirteen percent of the fans who participated in the survey (Pge 8). They have been the

official tire of Major League Baseball for three years now.

AEG finds new sponsor category with disaster recovery firm

According to Muret (2017) Belfor-Property Restoration has filled in a new

sponsorship category for AEG Global Partnerships as the new restoration partner for the

Staples Center as well as the T-Mobile Arena which is co-owned by MGM. Belfor-Property

Restoration excels in the field of restoration of commercial properties that have been damaged

by natural causes receiving a lot of exposure after all the hurricanes we were hit with this past

fall. The company is currently world-wide with hundreds of offices and thousands of

employees. Vice President of AEG, Jon Werbeck, did not disclose terms, however he did hint

towards a deal being in the seven figures category. The two arenas will receive multiple

benefits and coverages covered by an annual fee. Other services will also be offered such as

kitchen supplies, janitorial duties, etc. (Pge 14). They are also the official sponsors of the “Hero

of the Game” feature at King’s Games (Pge 14) recognizing citizens who have served our

country. Werbeck allegedly first thought of a partnership while watching an episode of the TV

show “Under Cover Boss” which starred CEO of Belfor, Sheldon Yellen. This isn’t the first time

Belfor has deals in the sports industry locking up a sponsorship with the Detroit Red Wings.

Werbeck spoke about the opportunities this will bring to Belfor, “It will also open doors for

Belfor to speak with our partners such as the casinos and banks, anyone with commercial

property, they’re now strengthening their ties with MGM as well on a global scale”. (Pge 14)

Nomadic turning eyesore into Super Bowl party central

According to Smith (2017) Jack Murphy will be hosting the 28th annual Super

Bowl Party at, of course with some enhancements made to accommodate the overall

experience (Pge 25). Murphy discovered the venue right outside of U.S. Bank Stadium fourteen

months in advance and knew he had to have it. With the renovations almost complete, the

venue will be known as “Nomadic Live!” at The Armory where the Super Bowl Party which is

held Super Bowl weekend will be sponsored by AT&T and DirecTV. Currently they are still

pursuing performers for the party, however their ticket prices have been set around two-

hundred and fifty dollars and that is just for general admission (Pge25). Tickets will be also be

sold on a parent company of Nomadic called On Location Experiences (Pge 25). DirecTV has

been a longtime associate and sponsor of the Super Bowl Party twelve seasons to be exact (Pge

25). Title sponsors are still being processed and all options are being considered, but can run

anywhere from six to seven figures (Pge 25). The Armory should have a total capacity around

eight-thousand guests segmented into three categories for three levels which are general

admission, special guests from the NFL as well as associates, and finally the celebrity level (Pge

25). Murphy is also working on a side project right in Mystic Lake Casino, a sixty-four-thousand

square-foot venue nearby Minneapolis.

Zero-hour’ resales part of StubHub-MLB deal

According to Fisher (2017) Stubhub as agreed to its third contract with the MLB

running all the way up to the 2022 season as they have become one of the MLB’s biggest

partners. Modifications have been made from their previous contracts which includes the

“zero hour” rule, it allows people to purchase tickets even during the first pitch with other key

improvements to the overall contract. The relationship between Scott Cutler (Senior Vice

President of Stubhub parent eBay) and GM of Stubhub North America, Perkins Miller, have

really been the deal breaker when it comes to relations with the MLB (Pge 5). They are involved

with every team in the league reeling in a staggering sixty-million dollars from their first deal

and their latest has put them in the ball park of a estimate of over one-hundred-million dollars

(Pge 5). Perkins Miller discusses what Stubhub brings to the table, “There are several things we

can do with both technology and data to improve the experience for everybody in the baseball

ecosystem, and help clean up the market” (Pge 5).

On Location Experiences signs QuintEvents to sell ticket and hospitality packages for Super

Bowl

According to Lefton (2017) On Location Experiences, one of the more notorious sports

hospitality companies, has landed a contract with QuintEvents (P.22) The contract entails that

QuintEvents will be selling Super Bowl packages with prices ranging from $5,000 up to $14,000

not including rooming (P.22). The NFL and QuintEvents have been in business together dating

back to 2005. On Location Experiences deal with the NFL includes the rights to purchase about

9,500 tickets and packages. Even while On Location was selling Super Bowl inventory on their

own, QuintEvents was flipping their own Super Bowl Inventory as well as other top tier events

such as Formula One, the Kentucky Derby, NBA All-Star Game and UFC (P.22). The next two

Super Bowls will be held in Minneapolis this season where temperature could play a factor in

ticket sales where numbers would be soft and the next season’s Super Bowl will be played in

Atlanta’s new Stadium where a warmer climate could be hit or miss. CEO of QuintEvents Brian

Lester said it best,” Every Super Bowl city has its own charms and challenges” (P.22).

Powerade Partners With Rugby League World Cup

According to a source from Sports Sponsorship Insider (2017) Powerade is now

an official business partner of the 2017 Rugby League World Cup. Their title as the official

hydration partner brings a different market with recognize their brand as well as the profits

from their contract. Powerade is a sister company of Coca-Cola so they will be providing the

refreshments on and off the field throughout the tournament which begins October 27th all the

way up till December 2nd.

Airbnb Teams Up With Buffalo Sports Franchises

According to a source from Sports Sponsorship Insider (2017) the ownership

group of the Bills and Sabres franchises will be agreeing to a partnership with Airbnb. The two

together will inspire and create brand new ways to experience the teams respective game day

events. They will be beginning their partnership with an even at the Suite Dreams at New Era

Field where one fan will have the chance to win a room at the suite paid for by Airbnb (SSI).

NBA Extends With Hotel Partner Marriott

According to a source from Sports Sponsorship Insider (2017) The National

Basketball Association will be continuing their partnership with one of their most reliable

sponsors, Marriott (SSI). Financial details have not been disclosed to the public yet and with the

finalization of the contract, Marriott will cover a few key events for the NBA the next two

seasons with bonus features to exclusively help Marriott’s business with benefits including VIP

tickets to these key events to the elite members of the Marriott (SSI).

Nike Strikes Long-Term Extension With British Athletics

According to a source from Sports Sponsorship Insider (2017) Nike will be

extending its contracts though the year twenty-thirty with British Athletics. Nike will be the

official clothing line, but word from Chief Executive of British Athletics, Neils de Vos is that, “this

is one of the strongest collaborations for athletics in the UK” (SSI). British Athletics has been

fully committed to Nike and Nike has returned with the same energy dating their relationship

all the way back to the year twenty-thirteen, the previous deal was set to expire at the end of

the year twenty-twenty.

Real Madrid Renews EA Sports Partnership

According to a source from Sports Sponsorship Insider (2017) EA Sports will be

singing an extension with the Real Madrid Soccer team. They have been partners together since

the year twenty-fifteen and will be among the many second tier global sponsors associated with

Real Madrid (SSI). The news was broken during a EA Sports event where multiple player from

the team attended. At the event players were able to experience the brand-new FIFA 18, the

news will be featured next month with star soccer player Cristiano Renaldo on the cover (SSI).

Previously a month before contract extensions were finalized, Real Madrid has partnered with

Xbox which hosted organized tournaments for the game itself and will be officially known as the

official console partner for Real Madrid (SSI).

Citations

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(n.d.). Retrieved November 29, 2017, from http://www.sportsmarketanalytics.com/Article-

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(n.d.). Retrieved November 29, 2017, from http://www.sportsmarketanalytics.com/Article-

Detail.aspx?id=252693

Broughton, D. (2017) Bud, Coke continue to rule the diamond, SportsBusinessJournal. V20 I31

Fischer, B & Smith, M. (2017) NCAA seeks guidance for its role in collegiate video gaming,

SportsBusinessJournal. V24

Fisher, E. (2017) For MLB, a murderer’s row of playoff teams, SportsBusinessJournal. V25

Fisher, E. (2017) ‘Zero-hour’ resales part of StubHub-MLB deal, SportsBusinessJournal. V20 I31

Lefton, T. (2017) Nike goes big, broad with new NFL Campaign, SportsBusinessJournal. V20

Lefton, T. (2017) Nike deal only part of NBA licensing story, SportsBusinessJournal. V20 I26

Lefton, T. (2017) On Location Experiences signs QuintEvents to sell ticket and hospitality

packages for Super Bowl, SportsBusinessJournal, V20

Lombardo, J & Lefton T. (2017) Jersey patch deals average $9.3 million annually,

SportsBusinessJournal.

V20 I26

Mullen, L. (2017) Wasserman’s recent NBA contracts, shoe deals top $600 million,

SportsBusinessJournal. V20 I26

Mullen, L. (2017) Coca-Cola returns to Derby in five-year deal, SportsBusinessJournal. V20 I31

Muret, D. (2017) Stadium Upgrades for 2017, SportsBusinessJournal. V24

Muret, Don. (2017) DraftServ installs QR code-activated soda dispensers,

SportsBusinessJournal. V24

Muret, D. (2017) AEG finds new sponsor category with disaster recovery firm,

SportsBusinessJournal.V20 I31.

Smith, M. (2017) Mercedes kicks the tires on college football, SportsBusinessJournal. V20 I26

Smith, M. (2017) Nomadic turning eyesore into Super Bowl party central,

SportsBusinessJournal. V20 I30