Why Sco­tia­bank bet $800M on NHL fans

Ex­pert says bank is brand­ing it­self as ‘the bank of hockey’

Winnipeg Free Press - - NEWS - ALEKSANDRA SAGAN

ANCOUVER — Sco­tia­bank’s $800-mil­lion deal for the nam­ing rights to the Air Canada Cen­tre, home of the NHL’s Toronto Maple Leafs, is the lat­est move by a cor­po­ra­tion to cor­ner the spon­sor­ship mar­ket of the coun­try’s na­tional pas­time.

While a whop­ping sum — on an an­nual ba­sis, 10 times as much as Air Canada is re­port­edly pay­ing — ex­perts say the in­vest­ment will pay back in div­i­dends through good­will and in­creased rev­enue as even die-hard fans have be­come ac­cus­tomed to the new norm of sta­di­ums bear­ing cor­po­rate names.

The bank an­nounced Tues­day it has signed a 20-year deal for the nam­ing rights for the arena, which will be­come the Sco­tia­bank Arena in July 2018. Next year’s name change will be the first for the 18-year-old venue.

But Sco­tia­bank be­lieves the in­vest­ment is worth the price tag for a deal that was called “record-set­ting” by Maple Leaf Sports & En­ter­tain­ment.

That’s be­cause Sco­tia con­sid­ers hockey “core to our strat­egy,” said Jac­quie Ryan, the bank’s vice-pres­i­dent of spon­sor­ship and phi­lan­thropy.

It sup­ports more than 8,000 community teams and al­ready has its name plas­tered on another NHL team’s arena, the Sco­tia­bank Sad­dle­dome, where the Calgary Flames play.

“Hockey is a key driver of our brand health,” she said, adding, “The reach of a hockey spon­sor­ship port­fo­lio in Canada is sig­nif­i­cant.”

Ex­ter­nal con­sumer re­search done for the bank shows peo­ple who are aware of its fi­nan­cial sup­port for hockey are three-and-a-half times more likely to con­sider us­ing its ser­vices, Ryan said, a po­ten­tial boon for a bank in a na­tion where it’s dif­fi­cult to en­tice con­sumers to switch in­sti­tu­tions.

“It’s quite pos­si­ble that num­ber could go up,” she added, thanks to in­creased vis­i­bil­ity when the Sco­tia­bank name ap­pears on the arena.

The bank is look­ing to in­crease that pos­i­tive sen­ti­ment by as­so­ci­at­ing it­self with the sport Cana­di­ans are so pas­sion­ate about, said Vi­jay Setlur, a mar­ket­ing in­struc­tor at York Univer­sity’s

VSchulich School of Busi­ness in Toronto.

Since banks are in an in­dus­try where they all pro­vide sim­i­lar prod­ucts, Setlur said it is cru­cial for them to dif­fer­en­ti­ate from their com­pe­ti­tion through things like sports spon­sor­ship.

The Bank of Mon­treal, for ex­am­ple, tends to fo­cus on soc­cer and bas­ket­ball, he said, while the Royal Bank of Canada hones in on ju­nior hockey and the Olympics.

By brand­ing it­self as “the bank of hockey,” Setlur said, what bet­ter plat­form for Sco­tia­bank “to re­in­force that mes­sage than to have the nam­ing rights of the Air Canada Cen­tre, which ar­guably to some is the epi­cen­tre of hockey in this coun­try?”

Banks could mea­sure a deal’s ef­fec­tive­ness by the num­ber of new bank ac­counts opened af­ter­wards, Setlur added, as well as the amount of money de­posited in them and the amount of in­ter­est the bank earned.

They may also look at less con­crete things like con­sumer sen­ti­ment, which may not al­ways trans­late di­rectly into rev­enue dol­lars.

Another ben­e­fit is in­creased me­dia cov­er­age, as the com­pany’s name will be linked to the arena any time an event takes place.

How­ever, cor­po­rate names slapped onto beloved sports sta­di­ums aren’t al­ways well re­ceived.

When a his­tor­i­cally named sta­dium is re­branded un­der a cor­po­rate spon­sor­ship, fans tend to get up­set, ac­cord­ing to re­search con­ducted by Stephen Rey­sen, an as­so­ciate pro­fes­sor of psy­chol­ogy at Texas A&M Univer­sity.

That was the case in 2005 when Toronto’s SkyDome, home to the Toronto Blue Jays, was re­named the Rogers Cen­tre much to the cha­grin of fans.

How­ever, a fol­low-up study Rey­sen con­ducted showed fans did not care if a sta­dium’s name changed from one cor­po­ra­tion to another, as will be the case when the Air Canada Cen­tre is re­named to the Sco­tia­bank Arena.

“The only way fans out there will care is if Air Canada is mean­ing­ful to the fan iden­tity, and I can’t see it be­ing mean­ing­ful,” Rey­sen said.

DARREN CALABRESE / THE CANA­DIAN PRESS FILES

Sco­tia­bank has signed a 20-year deal for the nam­ing rights for what is cur­rently known as the Air Canada Cen­tre.

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