Case Study: How to use naming rights in the business of sports Harvard Case Solution & Analysis

INTRODUCTION

The case study is based on naming rights in the business of sports which are allotted to arenas, esp. stadiums, football stadiums to be precise considering the scale of rights and annual turnover which has seen rapid boost in the past few years. The naming rights have recently become the tool of not only marketing but a financial as well, allowing the operators of sport facility to generate funds for the development purpose.

1.      The origin of naming rights

The naming rights have a long history of tradition, which can be rooted from the allocation of names of libraries, hall of residencies, airports and many other named after famous personalities. The first idea was bought in by USA, where it all started with the launch of Disneyland in California by Walt Disney in the year 1955, although Disneyland was opened by Walt Disney themselves, it formed the basis of the idea for allocating naming rights with the sponsorships. The first large arena to market the naming right was Key Arena in Seattle that bonded the deal for $0.75 million / year with the validity of 15 years in the year 1962.

Soon after the naming rights business become the trend in the sport business with names used as a marketing tool. Germany followed with the deal which was sealed between Volkspark stadium in Hamburg and AOL incorporation, the deal which stirred the local industry and become the apple of the eye of the public.

With the contracts averaging between 15 to 30 years, it become the strategic tool which not only provided huge funds, but also become a tool for strategic communication to the key stakeholders. To validate this comment, the most gossiping and publicized deal was sealed between Emirates Airline and Arsenal Football club, attracting millions of football fans around the globe to cheer for this deal.

2. Field of Sports where implementation of naming rights can be done

During the recent years, the sports industry has been the favorite of sponsors for the implementation of naming rights, yet it must be noted that not all sport activities carry potential to reap the benefits of this tool. After the initial surveys and trends set by sponsors to have the naming rights, some of the sport fields have been identified which has the highest frequency of getting naming rights.

Teams which consist of cycling have been the avenue for naming right for the sponsors, as this sport has huge audience base which is the prime target of any naming sponsor company, recent example is the Bowden development who has secured naming rights of Cycling SA (South Australia) elite team series. Along with the cycling, motor sport consist of Formula 1, NASCAR, RALLY, and BIKE (MOTO GP and World Super Bike) are the favorite spots for sponsor companies. Shell Petroleum recently refreshed its naming right with Australia Ford Team DJR Team Penske.

Moreover, Events such as those mentioned in scenario Golf Tournaments are the hot spots for the naming rights for the particular events which attracts material number of audiences and have multiplier effect. Golf Tournament which was named as Deutsche Bank championship, these particular events benefits the company with the limited cash flow with an aim to maximize the brand awareness of the company.

Case Study How to use naming rights in the business of sports

Clubs are also one of the fields of sports attracting sponsors for naming rights. Clubs mainly includes football, basketball, baseball and many others. Focusing on baseball, the recent agreement has been signed between Kane County Cougars Minor League Baseball team and Fifth Third Bank, Ballpark. The agreement has been placed to secure naming rights for Kane County Events Center.

Series are the next avenue of field of sports which has demand of naming rights of sponsor companies. Series like world cup are sponsored by name giving companies which buys name rights for particular series. Ski World Cup 2013/2014 series which was secured by Audi Company is one of the examples to reflect the attraction of this field of sport to sponsors.

Leagues are also the attractions for the name right companies, the most gossip Europeans football league, together with recent UEFA Champions League which was secured by multiple sponsors.

Track sections can be referred to motor racing (mentioned above) are also the spots for naming rights.............

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Case Study: How to use naming rights in the business of sports

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