The city of Chicago has spent nearly $300,000 to hire a marketing services firm to investigate selling the naming rights to various city attractions. Soon, Chicagoans might have the opportunity ride the Blue by American Express® line to O’Hare, or visit The Container Store’s Shedd aquarium and Maxim magazine’s Kohl’s Children’s museum. On the heels of the privatization of the Chicago Skyway and Millennium Park garages, selling the naming rights to cherished civic institutions might seem like the final act of the commercialization of our municipality. But, this is only the beginning.
Chicago is just one of many U.S. cities seeking “creative ways” to raise funds and offset budget deficits. Selling the naming rights to city programs, buildings and events appears to be the most painless way to build public coffers and is certainly much easier than trying to make existing departments more efficient. It seems like easy money, but in the long run there’s a catch for both the city and its would-be corporate partners.
Corporate sponsorships have been around in the world of sports for generations, and with each new sponsorship or stadium name change, the marketing impact of the tie-in becomes more diluted. Wrigley field was built as part of a chewing gum empire, but over the years the name has become more associated with the baseball team than a pack of Juicy Fruit®. A more recent example is U.S. Cellular’s sponsorship of the White Sox stadium. Though the telecommunications company spent millions for the naming rights, the majority of fans refer to the park as “The Cell” or even “New Comiskey”. U.S. Cellular is still better known for their painfully unfunny television ads starring Joan Cusack. Unless White Sox fans overwhelmingly use U.S. Cellular as their wireless provider, where is the value for the corporate sponsor? Now imagine everything from the public libraries to the Taste of Chicago with a named sponsor. When will corporate sponsorships reach the point of diminishing returns?
For the city, the money will come now; the conflicts of interest will come later.
The city oversees businesses in any number regulated areas, including taxes, zoning, consumer safety and inspections. The city must act on behalf of its residents’ best interests to ensure that businesses are in compliance with all laws and regulations. Yet, once the city enters into a multi-million dollar relationship with one of these companies, its independence will be forever compromised, or at least questioned.
But the city needs the money now. And if there are problems a few years down the road, I guess we’ll cross that bridge when we privatize it.
Chicago is just one of many U.S. cities seeking “creative ways” to raise funds and offset budget deficits. Selling the naming rights to city programs, buildings and events appears to be the most painless way to build public coffers and is certainly much easier than trying to make existing departments more efficient. It seems like easy money, but in the long run there’s a catch for both the city and its would-be corporate partners.
Corporate sponsorships have been around in the world of sports for generations, and with each new sponsorship or stadium name change, the marketing impact of the tie-in becomes more diluted. Wrigley field was built as part of a chewing gum empire, but over the years the name has become more associated with the baseball team than a pack of Juicy Fruit®. A more recent example is U.S. Cellular’s sponsorship of the White Sox stadium. Though the telecommunications company spent millions for the naming rights, the majority of fans refer to the park as “The Cell” or even “New Comiskey”. U.S. Cellular is still better known for their painfully unfunny television ads starring Joan Cusack. Unless White Sox fans overwhelmingly use U.S. Cellular as their wireless provider, where is the value for the corporate sponsor? Now imagine everything from the public libraries to the Taste of Chicago with a named sponsor. When will corporate sponsorships reach the point of diminishing returns?
For the city, the money will come now; the conflicts of interest will come later.
The city oversees businesses in any number regulated areas, including taxes, zoning, consumer safety and inspections. The city must act on behalf of its residents’ best interests to ensure that businesses are in compliance with all laws and regulations. Yet, once the city enters into a multi-million dollar relationship with one of these companies, its independence will be forever compromised, or at least questioned.
But the city needs the money now. And if there are problems a few years down the road, I guess we’ll cross that bridge when we privatize it.
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