There was a time when stadiums and arenas were named after their sports teams and/or cities. There were the Boston Gardens in Boston, Tiger Stadium in Detroit,Wimbledon in Wimbledon, and Old Trafford in Old Trafford (where the Manchester United U.K. football team plays). But all of that has changed. Boston Gardens is now the Fleet Center (named after a bank), and stadiums named after companies include Conseco Fieldhouse (home of the Indiana Pacers and named after an insurance company), Reebok Stadium (sports equipment and apparel), Bradford and Bingley Stadium (savings and loan) in the U.K., and ANZ Stadium (bank),North Power Stadium (power company), and Aussie Stadium (Aussie Home Loans) in Australia. Let’s not forget Qualcomm Stadium (San Diego), PNB Park (Pittsburgh), and the United Center (Chicago).And the list goes on.
What’s behind the name changes? According to Liz Miller, former sports executive, it’s “money, money, money”—and a lot of it.Consider the following amounts, which were paid for naming rights: FedEx Field (Washington, D.C., 27 years), $205 million; American Airlines Center (Dallas, Texas, 30 years), $4,195 million; ANZ Stadium (Brisbane, Australia), $27 million ($50 million in Australian dollars); Molson Centre (Montreal, Canada, 20 years) $21 million ($33 million in Canadian dollars); and Eircom Park (Dublin, Ireland, 20 years) $21 million ($23 million in euros). And the prices continue to escalate, as there are apparently more investors than there are stadiums and arenas.
Why would companies be willing to pay that much? One reason is to create the brand awareness and highprofile exposure that come with having one’s name associated with a sports franchise. Another is to make an impression on Wall Street, indicating that the company has now become a major force in the market.Every time someone attends the venue or watches a game broadcast from the stadium, he or she sees the company name, argue the buyers—and the payback is well worth it. Consumers remember the names of corporate sponsors, says Jed Pearsall, president of Performance Research, a Rhode Island–based market research firm. And, finally, the ability to interact and network with the cities and their franchises adds value, the buyers say. Is it really worth it—either to the companies or the franchises themselves? You may remember Enron Field in Houston, named after the now unpopular Enron Corporation. That deal wasn’t so good for the franchise or the city of Houston.
Savvis Communications (St. Louis), Fruit of the Loom (Miami), and PSINet (Baltimore) are others whose names appeared on stadiums or arenas before they went bankrupt. Then there is the TWA Dome, where the St. Louis Rams play. TWA, bankrupt, was bought out by American Airlines. In such cases, the stadium names don’t bode well for the cities, whose teams become associated with the problems, and they are particularly bad for the franchises, which often end up in court with other bankruptcy creditors. Then there are the public relations and publicity aspects of the deals. As long as things are going well, the move looks like a good one. But a number of problems other than bankruptcy can lead to PR nightmares. For example, in Denver, fans wanted to keep the name Mile High Stadium when a new field was built. They initiated a lawsuit when the naming rights were sold to Invesco for $120 million—bad publicity. Soldier Field in Chicago was named in memory of World War I veterans.When the city council sought naming rights, many people were not very happy (as you might imagine!). When people in Southern California felt that they were being ripped off by their electric company, Southern California Edison, they wondered about the utility’s investment in Edison Field. In general, the public often wonders whether companies are spending their monies wisely when they pay such large amounts of money for naming rights. They wonder even more when the same companies go bankrupt.
Consider the case of the Portland,Oregon, triple-A baseball team (whose stadium happens to be called PGE Park). The team gained publicity by having an “Arthur Andersen Appreciation Night” promotion in which there were paper shredding competitions and in-stadium money certificates hidden throughout the stadium. Anyone named Arthur or Andersen got in free, and the first Arthur Andersen received a gift pack and free suite for the game—all a tongue-in-cheek event making fun of Arthur Andersen,Enron’s accounting agency. And then, of course, people think about Enron Field.