Business Bits: Expansion in St. Louis & the Monday After

st-louisWith MLS announcing Portland as the League’s 18th Expansion Franchise, St. Louis appeared to be the big loser.   Since the announcement, Commissioner Garber worked hard to dispel that belief.  In an article published in the in St. Louis Post-Dispatch, Mr. Garber indicated that the League would work hard to steer investors to join Jeffrey Cooper’s bid.  We have written about Mr. Cooper’s bid before, and noted the League’s frustration with the lack of financial backing; it appears that the League is now going to work hard on Mr. Cooper’s behalf.

Mr. Cooper is a bridesmaid again, despite a solid stadium deal and a city with a strong soccer history.  With one more round of expansion scheduled for the coming years, he is running out of time to cement a team for the Gateway City.

Week one of MLS action is complete, and League wide, attendance was just OK.  Houston, Dallas and Chivas brought in about 16k, while KC and San Jose sold out their smaller parks.  Seattle was a sell out on Thursday night with more than 32k and the Galaxy brought in 18k (probably the most disappointing number of the weekend) for the Sunday game.   The Crew/Dynamo match-up of the last two Cup winners was also surprisingly lightly attended.  Dallas was higher than anticipated, but the presence of Blanco may have been a contributing factor.

The League debuted their new MLSlive features this weekend and the product seemed to work well.  For less than $20 for the season, the package is a fantastic bargain.  Direct Kick was free this weekend as part of the League’s annual preview.  With the price again at $79 for the season, this is also a great deal.  These packages do not include the games broadcast nationally on ESPN, FSC and Telefutura.  Interstingly, the local broadcasts prominently displayed advertising in the upper corners of the screens, adspace not used by EPSN2.  For the matchup on Telefutura, occassional screen advertising was present, but only for infrequent interludes.  Gildden, Nakita and Addidas were among the prominent stadium signage around the League. mls

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Interview With Tim Martin of Gallagher Sports

mlsEarlier today, Footiebusiness.com posted about San Jose’s recent sponsorship deal with Amway. Tim Martin, a 10 year veteran of the sports marketing field and the President of soccer marketing entity Gallagher Sports, lauded the deal in a recent article for ESPN.com.  Mr. Martin has worked for a number of major brands in an array of sports marketing categories and has negotiated tens of millions of dollars of sponsorship agreements.  He was kind enough to answer a few questions posed by Footiebusiness.com:

Footiebusiness.com:  Despite the obvious positives of bringing money to San Jose,  some fans have wondered whether adding Amway to the League’s other two multi-level marketing jersey sponsors (Xango & Herbalife) either diminishes the standing of the League or creates an association that could be harmful. Do you think those are legitimate concerns?

 

Tim Martin: They are certainly legitimate concerns, because each of those MLM’s has had noteworthy and seemingly legitimate legal and/or scientific complaints registered against them in the past.  At the end of the day, however, it needs to be a decision weighed, and ultimately made, by the club, based off of its unique goals and objectives.  We are also in an unprecedented economic environment where almost no industry is immune to public scrutiny when it comes to where they are spending what may be perceived to be the public’s money.  Two years ago an observer may very well have listed major financial institutions and auto makers as two of the best and most stable of industries from which a club could secure a shirt sponsor.  That was before congressional hearings and TARP funding became staples of the evening news broadcasts and cast major sponsorship funding in an entirely new light.  At times like this, there is risk in just about any sponsorship.  If there were 15 multi-level marketing companies across the front of MLS jerseys, it may be indicative of a problem.  3 of out 15, however speaks to sponsor category diversity.


FB: The League has been working hard to market the game to a younger, “hard core” fan base for a while now.  Do you think Amway’s product line a good match for this type of crowd? Who are they trying to attract?

TM: I do not think that Amway’s products are necessarily a good fit for such a target, however, without having a working knowledge of Amway’s marketing strategies, its difficult to say exactly who they are targeting, particularly because they are so diverse.  The one thing that I believe is safe to assume is that they find the Quakes (and MLS) a global medium for broadcasting their brand, and must feel that the impressions they will receive around the world are worthy of the investment.


FB: There are now four clubs without jersey sponsors.  Do you think sponsorships deals are in the works for those clubs?  Fans are amazed that teams like the Revs, Rapids and Dallas (with the power and business acumen of  Kraft, Kroenke, etc..)  have not landed a sponsorship.  In your mind, what are those teams looking for, and what should they be looking for in a deal?

T.M. I’m fairly certain that any club without a jersey sponsor is actively pursuing one.  Its far too great of a potential financial resource not to be.  Each club, however, will assign a different value to the front of their shirt, and by value I don’t just mean a certain sum of money, but also cognizance of the brand they are associating themselves with.  This is very relatable to your first question in that it all comes down to the goals and objectives of the club.  It’s possible that these remaining clubs have had offers from multi level marketers, or casinos, or tobacco companies, and simply choose not to go into business with them due to an organizational belief system (I have no first-hand knowledge of any such offers, just using that as an example).


F.B. Some of the first deals have now been in place for a couple of seasons.  Do you think that the sponsors have realized the intended benefits from these deals?

T.M. Again, not knowing each sponsors specific goals and objectives for striking these deals in the first place it’s impossible to say for certain how they feel these deals are working for them.  I think that at least one success story would be Glidden and the Columbus Crew.  First and foremost, they bought the sponsorship at what would today be considered a great value price of $1M per year.  Little could they possibly have known at the time that a former Boca Juniors legend would guide the franchise to its first title while providing the brand with unprecedented exposure in South America, on top of what they also obviously received in the States.  It can also be reasonably assumed that Herbalife has received adequate value back on their $4M+ investment through worldwide Beckham jersey sales alone, and the exposure that they provide.

Once again, many thanks to Tim Martin of Gallagher Sports. To the readers of Footiebusiness.com, what do you think about Amway coming into the League, or about shirt sponsors in MLS?

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