New Orleans Arena Pour Rights Changing?

Published: August 2, 2012

There are signs that the beverage selection in the New Orleans Arena may be changing.

In January 2007, it was announced that Cadbury Schweppes, through their 7UP brand, would be a major sponsor of the New Orleans Hornets. This would be the franchise’s first “Crescent City Champion” sponsor, meaning the deal exceeded $1m annually.

As a result of this deal, the team gave Cadbury Schweppes signs and advertising, promotional opportunities, and pour rights. Pour rights grant a sponsor the privilege of being the sole provider of certain classes of beverages in a venue or other designated area. The Hornets get to sell these rights as the primary tenant of the New Orleans Arena. (They get other benefits, as well, such as being able to bump Rush a night due to a playoff game).

Here is an example of a Request for Proposal for Wichita Falls’ pour rights if you would like some additional details of these sorts of arrangements.

Cadbury Schweppes was a company formed from the merger of Cadbury, a confectionary company, and Schweppes, a beverage company. This company has since split into Cadbury, a confectionary company, and Dr Pepper Snapple Group, a beverage company. This string of companies is what brings 7up, R.C., and more, into the Arena.

It’s not a Coke-or-Pepsi world out there, contrary to popular belief. Where The Coca-Cola Company gives us Coke, Sprite, Pibb Xtra, Dasani, and Barq’s; PepsiCo gives us Pepsi, Sierra Mist, Nothing, Aquafina, and Mug; and Dr. Pepper Snapple Group gives us R.C., 7UP, Dr Pepper, Deja Blue, and A&W.

One reason you can find Dr Pepper at Taco Bell (Pepsi restaurant via Yum!), etc. sometimes is that PepsiCo does not make a competitor for it. Same goes for McDonald’s since Pibb Xtra is not widespread and in spite of Coke’s efforts to entice the restaurant into exclusivity.

However, 7UP is no longer listed as a Crescent City Champion.

Moreover, 7UP is no longer listed as a corporate sponsor.

Even more moreover, no Dr Pepper Snapple Group brand is listed as a corporate sponsor.

So . . . what gives?

First, it stands to reason that this active rehashing of the website is because 7UP, etc. is no longer a corporate sponsor of the team. Capital One was a CCC, but had to back off of their commitment. They are still a corporate sponsor though and are listed as such. The 7UP deal was reported as a 6 year deal, but if it was a 6 season deal and one includes the 2006-2007 season where there were games played in the Arena as a `year’, then the deal is up. This would make sense since the deal would have ended at the time of the then-current lease. If the original deal carried into this season, short term deals can be renegotiated.

Second, if true, this leads one to conclude that the pour rights no longer belong to Dr Pepper Snapple Group.

Third, they are very likely to sell drinks at the Arena, so a company will move in, presumably The Coca-Cola Company or PepsiCo.

Fourth, The Coca-Cola Company is a proud sponsor of the Super Bowl XLIV Champion New Orleans Saints, and their Exclusive and Official Soft Drink sponsor. Their products have been served for quite some time in my Home Sweet Dome. Thus, there is an existing relationship with current Hornets ownership and with SMG who manages both the Arena and the Dome.

The above may lead one to conclude that Coke will be flowing where R.C. was last season.

But let’s not get too ahead of ourselves.

Maybe Dr Pepper Snapple Group is just changing their primary brand association with the Hornets, and perhaps the website hasn’t caught up or they have yet to decide which brand will replace it.

Gatorade, a PepsiCo product, is a proud sponsor of the Super Bowl XLIV Champion New Orleans Saints, and their Exclusive and Official Sports Beverage, Sports/Fitness Water Beverages and Sports Performance Beverages/Products sponsor. Thus, Pepsi is not without a relationship to use should this be a target for them.

Additionally, Pepsi may not want to cede the top two tiers of New Orleans pro sports to their rivals. Both companies have facilities in the area, just around the corner from the Saints headquarters. On the other side of the table, perhaps ownership and SMG want to have relationships with both parties if that helps to keep costs down.

With the all-important integration of the sports district, sponsorship alignment is key. Hugh Weber indicated this a while back, and the fact would not have changed just because he’s not with the franchise anymore.

Combining this with the pros above, then subtracting the cons, I’m still left on the Coke side of the world.

Anything can happen in business, and that’s what makes this fun, but it seems almost certain that Dr Pepper Snapple Group is out, and less certain that Coke is in.

We’ll keep you posted.

Have a Reed’s while you wait.

Thanks to Stockdale on Hornets Report who pointed the change on the website out earlier this evening.


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