Big East may sell name to C-7

[MU86NC]

Unless they bring back the Warriors nickname for the new conference? Get some donors to cough up enough cash to pay for the Big East name? Think about it...=)

Bring back the Warriors!!!!!

[Windyplayer]

Wow. It's that simple, huh? Catchy name, cool logo? Branding is done through success on the court? Is that right?

I guess Michael Porter was wrong when he said never, ever confuse product with brand. Like you just did.

What are we really selling with this branding effort? It's not like the teams' fan bases are going to increase or decrease based on the branding. No one is going to gush about our new slogan and say, "you know what, I will watch that DePaul-Seton Hall game." However, if both are playing well they will. Porter is obviously a marketing guru, but not sure this unusual product and branding effort fall under his mantra. People may complain about the branding effort, but ultimately the success of the new conference hinges solely on product performance.

[keefe]

It is a lot easier to shell out for something that already works than try to make one from scratch.

How much? I don't know. I don't know enough about the financials. But I think you definitely need to be willing to pay more than what it costs to build a new one. Because a new one is a crap shoot. It could work. It might not. This works. So you pay the premium.

Vic, you are 110% correct. Creating a new brand is the toughest challenge in business. That guy doesn't know what he's talking about. Number one, he doesn't know the difference between Brand & Product.

I don't have a feel for the baseline numbers but there is likely considerable residual value in the Big East brand. It is a lot harder and far more expensive to successfully launch any new brand. And there is no guarantee of success.

Another issue for a Branding play is that an athletic conference is much closer to an LLP than a publicly traded Brand Management Corp. Each Partner has a significant interest in protecting their own vested interests - in effect sub brands that have stand alone equity. In a company like P&G there is an ExCo that ultimately makes the hard decisions. Companies like P&G have three dimensional coverage of consumer categories, which is why P&G has four different laundry detergents - Tide, Cheer, Era, Gain - each with its own unique selling prop designed to attract a specific target demographic within prescribed channels of distribution. The brand managers are effectively running an independent business. And each brand has manager has a portfolio of line extensions designed to leverage any of a number of fixed costs while driving incremental revenue. When there is contention between brands, say on distribution strategy or pricing, then successive layers of management decide between the brands.

In a partnership model like the BE you effectively have 16 CEOs, each religiously protecting its interests but subordinating their product to the strictures of the Umbrella Brand. At P&G the Brand Manager for Tide can't take that brand and walk. But the Brand Manager of Syracuse and Pitt could and did. And that is why Texas started their own network, much to the chagrin of their Conference. But each member realizes that subordinating their brand to that of the Conference Umbrella makes them more competitive and generates a higher return than would being independent.



Here are some financials for the University of Wisconsin's Athletic Dept 2011 P&L


Big 10 Media Revenue

ABC/CBS/ESPN              $   8,709,710
Big 10 Network              $   7,894,078
Olympic Sport BTN         $   5,193,765
Campus Cut BTN            $   2,772,546

Total Media Revenue       $ 24,570,099

Less Brand Support         $  6,293,061

Net Big 10 Media Rev      $ 18,277,038

By participating in the Big 10 Wisconsin enjoys total media revenues of $24.6MM. But they had to pay $6.3MM each year to the Big 10 for Brand support - that is those monies used to support the Big 10 Brand. The annual cost of managing the Big 10 Brand approximates $76MM each year. So when people here say it isn't that much they are ignorant of the true costs of managing a brand.

There is an HBS case titled Mugga Joe. It's about the repositioning of Marlboro. Launched as a "woman's cigarette" PM realized they were limiting themselves to an artificially small market. When they realized most new joiners were not women but men they chose to reposition as a man's smoke. For their thematic they adopted the cowboy (the iconic Marlboro Man), the mountains, & rugged independence. Their communication was a powerful 60 second tv spot that had zero dialogue and absolutely no mention of the product. A group of cowboys are gathered around the campfire at dawn. All you hear is the crackling fire, birds chirping. As one cowboy pours out the coffee another holds a pack of Marlboros out to each cowboy, now redesigned to include the iconic Marlboro Mountain on the packaging. They then drink their coffee and smoke their Marlboros. That's it. But it effectively repositioned a woman's cigarette into a man's smoke. And Marlboro dominated the global cigarette market.

Launching a new brand is expensive. And it is very, very difficult. Keep the Big East name.

[Tugg Speedman]

Pay whatever it takes, within reason, to keep the Big East name.  It is extremely valuable.

Figure the cost to build a brand from scratch, because either we have to do it if we do not get the BE name or the current BE members have to do it.  Then figure what the odds that name will be a successful brand.  If it is 50%, then pay double that amount.  If it is 33%, pay triple that amount, and so on.  Add in a premium to make them feel like they got a deal (the smaller the better).

Wild guess ... $5 to $7 million.

Thoughts?

[keefe]

What are we really selling with this branding effort? It's not like the teams' fan bases are going to increase or decrease based on the branding. No one is going to gush about our new slogan and say, "you know what, I will watch that DePaul-Seton Hall game." However, if both are playing well they will. Porter is obviously a marketing guru, but not sure this unusual product and branding effort fall under his mantra. People may complain about the branding effort, but ultimately the success of the new conference hinges solely on product performance.

It is all about Branding. And if J Michael Porter were here he would tell you that conference realignment is entirely a branding play. But Porter isn't here so we'll have to rely on Chicos to tell us that all of this realignment is being driven by distribution to impose predictability on an irrational marketplace from its current chaotic structure to a more predictable stable of four power brands.

It is therefore imperative that our new conference brand themselves properly because it is the power brands that will carve out the biggest slices of the pie. There is considerable irrational exuberance on the demand side right now as new joiners/line extenders take on the world wide leader which is why we, on the supply side, are being gifted by Fox. That won't last forever and as the supply/demand rationalize those available monies will contract - all the more reason to have the strongest possible brand.

The guys in NYC and LA don't sit around and say "we need UNC" or "we need Michigan."  They say we need to be the home of the SEC. I put Wisconsin's share of Big 10 Media Revenues in a different note. In order to continue vesting value in the Big 10 Brand each member school gives back millions of dollars in Brand support payments; these payments are used exclusively by the Big 10 for the Big 10. And don't confuse Brand Support monies with OpEx. That is already stripped out of the monies paid to Wisconsin.

If you are familiar with corporate P&L's there are expenses paid below the line from an IBU P&L back to the corporation. At both GE and PepsiCo operating units are taxed below the line for Corporate overhead (Jack Welch's salary and staff and corporate jets) as well as brand management expenses.

In my role in Corp Strategy at T Mobile I managed the Wall Street industry analyst relationships (with our Deutsch Telekom parent's team in NYC) as well as the VC community for emerging and incipient technology plays. My team's budget was funded by that Corp Overheads line item in each and every P&L. When people would jokingly bitch about it and ask what they got I would gently point out that part of their comp was tied to DT ADR performance on Wall Street so they better play nice. And in dealing with the Street analysts I talked numbers but I was spinning the Branding Story of T Mobile as the Challenger Brand that kept the industry innovative, responsive, and vital in terms of evolving life style.

[keefe]

Figure the cost to build a brand from scratch, because either we have to do it if we do not get the BE name or the current BE members have to do it.  Then figure what the odds that name will be a successful brand.  If it is 50%, then pay double that amount.  If it is 33%, pay triple that amount, and so on.  Add in a premium to make them feel like they got a deal (the smaller the better).

Wild guess ... $5 to $7 million.

Thoughts?

I just cited that in 2011 the Big 10 invested $76MM in maintaining, growing, improving their brand. They do that every year.

Launching a brand for $5-7MM?? One Big 10 school spends that annually in a mature brand. You cannot launch a national brand for $7MM.   

[NotAnAlum]

I think this deal cries out to be done because the Big East brand has more value to the C-7 than it does to what's left of the BE.  The Value comes from its association to success in Basketball not Football and the new BE wants to be primarily a football league.  That's why we are breaking up in the first place.  The new BE may even find that the Big East name impedes their ability to form a nationwide conference like they seem to want to do.  The C-7 on the other hand need that tie back to the Big East of old to avoid a drop off in casual fan interest and recruiting stature.  Given the disparity in which the 2 groups view the name I think a deal gets done in exchange for leaving behind some exit fees or NCAA credits.  Well worth the deal.

[muhoosier260]

"Big Priest" or bust

[77ncaachamps]

Buy it and five of the "original" members will lend credence to the conference name.

Or don't and just laugh at a conference consisting if only one original member.

[keefe]

"Big Priest" or bust

Uh, you may want to rephrase that...if you know what I mean

[7-Up]

This seems like a real no-brainer to me. Do what it takes to keep the BE name. After listening to Keefe I am more convinced than ever that whatever we pay will be money better spent than what we will pay to come up with something new. To be honest, I thought C-USA was about as good as it gets for what that conference was and look what good that did. And in addition to all the reasons others have given for keeping the BE name, I think we can add one more: it will be easier for Buzz to recruit with the BE name. It's just one thing less that he will have to explain to recruits.

[GGGG]

I just cited that in 2011 the Big 10 invested $76MM in maintaining, growing, improving their brand. They do that every year.

Correct.  But that is money they use to advertise, etc.  The BE does something similar, but again, that is something they would do anyway regardless if they have a new name or an old one.  The fact is that a conference isn't like a consumer product.

Let me put it this way, the C7 pull off this deal if:

Amount BE wants for name < new branding costs + current BE brand equity

The amount the BE wants will be known by all parties.  The new branding costs are likely going to be obvious as the C7 does more research, but I think you are throwing figures out there that are not apples and oranges comparisons.

The real issue is how much brand equity does the current BE brand have?  That is more of an unknown.

[PuertoRicanNightmare]

Oooh ... oooh ... oooh! I can't wait to see all the folks coming out of the wordwork to agree with you on this.

I've always said it was better than Golden Eagles

[MarquetteNation]

WWFD...what would FOX do?

[WarhawkWarrior]

Big East = Hellava Brand

[Henry Sugar]

I've always said it was better than Golden Eagles

What nickname isn't better than Golden Eagles? Golden Eagles is the stupidest nickname in sports.

Also, bricky!

[GGGG]

Honestly, the BoT could have come up with the most brilliant and unique nickname ever, and it would have never been given a fair chance.  I think everyone thought that they would cave and bring back "Warriors," and when they didn't, all hell broke loose.

[Windyplayer]

The guys in NYC and LA don't sit around and say "we need UNC" or "we need Michigan."  They say we need to be the home of the SEC.

True. But they ultimately base their decisions on the number of viewers for each team and take a total viewership per conference to determine that conference's value. And viewership is determined by and large by the branding efforts of each school. No one decides to watch a game based on branding of a conference--either you or you know someone that went to the school, the school is exceptionally good, or you live in the area. The branding effort for a conference just seems to have a low threshold for success--meaning it's fairly easy to not botch it--given the established brands within the conference. In my opinion, the brand for a basketball conference becomes unique when its teams enjoy prolonged success in the NCAA Tournament and to a lesser degree in the regular season, but that doesn't necessarily increase its monetary value. That would be mistaken cause and effect. The value of each team in that conference increases due to increased viewership based on success, which in turn, increases the value of the conference at the bargaining table. Ultimately, the branding of the league is going to be shaped by extensive media coverage--see ESPN, CBS, Fox, etc.--for better or worse. You control the brand by winning. 

[Tugg Speedman]

Honestly, the BoT could have come up with the most brilliant and unique nickname ever, and it would have never been given a fair chance.  I think everyone thought that they would cave and bring back "Warriors," and when they didn't, all hell broke loose.

You mean like Gold.  While I prefer Warriors too, Gold is actually a good name. 

What schools have a color only as their nickname?  Stanford Cardinal (not the bird, the color), Harvard Crimson, Cornell Big Red, Dartmouth Big Green, Syracuse Orange.

I much prefer a nickname that associates MU with these schools as opposed to Southern Mississippi and Tennessee State (both are Golden Eagles).

In fact, given the changing in conferences if MU wants to use this opportunity to dump Golden Eagles for Gold, I would favor that (recognizing that Warriors is never coming back).  Going back to Hilltoppers (the name before Warriors) also works too.

Anything but Golden Eagles!

[Windyplayer]

You mean like Gold.  While I prefer Warriors too, Gold is actually a good name. 

What schools have a color only as their nickname?  Stanford Cardinal (not the bird, the color), Harvard Crimson, Cornell Big Red, Dartmouth Big Green, Syracuse Orange.

I much prefer a nickname that associates MU with these schools as opposed to Southern Mississippi and Tennessee State (both are Golden Eagles).

In fact, given the changing in conferences if MU wants to use this opportunity to dump Golden Eagles for Gold, I would favor that (recognizing that Warriors is never coming back).  Going back to Hilltoppers (the name before Warriors) also works too.

Anything but Golden Eagles!

Considering the name-change to Gold resulted in a PR nightmare, I can't see MU officials revisiting that anytime soon.

[Benny B]

WWFD...what would FOX do?

My offer (if I were Rupert):

[hairy worthen]

You mean like Gold.  While I prefer Warriors too, Gold is actually a good name. 

What schools have a color only as their nickname?  Stanford Cardinal (not the bird, the color), Harvard Crimson, Cornell Big Red, Dartmouth Big Green, Syracuse Orange.

I much prefer a nickname that associates MU with these schools as opposed to Southern Mississippi and Tennessee State (both are Golden Eagles).

In fact, given the changing in conferences if MU wants to use this opportunity to dump Golden Eagles for Gold, I would favor that (recognizing that Warriors is never coming back).  Going back to Hilltoppers (the name before Warriors) also works too.

Anything but Golden Eagles!

Gold is a horrible name under any circumstance.

[warriorchick]

My offer (if I were Rupert):

Oh, see, I made Louis a bet here. See, Louis bet me that we couldn't both get rich and destroy the Big East as a BCS conference at the same time. He didn't think we could do it. I won.

[Tugg Speedman]

I just cited that in 2011 the Big 10 invested $76MM in maintaining, growing, improving their brand. They do that every year.

Launching a brand for $5-7MM?? One Big 10 school spends that annually in a mature brand. You cannot launch a national brand for $7MM.  

Reports say C7 schools are going to split $500 million for 12 years, or $41 million year for the entire conference.  Using your numbers showing Wisconsin make $25 million x 14 schools means the BIG makes $350 million a conference (Only Texas and ND make more, about $40 million). Or, the B1G makes 8.5 times the proposed C7.

Lazy marketing brand managers say you need zillions and zillions to build a brand.  Like lazy Baseball GMs think the way to win the world series is to have a $250 million payroll.

$5 to $7 million is all the C7 has.  They don't have $76 million a year because the conference does not even make that much money.  The C7 does not have football, its own TV network or 4 million alumni (no typo!).  

The C7 is 5 Guys, the B1G is McDonalds, they are not the same even though they both sell hamburgers.

[Tugg Speedman]

Gold is a horrible name under any circumstance.

Golden Eagles is worse