What Slump? 2004 Sees a Quick Start to the Sale of Naming Rights for Major League and Minor League Sports Facilities

By Bill Miller

It has been commonplace for many observers, especially those in the media, to argue that the sale of naming rights has reached its peak. The failure of several high-profile agreements such as Enron and PSINet has certainly fueled the negative theories regarding the future of naming rights.

However, the first quarter of 2004 has seen another solid start for the sale of naming rights for major league and minor league sports stadiums and arenas.

There have already been ten naming rights agreements completed in the first quarter of 2004. In fact, while it is always dangerous to extrapolate too much from early trends, the year is on pace to be the best year ever for the sale of naming rights.

Of the ten agreements announced so far, four were for new facilities (Corpus Christi, Clearwater, Victoria & Allentown) three involved new names for existing facilities (Dunedin, St. Lucie & Harrisburg) two exchanged one corporate name for another (Carolina & Kelowna) and one was the restructuring and finalizing of a deal preliminarily announced several years ago (Rochester/PaeTec).

Of course, when one looks deeper into the numbers, the reality is that the naming rights industry was never as bad as some portrayed it to be. 

As the following chart illustrates, there have been 200 naming rights agreements announced for major league and minor league sports facilities since 1972. This total does not include any naming rights agreements for training facilities, concert & entertainment venues, theatres, college facilities, high schools or other venues.

While there has been a drop from the explosion of deals completed since 1999, there have been at least ten naming rights agreements completed in every calendar year since 1994.

In fact, one can make the argument that the 1999/early-2000 period mirroring the excessive economic exuberance seen throughout the economy was really the anomaly and that the industry has been on a steady pace since the mid-1990s...

Announced Naming Rights Agreements

• 2004 (10; so far)

• 2003 (18)

• 2002 (24)

• 2001 (15)

• 2000 (24)

• 1999 (34)

• 1998 (14)

• 1997 (10)

• 1996 (15)

• 1995 (14)

• 1994 (9)

• 1993 (2)

• 1992 (1)

• 1991 (2)

• 1990 (4)

• 1989 (0)

• 1988 (1)

• 1987 (0)

• 1986 (2)

• ***

• 1972 (1)

As indicated earlier, it is always dangerous to extrapolate too much information from early numbers. A slowing economy or any other number of events could negatively impact the sale of naming rights throughout the remainder of 2004.

In addition, each individual sale of naming rights presents its own challenges and a solid overall outlook does not mean that an individual facility will be able to sell naming rights in its market. However, for now, it is clear that despite what some may claim, teams, facilities and sports marketers can ask "what slump?" when asked about the state of the naming rights industry.

Posted 4/5/2004. Updated 7/04/2004.

Bill Miller is an Executive Vice President at The Leib Group, LLC in Mequon, Wisconsin. He is a regular contributor to Naming Rights Online and can be reached at bmiller@namingrightsonline.com