KFC, NFL Ink Marketing Pact For Upcoming Season
September 04 2009 - 3:54PM
Dow Jones News
After a tryout, Yum Brands Inc.'s (YUM) KFC and the National
Football League are kicking off a marketing deal for the upcoming
season that provides another platform for the chicken chain to
display its new image.
The agreement makes KFC the lone fast-food marketing partner for
the NFL, which had been without one since a pact with Burger King
Holdings Inc. (BKC) ended after the 2007 season.
Details and terms of the marketing deal are being kept under
wraps, though it is likely to include cross-promotion of NFL-tagged
items at KFC stores. The NFL season kicks off Thursday.
"We’ll have details to share as the season goes on," KFC
spokesman Rick Maynard said.
Last season, the NFL signed KFC as the "official wing sponsor"
of its playoffs and championship game in a deal that included
television and in-store advertising. The arrangement also allowed
the chain to slap the NFL and Super Bowl logo on buckets and drink
cups, and included a drawing to win prizes like a trip to this
season's Super Bowl.
The deal failed to provide a big lift to KFC's sales. The chain
posted "extremely poor" sales in January, the height of the playoff
season, though that came amid a big retrenchment in spending
following the financial meltdown.
Yum has since re-energized KFC with the introduction of its
grilled chicken products, which helped give KFC a double-digit
boost to same-store sales in its latest quarter. Yum is counting on
the turnaround of KFC to help boost U.S. earnings, while its
overseas business continues to drive growth.
The NFL had been without a fast-food marketing partner since the
2007 season, when a three-year deal ended with Burger King that had
featured, in part, commercials with the chain's mascot superimposed
into football highlights.
The league's prior fast-food partner, McDonald's Corp. (MCD),
ended its agreement in 1998.
The NFL recently signed up IHOP, owned by DineEquity Inc. (DIN),
as its full-service restaurant partner. Through October, IHOP will
be featuring a menu with football-themed dishes and will also run
television commercials with Philadelphia Eagles quarterback Donovan
McNabb and Arizona Cardinals receiver Larry Fitzgerald.
The NFL also recently signed Procter & Gamble Co. (PG) to a
multiyear deal that allows the consumer products giant to slap
"Official Locker Room Product of the NFL" label on Old Spice
deodorant and Head & Shoulders shampoo. The Wall Street Journal
reported the deal was valued at $10 million a year or more, citing
one person familiar with the pact.
The Journal also reported that sports leagues are looking for
new sources of revenue to replace ad dollars lost from the
financial services and auto manufacturing industries. Spending on
sports sponsorship deals in North America are expected to grow just
0.7% to $11.48 billion this year, after growing almost 15% last
year, according to IEG, a research company owned by WPP PLC.
-By Paul Ziobro, Dow Jones Newswires; 212-416-2194;
paul.ziobro@dowjones.com
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