There’s a graveyard of companies that have sponsored sports arenas and stadiums before going under. Perhaps the most notable was Enron Field in Houston, now Minute Maid Park, where the Astros play baseball. Obviously, the previous relationship came to an unceremonious end when, well, Enron. Other examples include Sports Authority, Conseco, Adelphia, and a bunch of other companies you’ve likely never heard of. Needless to say, it’s a bad look for everyone, and it’s yet another reminder that pride does come before the fall.
We should all keep this in mind with the announcement of the new name of the Los Angeles sports arena, the Crypto.com Arena. Home of the Lakers, Clippers, Sparks, Kings, and a bunch of events, the previously named Staples Center struck a 20-year deal with crypto.com for $700 million, which is a big number even in the context of big deals for sports arenas. For those who are unaware, which I’m assuming is most everyone, crypto.com is an exchange for cryptocurrency – Bitcoin, Dogecoin, Ethereum, and a bunch of other things I’ve never heard of. It’s like the Charles Schwab for crypto. If you go to their website, you can see Matt Damon pitching their product. And apparently times are good enough that they can afford – or at least hope to afford $700 million over the next two decades. And they aren’t the only cryptocurrency exchange getting in on the action. FTX, another cryptocurrency exchange, recently took over naming rights of the Miami arena from American Airlines. I have no idea if these arenas take crypto at the concession stand – or honestly, what that would even look like.
Companies name stadiums and arenas for few reasons. The first and foremost is publicity and brand exposure, especially for those businesses hoping to achieve a more household recognition. At the very least, people are learning more about crypto.com right now, which is kind of the goal. Companies also use this for legitimacy and brand enhancement, since being associated with big time sports teams could take you from outlier to mainstream, certainly a concern for a product a lot of people still assume is made up. And finally, companies hope that spending hundreds of millions for a name will help their bottom line through whatever ROI metric you’d want to use.
There’s a whole bunch of strategy and logistics that go into deals like these, on both sides of the leger – even though cash is always king. For the stadium and teams that play in it, you’d like a company with a positive reputation – or at least not a negative one. For the company itself, beyond just whether it’s a good business deal, you have to consider if the publicity could do as much harm as good. For example, it’s not a great look for a company that just got a government bailout to throw millions at what some consider a vanity project. Citi Field comes to mind here. In essence, it’s something of a marriage, which, as we all know, can go good or bad – and quite often because of money.
All that aside, what are we to make of the new Staples Center, named after a product that feels nearly out of a dystopian new world order? I’ve heard confusion, angst, and even some folks who proclaim they’ll never call it that – even though they had no problem using the name of a store that sold office supplies. I’d say this. On the one hand, this new sponsor is yet another reminder that the world is changing, and probably faster than we think. Moving from a place that sells office supplies to one that trades electronic currency is about as good a metaphor for the future as you’ll get. On the other hand, it’s also a signifier that the sports world is more interwoven with technology than we might recognize. From the use of biometric data to AI broadcasting tools to the endless reliance on deep analytics, professional sport has become something of an equation played out by humans – kind of like how a car is just a computer on wheels. Obviously, naming a stadium after cryptocurrency isn’t going to change how the Lakers play basketball. But perhaps it’s a reminder of where the game’s been going all along.
Of course, who really knows. If there’s an industry that seems poised for boom and bust, it’s crypto. Which would mean that crypto.com would join the likes of Enron and Sports Authority in the stadium graveyard.
Keith Strudler is the director of the School of Communication and Media at Montclair State University. You can follow him on twitter at @KeithStrudler
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