" />
Standing Out From the Crowd: Facilities Without Naming Rights

Standing Out From the Crowd: Facilities Without Naming Rights

Of the 113 sports facilities in North America that host a NHL, MLB, NFL or NBA team, 98 have a naming rights deal. That leaves just 15 facilities without one. A naming rights sponsorship is a highly lucrative piece of inventory and refraining from this type of deal in a time when facilities are looking for multiple revenue streams makes it a highly unique growth strategy for properties.

Naming rights on stadiums and ballparks is now a common practice - but there was once a time when naming rights deals were foreign to our venues. The trend started when owners of teams decided to brand the facilities with their own businesses. In 1911 Boston Red Sox owner John I. Taylor named Fenway Park after his Realty business, Fenway Realty. In 1926 Chicago Cubs owner William Wrigley Jr named Wrigley Field after his chewing gum business. Beginning in the 1970’s, naming rights deals began to resemble how they work today. Instead of an owner licensing their own company name to the stadium, third party business began to purchase the naming rights. In 1971, Schafer Beer purchased the naming rights to the New England Patriots stadium, and with that, give birth to the modern era of naming rights.

For both a brand and a property, there are several mutual benefits in a naming rights deal. The property receives a guaranteed source of annual income and the brand increases their awareness and builds an emotional connection with fans.

In some cases, venues might not be able to sell naming rights – the demand simply might not exist amongst corporate sponsors. However, while rare, some properties make the concerted decision to abstain. What is the motivation behind a “No Naming Rights” strategy? MKTG studies profiles the benefits of on unbranded venue though some of the world’s most high-profile unnamed buildings.

Case Studies:

Yankee Stadium- With a team value of $3.2 billion, the New York Yankees are one of the most recognizable sports franchises in the world – and they play at one of the most iconic stadiums in sports. In 2009 the Yankees moved from their old Yankee Stadium into the new Yankee Stadium. During construction of the new stadium reports stated that the Yankees rejected multiple offers from companies offering approximately $50 million for the naming rights to the new facility. However, the Yankees chose to keep the original name of the stadium that they have used since 1923.  Refusing the naming rights and maintaining an unbranded stadium helps to protect a brand strong enough to stand on its own. This allows the Yankees to build their own properties like  their Yankee owned YES television network which then opens a new option for potential sponsors. 

The Players Tournament- While not a traditional facility, golf tournaments offer a chance for brands to purchase title sponsorships. 35 of 52 tournaments during this year’s PGA calendar had a title sponsor. The few tournaments that choose to bypass a title sponsorship are usually the major tournaments (The Masters, The US Open, The British Open, and The PGA Championship). The Players tournament is often referred to as the “fifth major” and is viewed as one of the more prestigious non-major events. While the naming rights for a tournament like this would surely be lucrative, The Players have recently stated that they don’t see the tournament ever having a title sponsor. Ty Votaw, the Chief Marketing Officer of the PGA Tour has said, “We wanted the players’ organization, in this case the PGA Tour, to own and operate an event of distinction, an event of prestige”.  By forgoing a title sponsor and limiting the clutter, The Players is maintaining the tournament’s overall brand image. 

Old Trafford– Much like the New York Yankees, Manchester United is a globally recognized franchise. In 2005 when Malcolm Glazer took control of the club through a leveraged takeover, the club assumed millions in debt, which still exists today at $750 million CAD. However, despite these financial burdens, Manchester United has ruled out the possibility of selling the naming rights to Old Trafford Stadium despite them being worth a reported $100 million. When rival club Manchester City sold their stadium naming rights to Etihad in 2011 fans were upset, which demonstrated the importance a facility name means to the fans. Publicly announcing that naming rights are off the table has allowed Glazer and the Man U brass to appease the club’s global base of loyal supporters.

Forgoing naming rights should be taken on a case by case basis. Not all properties have the luxury of picking and choosing where their sponsorship dollars come from. But in a few select cases, forgoing a naming rights sponsor may provide the property with other benefits. Unbranded venues can:

• Allow you to invest in your own brand.

• Maintain or protect the prestige of a facility by limiting clutter.

• Honouring tradition to earn a halo with fans.

Never Say Never

While some heritage facilities taking adamant stands against naming rights – never say never. There have been several cases where an iconic facility has leveraged unique circumstances to onboard a naming rights partner:

Change of Facilities- When a team moves into a new facility, the opportunity is available to go with a complete name change as well. Properties previously burdened by history have the leveraged of positioning stadium entitlement as part of efforts to modernize a franchise or offset infrastructure costs. When the Toronto Maple Leafs closed Maple Leaf Gardens and moved into the Air Canada Centre or in Montreal when the Canadiens moved from the Forum into the Molson Centre,  a new facility may come with the consumer permission for a fresh start and new brand image, stadium entitlement included.

Incorporating the Old with the New- When a facility transitions into having a naming rights sponsor, they can ease the transition by incorporating the title sponsor with the former name. This is the approach Spanish soccer team Real Madrid has taken. Real Madrid plays in the Santiago Bernabéu Stadium which is named after the clubs former Chairman. This year Real Madrid struck a deal with International Petroleum Investment Company (IPIC), owned by the Abu Dhabi government, to take over the naming rights to the stadium. Although the historic venue will undergo a name change, the Chairman’s name will remain. It has been reported that the stadium will be known as the Abu Dhabi Bernabu Stadium, maintaining its historic ties.

Naming rights are a highly lucrative piece of inventory for properties. In sponsorship thought, like in all lines of business, sometimes it is the deals that aren’t made which are the most valuable. Fifteen facilities in North America have taken this approach and have chosen to remain without a title sponsor. Whether or not they will continue to resist the potential revenue remains to be seen. 

Healthy Energy Drinks Bring Healthy Sponsorship

Healthy Energy Drinks Bring Healthy Sponsorship

It Takes Sponsors to Raise a Village

It Takes Sponsors to Raise a Village