Global Spectrum's Marketing Ties Help In Bid Victory
By GREG BORDONARO
February 22, 2013
The decision to award Philadelphia's Global Spectrum the management contract for the XL Center and Rentschler Field had a lot to do with AHL Hockey and dollars and cents.
But another key, intangible factor that weighed into the decision making process, officials say, is the marketing and advertising muscle that Global Spectrum's parent and sister companies bring to the table.
Global Spectrum is owned by Comcast Spectator, a subsidiary of entertainment and media conglomerate Comcast.
As part of its pitch to take over management control, Comcast is offering cross channel marketing of XL Center and Rentschler Field on its cable networks and special marketing packages to the 500,000 Comcast subscribers in Connecticut.
Additionally, Comcast's NBC Sports Network, which has been making a major investment in Connecticut by moving its headquarters and studios to Stamford, will broadcast Hockey East games. That's the premier college hockey league that the University of Connecticut will join in 2014.
That, officials say, will lead to increased national exposure for the XL Center and a fledgling UConn hockey program, and the chance to rebrand the entertainment experience in Hartford.
"When all the numbers were crunched this was the gravy on the deal that sealed it," said Michael Freimuth, executive director of the Capital Region Development Authority, which selected Global Spectrum to manage XL Center and Rentschler Field.
Freimuth said it is difficult to put a monetary value on the cross-marketing opportunities, but he predicts there will be a lot of upside in having Global Spectrum manage both entertainment and sports venues and networking them with the other assets under the Comcast umbrella.
If UConn hockey can get a few games on NBC Sports national broadcast, for example, it could attract top college hockey teams to play at the XL Center, helping to immediately raise the profile of the program, Freimuth said.
Global Spectrum is one of the world's largest private venue management companies. It beat out AEG Management CT and Bushnell Management Services for the rights to manage the XL Center and Rentschler Field.
Global Spectrum is owned by Comcast Spectator, which has venues in the U.S., Europe, Asia and Middle East, and also owns the Philadelphia Flyers, Wells Fargo Center in Philadelphia and Comcast Sportsnet television channel.
Comcast Spectator is a subsidiary of Comcast, which owns a majority interest in the firm.
In its request for proposal response, Global Spectrum pitched its marketing and advertising muscle as a "unique benefit" that set it apart from its competitors, offering to bring several perks to the table. That includes cross-channel support of 30-second commercial air-time to include opportunities to promote both venues and their events. Newsmaker interview shows, spot production and radio simulcasts are on the table as well.
Global Spectrum also offered exclusive marketing to Comcast subscribers, including promoting special concerts at a reduced price; exclusive pre-sale ticket offers to Comcast cable and online subscribers prior to general public sale; and advertising campaigns through direct mail, email messaging and its video on demand service.
Frank Russo Jr., Global Spectrum's business development chief, said Comcast will work closely to give the XL Center, Rentschler Field, events and promoters more visibility, providing a bigger bang for their buck.
More importantly, Russo said Global Spectrum hopes to leverage its marketing capacity to rebrand the entertainment experience in Hartford, which will include adding pre- and post-game activities in the XL Center.
He said they also hope to establish close ties with hotels, bars and restaurants to create a strong system that promotes the Capital City.
"We think that Comcast gives us the opportunity to rebrand the experience in downtown Hartford," Russo said.
Tony Cashman, president and CEO of Glastonbury integrated communication firm Cashman + Katz, said marketing and advertising can serve as the life blood of an entertainment and sports venue because it impacts attendance and sponsorship rates. As arenas increase attendance, they can charge sponsors more for hanging an advertisement in the arena, he said.
And the only way to boost attendance, Cashman says, is to offer an attractive product on the event floor and make sure people know about it.
"When they are selling to ad agencies, they have to show attendance," Cashman said. "If they don't put bodies in the seats, they don't have numbers to back up ad rates or sponsorship rates."
Cashman said aggressive marketing is key for the XL Center in particular because of the competition it faces from much larger venues in New York and Boston, as well as casinos like Mohegan Sun and Foxwoods.
He said Global Spectrum's connection to Comcast is a huge advantage, because Comcast essentially owns the distribution channel that Global Spectrum needs to market events.
"That is a huge asset," Cashman said.
Of course, driving more activity to both venues through aggressive marketing and advertising also depends on putting on a quality show or event.
Russo said Global Spectrum plans to leverage its connections with the 110 arenas and stadiums it manages around the world to drive more concerts and events to Hartford venues. The company also recently launched its own promotional division, called Global Spectrum Presents, which aims to create more options to route tours to its venues.
Russo said Global Spectrum also has close ties with Live Nation, the California live events promoter that will likely be more willing to book events at the XL Center now that AEG will no longer manage the building.
AEG is a major competitor to Live Nation, which made Live Nation reluctant to book events at the XL Center, Russo said.
Starting when its contract begins in September, Global Spectrum plans to book 11 concerts in its first year at XL Center, Russo said.
He added that Rentschler Field's strength will be less the in the concert scene and more on smaller events like festivals and food markets.
And of course finalizing deals to keep the Hartford Whale and UConn men's and women's basketball teams in Hartford will also be key to offering an attractive lineup of events.
Global Spectrum's contract to manage XL Center and Rentschler Field hasn't been finalized yet and hinges on Global securing an AHL Hockey team to play at the XL Center.
Russo said they are still in active negotiations with Madison Square Garden to keep the Connecticut Whale in Hartford, but if a deal falls through, he is confident they will be able to land another minor league team.
Besides the advertising and marketing perks, Global Spectrum also offered the sweetest financial terms in its bid to take over the XL Center and Rentschler Field.
The competition provided interesting dynamics because AEG has been managing the XL Center, and Bushnell has been running Rentschler Field.
Bushnell, which pushed its local ties, didn't have the muscle or wherewithal to compete with the much larger, more established competition and didn't make the final cut for serious consideration, said Freimuth, the CRDA executive director.
Global Spectrum hasn't managed a facility in Connecticut, but offered a sweeter deal than AEG. That included an initial capital investment of $2.75 million, compared to $1.5 million offered by AEG, Freimuth said.
That initial capital investment should help leverage about $20 million in state bonding to help pay for capital improvements in XL Center.
The building will require a $16 million investment over the next 10 years just to sustain its operating systems, Freimuth said.
Further upgrades to XL Center, which are likely needed, will carry a price tag up to $100 million.
Global Spectrum also offered to take a smaller management fee of $721,000, compared to the $846,000 fee AEG asked for.