NEW YORK The arrival of spring means the return of baseball, which in turn means a new season of Major League Baseball sponsorships.
Over the last five years, MLB has doubled its number of sponsors, from approximately 12 at the end of the 2003 season to 20 this year, with Sharp the newest brand on board. (Remember, this isn't Nascar, where fans embrace the sponsors as if they were extensions of the athletes; in 2004, for instance, MLB scrapped a plan to turn bases into ads for Spider-Man 2 when fans revolted.)
John Brody, svp, corporate sales and marketing at MLB, discusses the season that kicks off this week.
Q: What do the sponsors mean to MLB in dollar terms this year?
A: Our partners, and there are 20 national sponsors [this year], represent a roughly $400 million business in direct and indirect spending ... with our broadcast partners—nationally and locally—with our national sponsorship dollars and with our media partners in general.
How much has that number grown in recent years?
I think our number has roughly doubled since 2003. What we've been able to do in the sales and marketing business is work with top-tier partners to accentuate great things going on on-field. Of our 20 sponsors, some 15 will have national advertising that is baseball themed. Our sponsors have really embraced the game and helped take it to greater heights.
To what do you attribute the growth?
It goes to the health of the sport—the fact that over the course of the last seven years we've had a different World Series champion each year. Every fan in every market has this all-important thing called hope. On opening day everyone has a chance to win the World Series. Our TV ratings [were] up between 10-15 percent [last year]. The Home Run Derby was up 10 percent and the All-Star Game was up 15 percent. Since 2003, [brands that] have signed on include GM, InterContinental Hotels Group, Nestle, Taco Bell and XM Satellite Radio.
Given all the sponsorships, is there a risk of the brands diluting their potency?
Without question we're very careful who we partner with. We need partners who are all in and who believe less is more. No disrespect to other sports properties, but we're not looking to have 75 national partners. We're only going to do deals with people we feel are leaders in their industry and people who can meet our fairly significant spending commitments. We need them to activate aggressively.
Explain your spending commitments.
Obviously direct-rights fees are a component, as is spending with our national broadcast partners—Turner, ESPN, Fox—spending with our satellite partner, XM, spending with our terrestrial radio partner, ESPN, and spending with our various clubs. It's doing what Baby Ruth is doing and taking 40 million candy bars and putting MLB logos on them. It's MasterCard doing MLB-themed creative. It's [InterContinental Hotels Group's] Holiday Inn dedicating three national spots to their MLB sponsorship. You also have to remember MLB is supposed to be fun.
Stadium naming rights have become pretty accepted by MLB fans. What do you see as the next frontier? Will an MLB team ever be named after a product, like the New York Red Bulls in Major League Soccer?
I will respectfully defer to the ninth commissioner of baseball [Bud Selig] on that topic. He said that during his tenure there would be no logos on uniforms. That doesn't mean what the Red Bulls are doing is right or wrong. I don't think that necessarily is the next frontier [but] it's the continuing evolution of media. As life continues to change and evolve, baseball will continue to evolve.
The Spider-Man episode made it clear that bases are sacred property. Yet the Cubs this year will have advertising among its iconic outfield ivy. What is the line, if any, that ads won't, or shouldn't, cross?
It's not for us at MLB to decide. We listen to our fans and we're respectful of the game on the field. Anything we do from a marketing or licensing or sponsorship or broadcasting standpoint is meant to enhance the game.
Which baseball player, past or present, is the biggest global brand?
What bigger hero, bigger spokesperson for change and bigger icon is there than Jackie Robinson? He didn't break the color barrier in baseball or sports, he broke [it] in life.
What kind of metrics does MLB employ in regards to its sponsors?
First, we rely heavily on research. We have an internal research department. The first thing we do when evaluating either a current partnership or one up for renewal is evaluate if it's relevant to our fan base and to their customer base. We're dealing in quantitative research based on hundreds of thousands of respondents telling us about their avidity for our sport or their avidity for a potential partner or an existing partner. We join the NFL as the only sports property in saying over 60 percent of Americans consider themselves fans of our sport. When you're selling and marketing a product, that's a pretty special place to start.
How do you match brands with events?
We try to look at different areas in different industries and say what is the best brand to match ourselves up with from a research perspective. Gillette is the presenting sponsor of Father's Day for MLB. Why? We both have an intense commitment to men's health and prostate cancer awareness. We're working with them on an initiative around Father's Day where we get the message out that one in six men will be diagnosed with prostate cancer. We're having a little fun with it and changing from the seventh-inning stretch to the sixth-inning stretch [around the holiday]. Gillette has been with us since 1937. That relationship is, we believe, the longest sports partnership ever.
Which sponsor is the biggest in terms of monetary compensation?
Anyone who is a sponsor of Major League Baseball is a valued business partner. We value people on the activation that they put behind it. Look at Anheuser-Busch, the official beer sponsor; they have roughly 26 club relationships in addition to the one with us. GM has 18. MasterCard has 15 or 16. It's about their commitment to the sport.
This is the second year of your deal with Holiday Inn. What's different about this year's efforts than last year's?
With their Priority Club Rewards program, they're taking the MLB message to hundreds of thousands of their most precious customers. They've done an unbelievable job of activating their partnership on television [and] at their hotels. We're going to be unveiling, for Priority Club Rewards members, a program in May. When members check in, they get a pack of MLB baseball cards. We really jumped in with both feet quickly at the beginning of last season. Having three new commercials, having Cal Ripken Jr., the soon to be Hall of Famer, as a spokesperson is new. They also have had enough time to fully integrate MLB into their look again campaign. All those things were done quickly last year. This is a much more well planned and complete opportunity for them.
Where in the world is the biggest growth opportunity for MLB?
As we look to the fan base, which is growing and expanding, as the world continues to change and evolve and borders between countries continue to break down, so too does our sport. Over 30 percent of baseball rosters are filled with players who are not born in the U.S. I think that speaks to the globality of the sport. You look at last year's World Baseball Classic: it had all the best teams from all around the world. The U.S. didn't make it out of the first round. The final was between Japan and Cuba.
Which category or brands would not work with baseball?
If our fans tell us there's an opportunity within a specific category, we look at it. If our fans tell us it's not the right fit, we listen to the most important judge and jury: our fans.
So there's nothing you'd rule out?
Our research tells us where we should be looking for relationships and where we shouldn't. I'm not omnipotent. I don't know the right places to be and the wrong places to be. I leave that to our fans, who have kept our game in good standing.