If you speculate in the stock market or simply follow high-tech news, chances are you knew about companies like
long before the general public. But now everybody knows those names. How? The answer may be etched in stone in San Francisco and San Diego.
A few years back, San Francisco's Candlestick Park -- home of the
-- was renamed
after a multimillion dollar investment by the network systems company. And a similar transaction renamed Jack Murphy Stadium in San Diego -- home to the
after the wireless communications company.
It wasn't a new idea. Corporations with household names, like
, have tried high-profile-venue sponsorship before. But for 3Com and Qualcomm, the move had a bigger impact.
The electronic and print media covering sporting events were thrusting the names 3Com and Qualcomm into the everyday lexicon of tens of millions of sports fans.
It was just what was needed: Ad revenue generated by Internet banner advertising has been decreasing with so many sites chasing a limited number of advertisers, according to
. This has put high-tech and Internet-related businesses in dire need of creative advertising solutions.
Paul McMann, an accounting professor who founded the
Collegiate Professional Basketball League
two years ago, saw this trend and realized he might have a solution to one of his league's problems: sponsorship.
McMann created the league in part because he saw
basketball as exploitative of its athletes, making billions by showcasing their play without cash compensation for the performers. And, as Sports Scoop
reported in July last year, he knew that while the schools claimed to be compensating the student athletes with educational opportunity, less than half of the men's college basketball players were graduating.
In his new system, corporate sponsorship would pave the way to a solution. The CPBL would be an eight-team league with each team named for a sponsoring corporation and the league would buy TV time in major markets to showcase its games. The athletes would be paid and also have college tuition, room and board subsidized by the league in an environment geared toward assuring academic success.
McMann brokered a $1 million television deal with the
, whose PAX network broadcasts in most major markets.
"The problem we were encountering was finding our niche when it came to securing sponsors for our teams," McMann said. "We initially targeted Fortune 500 companies. Typical brand managers liked the idea, but the companies in general were risk-averse. They wanted to know who else was doing it before they got on board."
Someone would have go first.
"We had a vision," McMann said. "And we needed to share our vision with other visionary types. In most companies those are the high-level executives like presidents. At the big brands, you couldn't get to someone that high." Enter the folks at
, the Internet portal, who agreed to sponsor the league's franchise in Boston.
"What the people at the CPBL understood is something that we understood," said Josh Todd, promotions specialist at Lycos. "Sports has loyal passionate fans. They relate with a brand, perhaps because of their passion."
Examples were everywhere.
followers have shown themselves to be particularly loyal to the companies that sponsor the cars that race. A study by Chicago-based sponsorship consultants
indicated a 72% loyalty: Racing fans were willing to shell out an extra quarter to buy Tide detergent, made by
Procter & Gamble
, because they wanted to support their sport and understood that sponsors keep ticket prices low.
"We think the Web is a great way to get information, and we know people like to follow their teams," Todd said. "We want them to come to our portal and our sports site to get information about their team and the league. By sponsoring a team in the league, we improve that possibility."
In a 1998 study by New York-based
, brand recognition proved the leading motivator for people to visit a Web site, twice as powerful as giveaways, which came in second.
Dennis O'Conner, CPBL spokesman, said, "The league is a potentially powerful vehicle for off-line branding for Internet companies."
The sponsorship opportunity was inexpensive. It costs a company $5 million to $10 million a year to get its name on an arena. And such agreements -- there are more than 40 -- cover several years. To sponsor a single college football bowl game, like
Tostitos have, costs about $10 million a year.
The Lycos agreement with CPBL was for $1.2 million in cash and services over three years. Lycos has agreed to set up a site for the league. In turn, CPBL agreed not to approach another portal.
, the Internet service provider, was next: It agreed to sponsor the team in Chicago, negotiating a three-year, $1.3 million goods-and-services deal. Acunet found the low cost particularly attractive and the exposure crucial for its plan to expand from a regional ISP serving five states to a national ISP.
"We had to increase our market awareness," said Jeff Schiebe, vice president of worldwide sales at Acunet. "We thought sports would be a great way to go and the CPBL a very efficient way to meet our goals."
Can team sponsorship really yield the kind of results Lycos and Acunet want? "There is almost none of it in this country," Todd said. "But in Europe we have seen companies take over the naming rights of a team and see an immediate impact from it."
McMann envisions all kinds of new deals, with all sorts of companies. "We have a portal and an ISP," he said. "We think there are possibilities with Internet shopping like an
or specialty stores like
. We're talking with an online brokerage."
One of the most obviously attractive potential partners is
-- because of the streaming video it might be able to provide the league. McMann mused that "anyone with a computer would be able to tune into a game one day."
It's important to pay attention to the "one day" in that quote, though: While the CPBL had hoped to hold its inaugural season in November of this year, it looks like the date will be pushed back a year.
This year's window of opportunity for recruiting athletes is about to close. "But," McMann said, "we can't start recruiting until all the financing is in place," for all of the eight teams in the league's business plan.
Roger Rubin has covered sports in the New York area for 10 years. He is a staff writer for the New York Daily News, covering high school and college sports. He appreciates your feedback at