It was a few weeks ago that news broke about Halifax Metro Centre’s newest and biggest sponsorship – after over 35 years, Atlantic Canada’s largest sports and entertainment venue was finally getting a naming rights partner. It had long been speculated that Halifax Metro Centre (HMC) would finally sell its name to a corporate partner, but little did Haligonians know that the wheels had been turning since 2012. Working on the valuation and adding strategic guidance to the selling process, TrojanOne would like to offer some insights into how the process of securing Scotiabank came to be, as well as some of the challenges and opportunities along the way.
History in Halifax
Owned by the Regional Halifax Municipality (HRM) but managed by Trade Centre Limited (TCL, a TrojanOne client), HMC is a beloved venue in need of a few updates after over 35 years of providing the community with world-class entertainment. Consumers have grown tired of the orange seats and old bathrooms.
Furthermore, Halifax hadn’t had the best history of securing naming rights for its venues. Both deals for BMO Centre and Emera Oval were done behind closed doors, resulting in animosity from the community about selling part of their community to corporate partners who paid so little ($50K or less annually for each).
Selling naming rights for the first time to a long-standing venue can easily be met with trepidation. To ease any potential public conflict, TCL and the HRM learned from venues such as Mosaic Stadium at Tindall Field, positioning the incoming revenue as an opportunity to offset tax funds to improve the venue, engaging the public in making recommendations for improvement, and making all communications from HRM townhall meetings available online.
Valuing the Halifax Metro Centre
With a lower historical value for Halifax’s naming rights opportunities, it was critical that a valuation of HMC was comprehensive, included several scenarios of sponsor benefits, considered sponsor objectives, and borrowed key learnings from interviews with 6 other such venues who had recently found naming rights partners.
To start, TrojanOne gathered historical data on over 25 naming rights deals in Canada, looking at 14 different variables that could affect sponsorship value. Through factor analysis, TrojanOne determined a specific range for Halifax Metro Centre naming rights, dependent of specific benefits a partner could receive and their specific objectives with the partnership.
Armed with a critical, third-party valuation, TCL and the HRM could confidently approach prospects and produce an RFP for the HMC naming rights opportunity.
Finding the Right Partner
Several key decision criteria were developed to ensure that Halifax Metro Centre would find the right partner – one who could positively contribute to the community, provide funds to renovate the venue, and lend a name that would add to HMC’s image.
A scaled decision criteria matrix was used to score each proponent, looking at criteria such as NPV of offer, exclusivity conflicts, proposed activations, and company fit.
After reviewing proposals, scoring key components against the decision matrix, and interviewing each proponent, TCL and HRM had a clear choice in mind for HMC’s future naming rights partner – Scotiabank.
The timing couldn’t have been better. Scotiabank was coming off the loss of its venue in Ottawa, HMC had recently celebrated an anniversary, and the announcement of upcoming sports & entertainment events to the venue meant it would be gaining additional recognition in the news.
Although it must have been incredibly difficult, the final decision was kept secret even internally with TCL and the HRM until the big announcement at a press conference on June 25, 2014. The final figures were in, and the name was announced – for $650,000 annually for ten years, Halifax Metro Centre would be renamed Scotiabank Centre.
Image Source: Twitter (@HfxMetroCentre)
Together, Scotiabank, Halifax Metro Centre, Trade Centre Limited, and the Halifax Regional Municipality will work together to build upon the legacy the venue has established since 1978. As the newly-named Scotiabank Centre, the venue will undergo significant upgrades to be completed in fall of 2017, with over $5M directly invested from Scotiabank. The partnership will allow for new opportunities to better engage not only attendees to Scotiabank Centre events, but to better engage the community at large, incorporating Scotiabank’s other sponsorships within the region. As Scott Ferguson, President and CEO of TCL declared, “a new era begins today.”