It's the latest sponsor to rethink the NFL. Last month, McDonald's Corp. walked away from the league.
Compared with Coca-Cola and McDonald's, Staples is a small spender in sports marketing. But its anxiety over the cost of doing business with the NFL is shared by others, and points to a new era looming in NFL sponsorship.
COST OF TIME
Staples, which just completed its second season as an NFL sponsor, is said to have reached an agreement in principal on renewing its deal. But it's not the price of the sponsorship that's preventing Staples from concluding negotiations; it's the cost of media time during NFL telecasts that Staples believes it needs to leverage those rights.
Staples used its sponsorship of the "Coach of the Week/Year" award last season as the major thrust of its NFL marketing activities. It included weekly media buys on then-NFL broadcaster NBC.
Staples wants to continue using the "Coach of the Week/Year" as its primary NFL marketing platform, but the retailer is said to be wary of the increased ad rates broadcasters will charge.
The NFL's new $17.6 billion contracts with ABC, CBS, Fox and ESPN could drive ad rates up between 15% and 25%, according to agency estimates.
OSCAR MAYER YIELDS
Oscar Mayer Foods gave up on its NFL media vehicle, the Super Bowl halftime show, over cost issues. True Value Hardware now is re-evaluating sports marketing as a strategy in general and it's unlikely to return to the NFL.
NFL sponsors say the power of the NFL property isn't being questioned, just its price.
A spokesman at NFL Properties, the league's marketing arm, said the NFL recognizes the new TV deal changes the dynamic of its sponsorship program. "It's incumbent on us to come up with even more creative solutions for companies that want to be NFL sponsors," the spokesman said.