High-level college and professional sports depend on corporate sponsorships to remain viable. The companies hope their associations for pro leagues or major college championships spawn increased interest in their products and services, which then leads to greater profits.
However, given the current economic situation, much of the public sees marketing spending as unnecessary junketing. Particularly when businesses that have received federal bailout money are doing the marketing.
Chrysler has sponsored the Bob Hope Classic, the PGA Tour event in Palm Springs, California, for several years. However, the 2009 event was billed not as the “Bob Hope Chrysler Classic” but as the “50th Bob Hope Classic.” Chrysler quietly fulfilled the last year of its contract with the PGA Tour but chose not to advertise itself so soon after receiving billions of tax dollars to remain open.
Northern Trust wasn’t so wise. The financial institution is the title sponsor of the event in Los Angeles. As TMZ reported, the Northern Trust Open was great for bank officials and invited guests. Sheryl Crow was paid to perform. Top-end accommodations and food were bought. Executives tried to say they hadn’t used bailout money. The public outcry was swift and loud.
Today, Wachovia announced the tournament in Charlotte that it sponsors, the Wachovia Championship, will be named “The Quail Hollow Championship” since the event will be played at the Quail Hollow Country Club. Wachovia expects to continue its sponsorship through the end of its contract in 2014. The bank itself will likely not survive that long as it was recently acquired by Wells Fargo.
Bank of America claims its sports marketing is profitable. Officials told CNBC that the bank nets three dollars for every dollar it spends through sports marketing deals. About 10 percent of new checking accounts come through sports, the bank maintains. If that’s so, then the institution’s other attempted endeavors are worse than I thought.
Most notably is Citigroup’s 20-year, $400-million dollar title sponsorship of the New York Mets’ new ballpark that will open in April. The idea of “Citi Field” being financed through tax dollars since Citigroup has received tens of billions of bailout dollars is appalling. The Mets and Citigroup executives say the deal was signed before the economic downturn but the contract remains binding.
