Multimillion dollar sports sponsorship contracts require careful negotiations best handled by an experienced attorney.
The Dallas Cowboys are rated the world’s most valuable sports team as of July, 2018. Blockbuster TV contracts and owner-friendly collective bargaining agreements are causing record sale prices in every major U.S. sports league. (source: Forbes)
Lucrative sponsorship deals for players and franchises are growing and having an attorney on your side to navigate the totality of these agreements is in your best interest.
Negotiating corporate sponsorship agreements
Negotiating sports sponsorships requires specialized knowledge of the intricacies of the sports industry. Each contract detail requires careful research and historical analytics evaluation. What may work for one sponsor may not be as effective a marketing tool for another. Following are important aspects of sponsorship negotiations:
- Establish value: The value of the sponsorship assets – such as use of trademarks, logos, signage, in-game promotions and direct marketing – depends largely on what the market will bear. The more competitive the industry, the higher the value will be. Competitiveness is based on success and popularity of the event or the sponsored individual.
- Evaluate the individual elements: Evaluating the individual assets of a sponsorship package can be complicated. Some elements are easy to quantify and value as common elements in the industry have established market values. Such elements may include tickets and signage. Less easily valued items may include various forms of marketing, exclusive use of intellectual property, licensing agreements and endorsements.
- Negotiate the details: There is no standard contract when it comes to sponsoring a sports team or individual athlete. Details must be tailored to the sponsor’s industry and business interests as the contract aspects vary widely depending on the desired exposure, type of sport or entertainment field, targeted audience and forms of media available.
The above are only a few factors that must be considered when negotiating corporate sponsorship’s, endorsement contracts or even certain aspects of individual talent agreements.
Consult an attorney
It is vitally important to consult an experienced sports and entertainment attorney when negotiating corporate sponsorship contracts or endorsement agreements. One missed detail may end up costing a company hundreds of thousands of dollars or more. Businesses seeking to sponsor an actor, musician, sports figure, coach, team or event should seek the advice of a lawyer knowledgeable in the entertainment and sports industries.
