The Effect of the Economy on Sports Sponsorships and Endorsements

What effect has the economy had on sponsorships and endorsements in the business of sports? 

A panel at the Sports Lawyers Conference discussed this issue, and here are some of my notes from the perspective of counsel for a Stadium/Arena owner, counsel for a sneaker company, and counsel for an athlete:

Stadium/Arena Owner:

• In the area of naming rights and stadium/arena sponsorships, money as as well length of contract are down
• Owners are looking for more money upfront
• Contracting parties have become more creative; consider the renaming of Dolphins Stadium after Jimmy Buffett’s LandShark Lager, a short-term deal which appears to be more about branding and tapping into Buffett’s incredible marketing reach than money
• Potential sponsors have a fear of entering into a sponsorship agreement and looking bad – i.e. the new home of the New York Mets, CitiField

Sneaker Company:

• The volume of sponsorships and endorsements have remained steady, but the dollars are different
• Performance-based incentives have not been affected; sponsors will still pay for the attention created by remarkable performances

Athlete:

• Sponsors appear to be using the economy as an excuse to pay athletes less
• Cash – more specifically upfront cash – is the key to the deal, more now than ever