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MillerCoors, Chicago Bars Call Marketing Audible on NFL Lockout

Crain's Chicago Business, June 09, 2011

By Kate MacArthur

With the National Football League lockout in its 88th day and no end in sight, some of the Chicago businesses most dependent on football for sales — beer makers and bars — are getting serious about contingency plans.

MillerCoors LLC executives are mulling alternative advertising strategies, including college football promotions and Major League Baseball, to try and fill the gap for the brewer's biggest marketing season of the year, according to two executives with knowledge of the situation.

“It's the single-biggest media expenditure,” says one of the executives, speaking on the condition of anonymity. “This is the time when (MillerCoors would) drop $40 million to $60 million in media, so where do you redeploy that? As a national property, nothing gets the ratings of the NFL.”

MillerCoors declined to comment.

The labor dispute started March 12 between the league and the NFL Players Assn. over game revenues, the number of games, salaries and healthcare, among the issues. On Friday, a court urged both sides to work out the issues between themselves. Talks resumed Wednesday with no resolution.

Most marketing industry observers agree: Nothing could make up for a lost NFL season.

“The fourth quarter is one of the most crucial times in advertising, which is why the NFL is such a big player with advertisers. People use it as platforms for campaigns,” says Donna Speciale, president of investment and activation and agency operations for New York-based MediaVest USA, an agency that buys and plans advertising.

If the season doesn't air, “it's going to be more of a challenge for the advertisers to find those exact audiences that they were looking for,” she says.

For MillerCoors, the timing of the lockout has a bit of schadenfreude: This will be the first season in eight years that the Chicago-based brewer hasn't been the official NFL sponsor with its Coors Light brand. Its rival, St. Louis-based Anheuser-Busch Cos., offered a higher bid.

Instead, the maker of armchair quarterback staples Miller Lite and Coors Light has continued its sponsorships of 21 individual teams, including the Chicago Bears.

Plus, the brewer moved some of its advertising budget to Mexican soccer and is contributing to parent Molson Coors' $375-million National Hockey League sponsorship.

“If the NFL and the union reached a deal today and the season would go on, there are some major sponsors who are (already) out money because they've already started producing in-store displays and ads for if there weren't an NFL season that they'd have to scrap,” says Jim Andrews, a senior vice-president with Chicago-based sponsorship consulting and research firm IEG LLC.

League executives have a business-as-usual stance.

“We're over a month-and-a-half from training camp starting, and nobody is panicking,” says Chris Hibbs, senior director of sales and marketing for the Chicago Bears Football Club. “Everyone is prepared for our season to kick off on Sept. 11, our home opener.”

Meanwhile, some sports bars aren't waiting for labor peace to alter their own plans.

Revenue at Joe's Bar in Lincoln Park jumps 25% to 40% when football is on the TV. The bar typically fills summer weekends with charity bean bag tournaments, but ends the games in September.

Not this year.

“We just said, don't cut anyone off. We just want to get people in the door, so don't turn anything away,” says Gabby Lobascio, special events manager for the bar.

Others are hoping for the best.

If there is no season, “it will completely wipe out Sunday, and NFL Sunday is a pretty decent day,” says Mike Jannusch, owner of Sedgwick's Grill in Old Town, who adds that the NFL contributes 20% to weekend sales. “I still think we're at the point where everything gets settled — and I don't think anybody believes it's not going to. We're not there yet.”