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Sponsorship industry veteran Adam Hodge has urged brands and rights holders to think carefully about naming rights before taking assets to market.
He warns that deals shorter than seven years rarely deliver full value.
The former head of marketing strategy at Gemba told Sponsorship News that naming rights should be approached with an understanding of how the brand will be referenced by the public and the media.
“When you name something, be it a stadium, be it a league, be it whatever, there's an easy tendency for everybody else to cut your brand off,” he says.
“Sometimes it happens where it's impossible to remove the brand name from it.”
A small number of sponsorships had achieved a level of cultural adoption where the sponsor became inseparable from the property, however.
He pointed to Clipsal 500 Adelaide, which was known simply as Clipsal for two decades, despite many consumers not knowing what the sponsor manufactured.
Suncorp Stadium is another example, with Hodge observing that younger fans have largely abandoned the traditional name, Lang Park.
None-the-less, this level of brand association is rarely achieved quickly and usually required long-term investment.
“Once the sponsor went over seven years, it became a really difficult process for a new partner to remove that halo of it being called that,” he says.
Stadium deals of fewer than seven years were unlikely to deliver a strong return unless the venue was new and had no previous naming association, he argues.
Brands entering properties with strong heritage or passionate fan bases should be prepared for initial resistance.
“It's amazing how noisy fans will be about how upset they are about something, but then equally how quickly they'll forget about it when all of a sudden that cash injection means they can buy that amazing player and win a flag,” he says.
International restrictions can also limit the value of naming rights.
Hodge used the example of the Subway Socceroos, who must play under a non-branded name at FIFA-sanctioned events.
“They only get it really in domestic games in their own market, and then as soon as it goes into an international environment, that gets lopped off anyway.”
He recommends to brands with naming rights ambitions that they work closely with rights holders to roll out their brand carefully, particularly where heritage assets are involved.
AIG took a gradual approach when taking front-of-jersey sponsorship of the All Blacks, including initially considering a black-on-black logo to ease fans into the change.
“We actually don't want to come out year one with a big white logo on the front of your jersey,” Hodge said.
North American sponsorship markets had set a different standard for naming rights, where almost every major stadium carries a sponsor name and media are more willing to use it, he points out.
“The media know the game. If you want your jobs to continue, which is covering sport at these stadiums, then you better provide the name check to the brands who, at the end of the day, are paying everyone's bills.”
Stadiums and arenas generally offered fewer challenges for brands than teams and leagues however, because they lack the same generational baggage.
Hodge pointed to Optus Stadium in Perth as an example of a new venue where the brand quickly became embedded.
“That's reaped them so many rewards,” he concluded.
