No, Sponsorships Are Sponsorships

To answer my last post: I see no obvious difference in “level of waste” between the naming rights for the new Mets stadium and the sponsorship of the New York City Thanksgiving Day Parade.

Both a stadium and a parade provide public benefit. The costs of providing each can be partially defrayed by allowing one or more companies to add their name(s) to it. And either can be wasteful or efficient, provide more or less equal compensation to those employed by them, and so on.

The heart of understanding this NALM misjudgment is to realize that, since a stadium alone does not entertain, it’s easy to underestimate its communications impact. But sentimentality makes this particular comparison more uneven: Macy’s has been sponsoring the Thanksgiving Day Parade for so long that most people never consider the possibility of another company doing it, or of the parade not being sponsored at all. (I remember being pretty annoyed when Met Life took over the naming rights for what till then was the Pan Am building.)

I doubt that Citicorp will hold the naming rights to the Mets stadium 85 years from now, but if it does, it will seem very strange if another company takes it over. We can compare the marketing effect or degree of public benefit of sponsoring a parade vs. naming a stadium some other time, but it’s clear that they’re of a piece and not particularly different in principle.

There Are Sponsorships and There Are Sponsorships?

Happy Thanksgiving to all! Be safe, relaxed, and joyful.

My marketing note for the day is just this: If Citicorp’s naming rights for the Mets stadium are wasteful, what about Macy’s sponsorship of the New York Thankgiving Day parade? Where, exactly, is the difference? If you’re thinking that, in your bones, you know the Macy’s Thankgiving Day Parade is different, I advise caution.

Hint: Is a parade more or less of a public service than a sports stadium?

Naming Rights ≠ Waste

There was a lovely posting at Talking Points Memo yesterday with the NALM subtext that naming stadiums after companies is bad; wasteful.

The post’s topic was that Citicorp just got a ton more money from the government in order to stay afloat, and yet it’s still spending $400 million on naming rights at the new New York Mets stadium (which will be called Citi Field). Rachel Maddow also had a segment on this on last night’s show.

The disdain journalists can have for the sources of their daily bread can sometimes amaze a marketer who’s worked in media. I understand the need for distance from sponsors and advertisers, certainly; this distance enables integrity. And I rather admire those who bite the hand that feeds in the name of integrity—since sponsors and advertisers, including multi-billion-dollar banks on the dole from the Feds, support the marketing and media industries that pay most journalist’s salaries (even Blogads-supported journalists).

But these guys shouldn’t show such disrespect for an entire industry, in this case sports marketing, as to assume ipso facto that naming rights are so wasteful that no company receiving taxpayer money should be allowed to spend money on them.

Look, Citicorp is spending $400 million for these rights, which they will have for 20 years. $20 million a year. Let’s forget for the moment that some of this $20 million a year will go to employ people—that’s a complicated and I think ultimately specious argument.

No, the point of marketing is to make extra money by investing in it. Having the stadium of one of the best-known teams in the U.S. named after your company means that that name will be repeated over and over again, on TV, on the radio, in sports articles, on the train, in peoples homes, and a thousand other places. Will frequently hearing, reading, and thinking the word “Citi” cause consumers and businesspeople to go to Citicorp more often, enough so that the bank will gain more than $20 million a year in additional revenue? I don’t know, but it doesn’t sound outlandish to me; far from it.

Junkets for losers, on the other hand—now those are wasteful. Just a lot less expensive (usually).

→ Update: My buddy SK points out to me that it’s actually Citicorp, not Citibank, naming the stadium. So I’ve corrected the above.