Archive for the ‘Naming Rights Deals’ Category

New Naming Rights Deals Show Promise: Part 2

Monday, December 9th, 2013
Photo Credit: Brant Ward/The Chronicle

Photo Credit: Brant Ward/The Chronicle

As mentioned in this blog on Friday, two major naming rights deals were announced last week in the Bay Area that could pave the way for similar deals. While both involved recently renovated civic properties whose naming sponsorships will provide much-needed funding, the deals were quite different.

On Friday, we reviewed City National’s renaming of the San Jose Civic, and how the deal may portend success for the eventual renaming of San Francisco’s Masonic Auditorium and other older urban venues undergoing renovation. Today we explore Kabam’s 15-year, $18 million naming rights deal with the University of California to name their football field Kabam Field at California Memorial Stadium.

The Kabam deal is most interesting for the fact that it names a subset of the stadium (the field) and basically asks people to flip the field name with the stadium name. Referring to it as such may occur on occasion at Cal, given the generosity of the sponsorship and the fact that so many Kabam execs and staff have Cal ties, but it won’t be referred to as “Kabam” by the average game attendee. It will likely be referenced most often on TV broadcasts, particularly on the Pac 12 Network. This exposure would appear to be the most valuable visibility feature of the sponsorship.

However, this deal is about more than the commercial naming of the field. As a Cal alum, Kabam’s CEO, Kevin Chou, wanted to make a financial commitment to the university and had great support from the numerous Cal grads on his team. That makes this a creative form of “strategic philanthropy,” providing a win for all involved. In addition to the naming deal, Kabam committed incremental funding for a scholarship program that ties back to other education-supporting elements of the arrangement.

The implications of this for other properties relate primarily to the elevation of a secondary position to that of a lead level sponsorship. It would have been politically difficult, if not impossible, to change the name of the stadium itself, especially given Cal and Berkeley’s socially progressive environment. In fact, the field re-name would likely have been passionately resisted had it gone to a traditional major corporate buyer – or to a target such as a financial institution or petroleum company. Instead, the administration took the path of least resistance and arranged a deal with an alum-led innocuous tech company with a clever name (inspired by the old Batman TV show).

For other venues that have long-established names, the deal offers a precedent for treating a high value secondary sponsor as a virtual naming partner. This will come in handy when the name of a sponsored venue is either too valuable to its constituents to change, or so locked into its stakeholders’ consciousness that no amount of money will get people to use the new name.

Such will be the case with the Santa Clara Convention Center, which we are representing for major corporate sponsorship. Changing the name of a convention center would be difficult given the range of corporate events that are held at such a facility day in and day out, and the value of having “Santa Clara” attached to the building is highly valuable to local government and businesses. It’s much more desirable to retain the municipal name but attach a strong second tier position. Hence, the highest level sponsorship at the venue will be a “presenting” level, which may be positioned as the “Santa Clara Convention Center Powered by Company.” The marketing of this name and the benefits package that comes with the deal will then be where the value has to add up for the sponsor. We see the SCCC deal as being another game changer that will serve to move the needle further on naming of existing venues. More on the SCCC opportunity soon – stay tuned!

New Naming Rights Deals Show Promise: Part 1

Friday, December 6th, 2013
Photo Credit: Vicki Thompson

Photo Credit: Vicki Thompson

Two new major naming rights deals were announced this week here in the Bay Area, each of which could create a ripple effect of other deals here and elsewhere. Each involved a financially challenged civic property whose naming sponsorships provide much-needed funding following major renovations of the venues. However, each deal was quite different in its scope, inspiration and visibility.

The two deals to which I am referring are:

  • City National Bank’s naming of the old San Jose Auditorium – now the City National Civic. The deal was announced this week in San Jose with a value of $1.2 million (gross) over a five year term.
  • Kabam’s naming of the football field at Cal’s Memorial Stadium – now Kabam Field at California Memorial Stadium, announced yesterday by Cal and Kabam execs. The terms of the deal are $18 million over 15 years, plus additional scholarship funding.

The impact of these deals should be very positive for other public or semi-public venues with naming or other major sponsorship opportunities available including the Masonic Nob Hill Auditorium in San Francisco, a jewel of a building that provides a high value naming platform; and a presenting level sponsorship position for the Santa Clara Convention Center, which happens to be a block from the 49ers new Levi’s Stadium. We’ll have more on each of these platforms later.

Taking it one deal at a time, the City National deal was very interesting for these reasons:

  • It follows another naming deal City National did in SoCal in 2011, the City National Grove of Anaheim. Evidently they saw good results from the first naming and know how to use such a sponsorship to generate a return.
  • The Civic (as most people will likely refer to it) has been renovated, so the company is not just attaching its name to an old building but an upgraded one that is poised for a solid run of more and better events.
  • The building is older and the events it hosts are an eclectic mix of concerts, family shows and private events, so it attracts a diverse array of audiences.
  • The location and connection to City government are of value to City National – having a named venue in such a strategically important spot carries high value for a financial services firm that is trying to stand out and compete with bigger companies in the space.

This deal portends well for the Masonic opportunity given some similarities and some differences that favor San Francisco’s historic Nob Hill theater. Live Nation now operates the theater and is undertaking significant renovations to modernize the building. This is the natural time to market a naming position and to make such a name change, as it is more likely to be accepted by the public and to be of greater value to the investing company.

Part 2 on Monday will explore the Cal Kabam deal and support the concept of how a second tier sponsorship can be positioned as the equivalent of a venue naming deal – if handled correctly and thoughtfully by all involved.