Matier & Ross:
The 49ers cut a $220 million stadium-naming deal with a San Francisco institution — they’ll play in Levi’s Stadium.
One of San Francisco’s most widely recognized companies, the clothing outfit Levi Strauss & Co., will pay $220 million over the next two decades to put its name on the San Francisco 49ers’ new stadium in Santa Clara.
The naming rights agreement — which will help the Niners pay for their $1.2 billion stadium, scheduled to open for the 2014 season — was announced Wednesday in a news conference at Levi’s headquarters. The 68,500-seat venue will be called Levi’s Stadium.
“Levi’s Stadium will connect two iconic Bay Area brands that share similar values, a rich heritage and a pioneering spirit,” said Chip Bergh, CEO of Levi Strauss.
Bergh called the deal a “chance for us to engage with sports and music fans across the Bay Area and around the world.”
Team CEO Jed York noted that 49ers — as in the mining kind — have “worn Levi jeans since the Gold Rush era.” And while it may not be the biggest stadium naming rights deal ever secured, York said it was the “right fit.”
The announcement comes as the Bay Area Super Bowl Committee formally submits its bid to host the Super Bowl, either in 2016 or 2017, at the Santa Clara stadium.
The naming rights deal is the last of four major pieces needed to finance the stadium — with luxury boxes, seat licenses and other corporate sponsorships helping to cover the tab.
The selection of an old-line San Francisco apparel brand over a Silicon Valley company is a bit of a surprise, given the emphasis the team has placed on making its new stadium state-of-the-art.
The deal is considerably less than the $330 million that the Niners were hoping to snag from a naming rights deal just a few months back. It’s also well below the $450 million that Met Life paid in 2011 to put its name on the new home of the New York Giants and Jets in New Jersey for 25 years.
However, York told us the team already had enough “contractually obligated income” to finance the stadium — and, in fact, may go over $1.3 billion total with the naming rights pledge.
“So the way we look at it, it’s not just about a naming rights number,” he said. “It’s about the collective sponsorship revenue and making sure we had the right fit.”
Three other companies reportedly expressed interest in the stadium naming rights.
The 49ers had hired Creative Artists Agency of Los Angeles to help the team land a naming rights partner. But this deal apparently came through the side door when somebody connected to Levi’s reached out directly to York and suggested he talk to Bergh.
The two met over dinner in December, then spent months working out an agreement.
James “J.C.” Curleigh, the executive vice president who heads the Levi’s brand, says the deal will eat up “a decent percentage” of the company’s annual advertising budget — but that it’s worth every cent.
“Go to any concert or sports event, and more people show up in denim than anything else,” Curleigh said.
Still, former 49ers executive and sports consultant Andy Dolich is skeptical that Levi’s will reach the audience it’s looking for, given the limited number of events that will be held at the Santa Clara stadium and the generally older crowd that pays to see the Niners.
He thinks the Golden State Warriors’ planned arena on San Francisco’s waterfront — where there are likely to be four times as many events a year and a wider range of people — might have been an even “better fit.”