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New Meadowlands Stadium's name a sign of the times
Jan 5, 2010
Sports Business
New Meadowlands Stadium’s Name a Sign of the Times
By RICHARD SANDOMIR | The New York Times
What shall we call the new stadium that will house the Jets and the Giants starting next season?
Without a naming-rights deal, it is New Meadowlands Stadium — a blah yet refreshing reminder of the era before names like Invesco, Reliant, Ford, Lucas Oil, Gillette, Qwest, FedEx and Heinz adorned N.F.L. homes.
For the Giants and the Jets, finding a naming-rights buyer for NewMead will take time. If they planned to dedicate revenue from such a deal to help pay their construction debt, they will have to use money from other sources.
The market has been largely dormant and may never return to its prerecession peak, when Citigroup agreed in late 2006 to pay the Mets $400 million over 20 years to name the team’s ballpark Citi Field and Barclays followed soon after with a similarly priced deal to put its moniker on the Nets’ proposed arena in Brooklyn.
“The market is still completely frozen,” said Jim Biegalski, senior vice president for consulting at The Marketing Arm, a marketing firm based in Dallas. “From an overall sponsorship perspective, naming rights have such a taboo connotation that very few marketers will entertain a conversation about it.”
He said that it might take two or three years for the market to exhibit signs of significant life.
Meanwhile, New Meadowlands, Cowboys Stadium and Nationals Park in Washington await a turn in the market. Soon, Land Shark Stadium, the home of the Miami Dolphins, will lose its corporate name. It will revert to one of its former appellations, Dolphin Stadium, after Tuesday night’s Orange Bowl.
The short-term arrangement announced last year did not pay the Dolphins any money; it was a marketing deal with Jimmy Buffett, the singer and Land Shark Lager entrepreneur.
The biggest naming-rights deal anywhere was supposed to come to the Meadowlands. The prospect of two teams, the Giants and the Jets, inhabiting the same stadium, was supposed to yield the fattest fee (unless the Yankees changed their minds and sold naming rights to their new stadium). Allianz, the German insurer, was willing to pay $25 million a year to puts its name on what was going to be the only stadium in the N.F.L. with two teams.
But talks collapsed in September 2008 after sharp criticism about the company’s Nazi past, which included insuring facilities at Auschwitz and other concentration camps. The unraveling of that agreement came days before Lehman Brothers lurched into bankruptcy, which accelerated the crisis in the foundering economy.
Still, on the day Lehman declared its insolvency, one stadium deal was announced: Target Corporation said it would put its name on the Minnesota Twins’ new ballpark for a quarter-century at perhaps $5 million annually.
Then naming rights turned toxic.
The Citi Field deal was excoriated as a symbol of corporate excess and egomania. Citigroup and other banks that got federal bailout money — and had existing naming-rights deals and other sports sponsorships — were viewed as spendthrifts. Citi tried, but could not find an escape clause from its Mets contract.
Bank of America, which got bailout cash, stepped away from a deal worth more than $10 million a year to be the new Yankee Stadium’s top sponsor and opted for a less expensive sponsorship.
The recession and the departure of the star architect Frank Gehry led to renegotiating some terms of the Barclays-Nets deal. A bond document says the arena naming rights were halved.
The Nets insist that they have given Barclays more for its sponsorship money and that the bank’s total annual payments, including fees for other rights, remain unchanged.
The Giants, the Jets, the Cowboys and the Nationals’ expectations have been scaled back or deferred. A Cowboys spokesman, Rich Dalrymple, said in an e-mail message, “The subject has pretty much gone away since the stadium here opened.”
Biegalski, the marketing executive, said that the recession “has made marketers look deeply at naming rights and how they drive their brands.” He added that he could not foresee deals priced like Citigroup’s unless they give the sponsor equity in the stadium or the team.
Steven D. Korenblat, a partner at the law firm Bryan Cave who negotiated Citigroup’s deal with the Mets, said that companies that were formerly interested in naming rights were looking at sponsoring events, which tend to be less expensive and have shorter terms. He added, “I think any stadium that is built with the expectation of naming rights is going to have to adapt and try to seek a greater number of lesser deals.”
That, in a way, is what the Jets and the Giants have done, although they did not plan to sacrifice naming rights for four cornerstone partners that are each paying $8 million a year. Two sponsors, MetLife and Anheuser-Busch, signed up in 2008, before the economy tanked, while two others, Pepsi and Verizon, made their deals last year.
Giants and Jets officials did not respond to requests for comment about the status of their talks with potential naming-rights buyers. But Mark Lamping, the president of NewMead, wrote in an e-mail message that “we continue to have positive discussions but at this point we do not have anything we wish to discuss publicly.”
