A New Paradigm for Sports Venues: Sponsor ROI
03.8.2012
Virginia Pettit in Sports, Sports Venues New Paradigm

Photo credit: Tom Kaminski / WCBS 880

This is the third article in a five part series. Read the Full Report.

“If you build it they will come,” right? Wrong! On its own, a sports venue won’t draw a crowd unless the overall experience that each individual fan will encounter within that venue is designed to be positive, compelling, comfortable and exciting. You’re a rare genius if you can provide that kind of experience on your own; more likely, you need strong partners who share your goals. So our second new paradigm strategy is to engage your partners as deeply as you do your fans. I feel fortunate to have spent ten years in the sponsorship industry during a (relatively) strong economy, when even static signage was enough for some advertisers who valued simply being part of the team—but oh, how things have changed. Building a strong sponsorship platform for your sports venue has never been more critical to your venue’s success. With civic budgets all but evaporated, the private sector increasingly foots the bill for stadium and arena construction or renovation. Fortunately, thanks to a (slowly) recovering economy and strong proof that sports sponsorship pays off, corporations are (slowly) spending again. But with tight budgets, partners will scrutinize every letter of a sponsorship deal more than ever before, so you’re on the hook to deliver.

First, it’s imperative to understand how your sponsors actually measure ROI. A beverage company might be most interested in pouring rights and increased volume of sales, not to mention brand awareness. A telecommunications company, on the other hand, will often want a platform to show off the seamless integration of its television + phone + internet + mobile capabilities and sell new subscriptions or incremental services. A B-to-B services firm is likely to demand VIP access and exclusive hospitality elements, allowing them to entertain their own clients and targets in a unique and engaging atmosphere. The list could go on. Point is, each sponsor’s goals are specific and different, so it’s important to understand the details of those goals before you propose a strategy for achieving them.

It’s equally important to engage your sponsors early in the design process, regardless of whether you’re building a new venue or renovating an old one. Last year we hosted a discussion of sports sponsorship issues and trends, and one of the biggest takeaways was the imperative for this kind of collaborative long-term planning. Participating in that discussion, Shervin Mirhashemi, chief operating officer of AEG, described the benefits Farmers Insurance gains by committing early to the title sponsorship of AEG’s proposed NFL stadium in downtown Los Angeles: By getting in “four or five years in advance of the opening of the facility they’re going to be able to sit down with our architect and walk through exactly what their color schemes are, their branding initiatives, how they want to incorporate their agents and engage with their customers within the facility. Being able to be out there in front of it rather than [coming in] after the facility is built or the designs are complete and then trying to fit a square peg into a round hole after the fact is so integral. That creates the value proposition. That justifies the money they’re paying.” In fact, at another event hosted by IMG and the SportsBusiness Journal, Farmers’ chief marketing officer, Kevin Kelso, expressed that “just the strength of the announcement was a powerful thing for [Farmers],” and that the company received $3.8 million worth of ad equivalency value in media from the January 2011 announcement alone—before even a dime had been paid to AEG. Hello, ROI.

Last but certainly not least, don’t forget the fans. When Gensler surveyed fans last year, just 15 percent expressed that they think advertising and/or promotions have a negative impact on the game day experience. It’s a shame that any number of fans feels that way, but honestly, can you blame those that do? When every last inch of a venue is plastered with a corporate sign or logo, today’s sophisticated consumers recognize right away that the venue has made money from that billboard, and are likely to ask “what’s in it for me?” In other words, if sponsored elements are not thoughtfully designed to be a positive part of the fan’s game day experience, the fan won’t connect with them, and the sponsor’s investment has been wasted. That integration that Mirhashemi mentioned—aligning Farmers’ color schemes and branding initiatives with those of the overall venue—should be a major incentive for sponsors and facilities to work together early in the design process. Slapped-up signage that isn’t integrated into the fan’s experience is a distraction, and no one wins in that scenario. Goodbye, ROI.

Formerly called the New Meadowlands, MetLife Stadium in New Jersey is frequently cited as one of the best examples of a well-designed sponsorship platform. In fact, MetLife originally signed a deal to be one of the New Meadowlands’ four cornerstone partners when the venue opened in 2010. But after what I presume was a great first year, the sponsor upped the ante and bought the overall title sponsorship in 2011. And now, with their venue’s new name, MetLife Stadium’s operators have the fantastic opportunity to resell the original cornerstone partnership that MetLife vacated—prime real estate in the U.S.’s biggest media market, not to mention the site of Super Bowl XLVIII in 2014. The New York Giants’ chief marketing officer, Mike Stevens, summarized the multi-faceted reality of that opportunity well in a recent AdWeek article: That level of partnership is “the ultimate commitment—as permanent as permanent gets. The sponsor has to be something the fans approve of, and it has to complement our partners who are already with us.” The wishes of each individual stakeholder have to be considered in order for a sports venue to be successful. Left overlooked, partners will quickly leave you behind, but treated as true partners, they’re in the game long term.

Click here to download a summary of our research on sports venues’ new paradigm.

Virginia Pettit
Virginia Pettit is an associate on Gensler’s firmwide marketing team, and is based in the Washington, DC office. A former corporate sponsorship executive for an NFL team and known to have nerdy emotional reactions to TV commercials, Virginia is passionate about market research, marketing strategy, and the ways brands and consumers communicate with each other. She channels these passions to develop communications strategies for the firm’s retail, hospitality, sports, and brand design practices. Contact her at virginia_pettit@gensler.com.
Article originally appeared on architecture and design (http://www.gensleron.com/).
See website for complete article licensing information.