Tag Archives: detroit

When Can Stadium Naming Rights Turn a Corporation into a Hero?

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Corporate America: These fans could be cheering just as mightily for your brand soon enough.

Despite the crippling economic situation in Detroit, it seems like it is “all systems go” for the construction of a new home for the Red Wings in the city affectionately known as “Hockeytown.”

Although the City of Detroit filed for Chapter 9 bankruptcy in July in the largest municipal bankruptcy filing in the United States, a state board declared a unanimous vote the same week approving plans for a new downtown hockey arena.  The $650 million project will be funded, in part, with an estimated $285 million in tax dollars – even though the city is in an estimated $18-$20 billion in debt.

Detroit has become a place where police, on average, take an hour to respond to calls for help and 40% of streetlights are powered off in an attempt to save money.  Vacant buildings and empty schools litter the landscape of the former industrial powerhouse.  On the face of it, a new stadium dependent on public funding just doesn’t appear to be an appropriate allocation of property taxes given the dire situation of Detroit city services.

Advocates for its construction, however, view the 18,000-seat arena as the centerpiece in a development plan to inject life into the 45-block area linking midtown and downtown Detroit.  Michigan Governor Rick Snyder hopes the proposed retail, office, and parking space around the arena will create a better long-term environment for the city.

Completion of the area is anticipated for 2017, but to this point, there has been no public mention of any corporations vying for naming rights of the Red Wings’ new home.  The proposed arena would be home to one of the most storied franchises in all of professional sports and would supplant the Palace at Auburn Hills as the premiere indoor concert venue in Metro Detroit.  There is a lot riding on this venue, and it has the potential to breed a very positive influence on a very depressed city.  According to our research, this is the perfect situation for big business to find sponsorship success by playing the hero, rather than the exploiter.

In the first independent study of its kind, Performance Research revealed the critical “Naming Rights & Naming Wrongs” of stadium sponsorship.  When do companies get it right, you ask?  In situations such as this where there is a strong need for a new venue, and there is a deep appreciation for corporate contributions that help make the new stadium a reality, that’s when!

Some pertinent highlights from the study: Nearly 40% of respondents opposed the idea of changing the titles of existing stadiums and arenas to accommodate corporate naming rights, regardless of the reasoning.  However, companies that struck deals with new and developing arenas experienced a positive impact on public opinion with 6 out of 10 fans. Local supporters embraced named stadiums that were new because they often felt they benefitted personally as a result.  ‘Lower taxes,’ ‘more sports opportunities,’ and ‘lower ticket prices’ were the most appreciated benefits cited by fans.

Although hockey is not discussed, this intriguing USA Today infographic highlights the lucrative nature of stadium naming rights today.  Joe Louis Arena, Detroit’s current house of hockey, is one of only three in the NHL without a corporate sponsor.  Our prediction?  Look for the new Detroit arena to buck this trend and shop its naming rights this time around.  And, if corporate America is smart, they will surely listen.

If a corporate sponsor emerges to help facilitate Detroit’s new downtown developments, the results would be tremendous for everyone involved.  A city in desperate need of salvation would see government funding allocated where it is needed most.  The new venue and surrounding infrastructure would provide a well-timed ray of economic hope for Detroit. And its residents, as well as those outside of the area, will recognize that sponsor’s commitment in making it all happen with substantial PR gains in the process.

That is how to become a corporate hero in one easy step.  What’s not to like?

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Filed under Caught Our Eye, Current Events, Independent Research Studies

Where’s the pizza, Little Ceasar?

Amongst all the college football bowl games going on this month, one in particular is standing out in my thoughts.  This game, the Little Ceasar Pizza Bowl, took place last week in Detroit with a battle between Marshall and Ohio.

Little Caesars, who took over title sponsorship for the first time this year, was hailed in the Detroit local press as a savior for the city, and a good sign that Detroit is still a viable option for major sporting events amidst economic crisis.  While this positive press and media coverage is a good thing for Little Caesar, perhaps there was another area of their sponsorship that the QSR chain could have focused on.  I am referring to the fact that no Little Caesars pizzas were available inside the stadium.  On top of this, one of their competitors, Hungry Howie’s, was present and for sale.

Right off the bat one would begin to question this issue. Why not provide / sell your product at the game?  It offers a perfect opportunity for a fan that is already at “your game” to try the exact product that you are there to promote.  Not only would you benefit from name recognition, but you would tap into other senses via the pizza.

On the other side of the spectrum is the reality that selling Little Caesars pizza would infringe on the agreement that Hungry Howie’s and Ford Field already have in place.  I don’t imagine Howie being too excited about letting Caesar cut into his pizza sales.  Did Little Caesars consider this before signing on as a title sponsor? Is there anything they can do next year to avoid this same awkward issue?

Selling Little Ceasar at the game could have proved beneficial to their cause, and the fact that their product wasn’t present defintely caused a few heads to turn.  This seems to be an issue that may have not been avoidable, but certainly deserves to be questioned.

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Filed under General

Economic Recovery could (should?) spur era of “Customer Compassion”

As Americans struggling through a down economy, we have had little to do other than budget our spending and look for the light at the end of the tunnel.  When we do pull ourselves out of this hole, how will we spend out money when these brighter days come?

gmOne sector that makes this question very interesting is the automobile industry.  As of early June, the American Government (i.e. American Taxpayers) owns roughly 70% of General Motors, which could lead to a historic shift in consumer purchasing objectives.  Now that the majority of this manufacturing giant is owned by the public, does that make us any more likely to purchase one of their (our) vehicles?

Some would say of course.  “How unAmerican would you be considered amongst your peers if you chose a foreign manufacturer, considering future taxes and financial stability are linked to GM’s success?” asks Bill Doyle, VP of Performance Research.  Like minded individuals would agree that this sense of “new America” patriotism will offer the domestic auto industry a big bump as we rebound from rougher times.

Besides the possibility of increasing sales in the near future, the post recession customer base will offer GM a chance to re establish themselves as a viable option for the long term, and if they succeed, setting up the building blocks to create a new sense of brand loyalty.  The determining factor will be GM’s ability to lure skeptical consumers to sign on the dotted line, by invoking an air of U.S. pride, and offering a product comparable to Asian competition.

If given the option of two similar vehicles, at equivalent prices, I would like to think that I would purchase the American made automobile based on both economic impact, and national pride, but it would be require some consideration.  Why do we owe to these companies who took so much, yet how do we turn our backs on one of our own?

What would you do?

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