Commentary

At Issue: Is Major League Baseball Still a Hit with Advertisers?

Of the premier sports leagues, Major League Baseball tends to get the most heat from both the media and marketing communities. Some of the criticism may be justified -- the game's economic structure makes it difficult for more than 12 or so of the league's 30 teams to be competitive in any given year, which doesn't bode well for broadcast, cable or radio outlets attempting to hawk their ad time. On the other hand, baseball still generates ratings and boasts a passionate fan base, albeit an older one than many advertisers might like.

So as the league embarks on its 2003 season, we decided to ask several media mavens whether baseball remains a solid buy for advertisers. The overall consensus was that the game, while no longer an elite property, still offers opportunities for those advertisers willing to be both creative and a little bit daring. Rumors of baseball's demise, it seems, have been greatly exaggerated.

Rick Dudley, president/CEO, Octagon Worldwide
You might not see it in the numbers, but baseball is still America's Pastime. The passion for the game may not be as great as it once was, but it's still there. Advertisers who connect with that passion are going to do well. The NFL may have passed baseball in ratings and quality of demographics, but what do you hear on talk radio? It's baseball talk, even during football season. You run by little-league fields and kids are still playing. At the end of the day, there's nothing more contemporary than a classic.

Clearly the consumption habits of sports fans are changing, so it's incumbent upon baseball advertisers to change with them. If advertisers are looking for an older demographic, TV is the way to go with their buys. If they're looking younger, the more interactive media -- where fans are reaching out for more information -- are the best option.

Another thing about baseball is that it is relatively immune to what I call the TiVO syndrome. Watching the games after the fact is not exciting, so the prospect of consumers zipping through commercials isn't an issue. There aren't too many properties like that. There's baseball, football, the Academy Awards, maybe one or two more. Broadcast and cable outlets should be able to get higher prices for their time as a result.

Dan Migala, executive editor, Team Marketing Report
I find it fascinating how some of the teams are coming up with new marketing ideas. They sell everything except the game in some cases. On the other hand, maybe that's a good idea -- market to the entertainment seeker as opposed to the hardcore fan, who's going to attend or watch anyway.

What you're seeing are more short-term arrangements. Teams and their broadcast partners used to have four- or five-year deals with advertisers; now it's mostly one-year agreements. Advertisers are getting away from the traditional signage in stadiums, because they want more than a static presence.

Radio remains baseball's best medium for advertising. It's paced better and there are some time-outs, which are great for advertisers. The Kansas City Royals sold a concept to a local car dealership. They're going to do in-game "greatest deals in baseball history" features and link them to the dealership. There's some subtlety to that. It's a great tie-in without overdoing it.

Can baseball give that great quantifiable return for advertisers? Right now, hope springs eternal. But there are always challenges. With some teams, there's no way they're going to be competitive on the field, so advertisers are more than justified in asking, "Why should we invest as franchise that might not be here next year?"

Robert Tuchman, president and founder, TSE Sports and Entertainment

I think it's a good buy right now. Baseball has more or less overcome a lot of the problems that arose from the strike [in 1994]. You had the home-run race with Mark McGwire and Sammy Sosa, you had a few great World Series. What you have to remember about baseball marketing is that it's largely built on the names of the players, whether it's a Bonds or a [Hideki] Matsui, who have the potential to drive up fan interest and open up new markets.

Baseball's attraction to advertisers largely depends on the demographic the advertiser is going after. The automotive companies and large beverage companies are always going to be in on baseball, especially on the national and cable broadcasts. I see good opportunity for companies in the clothing category as well.

I'm a big proponent of doing things on a regional and local basis, so I think the best media for baseball are local broadcast and cable. Companies that don't have huge ad budgets can do a lot of things on a local basis and get great bang for their buck.

Jameel Spencer, president/chief marketing officer, Blue Flame Marketing
Baseball saw a real hiccup with the strike/lockout thing, and that obviously left a bad taste in the mouth of your average consumer. But Americans have a short memory. I still think it's a solid buy for advertisers. The bottom line is that it's still America's Pastime, regardless of everything that has happened over the last decade or so.

There are many lifestyles spread across the baseball culture. For instance, if you like baseball, chances are that you don't have a problem with beer -- so right there is one huge category that's always going to be advertising. Ralph Lauren Polo? I don't think I'm going out on a limb by saying they're probably not going to get the same results.

Baseball is probably number four among the major sports properties. NASCAR has such an enormous following. The NFL is number two, but only because there's just one game per week for each team. The NBA has done a great job reviving the energy of the game, even with Michael Jordan on the way out.

I think baseball's problem is that it needs to catch up to the times to a certain extent. They have to figure out who the next wave of fans are. Until they do, they're not going to be what they used to be to advertisers.

Dr. Kathleen Davis, executive director, Sports Management Research Institute
Baseball is a good buy right now, but I'd like to preface that with my opinion that sports in general are almost always a solid buy for sponsors that are looking to reach a varied audience and increase their market share. Sports, and baseball in particular, are a big part of everyone's lifestyle. And as opposed to the scandal-prone corporations and religious institutions, sports tend to bounce back quickly from controversy. For instance, over the last few years, consumers have shown that they're very forgiving of baseball.

Baseball is really an advertiser's dream, regardless of whether it's on TV or radio or being watched in-person in the stadium. People are exposed to ads for a very significant amount of time during the game, and there's a large opportunity for repeat exposure over the course of the season. Radio is probably the best medium for baseball ads, but that largely depends on the market.

I really don't know what kind of advertisers should be working with baseball right now. The economy is such that finding the dollars anywhere is so hard. Could household products work for baseball? Would media outlets carrying baseball games say no to tampons? Perrier? I don't know. Sometimes you don't have the luxury of choice. If they get the dollars from advertisers, sports teams won't have to pass the costs on to fans.

Stuart Marvin, vice president of marketing and promotion, The Sporting News
Baseball is still a good option for advertisers, but only to the extent that the advertiser develops programs around it. There's a sense that baseball skews a little bit older than most of the other major sports, but research shows that a significant percentage of the audience is young. I'm not sure if anybody is developing programs that specifically appeal to that younger niche. To make a blanket statement that baseball isn't great for advertisers because it skews older is very shortsighted.

Major league baseball has a lot to offer advertisers, mostly in terms of its history. It's Americana. I think they could probably learn a little bit from NASCAR, which to me is the gold standard right now. Unlike baseball, NASCAR provides a forum for fan access. Fans can get close to the drivers, they can participate in promotions that get them in the pits or pace cars.

I wonder why baseball hasn't done better with American automotive advertisers. It seems to be a glaring hole for them. There should be a relationship with baseball where both parties benefit.

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