Game Faces

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Corporate hospitality, one of the fastest growing areas of business-to-business marketing, is back on the upswing after going into freeze mode last fall.

"The terrorist attacks and the recession caused a slowdown in activity last year, but things have come back strong this year, with package-goods marketers topping the list," says Robert Tuchman, CEO of TSE Sports & Entertainment, New York.

And much of this activity is very hospitable, with businesses providing favored b-to-b customers entree to major, coveted sporting events. At last month's Masters golf tournament in Augusta, Ga., for instance, top business customers of such marketers as Sprint Corp. and Coca-Cola Co. were lavished with perks such as hard-to-get passes to the Masters plus accommodations at private local homes, complete with service from butlers, maids and meals catered by top chefs.

The price tag for companies sponsoring such junkets ranges between $25,000 and $50,000 for groups of 25 to 100 executives, and sometimes can surge as high as $100,000 for a dozen executives, insiders say.

Industry experts estimate spending on corporate hospitality-which can include backstage concert passes, front-row seats at the Super Bowl and the Olympics, and personalized coaching sessions with top athletes-has surged about 30% in the last five years, though they generally balk at putting a dollar total on such activity. Corporate hospitality spending tied just to the Super Bowl usually reaches about $200 million, though this year it was off 20%-25%, industry watchers say.

"New York is probably the world's biggest event market, with over 2,000 venues and 100,000 trade events annually amounting to about $4 billion," says David Adler, CEO of, which launched last year to promote the services of business-to-business event experts and suppliers.

Overall corporate spending for b-to-b events returned to normal in March, says Ray Warren, CEO of Raycom Sports, Charlotte, N.C., which has coordinated games at the Georgia Dome with legendary college basketball players on behalf of clients such as Bank of America.

While corporate belt-tightening has caused sharp retractions recently in sports sponsorships and stadium naming rights, businesses are boosting spending on one-on-one marketing to key targets, Mr. Adler says.

"As business budgets come under scrutiny, b-to-b events are more important than ever because they offer highly effective, one-on-one contact with customers for a fraction of the cost of a trade show or an advertising campaign," Mr. Adler says.

Although the price tag seems high-businesses routinely spend $3,000 or more per attendee to high-end corporate parties-the outlay is far less than a typical small ad campaign, which runs between $500,000 and $1 million, says Mr. Tuchman. But as high-end b-to-b event marketing evolves beyond the days of the booming late 1990s, it's harder than ever to wow corporate bigwigs, says Brandon Steiner, chairman of Steiner Sports Marketing, New Rochelle, N.Y.

"By this time, a lot of top executives have seen it all when it comes to top-name athletes and entertainment," Mr. Steiner says. "We're having to go further to get them to take time away from their families and personal life for business events."


The latest trend: business-to-business events close to home involving the entire family, such as one-on-one soccer clinics for the kids with Olympics/WUSA soccer star Mia Hamm or family batting practice with Yankees star Derek Jeter.

"Top decision-makers are pressed for time and minimizing travel, and if we can offer them a chance to be with their kids and also experience something totally unique with a top athlete or celebrity, it's memorable for the executive and the sponsor," Mr. Steiner says.

Another fantasy Mr. Steiner has fulfilled for corporate titans and clients from Chase Bank and Merrill Lynch & Co. is the chance to shoot some hoops with a couple of National Basketball Association players on the floor of Madison Square Garden or scrimmage with NFL stars at Giants Stadium.

"There's no substitute for standing on the actual hardwood court, taking shots with former and current NBA players, and when companies get the chance to play with clients and prospects in those venues, it's an amazing relationship-building opportunity," Mr. Steiner says.

"A decade ago, business-to-business marketing was about giving a pair of tickets to a company or providing a spectacular dinner, but now it really has to be special and personalized to that company's territory and interests," Raycom's Mr. Warren says.

High-tech companies led the boost in spending on events in the late 1990s, but recently package-goods companies account for about 70% of TSE's business, with clients including Anheuser-Busch, Kraft Foods, and PepsiCo's Pepsi-Cola Co. and Frito-Lay. Others have included AT&T Corp., Ford Motor Co. and Toyota Motor Sales USA.

"The onslaught of private-label brands owned by retailers and the rise of competition overall are putting a lot of pressure on companies to influence the decision-makers behind the scenes, the people who decide where brands go on store shelves, and which beverages get promoted at bars and restaurants," Mr. Tuchman says. "It's big business and getting bigger."


So big and so competitive that the venues hosting the events and the marketers that sponsor them are closemouthed about their activities.

Even brands that previously settled for trade shows and industry events to influence their customers are turning up the heat: Agribusiness giant Syngenta hired Omnicom Group's Martin/Williams, Minneapolis, to create an unforgettable experience by putting farmers in cars with Nascar drivers, screaming around the track at 180 mph. "You'd be amazed how, when you put hard-nosed, stoic business guys into a race car or give them one-on-one time with one of their sports heroes, they melt," says Mr. Tuchman.

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