Tuesday, March 31, 2009
So what are a club such as this doing with the disgraced name of AIG on their shirts? It is causing consternation in the United States, where United fans cannot wear their replica strips, at least in public, and some members of the House of Representatives have demanded that bailout money from the US taxpayer should not be used “to support an English soccer club” — and it is beginning to dawn here that this symbol of the financial system’s vindictive disintegration has no place in the people’s game.I had not given the demand side of this problem any thought before reading this column. But it strikes me that if AIG is the corporate poster-child of the financial crisis, and American fans are keeping their shirts in the closet, all of the shirts that have been produced to date should be re-directed to the "secondary market." Barclay is considering the problem as one of sunk cost in shirts for sale versus the dignity of the club. What would intrigue me is an analysis which quantifies a) the effect on shirts sales of AIG's demise, and b) the decline in value of the stock of Man Utd shirts owned by consumers. "Forgoing" the £18 million from AIG would indeed generate significant value on its own, and a chunk of that would be captured by the club.
The honourable course facing United is clear: they should forgo the £18 million or so still due on a contract expiring at the end of next season and put something admirable on their shirts free of charge, following the examples of Barcelona, who advertise Unicef, and Aston Villa (also American-owned), whose friendship is with Acorns, a children’s hospice.
For United, unfortunately, making such a decision would be like Uturning a liner, in that it would involve the scrapping of global mountains of Nike kit and other merchandise already prepared for the summer tour to China, and next season.
Thursday, March 12, 2009
The cynic in me wonders if that sort of profit calculation is what left Bank of America with a treasure chest full of toxic assets. The slightly less cynical view is that, if sponsorships are so darn profitable, a) why didn't the Mets get even more out of the naming rights to Citi Field, and b) why is there so much worry about the threat of businesses not renewing their sponsorship deals?
Lewis also addressed bank marketing activities involving sports.
“I’ll admit that it’s easy to be skeptical about the business value of multimillion dollar marketing contracts with sports teams,” Lewis said. “And, obviously, there are lots of business executives who just really enjoy having access to teams and athletes.”
Lewis said he’d rather spend time in the mountains with his wife.
Nevertheless, he said for every dollar the bank spends in sports marketing, it gets $10 in revenue and $3 in profit.
Makes you wonder if one can trust anything a banker says these days...
Tuesday, February 17, 2009
Stanford Financial appears to be on quite a roll when it comes to locking up sports endorsements. Some of the recent deals it’s announced include ones with professional golf and tennis associations, US colleges and English soccer players. In Antigua, where Allen Stanford has dual citizenship and was knighted in 2006 by the island’s government, the firm is a sponsor of worldwide cricket competitions. International cricket tournaments are regularly played at Stanford Stadium on Antigua.These strike me as a bit bizarre and intriguing: did sponsoring cheerleaders bring in an unsophisticated clientele? Regardless, the
But maybe the glitziest sports marketing deal Stanford Financial struck came in February 2007 when the firm reached a deal with the NBA’s Miami Heat to get naming rights to one of the main entrances to the team’s home arena. The multi-year deal allowed Stanford Financial to create a so-called VIP entrance at the AmericanAirlines Arena for professional athletes, celebrities, dignitaries and the firm’s “high-level clients.’’ The terms of the deal weren’t disclosed.
Brian Bertsch, a Stanford Financial spokesman, says “the terms of sponsorship deals are confidential.’’ But he adds that the deal with the Heat makes a lot of sense given the firm’s “strong and diverse client base in the South Florida region.’’ As for the deal with [Vijay] Singh, he says, “I can tell you that the deal with Vijay is not exclusive.”
The sponsorship with the Heat is part of another strategy by Stanford Financial to spend big bucks on sports in US cities where it has a big footprint. In Memphis, Tenn. the firm is a major sponsor of charitable and professional golf tournaments. In October 2007, Stanford Financial became the official sponsor of the cheerleading team at Louisiana State University, located in Baton Rouge, another big hub. A year earlier, the investment firm struck a similar arrangement with the University of Mississippi’s cheerleaders.
Tuesday, February 03, 2009
The list of deals in jeopardy is growing. Forbes recently reported on the quasi-nationalized AIG's aversion to extending its $78 million sponsorship of the Man Utd shirt beyond 2010... if they are around that long.