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Jersey deal a measure of success for Canadian soccer

5 July 2010 No Comment

World Cup soccer is a major draw in Canada, a fact many bars and offices can attest to over the past month. Until recently though, homegrown professional soccer has always managed to stumble on the pitch.

Pro leagues have come and gone, often launching with high hopes only to fold in dramatic fashion. But as Major League Soccer gets ready to add a pair of new franchises in Vancouver and Montreal in the next two years, there are signs things are different this time around.

Perhaps the most important indicator of the league’s popularity in Canada, beyond the obvious ticket sales, is that sponsors are starting to pay real money to have their names on MLS jerseys.

When Bank of Montreal reveals this week that it has renewed the exclusive rights to Toronto FC’s kit for the next five years, there will be no mention of a dollar amount. However, sources indicate the sponsorship is worth at least $4-million a year – a sum BMO is effectively paying to keep other sponsors away from its prized franchise.

“We could see the value of the jersey, and how the spectators value the jersey,” said Sandy Bourne, vice-president of advertising and sponsorship for BMO, which also has its name on the stadium where the team plays.

BMO’s deal comes a few weeks after Bell Canada won the rights to the new Vancouver Whitecaps jersey when that squad joins the MLS next year. Sources indicate that sponsorship is also worth seven figures, though it is less than the Toronto FC pact.

The escalation of such contracts is promising news for the league. Unlike other team sports where ads on uniforms are considered sacrilege, jersey sponsorships in soccer are seen as an indicator of a team’s status.

For evidence, look no further than the bidding for the rights to Manchester United’s famed jersey.

When insurance giant AIG got itself into financial trouble, it didn’t take long for Aon Corp. to move in on its rival’s deal with Manchester United. In less than three weeks last summer, Aon negotiated a four-year deal to have its name stitched across Wayne Rooney’s chest starting next season.

At £20-million a season (about $32-million) the Manchester deal is the richest sponsorship in pro soccer. But even though MLS will never see such dollars thrown at its clubs, the $4-million ascribed to the BMO deal is a significant increase over the last contract.

Back when Toronto FC signed its first jersey deal with BMO, the price was closer to $1-million or $1.5-million a season – and that was more of a symbolic amount. Neither side could peg a real value to the ad space being sold for a club that had not stepped on the field

“It was kind of like jumping off a cliff into a lake and you don’t know what’s down below,” said Tom Anselmi, chief operating officer of Maple Leaf Sports and Entertainment. “We took our best guess on value based on our knowledge of the market and value of what things are selling for around the league.”

Since then, Toronto FC has consistently attracted some of the league’s biggest crowds, a trend Vancouver hopes to echo in 2011, followed by Montreal in 2012.

Despite fetching a higher price from BMO, Mr. Anselmi said MLSE didn’t consider putting the jersey rights up for auction this time around.

“We’ve been approached numerous times over the last handful of years, people saying ‘Hey, when it comes up, let us know. We’d like to talk to you,’” Mr. Anselmi said. “But we really didn’t contemplate going to the market.”

However, marketing experts suggest the landscape could be changing for pro soccer in Canada.

“MLS has been struggling to find its identity since the World Cup in the U.S. [in 1994], but they have come on strong,” said Keith McIntyre, president of K.Mac & Associates Marketing Inc. “With Vancouver and Montreal joining the league, the value will increase for Canadian sponsors.”

This story first appeared on the globeandmail.com