Title: Marketing investments in sport venue naming rights and the market value of the firm

Authors: David M. Goldberg; Jason K. Deane; Terry R. Rakes; Loren Paul Rees

Addresses: Department of Business Information Technology, R.B. Pamplin College of Business, Virginia Polytechnic Institute and State University, Pamplin Hall Suite 1007, 880 West Campus Drive, CAMPUS 0235, Virginia Tech, Blacksburg, VA 24061, USA ' Department of Business Information Technology, R.B. Pamplin College of Business, Virginia Polytechnic Institute and State University, Pamplin Hall Suite 1007, 880 West Campus Drive, CAMPUS 0235, Virginia Tech, Blacksburg, VA 24061, USA ' Department of Business Information Technology, R.B. Pamplin College of Business, Virginia Polytechnic Institute and State University, Pamplin Hall Suite 1007, 880 West Campus Drive, CAMPUS 0235, Virginia Tech, Blacksburg, VA 24061, USA ' Department of Business Information Technology, R.B. Pamplin College of Business, Virginia Polytechnic Institute and State University, Pamplin Hall Suite 1007, 880 West Campus Drive, CAMPUS 0235, Virginia Tech, Blacksburg, VA 24061, USA

Abstract: Sport venue naming rights agreements represent monumental long-term marketing investments to increase brand awareness and improve a firm's image. These agreements require enormous expenditures, highlighting the importance of understanding their impact on the firm's market value. Questions of the wisdom of such investments today, which types of sport venues are most appropriate, and whether full corporate names or truncated ones are equally successful are of more than academic interest. Prior research has presented only a limited window into the efficacy of these deals. Results from the well-known event study methodology show improved stock market returns based on 122 announcements of naming rights deals, although it is found that market reactions have soured since 2001, when several firms investing in naming rights experienced insolvency. Investments in naming major league baseball or multi-sport venues have been particularly wise. Somewhat surprisingly, we observe that longer sport venue names are preferred to other name lengths.

Keywords: event study; sponsorship; sports; investments; advertising.

DOI: 10.1504/IJSMM.2019.099785

International Journal of Sport Management and Marketing, 2019 Vol.19 No.3/4, pp.233 - 252

Accepted: 07 Apr 2018
Published online: 16 May 2019 *

Full-text access for editors Access for subscribers Purchase this article Comment on this article