Banking & Finance and Sports Business

Stadium scores Colts 30-percent sponsorship increase: Entertainment in 14 themed areas starts four hours before kick-off; strategy gains notice from other NFL teams

August 11, 2008

The Indianapolis Colts will score almost $18 million annually through their new stadium's title sponsorship and deals with 14 founding sponsors, each of which has its own themed area of the stadium's interior.

Including sponsor agreements for two massive video boards at each end of the stadium, a narrower video board circling the upper reaches of the lower bowl, and other in-stadium deals, the Colts should bring in $20 million, 30 percent more than in the RCA Dome, according to team officials.

The naming-rights deal with California-based Lucas Oil Products Inc. will bring just over $6 million annually over 20 years, while the founding-partner sponsorships-which range from five- to eight-year deals-will bring in just under $12 million annually.

More sponsorship revenue may be coming. Colts officials are working with Cummins Inc. to put the engine-maker's name on two pedestrian ramps. Flooding at the company's Columbus headquarters this summer slowed negotiations, but they could be rekindled in time for signage to be in place for the start of the Colts' 2009 season.

Armed with research data compiled for the team by Denver-based The Bonham Group, Colts officials did all the deals themselves.

The Colts gave each founding partner a $150,000 to $200,000 credit for the first year of its contract and provided each with design consultants.

Sponsors aren't just slapping their names on a corridor. Chevrolet, for instance, is promising to have a variety of its newest vehicles on hand with interactive features.

Not to be outdone, AirTran Airways is hanging a replica of one of its planes from the ceiling and is building a cross-section of a plane's fuselage where fans can get their picture taken sitting next to a life-size, three-dimensional likeness of an active Colts player.

The theory, sports marketers say, is that the more entertaining sponsors make their areas, the more visitors they'll receive during Colts games and other events. Attendance at non-Colts events is important to the team because it gets half of revenue from those events. The team gets all the revenue from its own games.

"The trend in the NFL is toward increasing the inventory in your home venue, and the Colts did their homework on this to really maximize what they could get," said Larry DeGaris, director of academic sports marketing programs at the University of Indianapolis.

'Less-than-ideal time'

While the Colts won't bring as much sponsorship cash as the New York Jets and Giants expect to reap from their new stadium, the team is getting more than either the Pittsburgh Steelers or Cincinnati Bengals. The Steelers opened their stadium in 2001, the Bengals in 2000.

"The Colts brought in a strong revenue stream at a less-than-ideal time for sponsorship sales," said David Carter, principal of Los Angeles-based Sports Business Group. "I think that probably has a lot to do with the team's on-field performance and the good will they've built up in the community."

While the Jets and Giants each will bring in $50 million in annual stadium sponsorships, Pittsburgh is scoring $12 million to $15 million, and Cincinnati $10 million, sports marketers said.

Stadium sponsorship revenue is key because, unlike ticket revenue, it is not shared with other National Football League teams.

"The fact that they got all these deals done months before the stadium was complete is really impressive," DeGaris said.

The Colts had to sell sponsorships early to pull off their groundbreaking idea of allowing sponsors to design their areas while the facility was being built.

"It's the first time something like this has been done, and the results are fantastic," said Tom Zupancic, Colts senior vice president of sales and marketing. "We think we are going to revolutionize the way stadiums wrap in these sponsors. I can guarantee you, people here have never seen anything like this."

Other NFL teams are interested in taking a page from the Colts' playbook, said Jay Souers, Colts vice president of sponsorship sales.

"We've already had several teams call us wanting to hear about and see what we've done," he said. "We gave our founding sponsors a challenge to help us entertain the fans while also getting their message out. The result is a series of very unique, engaging displays."

Colts officials are so convinced people will be riveted by the displays that they will open Lucas Oil Stadium four hours before kick-off, instead of the NFL standard 90 minutes before the game.

"That's the first time I've heard of something like that," Carter said.

Getting creative

Sponsors-from Coca-Cola and Budweiser to Huntington Bank and Baker & Daniels-spent more than a year designing and setting up their spaces at the 63,000-seat retractable-roof stadium.

In addition to working with North Carolina-based Wagner Murray Architects, which was brought in by the Colts to assist the founding sponsors, companies worked with their own advertising agencies and marketing firms to help set up their space.

Forrest Lucas, owner of Lucas Oil, took a hands-on approach with his company's sponsorship of the north gate.

"I've been at the stadium almost every week," he said. "I want this done just so because this will be a place where we show Lucas Oil to the world."

The Lucas Oil gate will feature drag racing, stock and open-wheel cars, even a souped-up tractor. It also will rev up fans with race-car simulators.

Lucas said the stadium deals his company signed were driven as much by nonfootball events as Colts games. City officials said 120 to 150 events annually-from trade shows and corporate stockholder meetings to the NCAA Final Four-will be held at Lucas Oil Stadium.

"We look forward to interacting with all the people that come through this facility and getting our message out to them," said Rebecca Carl, chief marketing and community relations officer for Clarian Health, one of the founding sponsors. "We want to reach out with our message to as many people as we can, and we think there's going to be a wide cross-section of people coming through this facility."

Clarian's space will feature displays of giant football players tackling the stadium's columns decorated as tackling dummies, each labeled as a health condition, such as "heart disease."

The hospital network also will offer health screenings in its area, along with the popular corn-hole game, prize giveaways and a large video screen playing Colts highlights.

Every section, Zupancic said, will have an interactive element. Many of the companies will offer "register to win" promotions and staff their areas during games.

Huntington National Bank's area will feature massive replicas of its Colts bank card and check, along with two circular LED tickers featuring information on financial markets and on the bank. It also will have four interactive kiosks showcasing information on the new stadium.

"Our goal is to attract banking customers, plain and simple," said Brent Frymier, Indiana marketing manager for Huntington National Bank, which sponsors the west gate. "But we understand the value of entertaining fans for both the team and sponsors. We've designed our area with that in mind. We think we're going to be a part of something spectacular."
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