PepsiCo is proving there's plenty of room for non-league sponsors in the world of sports marketing, whether sports leagues and their sponsors like it or not.
Recent moves by PepsiCo units Taco Bell Corp. and Pepsi-Cola Co. to capitalize on professional basketball and football icons are challenging the gentlemen's rules of official league sponsorships, making what was once called "ambush marketing" more commonplace than ever.
Some observers still cry foul as marketers from PepsiCo to Burger King Corp. launch high-profile sports campaigns without ponying up the once-requisite heavy sponsorship dollars. But as such deals become more routine, the onus is on official sponsors like McDonald's Corp. and Coca-Cola Co. to defend their positions with more powerful tie-ins or re-evaluate their sponsorships altogether.
Following Pepsi-Cola Co.'s surprise $50 million sponsorship deal with the Dallas Cowboys' Texas Stadium three weeks ago--ambushing National Football League sponsor Coca-Cola- Taco Bell last week took advantage of the National Basketball Association labor dispute to organize a pay-per-view bout between endorsers Shaquille O'Neal and Hakeem Olajuwon.
Taco Bell hinted at a live matchup between the two NBA centers in a TV spot two months ago starring Messrs. O'Neal and Olajuwon. But it wasn't able to organize the event until labor talks between NBA team owners and players collapsed in July.
The basketball stars will compete for a $1 million prize on Sept. 30 at the Trump Taj Mahal Casino Resort in Atlantic City. Showtime Event Television will telecast the contest live.
Taco Bell is seeking NBA forwards and guards to play undercard matches before the main event, said Jerry Gramaglia, senior VP-marketing. A major music act is also slated.
Other marketers are being wooed for secondary sponsorship positions, including Shaq's footwear sponsor, Reebok International, and Spalding Sports Worldwide, which has endorsement deals with both stars.
Executives within the sports marketing world, however, say Taco Bell may have a tough time lining up players for the undercard matches, since McDonald's has so many of the league's best under contract.
"I think this Shaq vs. Hakeem grudge match is tacky, and I wouldn't advise my clients to be involved in such silliness," said a marketing agent for several of the NBA's biggest marketing stars. "It cheapens the NBA brand name."
David Green, exec VP-marketing at McDonald's, said: "We have good alliances with the NFL and the NBA, but nothing is pristine. But I think customers know who steps up to the plate and makes the real commitment."
The NBA echoed that point. "Pepsi and Taco Bell can run effective publicity campaigns, but McDonald's and Sprite can create fully integrated marketing efforts that can move product," a spokesman said, pointing to the 15% surge in Sprite's sales since becoming the NBA's official soft-drink sponsor last year.
Taco Bell isn't content to use the match as a pure publicity stunt. It will also sell specially priced food packages and give away collectors cups. A network TV spot for the "Taco Bell One-on-One Championship" will break a week before the event from Bozell/Salvati Montgomery Sakoda, Costa Mesa, Calif. Taco Bell is close to signing Spike Lee as director; Mr. Lee directed the first Shaq-Hakeem spot.
The merchandising possibilities are endless, Mr. Gramaglia said. Taco Bell is considering rebroadcasting the event and possibly selling it in video.
"I think people know McDonald's is the NBA sponsor, and they've done a great job," Mr. Gramaglia said. "We're not trying to claim that. The world of sports is big enough for a lot of players."
Copyright August 1995, Crain Communications Inc.