Would a stadium by any other name smell as sweet?
When it comes to sports stadia, fans probably disagree with Shakespeare’s proclamation regarding the odour of roses. In contrast, clubs’ boards are fully with the bard when it comes to sweetness: they know it’s a huge revenue-generating opportunity, which is why valuing stadium naming rights is, literally, such a big deal.
So, purely to get the ball rolling, we looked at the published value of 20 stadium naming rights deals (added SoFi Stadium deal in September) across major sports clubs in England, the US, Australia and Canada. This figure was then cross-referenced against both the stadium’s capacity and the guaranteed number of home league matches for the team(s) that play there.
The idea was simply to see what value per attendee a sponsor might stump IF the deal had been based ONLY on the club guaranteeing sell-outs for each regular season game. After all, in most cases, clubs can’t absolutely guarantee their team will be drawn at home in cup games or qualify for play-offs over a number of years.
For example, American Football team the Las Vegas Raiders recently signed a stadium naming rights deal with discount airline Allegiant Air for a reported $20-25 million annually. The stadium holds 65,000 seats and the Raiders usually play eight home games in the regular season – equating to 520,000 potential attendees. Taking a middle value of $22.5 million equates to £35.77 (based on current exchange rates) per regular season match attendee – by a huge distance, the highest value among the 20 we measured.
In contrast, Disney shelled out at least AUS$8.75m – the equivalent of just £1.74 per attendee – to turn Melbourne’s 53,359-capacity Etihad Stadium into the Marvel Stadium which is home to five Australian Rules Football teams, a cricket and a soccer team. As a result, they get a whopping 53 home games which explains the extremely low cost per attendee.
Disney’s deal shows the extra value in sponsoring stadia that play host to a number of different teams as well as other events. For example, our recent analysis showed that M&S Bank, who have naming rights to the Liverpool arena in which the Netball World Cup took place, achieved half the media mentions of title sponsor Vitality, despite having no official sponsor association with the event.
As we noted at the start, valuing stadium naming rights involves a whole host of factors – way beyond the two we’ve started out with. But one has to start somewhere.
Take Tottenham Hotspur for example. There’s been much publicity on the potential value of naming rights to their brand new stadium. Based purely on the maths in this piece, aligning it with the Disney/Marvel deal would value Spurs’ stadium at £2.1 million per year, whilst the mid-range of these 20 would put it at a shade over £13 million – fairly close to arch rivals Arsenal’s £15.3 million naming deal with Emirates.
Or, if they pitched at the Raiders/Allegiant level, it’s a substantial £42.2 million annually (similar to the £40 million Spurs has agreed with AIA for the shirt sponsorship).
Ironically, one of the Raiders’ games in 2019 is at Spurs’ new stadium, so perhaps that’s where they see the level at.
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