Friday, January 4, 2013
Title game sponsorship cost could double
By Kristi Dosh
The company that becomes the title sponsor of the new college football championship could end up paying double -– upward of $35 million -- what current sponsors of BCS bowls pay. That's according to ImageTrack, a service launched by sibling companies IEG Consulting and Kantar Media, which monitors sponsorship integration and advertising.
Under the present BCS system, the title sponsors of the Rose Bowl, Fiesta Bowl, Orange Bowl and Sugar Bowl each receive rights to the championship game once every four years when the game is played at their venue. IEG estimates each sponsor spends about $15 million to $20 million annually.
ImageTrack has projected the cost of becoming the title sponsor of the new college football national championship game after the 2014 season at $35 million annually.
“There will be, especially in the first few years of the new playoff system, a lot of interest in the championship game,” said Jim Andrews, IEG’s senior vice president of content strategy. “You won't have that cloud you've had in the past where it's not necessarily No. 1 and No. 2 playing.”
Andrews expects the new title sponsor will sign for three to five years, a typical length for sponsorship deals in sports. He also expects the current title sponsors -- VIZIO, Tostitos, Allstate and Discover -- will be the first approached about title sponsorship.
“Whether any of them will actually step up remains to be seen,” Andrews said.
If they don’t, then who?
“The brand that comes to mind is AT&T, who has a huge ad buy with ESPN,” Andrews said. “Dr. Pepper is another one who doesn't have a BCS game but has the SEC Championship and is a big advertiser throughout the season.”
ESPN has a 12-year agreement to broadcast the FBS playoffs, which will include the national championship game and national semifinals. ESPN owns the rights to the Rose, Orange and Sugar bowls, even when they are not the sites of semifinal games. An ESPN spokeswoman declined to comment about whether ESPN will remain the beneficiary of the title sponsorship money, as it has under the current BCS broadcast agreement.
Companies that pay to be a title sponsor hope the exposure of being associated with a key event makes for a good investment. The sponsorships also typically include a season-long advertising spots on the network.
ImageTrack values title sponsorship in two ways. Looking merely at what a sponsor would have to spend to buy commercials with equal airtime, called advertising value, title sponsors often double or triple their money. However, because seeing a logo for one minute isn’t exactly the same as a one-minute commercial message, ImageTrack has another formula that estimates the sponsorship value of the exposure. Under that formula, sponsors don’t always break even in years when they don’t have the national championship game, but the payday is substantial in years that they do have the championship game.
Logos and other visual representations of the sponsor appear anywhere from one to two hours during television and digital broadcasts. Verbal mentions of the sponsor by broadcasters ranged from 17 to 58 mentions the past two years of games.
The value of being a title sponsor varies by sport and event. Consider a Kantar Media study of marquee PGA events outside of the majors that had four days of coverage on CBS and Golf Channel: Those sponsorships are estimated to cost $4 million to $8 million, and the advertising value topped $4.4 million with a sponsorship value of $2.4 million. It’s a different story in NASCAR and its key races: Title sponsors pay anywhere from $400,000 to $1.5 million, depending on the race. In one marquee event studied, the advertising value topped $17 million with a sponsorship value of more than $4.8 million.
Title sponsorship of The 2012 Allstate BCS Championship was worth $104 million in advertising value for Allstate and $28 million in sponsorship value, according to the ImageTrack.