Wednesday, November 15, 2006

Sports Sponsorship $20M a year for 20 years?

I don’t know if you heard the news that Citigroup signed a naming rights contract with the New York Mets for $20 million dollars a year for 20 years? Yes, read that line again. It is, by far, the most money ever paid for a sports sponsorship.

The details of the contract have not been announced. According to MediaPost, some of the items could include:

* Typical sports stadium-naming deals include a litany of items from signage to luxury suites. In Citigroup's case, the deal was enriched by the opportunity to lock up exclusive marketing rights in product categories where it does business--including banking, credit cards, and brokerage services.

* If Citigroup negotiated to handle financing for the stadium or to provide financial services to Mets' management and players and their families, notes Don Hinchey of The Bonham Group, the amount would look like a grand slam for the banker.

Companies looking to spend $20 million dollars on sports sponsorships usually sponsor an all-star game or develop a national sponsorship -- they don’t work with one team.

New York is the financial capital of the world, so if the bank has a smart sports marketing team, over time, this could work. At this time though, the jury is still out.


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