Why West Ham’s crowd trouble will scare off potential London Stadium sponsors
Synergy chief executive Tim Crow on why the Hammers and the LLDC will have a tough time finding a sponsor for the London Stadium.
Naming rights sponsorships of major sports stadiums and entertainment arenas are something with which we are all very familiar. What began as a US phenomenon in the 1970s and 80s, as brands took the opportunity to put their name on a wave of new American stadiums, is now a worldwide trend, not least in the UK, where there are dozens: in London alone for example, think of the Emirates Stadium, The O2 and The SSE Arena.
So it wasn’t at all surprising that the owners of the Olympic Stadium, the London Legacy Development Corporation, set out to find a naming rights sponsor as a key part of the post-Games stadium funding plan. But it was always going to be a tough sell. In the modern era, Olympic Stadiums worldwide have struggled to find a naming rights sponsor post-Games. And many of the reasons for this are at play again in London.
For one thing, there’s the cost. Naming rights sponsorships of major stadiums typically involve multi-year commitments running into tens of millions of pounds – a huge investment which brands will need a very convincing long-term business case to justify, particularly as they also need to budget for the additional costs of marketing the sponsorship, which can be as much as the rights fee.
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There’s also the fact that the stadium already has a widely-used name – the Olympic Stadium, although it has since been renamed the London Stadium. Brands strongly prefer to name a new stadium rather than re-name an existing one, which is much more difficult and time-consuming.
But London also has its own local factors that make finding a sponsor very difficult.
The first is of course the economy. As we all know, we live in uncertain times, in which brands are much less likely to commit to long-term, high-price sponsorships.
West Ham's move to the London Stadium has not been smooth (Source: Getty)
The second, related point is that the UK sponsorship market is the softest it has ever been. Demand for sponsorships is at an all-time low, but the market is massively over-supplied, with the result that there is a huge range of major sponsorships unsold – most of them offering better value at a lower price with much less risk than the Olympic Stadium.
And finally, there is what one might term the West Ham factor.
Partly, this is the negative tone that has surrounded and continues to surround the Olympic Stadium post-Games: the controversies around the process that led to West Ham’s tenancy, the tenancy agreement itself, and recently the crowd violence at West Ham matches, which reached a new low this week. Not a background that sponsors would want to be associated with.
But also it’s the fact that – in contrast to other major London stadiums and arenas – other than West Ham matches there is little else scheduled to happen at the Olympic Stadium going forward. And even when other major events do take place there, such as next year’s World Athletics Championships, an Olympics Stadium sponsor would have no visibility because the organisers will insist on de-branding the stadium to protect their own sponsors, as is always the case for major events of this type.
For as long as that continues, what brands are being offered as a sponsor of the Olympic Stadium is in effect to become a sponsor of West Ham. And that is another negative factor for many brands, because such a close association with one club runs the risk of alienating fans of other clubs, particularly in London.
Add all that together, and what the LLDC is looking for is a brand with a lot of love for West Ham, deep pockets, and who is prepared to take a leap of faith and combat a lot of negativity.
Tough sell.