Hi, everyone. Welcome to another episode of
William Collis:office hours with the professor. As always, I'm your host,
William Collis:William the professor Kahless. And I'm super excited to do
William Collis:another deep dive in an esports topic that caught my eye this
William Collis:week. And what's our topic today? Well, its naming rights,
William Collis:specifically, its team liquids and ALCS and Academy teams
William Collis:rebranding as Team Liquid Honda as part of a sponsorship deal.
William Collis:Now, this also includes other elements, including like, I
William Collis:think, a Honda lounge, for Team Liquid players to compete in
William Collis:sort of special Honda vehicles for the players. But the big
William Collis:thing we want to talk about today is teams selling naming
William Collis:rights. Because this is the second time something like this
William Collis:has happened. We've seen this previously with TSM, and going
William Collis:to TSM FTX. Or at least second time, we've seen a major deal
William Collis:like this. And presumably that means that we've seen it twice,
William Collis:we'll see more of it. So the question I have is, is this a
William Collis:good thing or a bad thing for the esports industry. And the
William Collis:easiest way I know to dig into that is to do some simple pros
William Collis:and cons analysis. So let's start with the pros. The obvious
William Collis:one is money. If you're a pro team, and you're willing to sell
William Collis:naming rights for your team or for your roster, you can get a
William Collis:lot more money from from a sponsor, presumably, right, it's
William Collis:another asset that you can offer. And in turn, a benefit to
William Collis:a sponsor here is exposure, right? This is a new prominent
William Collis:way to get your brand inserted into prime placement. It's
William Collis:literally in the name of the roster or the team. And I think
William Collis:there's also a little bit of backdooring going on here.
William Collis:Because if your Team Liquid, let's say it's probably pretty
William Collis:tough to insert Honda branding and name into an LCS broadcast
William Collis:without some sort of agreement with riot. But if you change the
William Collis:name of your team to Team Liquid Honda, it's sort of a cheeky or
William Collis:clever way of getting your sponsor in the broadcast more.
William Collis:So there's a little bit of a backdoor element here. So those
William Collis:are the pros money and exposure. Pretty straightforward. What are
William Collis:the cons? Well, there's really only two but one that matters
William Collis:the most. And it's potentially a pretty important one. It's
William Collis:cheapening the brand, right? Potentially selling naming
William Collis:rights deals could undermine the value of the core brand. The
William Collis:naming rights are offered up to we do see naming rights deals in
William Collis:traditional sports from time to time we even see hold teams that
William Collis:are named after things, for example, the New York Red Bulls
William Collis:and MLS soccer here in the States. But I think if we saw
William Collis:something like the Honda Yankees in Major League Baseball, we
William Collis:would have a mixed reaction to it fans would have a mixed
William Collis:reaction to it, right? Because in some sense, it would could be
William Collis:seen as degrading or making the Yankees brands lesser. And
William Collis:certainly there's a world where if an esports, for example, all
William Collis:the teams did this, and it was suddenly Honda versus Toyota
William Collis:versus Ford. Right. You know, I think it would in the extreme
William Collis:case, this would start to feel a little weird, and maybe over
William Collis:sponsored or over corporately exposed, right. And that brings
William Collis:me to kind of the second con of this, which is, I think this
William Collis:puts pressure on other teams to do more deals like this. Because
William Collis:if Team A is willing to sell their naming rights, and Team B
William Collis:isn't right, that's a big advantage for Team A going with
William Collis:sponsors. And there's also a sort of difficult to put back in
William Collis:the box effect here. If Team A is sold their naming rights in
William Collis:the past and they're doing a deal with a new marquee sponsor,
William Collis:that marquee sponsor is going to know naming rights are on the
William Collis:table and might insist you know, you Hey, you did it for these
William Collis:guys. Look at all the money we're paying you. We want naming
William Collis:rights to. So again, pros money exposure, cons brand cheapening
William Collis:and a little bit of a slippery slope effect here for the
William Collis:industry. So how does the professor grade this overall,
William Collis:what's my final take on where these pros and cons balance out?
William Collis:And I had a big think about this, and I come out with an
William Collis:unusual grade for this, I give this a pass. I don't think this
William Collis:is a good thing, or really even a bad thing for the industry. I
William Collis:think it just reflects the state of where we are today in gaming
William Collis:teams are looking for revenues. The naming rights is an asset
William Collis:they seem to be allowed to sell today. So they're going to sell
William Collis:that asset. I do think at some point, there'll be some
William Collis:guardrails put up with this, maybe around the publishers,
William Collis:right, because as I said alluded to earlier, if it becomes Honda
William Collis:versus Ford versus Toyota, in every professional match, might
William Collis:not be the best for the esports industry. But that just means
William Collis:teams that are doing early deals like Team Liquid and TSM I think
William Collis:are smart. They're sort of front running ahead and getting the
William Collis:revenues while they can get them. So that's my take on
William Collis:naming rights deals and esports. And one last thing before we go,
William Collis:I'm actually taking a vacation. So you might not see office
William Collis:hours with the professor for a little while. But if that's the
William Collis:case, don't worry. I'll be back with new episodes around mid
William Collis:July. And I look forward to doing a deep dive into esports
William Collis:news with you then. Thank you so much.
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