When the Rams packed their bags for Los Angeles after 21 seasons in St. Louis, the team was missing a few necessary components required of NFL franchises.
Yes, there was a full complement of players, veteran coaches, and truckloads of equipment. What stayed behind were sponsors, season ticket holders, and a lot of staff.
None of the businesses that backed the team in the Midwest opted to renew their deals after the move, there were no season ticket holders to renew, and only half of the franchise’s business staff opted to head west. In addition, the team had to pony up a $550 million relocation fee (payable over 10 years) to the National Football League for the right to start all over again in Inglewood.
It’s safe to say the team had a lot of work to do despite its deep roots in the region.
“We’re an expansion team with roots in Los Angeles,” said Kevin Demoff, the Rams’ chief operating officer. “We’re the city’s oldest and its most recent team.”
After the league’s owners voted to allow the team’s move in January, the Rams signed a deal in March with California Lutheran University in Thousand Oaks to hold practices on campus during the next two NFL seasons. A month later, the Rams signed a lease for office space in Agoura Hills that is intended to house the team’s headquarters until its Inglewood stadium and complex is completed in 2019.
The office is being built out to the Rams’ specifications while training camp continues at UC Irvine, some 75 miles south of the temporary headquarters, throughout August. Players and some business staff are staying in the school’s dorms for up to seven weeks, rather than the traditional few weeks of training camp, until the Thousand Oaks space is ready.
Further complicating matters, the Rams’ temporary status – the team will play its home games at the Los Angeles Memorial Coliseum, a venue managed by USC – limits its ability to sign some lucrative sponsorship deals.
Those types of contracts – especially stadium-naming rights – are important for NFL teams, which divvy up national television revenue, the league’s largest revenue stream, in equal portions to all 32 franchises. Because stadium rights and suite sales are negotiated on the local level, the proceeds of those deals stay with the team and are not shared with the league, so it might be close to three years before the Rams see any such money.
Also hampering the team’s business efforts is an agreement with the NFL that the team would only be allowed to only sell three-year sponsorship deals – unless the San Diego Chargers announce plans to join or decline an option for the Inglewood stadium this year. Once that decision is made, the Rams can begin selling tickets and sponsorships for the new stadium.
Meantime, said Demoff, “companies call about naming rights, suites, and sponsorships and we haven’t been able to have those discussions yet. We have a number (of sponsors) that will carry us through the next three years at the Coliseum.”
And while team owner Stan Kroenke has a net worth estimated at $8 billion and can ride out the three years until the stadium is completed, those local sponsorships are important. Not only do they bring in cash but they help position the Rams brand in the market.
Some of those “homecoming” partners include Cedars-Sinai Health System, beer brand Corona Extra as well as grocery chain Albertsons Cos. Inc. and its subsidiaries Vons and Pavilions.
The three-year Cedars deal includes traditional elements such as in-stadium signage, print, and radio advertising, and sponsorship of the Rams Kid Zone on game days. Cedars will also work with the franchise year-round on activities that help improve the health of people in the community as the team’s official health care partner.
The Rams declined to disclose the terms of the deal with Cedars or of any of its other early sponsorship agreements.
Corona Extra, one of the more than 100 brands produced by Victor, N.Y.-based Constellations Brands Inc., signed on as the exclusive imported beer for the team. The three-year deal includes in-stadium signage, use of the Rams’ logos on packaging, and sponsorship of the new Corona Beach House party zone on the east side of the stadium. Corona will also be integrated into the team’s Hispanic Heritage Month program in October. The Rams’ Aug. 13 preseason opener against the Dallas Cowboys marked the introduction of Corona Extra draft to the L.A. market. It will also be distributed at hundreds of bars in the area beginning in October.
“They are in a great position to build out the sales strategy of the new property and use the next three years as a long-term interview process to find the appropriate and meaningful long-term partners,” said Jeff Marks, president of Santa Monica’s Premier Partnerships, who advised the NFL’s Atlanta Falcons on its stadium naming-rights deal with Mercedes-Benz this year in addition to other sponsorship agreements.
Fan interest in the Rams has been strong. The team has sold all 70,000 season tickets for the upcoming season and single-game tickets have also been completely snapped up. However, the team will only play seven regular-season games at the Coliseum this year instead of the usual eight, as the team will host one home matchup in London. The Rams have also agreed to play a regular-season home game in China in 2018.
These games illustrate the NFL’s desire to expand its international presence and the Rams are eager to be a central part of those efforts.
Chief Operating Officer Demoff stressed that the move to Los Angeles was important due to the region’s connections to Latin America and because of L.A.’s role as a gateway city to Asia. He’s confident that the team will find major corporate partners going forward, noting that several large national and international companies have reached out to tell him that Los Angeles is their most important market.
“We need to make sure that we’re set up for success and that we partner with companies that represent us as the right strategic partners in the community,” he said.