DL appears ready to take MKE convention center naming rights

[WorldTraveler]

http://www.jsonline.com/business/delta-air-lines-to-buy-convention-center-naming-rights-pv6glri-166260126.html


Downtown Milwaukee's Frontier Airlines Center apparently will be replacing "Frontier" in its moniker with "Delta."
Delta Air Lines Inc., which is increasing its operations at Mitchell International Airport, has reached an agreement to purchase the convention center's naming rights, according to two sources familiar with the pending transaction.
"I know it's in the works," said one source, who spoke only on the condition of not being identified.
Delta spokeswoman Chris Kelly declined to comment, citing a corporate policy of not discussing rumors.
Franklyn Gimbel, board chairman of the Wisconsin Center District, which owns and operates the convention center, said recently that an agreement has been reached with a new naming rights partner for the last year of the current agreement with Frontier Airlines.
Also, Gimbel said negotiations are ongoing for an additional five years with the new naming-rights partner. He declined to identify the new partner but said he hoped it would be revealed by the end of August.

Would this be DL's only city where it has naming rights in a non-hub city?

 

[eolesen]

Heck, it's probably the first time I've ever seen an airline try to get naming rights on a convention center... but that's all that is left.

BHO got the naming rights to the Bradley Center earlier in the year (home of the NBA Bucks and AHL Admirals), and Miller Park is pretty self explanatory as the home of the Brewers.

 

[Kev3188]

Heck, it's probably the first time I've ever seen an airline try to get naming rights on a convention center... but that's all that is left.

BHO got the naming rights to the Bradley Center earlier in the year (home of the NBA Bucks and AHL Admirals), and Miller Park is pretty self explanatory as the home of the Brewers.

Don't forget US Cellular arena...

 

[WorldTraveler]

Probably doesn't hurt BMO or US Cellular to have obtained naming rights since they aren't on anywhere near the global scale of any of the major US airlines. Neither do business in my neck of the woods. For events broadcast outside of the region of the stadium it helps to be able to use your influence in the region to build brand awareness outside of it.

Perhaps one of you can recount NW's history of MKE esp. relative to Midwest Express, but I think the real significance of this move is that DL is wanting to take its place back at the table at MKE and is letting it be known it is not ceding the MKE market to WN, even though with F9s pulldown and WN's acquisition of FL.
MKE is just one of the many cities in the midwest than NW historically dominated and which DL has no intention of giving up... obviously MKE is valuable because of its proximity to the CHI market but it also is also on the edge of an entire region which NW and now DL are the largest airline.

Not sure what it cost to gain naming rights - presumably DL didn't take it just for the remaining term of the existing contract - but it is more symbolic of DL's desire to protect its interests in MKE which is symbolic of the upper midwest as a region.

I also would like to know if any other airline has naming rights in a city that is as relatively small on their network as MKE is. I'm not sure MKE is even in DL's top 20 domestic cities.

 

[Kev3188]

Not sure what it cost to gain naming rights - presumably DL didn't take it just for the remaining term of the existing contract - but it is more symbolic of DL's desire to protect its interests in MKE which is symbolic of the upper midwest as a region.

I believe F9 is/was paying $500k/year...

I also would like to know if any other airline has naming rights in a city that is as relatively small on their network as MKE is. I'm not sure MKE is even in DL's top 20 domestic cities.

Currently sitting in 31st place, based on avg. daily departures...

 

[737823]

What happened to the Delta Center in SLC? Seems DL has a significantly larger operation there and maybe they should get those naming rights back.

Josh

 

[Kev3188]

I think they lost (or gave them up) while in BK.

Maybe they think the smaller investment in MKE will reap a larger relative return?

 

[eolesen]

Dunno, but I'd heard the $500K figure from someone else, and not someone at F9 or DL. I can think of better ways of spending $2.5M over 5 years than to advertise to the attendees of the Wisconsin SuperCheer Championships, tattoo/gun shows, or the annual railroad memorabilia sale....

And yes, I'd forgotten about the arena. At least that has a sports floor.

 

[WorldTraveler]

Perhaps I have missed it, but has AA rejected naming rights for stadiums in MIA and DFW? If not, sounds like they are forking out $8.5M per year.


Under its deal with the city of Dallas, AMR pays about $6.5 million annually for naming rights to the center. The contract runs through 2031, which suggests the company is on the hook for more than $120 million. AMR has a less expensive deal with the Miami Sports and Entertainment Authority for the American Airlines Arena, the home of the NBA’s Miami Heat, for which it is set to pay $2.1 million annually through 2019.
http://www.fwbusinesspress.com/main.asp?SectionID=30&SubSectionID=55&ArticleID=18223

 

[Kev3188]

Dunno, but I'd heard the $500K figure from someone else, and not someone at F9 or DL.

IIRC, it was in a MKE Journal-Sentinel article, but I'd have to go look for it...

I can think of better ways of spending $2.5M over 5 years than to advertise to the attendees of the Wisconsin SuperCheer Championships, tattoo/gun shows, or the annual railroad memorabilia sale....

Me too, but here we are...

 

[WorldTraveler]

let's see... 500K per year in a market where you are growing your market share or $6.5M in a market where low fare carriers are already chowing down while writing the menu for the next course.

hmmm.

Or we could just have no marketing.

 

[Glenn Quagmire]

http://www.jsonline.com/business/delta-air-lines-to-buy-convention-center-naming-rights-pv6glri-166260126.html


Downtown Milwaukee's Frontier Airlines Center apparently will be replacing "Frontier" in its moniker with "Delta."
Delta Air Lines Inc., which is increasing its operations at Mitchell International Airport, has reached an agreement to purchase the convention center's naming rights, according to two sources familiar with the pending transaction.
"I know it's in the works," said one source, who spoke only on the condition of not being identified.
Delta spokeswoman Chris Kelly declined to comment, citing a corporate policy of not discussing rumors.
Franklyn Gimbel, board chairman of the Wisconsin Center District, which owns and operates the convention center, said recently that an agreement has been reached with a new naming rights partner for the last year of the current agreement with Frontier Airlines.
Also, Gimbel said negotiations are ongoing for an additional five years with the new naming-rights partner. He declined to identify the new partner but said he hoped it would be revealed by the end of August.

Would this be DL's only city where it has naming rights in a non-hub city?

I remember when Northwest was going to operate a mini-hub out of MKE after purchasing A stake in Midwest? Didn't work out.

 

[WorldTraveler]

I don't remember the details - but IIRC NW tried to hedge its bets in MKE by buying into Midwest and then tried to coordenate w/ YX. Given that YX has gone into the history books and the hub was dismantled by its successor, was the problem the hub in MKE or the fact that NW was trying to work w/ a company that itself was built around being a public version of Kimberly-Clark's private jet and its successor couldn't figure out how to properly serve the market? Perhaps a focus city as DL and WN are both likely to have is what MKE needs - but neither will operate MKE as a hub. IND are RDU are similar where both DL and WN have focus cities.

BTW, there was a time when DL's frontline, non-marketing personnel went on sales calls with sales reps in order to give all employees insight into DL's customer base and to help customers get to know the frontline people who made the airline work.

 

[eolesen]

I just did a data pull, and it looks like DL is offering 3500 seats a day in MKE. That makes MKE is the 35th or 36th largest city in DL's system...

Assuming the $500K holds up, DL's paying about $0.40 per ASM for the naming rights on a facility that may or may not be seen by a couple thousand people per week attending an event, and maybe a couple thousand driving past.

There are probably some tie-ins for group rates on people coming to events, so that shows some potential revenue offsets you wouldn't have at a sports arena.

But it's still an odd pick for a city that much off the beaten path network-wise.

It's not a reasonable example to try and compare the relative cost of AA or anyone else's naming rights at a professional sports arena, especially when it is in one of their top 5 markets.

But since you did, here's the comparative math:

AA's offering about 87,000 seats a day at DFW, and 47,000 per day at MIA, and the cost comes out to less than $0.20 per ASM in DFW and less that $0.12 per ASM in MIA.

In addition to the tens of thousands of drivers going past those facilities daily, and the tens of thousands of people who attended each event held there over the course of the year, there were millions who saw the AA name and logo while watching the NBA Playoffs and Championship last year.

I'd say that a professional sports arena naming is worth the investment. This one? Interesting, but hard to judge just yet.

 

[QA4Jet-A]

I just did a data pull, and it looks like DL is offering 3500 seats a day in MKE. That makes MKE is the 35th or 36th largest city in DL's system...

Assuming the $500K holds up, DL's paying about $0.40 per ASM for the naming rights on a facility that may or may not be seen by a couple thousand people per week attending an event, and maybe a couple thousand driving past.

There are probably some tie-ins for group rates on people coming to events, so that shows some potential revenue offsets you wouldn't have at a sports arena.

But it's still an odd pick for a city that much off the beaten path network-wise.

It's not a reasonable example to try and compare the relative cost of AA or anyone else's naming rights at a professional sports arena, especially when it is in one of their top 5 markets.

But since you did, here's the comparative math:

AA's offering about 87,000 seats a day at DFW, and 47,000 per day at MIA, and the cost comes out to less than $0.20 per ASM in DFW and less that $0.12 per ASM in MIA.

In addition to the tens of thousands of drivers going past those facilities daily, and the tens of thousands of people who attended each event held there over the course of the year, there were millions who saw the AA name and logo while watching the NBA Playoffs and Championship last year.

I'd say that a professional sports arena naming is worth the investment. This one? Interesting, but hard to judge just yet.

My best guess is... this is all because of WN/FL.