General

Live Strong, Name Strong

Major League Soccer's Kansas City Wizards Sporting Kansas City have just announced that they have "sold" the naming rights to their new soccer specific stadium to Lance Armstrong's LiveStrong charity. The 6-year deal is worth an estimated $15 million, but Sporting are not accepting a dime from in exchange for the rights.

Are they doing this out of the goodness of their heart? Well, there was no indication prior to the announcement that LiveStrong was willing to pay $15 million for any stadium's naming rights, so revealed preference seems to suggest LiveStrong thinks the naming rights are worth less than $15 million to them. If Sporting Kansas City really want to help beat cancer, they should sell the naming rights to the highest bidder and then just give the proceeds to LiveStrong. (Consider the same reasoning the next time you are thinking about donating a car to charity.)

In fact, the stadium operators have said that they hope that the LiveStrong connection helps persuade music acts to use their venue over other competitors in the area.  (No word yet on whether Sheryl Crow has signed up for a gig yet.)

Similarly, one could cynically say Barcelona's jersey sponsorship with UNICEF, which paid nothing for the world's most valuable fabric real estate, was done to pave the way for Barcelona, a long-time holdout in jersey sponsorships, to enter the market with the least protestations from traditionalist fans. Indeed, the team just announced that this season will be the last on the front of the jersey for UNICEF, as the next 5 years have been purchased for a record 170 million euros by "Qatar Foundation," an Middle Eastern economic development group.

Still, if a charity can leverage its goodwill into valuable advertising, all the better. And donations to charity, whether done due to pure generosity or as an economic investment, still serve to help cancer patients and feed children.

3 Comments

  • Avatar Of Christopher
    Christopher March 18, 2011

    Vic,

    One thing you might get right first……the team is no longer the Kansas City Wizards, but instead Sporting Kansas City.

    I’m hoping the rest of your article is correct but you’re scaring me with that first factoid being wrong and it makes me wonder if the main point of your article has holes in it.

  • Avatar Of Nick W.
    Nick W. March 18, 2011

    Christopher, other than not putting in the newest name for Sporting KC, the article is spot on with what is happening.

    Furthermore, I believe it was said that Sporting KC would also donate a part of ticket sales and concessions to Livestrong, with Livestrong hoping this will bring in around $7.5 million in donations during the length of the contract.

  • Avatar Of Victor Matheson
    Victor Matheson March 18, 2011

    Yikes! How did I get that wrong ? As some people on the blog may know, I was a referee for MLS for quite a few years, and old habits die hard. Just be happy I didn’t refer to them by their original, and somewhat unfortunate name, “The Wiz.” (Now if I can only stop calling the NY Red Bull, the Metrostars, I’ll be set!)

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