New York City: Your Ad Here

Posted by Doug Turetsky, September 6, 2012

New York City itself may not be for sale, but the rights to tie your corporate name and logo to a variety of city facilities and services may increasingly be up for grabs as public agencies look for ways to raise revenues to meet growing expenses and offset city funding cuts.

On September 14, the city’s parks department is scheduled to receive bids from companies for the right to affix their names to 55 dog runs and 631 basketball courts. The city’s 2013 budget anticipates $1.5 million in annual revenue for the naming rights to the dog runs and $3.5 million from the basketball courts in fiscal years 2013-2016. An additional $8.0 million in annual revenue over the same period is expected through more sponsorships, although the parks department has not yet announced what facilities it will offer to potential sponsors. The city’s financial plan expects the parks department to take in $13 million annually in sponsorship revenues through 2016.

The parks department’s effort to sell these naming rights is being done under an initiative it calls the NYC Parks Corporate Partnership Program. Under this program, the agency says, “[C]ompanies can invest in a unique opportunity to promote their brand through NYC parks assets.” The parks department is offering potential partners rights that can stretch from onsite to online.

IMG Worldwide, a major sports and fashion marketing and licensing company, has been enlisted to play a key role in the parks’ partnership program (IMG is the marketer of New York City Fashion Week). The parks department Web site describes IMG as “the exclusive designated agency to develop and commercialize this opportunity.” Proposals for sponsoring the dog runs and basketball courts are to be sent to IMG. For its work on behalf of the parks department, IMG is reportedly being paid by NYC & Company, a private organization that does tourism promotion and marketing for the city. In 2011, about 40 percent of NYC & Company’s $36.4 million in revenues came from city funding.

The parks department is not the first agency to market naming or sponsorship opportunities. The Department of Transportation’s bike-share program, now expected to start rolling in March 2013, is being funded solely with sponsorship money: $41 million from Citigroup and $6.5 million from MasterCard. For its cash, Citigroup will get its name on 10,000 bikes and 600 docking stations around the city. MasterCard is providing the payment system for the program.

Similarly, the Metropolitan Transportation Authority is seeking to take greater advantage of the MetroCard’s ubiquity as well as its iconic link to the city by offering advertising space on the front of the card. The back of the card has already been available at costs ranging from $25,500 for 50,000 cards to $450,000 for 2.5 million cards. Rates for the front of the card haven’t been determined yet.

The transportation authority has also sold naming rights to the Atlantic Avenue-Pacific Street subway stop for $200,000 a year for 20 years to the British banking firm Barclays. The station, which sits under the soon-to-be opened Barclays Center arena in Brooklyn, is now called Atlantic Avenue-Barclays Center (Barclays paid $400 million over 20 years to purchase naming rights for the publicly subsidized arena from the Nets).

At least one other local agency has declared its intention to offer up its facilities for some form of advertising. Last September, the Daily News reported that the New York City Housing Authority was floating the notion of offering billboards to advertisers at its development projects, an idea that provoked unease among some residents and elected officials.

But the housing authority still sees its 2,600 buildings in 334 developments citywide as an opportunity for prospective advertisers. In January, the housing authority released Plan NYCHA: A Roadmap For Preservation, a five-year plan to improve services and increase partnerships and revenues. Although it provides only the barest of details, the plan states that the housing authority aims to “design and launch a plan to offer NYCHA property for advertising with input from residents.”

New York’s streets were once believed to be paved with gold. In the future, they may increasingly be paved with sponsorship dollars.