Joshua Clark

Wednesday, Dec. 20, 2017

Catering to corporate fans priority at Valley sporting events

PHOENIX — Imagine watching a Nascar race from a comfortable couch above Turn One. Or, with drink in hand and perched high above the tee box, observing a top PGA Tour pro take on one of the most exciting holes in golf.

Both options are available to Valley sports fans. Corporate sponsorship are a large part of professional sports, with revenue streams growing steadily over the past decade.

From 2006 to 2015, total revenue worldwide from sports sponsorship ballooned from under $27 billion to over $45 billion, and through the majority of 2017, $16.4 billion dollars have been spent in sports sponsorship in North America, according to Statista.

Sports in the Valley are no exception to this growth, and two of the largest events in Phoenix continue to invest large amounts of money into attracting corporate fans and sponsors.

The Waste Management Phoenix Open and Phoenix Raceway are both developing and renovating suites and other facilities aimed at increasing revenues.

“We have our Bay Club on our 17th hole right on the fairway which is probably our most luxurious venue,” Phoenix Open tournament chairman Carlos Sugich said. “We started out with that venue two years ago with 20 suites, last year we expanded to 34 and next year we will be close to 50. On that same hole on the south side we are creating a new venue for 2018 called Cove 17 that is going to have 60 suites and two large lounges on each side.”

The Bay Club at the Phoenix Open’s 17th hole is one of the tournament’s most luxurious venues. The Open has more than 400 suites. (Joshua Clark/Cronkite News)

The Phoenix Open has over 400 suites, with 275 of them at the 16th hole in the PGA Tour’s only enclosed structure. As of last year’s tournament, the event has 200-plus corporate sponsors that purchase these suites to entertain clients and employees.

PIR showcased Curve, its new luxury suite with plush seating and panoramic views, for the first time during the Can-Am 500 race weekend, as well as newly redone suites in what is just the beginning of renovations for the race track that will total out at $176 million.

A lot of that money will be applied toward new grandstands and infield areas, but a big chunk will continue to be directed into the corporate fans.

“In addition to Curve, we are building brand new luxury suites,” president of Phoenix Raceway Bryan Sperber said. “This weekend we will have a grand total of 33, but we have construction underway and when that is completed in November of 2018 our total suite count will go up to 53. The corporate guests are really loving what is going on so far.”

In return for these investments, these sporting events see huge returns in revenue. Skybox 16 at the Phoenix Open costs guests $51,000, with Cove 17 coming in at $46,000. Those interested in enjoying the tournament in a corporate tent can expect to spend over $70,000.

Those hefty prices aren’t keeping customers away though. The Phoenix Open is the highest-attended golf tournament in the world with over 650,000 people attending in 2017. The suites sell out long before the golf starts and the Open maintains many of their partnerships that go back years.

PIR sold out all their suites for November’s NASCAR Can-Am 500 races as well.
Coors-Miller is one company that has sponsorship and hospitality agreements with both events, as well as the Phoenix Suns and Arizona Diamondbacks.

“It is a way for us to bring our brands to life,” field marketing manager Dave Mickschl said. “You look at the attendance numbers on these platforms for exposure and getting our brand out there and people interacting with it. Specifically, Coors Light is the brand that we lead with, but we also use the hospitality side to entertain customers and clients and give them an experience.”

These companies constantly evaluate their agreements to make sure the cash flow they invest is being returned.  This year Coors-Miller decided to end an agreement with an unnamed professional team in the Valley, but for years they have maintained their relationship with PIR and the Phoenix Open.

One factor in this is the unique opportunity both PIR and the Phoenix Open offer when compared to the four major traditional sports.

“They all do a great job, but this is just a different style of entertaining,” Sperber said. “One of the things that makes motor racing different is that it is a much longer experience. What corporate guests tell us is that they really love the opportunity to socialize with their guests for longer periods of time and really make a full day out of it, where with most other sports you’re in and out in a couple hours.”

Sugich said the same of the Phoenix Open.

“With this event, it’s a weeklong event. We open the gates on Monday and Tuesday for practice rounds, we have Pro-Am’s on Monday and Wednesday, we have an event on 16 which we call the ‘Shot of Glory’ and then we have the competition Thursday through Sunday of the actual tournament.
“Unlike football, where you go to the stadium for two or three hours, in golf you’re at the stadium, if you want to call it that, pretty much all day for the whole week. So, I think that provides more opportunity to entertain clients in comparison to regular sports.”

With the Pro-Ams, individuals and corporations are given the opportunity to compete with and against professional golfers for $11,500 a spot, and includes a breakfast attended by the amateur and professional players participating in the tournament.

For Phoenix Open title sponsor Waste Management, the partnership extends past entertainment, hospitality and even advertisement.

Waste Management, the PGA Tour and the Thunderbirds, the charitable group that hosts the Phoenix Open, have worked together since 2000, culminating in the title sponsor partnership in 2010 that will continue until at least 2025.

Waste Management uses the events to entertain its biggest clients and largest stakeholders, but highlights the accomplishments it has achieved in the hope of attracting more customers to their services.

The Phoenix Open was recently recognized for its efforts in sustainability largely due to the fact that the tournament generates zero waste despite the 650,000 people who attend every year.

They accomplish this through their partnership with Waste Management, who through recycling, composting and donations divert all waste from landfills. Waste Management then brings current and prospective customers to the event to try and expand their business.

“It’s an opportunity for us to showcase what we do,” Waste Management corporate senior director of sales and sports marketing Jeff Spencer said. “So, when we have customers or even prospects who spend time with us that week it’s a great opportunity for them to engage with the games, engage with the events, and build relationships and partnerships with ourselves and with them. We also get to show them what we are capable of. What is the differentiator that Waste Management brings to the table? That’s the whole theme around sustainability and the things that we have done with that event.”

Sponsorships and corporate agreements in sports continue to grow, both in the Valley and internationally. Company names are attached to everything. Stadiums, jerseys, replays, you name it.

Corporations invest their money into sporting events because it creates a tie to customers that other outlets don’t offer. By attaching yourself to a sports team, you are attaching yourself to a local community and the emotional investment individuals put into their teams or favorite events.

“Most folks are a fan of something, and many times a fan of multiple things,” Spencer said. “Sports is just such a universal venue that appeals to so many folks that we get the opportunity to form those relationships and attend events with our customers and our prospects. We are a national brand but we really like to think of ourselves as thinking and acting locally within the communities we operate in, and I think that sports hospitality has the benefit of allowing us to do that.”