'Seahawks Stadium' name fine for now

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'Seahawks Stadium' name fine for now

Thursday, May 9, 2002

By BILL VIRGIN
SEATTLE POST-INTELLIGENCER COLUMNIST

As announcements involving highly visible public edifices go, this one had all the fanfare, pageantry and portent of the disclosure that they'll be mowing the grass at the Seattle Center sometime in the next few weeks.

The Seattle Seahawks announced last week that the Seahawks Stadium, due to open next fall, will henceforth be known as ... Seahawks Stadium.

Or at least it will on an interim basis until stadium developer First & Goal Inc. can find what it describes as "a suitable naming-rights partner."

The decision makes a fair amount of sense. With a backer like Paul Allen, the Seahawks and First & Goal are hardly in a position to be stampeded into a deal with whoever is available simply to drum up some cash.

Patience in this situation is a virtue. First & Goal said in its announcement it wants a name on the stadium representing a company which "is financially solvent and can stand the test of time." By waiting, First & Goal avoids the potential for embarrassment should its "naming-rights partner" go bankrupt and the name of the stadium change more often than the reader board advertising Big Macs down at the local McDonald's.

Or worse, goes bankrupt, throws thousands of people out of work and becomes a national synonym for corporate greed, corruption and malfeasance, which is what happened in the case of the Houston Astros and their corporate naming-rights partner -- Enron.

Enron was the most splashy example of a naming-rights debacle, but it was hardly the only one. The national business media had great fun tracking the bankruptcies (TWA, PSINet) and stock swoons of stadium-naming companies. Whether the two had any connection was a matter of debate; Safeco's stock slump after the opening of Safeco Field had more to do with the company's own missteps than spending money on a stadium sponsorship deal.

But Safeco investors got no lift from the naming deal or an association with the winning Mariners, and critics of such deals contend they're at least a signal of misplaced corporate priorities and attention, if not misallocation of financial resources.

Whatever the connection, the market for stadium naming rights, like the stock market itself, is in the doldrums. The Seahawks say they have some candidates but didn't want to be rushed into a deal.

That, too, makes sense for both sides. Now is not the time for corporate management to be signing high-profile advertising and sponsorship deals, even if they make sense in the long run, while they are at the same time laying off workers or cutting dividends. Executives can get away with a lot of outrages -- for proof, just read the compensation and options section of the typical proxy statement -- but a stadium naming- rights deal might be equivalent to standing Statue of Libertylike with a metal rod in hand in an open field during a thunderstorm.

Better for them to wait until the economy improves. Better, too, for the Seahawks, who can avoid signing a deal at the bottom of the market.

And this is a bottom of the market, contends Dean Bonham, whose Denver-based sports mar- keting firm The Bonham Group has analyzed and negotiated sponsorship and naming deals. In a column of predictions for 2001, Bonham had warned that sponsorship price tags would come down "as the universe of major corporations with hundreds of millions of dollars in their hip pockets continues to shrink, thanks primarily to the self-destruction of the dot-coms."

Now he's predicting a rebound; what's going on now is a correction. For the long term, he says, "naming rights fundamentally deliver more value than any other sponsorship in the sports world today."

That doesn't mean a return to the days of 5 percent to 15 percent annual growth in naming-rights revenue, Bonham says, but the market will come back and the Seahawks stadium deal, provided the price and term are set properly, will be in the middle of that rebound. "There's no question that's a prime property," he adds.

When the market does rebound it will be fascinating to see who is signing the naming deals, and whether there's any more common sense about who should be signing them.

For many companies, stadium rights-signing deals were driven more by ego than any real or imagined business payoff. A sta- dium sponsorship deal wasn't like- ly to make a sports fan do business with an Enron, for example.

And that's supposing the fan even knew what business the sponsoring company was in. Can you guess what lines of business Adelphia (Tennessee Titans), CMGI (New England Patriots), Pro Player (Miami Dolphins and Florida Marlins) or PSINet (Baltimore Ravens) are or were in? Cable and telecom, Internet ventures, Fruit of the Loom and Internet service, respectively, in case you cared.

Bonham says sponsorship deals do make sense for companies with a strong consumer orientation, such as finance, consumer goods and cars. Invesco, he says, will get a huge boost in name recognition for having its name attached to the new Mile High Stadium in Denver. Interestingly, some companies are so well known that a sponsorship deal will deliver only incremental gains -- Pepsi, for example, which has its name on the Denver basketball and hockey arena.

First & Goal has the luxury not only of patience but an owner with lots of options. It could sign a conventional sponsorship deal. It could sign up one of Allen's own companies to put its name on the stadium (Charter Communications, for example?). Heck, it could even emulate the sports owners of old and put his or his company's name on it (Paul's Park? The Vulcan Venue?).

First & Goal also faces a stark reality: The most pressing issue for the Seahawks right now is not putting a name on the stadium but putting a team in the stadium that anyone cares about or wants to see.

It can't be that huge a burden to be without a corporate sponsor's name on the playing field. There's at least one other franchise that has taken the unimaginative step of naming the stadium after the team that plays in it ... and somehow the New York Yankees seem to have done all right.

P-I reporter Bill Virgin can be reached at billvirgin@seattlepi.com or 206-448-8319. His column appears Tuesdays and Thursdays.

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