VOL. 129 | NO. 248 | Monday, December 22, 2014
Sponsors Pay Big Bucks to Join College Bowl Games
MICHAEL LIEDTKE | AP Business Writer
SAN FRANCISCO (AP) – Ready! Set! Hut, hut: This holiday season's blitz of college football bowl games features a reshuffled roster of corporate sponsors spending millions to thrust their names in front of fans watching on TV and in the stands.
The bowls haven't disclosed their asking prices, but sports marketing experts contacted by The Associated Press estimated the annual cost for the top-tier games ranges from $25 million to more than $30 million. That's up from $16 million to $20 million previously.
The substantial price increase probably prompted sponsors to reassess the value of the bowl affiliations, says Kevin Adler, chief engagement officer for sports marketing specialist Engage Marketing in Chicago.
Twelve of the 33 bowls returning from last year have sold their naming rights to new sponsors, including several that defected from one game to another. Five other bowls are making their debuts during this holiday season, and three of them – the Popeyes Bahamas Bowl, the Raycom Media Camellia Bowl and the Ford Motor Quick Lane Bowl – are kicking off with corporate affiliations.
This year's list of new sponsors include:
– Century-old tire maker Goodyear, which bought the naming rights to the Cotton Bowl in a promotional expansion beyond its well-traveled blimp.
– Duck Commander, a Louisiana company sponsoring the Independence Bowl in its home state to introduce itself to people who don't watch the "Duck Dynasty" reality-TV series.
– BitPay, a 3-year-old startup that is using the St. Petersburg Bowl in Florida to enlighten a broader audience about bitcoin, a digital currency that so far has appealed mostly to computer geeks, speculators and crooks trying to conceal their financial footprints.
"We are hoping the audience watching the game at home, in sports bars, airports and hotels is going to be Googling to find out more about bitcoin," says Stephanie Wargo, BitPay's vice president of marketing. More than 100 merchants in a "Fan Zone" located near the St. Petersburg Bowl also will be accepting bitcoins from customers leading up to the Dec. 26 game.
BitPay, a bitcoin processing company, made a three-year commitment to take over the St. Petersburg Bowl naming rights from Beef O'Brady's, which ended a five-year affiliation with the game.
Evolving sponsors have become part of the college bowl tradition since the games began auctioning off their naming rights several decades ago to help cover their rising costs. The Holiday Bowl in San Diego has gone through seven sponsors since its 1978 inception (National University, a San Diego college, is returning for its second consecutive season as the game's main sponsor).
While some college football fans still lament the commercialization of the sport, bowl directors say the games couldn't go on without the naming rights fees to supplement the revenue from ticket sales and TV broadcasting rights.
"It's critical, you can't survive without a sponsor," says Gary Cavalli, executive director of the Foster Farms Bowl in Santa Clara, California.
After selling its naming rights to two different corporate sponsors during the first 11 years of its existence in San Francisco, Cavalli's bowl played last year without a business backer – and lost more than $100,000 despite cost-cutting efforts.
The bowl is in better shape after Foster Farms decided that attaching its name to a college bowl would be a good way to sell more chicken wings and other frozen food as the Livingston, California, company expands eastward.
"We know that Americans love football, and we know Americans love to eat chicken while they are watching football, so it's a perfect fit from that perspective," says Bryan Reese, Foster Farms' senior vice president of sales, marketing and research and development.
Only four of the 38 bowl games scheduled from Saturday, Dec. 20, through Jan. 4 weren't able to sell their naming rights. Two of those, the Hawaii Bowl and the Birmingham Bowl, lost their sponsors from last year. The two others, the Boca Raton Bowl and Miami Beach Bowl, are being played for the first time this year.
This year's revised line-up of bowl names stems in part from college football's new system for determining a national champion. Four teams are now selected to compete in playoffs that begin with a semifinal round in two bowl games played on New Year's Day. The semifinals will be played at the Rose Bowl and Sugar Bowl this season, then rotate among the Cotton Bowl, Orange Bowl, Fiesta Bowl and Peach Bowl.
The added drama of a playoff for the national championship prompted ESPN to pay more for the broadcasting rights to the games, resulting in an increase in the price for the naming rights.
Tostito's said it ended its 18-year relationship with the Fiesta Bowl after deciding it wanted "to steer its marketing and growth strategies differently." Without elaborating, Discover Financial traced its decision to stop sponsoring the Orange Bowl to the new playoff system.
Fiesta sold its naming rights to TV maker Vizio, which had previously backed the Rose Bowl, while the Orange Bowl lured Capital One away from the Citrus Bowl. Northwestern Mutual replaced Vizio at the Rose Bowl and Goodyear rolled into the Cotton Bowl after AT&T backed out from its naming rights deal.
With few exceptions, the bowls played before New Year's typically sell their naming rights for $500,000 to $1 million annually.
"The cost is not exorbitant, so you get a pretty good bang for the buck," says Jim Andrews, a senior vice president the sponsorship and consulting firm, IEG. "You don't get blockbuster (TV) audiences, but those who do watch are pretty committed."
Nevertheless, the money spent on bowl naming rights can turn out to be a waste if the buyer doesn't have a concrete marketing plan.
"The first time someone in a company says, 'Hey, we should sponsor a bowl game,' there should be someone in the room who asks why," Engage Marketing's Adler says. "If no one pauses to answer the why question, those deals won't be long-term."
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