Logo Redesign in Sports Marketing Part Two: The Cost of Re-Branding

In part one of the Logo Redesign in Sports Marketing series we discussed how a team’s logo is vital to brand recognition and market strategy. We also discussed some of the ways teams execute logo redesign and re-branding. Part two is about the cost of re-branding; how much does it cost and who really pays?

The determining factor of cost is where the team’s re-brand falls on the scale from evolution to revolution (as we mentioned in pt. 1 of this series). The more extreme the redesign, the more it will cost to implement and to appropriately market it.

If we’re talking just strictly uniforms, the NFL’s decade-long partnership with Reebok was worth $250 million and Bloomberg Businessweek estimated that the NFL’s new five-year contract with Nike could be worth $35 million per year.

marlins park big

Marlins Park

The most expensive re-branding endeavors are undoubtedly the rare, but still occasional cases where the franchise changes everything, from their name to their location. The new Marlins Park cost a reported $515 million to build, of which the public paid $360 million along with a $91 million construction loan financed by Miami-Dade County over 40 years. According to Miami-Dade mayor, Carlos Gimenez, the loan will cost over $2 billion in principle and interest once it is paid off. Which brings me to my next question. Who really pays?

Teams get direct financial support from sponsors and indirect financial support from the fans, which buy their merchandise and licensed items, tickets to the games, pay for parking in the stadiums, etc. And as we mentioned above, owners don’t typically pay for the bulk of their stadiums; the taxpayers do.

The biggest revenue a franchise receives, however, actually comes from broadcasting the games on television. The media pays the teams for the rights to broadcast and inform about the game or event. Sports teams are an especially profitable product because they can be global and remain unchanged, unlike other products that have to be tailored according to the country they’re being sold in.

So who really pays? Well… you do. Even if you aren’t at the game, you’re sitting at home watching it on TV on the sports channel you subscribed to and buying the products advertised on the commercials. As long as you’re a fan, you pay one way or another, which is why franchises go through all this trouble in the first place; to make sure you identify with the brand and remain loyal.

Stay tuned for part three where we’ll discuss the impact of re-branding in sports marketing and the affect it can have on those loyal fans.

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Category: Logo