Izod Center naming rights deal going up in smoke
Posted by ZA on October 22, 2009
In 2007 the New Jersey Devils and Seton Hall Pirates announced they would be moving their home games to the Prudential Center in Newark, New Jersey. The Devils and Pirates were both leaving the Continental Airlines Arena, which had been their home venue for nearly 20 years. That move had a domino effect which is still being felt today.
Continental Airlines subsequently backed out of their $1.3 million dollar annual contract for the naming rights the Meadowlands Arena; which had been called Continental Airlines Arena since 1995. The New Jersey Sports and Exposition Authority then went out to get bids from companies who wanted to put their name on the building. They received a few offers and finally settled on a deal with Izod at $1.4 million per year. The new name of the arena in East Rutherford, New Jersey would be the Izod Center.
The Izod Center has been the home venue for the NBA’s New Jersey Nets, as well as, a host of concerts and events for the past two seasons. But it appears now that could all come to an end. The Nets have been made plans to move their franchise to Brooklyn to play at the Barclays Center; a move that should happen in 2011. Which in theory would give the Izod Center a permanent resident for at least two more years, which would cover most of the three year’s left on the naming rights deal. But now the Nets are considering moving their home games to Prudential Center, which would leave the Izod Center devoid a full-time tenant.
What does this loss mean to Izod’s naming rights deal? It means Izod would no longer get the millions of mentions that come from having a professional sports franchise playing in your building (mentions on Sportscenter and in every newspaper that prints a story on the Nets game). It means that there would be approximately 800,000 fewer people attending events the arena bearing their name, because the 40 Nets home games are eliminated. In-short, it would mean a huge decrease in the exposure the deal originally was set to provide. On the plus side, Izod could save some money because the annual payment on the deal drops to $750k if the Nets are no longer the tenant. But does a reduced cost really offset all that Izod loses in exposure on the deal? No, Izod would be left with an aging venue sitting nearly empty next to the New Jersey interstate. Izod will be the naming rights partner for an arena that is dying. That is not exactly the kind of deal you want your brand associated with; Izod should look to get out of this deal if the Nets leave.