Shutdown presents challenges for teams, sponsors
Associated Press
CHICAGO — There are no sponsored power plays at the moment.
No doughnut races in the fourth quarter.
No calls to the bullpen presented by phone companies.
Amid the coronavirus shutdown, sports business executives are having tough conversations about lucrative advertising and marketing contracts with no games on the horizon. Everyone involved knows the relative insignificance of the talks in the greater scheme of things, but billions of dollars are in play, and the results could have far-reaching implications for sports for years to come.
“It’s unprecedented,” said Justin Toman, the head of sports marketing for PepsiCo Inc. “I think there’s been a lot of creativity and discussions, scenario planning on how to deal with it. But it’s ongoing and I don’t think anybody has the answer. I think it really is this almost unthinkable thing that has impacted the world of sports.”
The conversations are made even more complicated by an almost infinite number of variables.
It’s unclear when the NBA and NHL will be able to resume this season, if at all. If they start play again, it’s uncertain how they will deal with the rest of their regular seasons and playoffs. Major League Baseball is looking at myriad scenarios for its season, and even the NFL in its offseason is dealing with its own set of potential issues.
Then there are questions around playing without fans — one of the possibilities being contemplated by some leagues.
“If there’s no fans in the stands, then, from a sponsorship perspective, there will be a race to who gets TV inventory, TV-visible inventory, which is roughly half of the value to sponsorships,” said AJ Maestas, the founder and CEO of Navigate Research, a sports and entertainment research firm. “So half of the value you’re trying to replace, or make good, you know as a marketing term, with very limited television inventory, because usually it’s close to sold out in a healthy economy.”