Branding the World of Sports

Posts Tagged ‘AIG’

Evaluating my 2009 Sports Marketing predictions

Posted by ZA on January 3, 2010

Time to take a look back and evaluate how I did on my 2009 predictions for the world of Sports Marketing. I posted my “bold predictions” on January 2, 2009 as a wide ranging look at some of the big moves I thought would happen in the industry.  I made seven predictions and wind up getting almost half of them correct.

Prediction: Tiger Woods will sign with Mercedes or BMW.

Result: This one did not happen, but who could have predicted the implosion that would happen to Tiger Woods the endorsement star in 2009.  Tiger is currently losing endorsements by the week, but I still think this prediction will eventually come true.  Companies will stay away from Woods for awhile, but when they do come back I expect Tiger to pickup a luxury car endorsement deal.

Prediction: Wrigley Field gets a new name.

Result: This one didn’t happen, although the Cubs were finally sold at the end of the year so it could be on-tap for 2010.

Prediction: AIG will end uniform sponsorship with Manchester United.
Result: I got this one right.  Shortly after writing these predictions word came out that AIG would discontinue their deal with Man U.  AIG actually just chose not to renew their deal, but close enough I got this one right.

Prediction: NASCAR will cut races.

Result: It was a tough year for Nascar with a tough economy and huge losses in the auto industry both hurting the sport.  The end result was that some races were not return to the schedule (e.g.- Milwaukee Mile in 2010).

Prediction: Reebok will be folded by Adidas.

Result: This did not happen, and with parent company, Adidas’ stock up 20% in 2009, the Reebok brand might be safe for awhile.  That said, I still think we’re still headed towards an Adidas versus Nike world, so at some point Adidas is going to put Reebok down.

Prediction: Under Armour will be acquired by Nike.

Result: This did not happen, but I still feel it’s one that could happen soon.  Under Armour’s stock is only up slightly since beginning of ’09 and UA stock took a pounding in October when they missed the mark with their expansion into running shoes.  Nike is still flying high and has a $30 billion market cap, so I think they eventually make this acquisition to eliminate a big competitor.

Prediction: David Beckham goes back to Europe.
Result: Nailed this prediction.  Becks came, he played a little bit and created a sensation.  Then David high tailed it back to the Spanish Premiere League.  I think Beckham likes the idea of playing in America, but isn’t really interested in doing it just yet.

Posted in Adidas, Apparel & Shoes, Golf, Nascar, Nike, Sports Brands, Sports Marketing, Under Armour, Venue Naming Rights | Tagged: , , , , , , , | 1 Comment »

New York Times only tells half the story

Posted by ZA on April 5, 2009

The New York Times piece by Eric Pfanner titled, “When the Attention isn’t Worth it” misses the mark.  While true that companies need to spend wisely when it comes to sports sponsorships, that doesn’t mean they should eliminate them when times are tough.  The article is critical of the sports sponsorship deals cut by companies that that are part of the government bailout, and specifically points out excessive spending by AIG and RBS.  But the article fails to point out the importance these sports sponsorship deals have in a company’s marketing plan.  It also doesn’t mention that some of these deals are proven money makers, like some of the deals that Bank of America was criticized for by Congress.

Sports sponsorships are a vital component of many large companies marketing plans.  They are equally as important as other forms of advertising and public relations.  They play a big role in building the brand of the companies that use them.  I think the Times & Pfanner need to paint a more complete picture of the subject, not just focus on the dollars being spent.  They need to report the dollars that are being generated as well.

Posted in Endorsement Deals, Sponsorship Deals, Sports Marketing | Tagged: , , , | Leave a Comment »

AIG loses their shirt…literally

Posted by ZA on March 18, 2009

The news for troubled insurance giant AIG has not been kind lately.  When the most powerful man in the free world is angry with you, that is never a good thing.  And President Barrack Obama did not mince words this week when he said he was angry at AIG over their handing out bonuses to top executives.

So how does a brand respond to the crisis?  How is AIG responding to this current crisis?
It appears AIG is doing a whole lot of nothing.  This article from AdAge discussed what PR steps AIG could take to help their current situation.  Even the PR experts admitted this situation is going to be extremely tough for AIG to rebound from, because money spent on a PR campaign to win back consumer hearts and minds will likely be viewed as more excess.  AIG did not respond to questions sent by AdAge on the story.

Making it worse for AIG is that while they take their duck and hide approach to handling this crisis, one of their biggest marketing opportunities just ran away.  News came out that AIG is losing its shirt sponsorship with soccer club Manchester United.  The deal which AIG has held since 2006 will not be renewed after the 2010 season is done.  While on the surface it might seem great for AIG to rid themselves of a $25+ million dollars per year team sponsorships, it is a big loss for AIG.

Manchester United is one of the most popular football (i.e.- soccer) clubs in the world.  Man U jerseys (or “kits” as they are called in soccer) are worn by their fans across England, Europe, Asia and the United States.  Wikipedia reports that Manchester United has over 330 million supporters worldwide, which is almost 5% of the Earth’s population.  Assuming it is true, that means that one out of every twenty people on this planet count themselves as a support of this soccer team.  That means there are millions upon millions of people walking with Man U jerseys with AIG on the front.

Is it worth $25 million dollars per year for AIG to get that type of brand exposure? I think so; and some smart company is going to jump at the chance to pay Man U even more in their next jersey sponsorship deal.  CNN reports that Indian conglomerate Sahara and Saudi Telecom are already interested and I bet a few American corporations give it a close look.  Nike, are you listening?

So AIG is not saving $25 million dollars per year, they are losing brand exposure on a global scale.  The richest club in all of professional sports, with the largest fan following in sports, is wearing your company name on their chest; and you give that up?  Makes no sense to me, it seems like they could have cut corners on some other marketing deals in order to maintain the relationship with Manchester United.  But alas, it is just another blunder in a series of missteps that AIG has made lately.

Posted in Apparel & Shoes, Soccer, Sponsorship Deals, Sports Brands, Sports Marketing | Tagged: , , , | Leave a Comment »