- MLS team’s commercial prospects given ‘dramatic overhaul’ by move to $400m stadium
- Mixed-use development with sportsbook planned to capitalise on sports betting legislation
- Ex-England captain Rooney has ‘put spotlight on team’ and ‘elevated business opportunities’
Once Major League Soccer’s most successful club, DC United regained its relevance both on and off the field last summer with the opening of its $400m (€351m) 20,000-seater Audi Field stadium and the arrival of ex-England star Wayne Rooney.
Now the club is reaping the rewards of both factors. “It’s a dramatic overhaul. It’s as big of a change as you can have on a club,” says Jason Levien, the DC United chief executive and managing general owner, of the commercial transformation in the past year. “We went from a club that really needed a shot of adrenalin and we’ve got it.
“From a year ago to now, we’re in a dramatically different world. We can talk to corporate partners that wouldn’t talk to us before – we’re getting incoming outreach from them – we’re getting players who may not have considered us before, we’re looking at front-office staff who may not have been interested in joining us before.”
In January this year, the team signed a local broadcast deal with subscription-based OTT provider FloSports, worth a reported $13m over four years. Previous partners Comcast SportsNet Mid-Atlantic (now NBC Sports Washington) and Sinclair Broadcast Group did not pay rights fees at all, with the club sharing costs and advertising profits. Competition between several broadcasters – another first for the club – drove up the value.
According to The Athletic, DC United was in talks with at least six companies – including United Airlines, Amazon and ESPN+ – for a shirt-sponsorship deal for the 2019 MLS season. In the end, the team signed a reported one-year renewal with government contractor Leidos. Moving forward, DC United is seeking at least $5m a year for a shirt-front deal, which would be among the largest in MLS, a significant rise from the $3m-a-year partnership with Leidos.
According to Levien, DC United has also had “multiple” inquiries about sleeve sponsorship for the 2020 season, when the new inventory will be introduced in MLS, which could be worth up to $1m a year.
Monetising Audi Field
Having “reintroduced” itself into the local market, as Levien puts it, DC United has sought to maximise the commercial opportunities provided by Audi Field, which cost club investors $250m and the city $150m.
RFK Stadium, the club’s home from 1996 until 2017, offered few such opportunities. Opened in 1961, the cavernous but crumbling stadium offered a poor experience for fans – a track around the field meant supporters were far from the action, while the amenities were sub-standard – and little inventory for the club, which did not own or operate the venue, to exploit.
Levien tells SportBusiness: “It wasn’t built for soccer, so when you get 10, 20, 30 rows up, you are far from the action. There were no naming-rights opportunities as it’s named after an American hero [former US Senator Robert F Kennedy] but there were also no real opportunities to have corporate hospitality. There is no premium experience for fans…there were a lot of issues at RFK that did not allow us to have an opportunity to grow the business.”
In 2017, DC United was the lowest-ranked MLS team by sponsorship income due to its inability to sell inventory at RFK. It immediately rose to ninth place last year, following the move to Audi Field.
The 12-year naming-rights deal with Audi – worth approximately $4m a year, among the top in the league – has since been followed by commercial deals with Coca-Cola, EagleBank and Heineken.
Other areas of the stadium complex, such as the plaza area outside the venue, will be branded this year and next.
Levien believes the Audi partnership – signed in February 2017, “before we put a shovel in the ground” – inspired the interest of other companies.
“We had been talking about building a new stadium long before I arrived [as co-owner in 2012] so I think there was some reluctance from not only corporate partners but also folks in the community to get too excited because they knew what challenges lay ahead and what might happen,” says Levien. “I think once Audi jumped in, it certainly triggered other conversations and helped other companies get comfortable very quickly with partnering with us.”
The fan experience has been significantly improved. A leading local chef José Andrés is overseeing all food and beverage concessions, in conjunction with Levy Restaurants. Other features include the Heineken Rooftop, which offers a place for fans to socialise and take in views of the city and surrounding National Parks; 31 (sold out) luxury suites; club areas for premium members; and a designated supporters’ section in the stands. The ability to order concessions from seats via an app is being explored.
Fans have responded. DC United averaged 20,264 supporters a match at Audi Field after moving in in July, up from the average of 17,904 at the 46,000-capacity RFK in 2017. Prices have largely remained the same in the new stadium so far, but the club reportedly enjoyed a 50-per-cent increase in season-ticket sales from 2017 to 2018. Single-game tickets have risen $5-$25 a seat while, in the secondary market, the average ticket price has increased from $32 to $65, according to Vivid Seats.
There have been some hiccups, though. Moments before the stadium’s opening game against the Vancouver Whitecaps on July 14, a large metal object fell from a railing and struck sideline reporter Lindsay Simpson, who was concussed. Simpson, who is also the club’s vice-president of marketing and communications, is still employed by the team and on extended medical leave.
There were also initial problems with the WiFi connection, which prevented the loading of mobile tickets and affected the press box, while there were also long concessions lines.
Meanwhile, according to The Athletic, the club is making a seven-figure investment to black out an open area on the west side of the stadium to try to eliminate an issue of the setting sun hampering the broadcast of evening games.
Exploiting legalised sports betting in DC
The club is developing land in the surrounding Buzzard Point neighbourhood to make the complex a 365-days-a-year destination. ”We’re trying to make the stadium a community centre for activity and entertainment throughout the year,” Levien says.
The club is in advanced discussions with at least four developers to build a mixed-use project on space next to the stadium, on which it has a 99-year lease. Plans include a sports bar and restaurant, which notably would include a sportsbook.
Legalised sports betting is poised to be introduced in Washington DC this year and a current bill makes provisions for gaming to be allowed at Audi Field. In a special amendment, no other entity will be able to take legal sports bets within a two-block radius, giving the club some local exclusivity. Partnerships with gaming companies are also being explored.
Plans also include an esports arena – DC United recently joined MLS’s esports league, eMLS – and an independent coffee house with indoor and outdoor seating.
Levien says: “We are looking to do some esports events – this is something we are taking are hard look at. All of esports is a dramatically growing industry. It’s an opportunity to engage our current fans and connect with some younger sports fans who don’t know as much about DC United. It’s an exciting opportunity for us to grow our fanbase more than anything.”
According to the Washington Post, DC United aims to stage 50 to 75 on-field events at Audi Field each year, and approximately 200 overall including indoor corporate events.
In August, National Women’s Soccer League team Washington Spirit played the Portland Thorns in a league game at the venue, while a month later DC United staged a friendly against Honduran team Olimpia.
The local team in the revived XFL will lease Audi Field from 2020 – though there are some concerns over how American football games will affect the turf – and there are also plans for concerts, lacrosse, rugby union, and college, pro and international soccer matches. A US men’s national team game is slated for June, while summer friendlies against Championship club Swansea City and LaLiga team Real Betis are also planned.
DC United and Swansea have co-owners in common, including Levien, and both parties have already sought ways to exploit this relationship. DC United helped enable Events DC – the official convention and sports authority for the jurisdiction – become a sleeve sponsor of Swansea in this season’s FA Cup. “[Events DC] were looking for some international exposure and we were able to negotiate that,” Levien says.
DC United is also building a 50,000-square foot facility in Loudoun County, Virginia, that will include a 5,000-seater stadium for new United Soccer League affiliate Loudoun United, training pitches for the first team and a youth academy.
Loudoun United is poised to play at Audi Field until its stadium is completed this summer. Meanwhile, DC United players will practise at RFK Stadium’s outer fields and use a rented changing room and other facilities at the old arena until the new training complex is finished, which is expected to be by the end of the year. Naming rights and other sponsorship opportunities are being explored.
Capitalising on ‘the Rooney effect’
Much of the reason for the increased interest in DC United – both on and off the field – has been the arrival and subsequent impact of Rooney.
DC United were bottom of the Eastern Conference when he joined the team from Premier League club Everton in June, and he almost single-handedly dragged the team into the end-of-season play-offs. He has given the club new relevance, both domestically and internationally.
According to GumGum Sports – which measures the media value of sponsorships across TV, streaming and social media – the first four months of Rooney’s presence in the team generated $4.5m in social media value for kit sponsor Leidos, up from $130,000 prior to his signing.
Rooney’s arrival on June 28 resulted in 3.7 million social media engagements, while his most memorable moment on the field – a last-ditch tackle before setting up an unlikely winner against Orlando City in August – led to 11.4 million engagements which, according to GumGum, was worth $1.6m in media value.
The 33-year-old is by far the most expensive signing in club history: he signed a three-and-a-half-year deal worth around $12m, with a number of additional performance-related bonuses worth up to $4.85m total.
DC United and Rooney are also working together to maximise his commercial impact. The club and Rooney’s agency Triple S Sports & Entertainment Group have joined forces with leading marketing firm Octagon to handle his marketing and media intellectual property rights in North America.
According to The Athletic, Rooney and DC United have a seven-year marketing agreement, worth a guaranteed $2.5m to the player. If DC United makes more than $2.5m off Rooney, he will be entitled to 50 per cent of all additional profits.
Rooney appears to be money well spent. According to Levien, many businesses are looking to partner with DC United directly because of the former England captain’s presence in the squad.
“In terms of the business side, Wayne Rooney put a spotlight on our team,” says Levien. “Going into a new stadium, being a team that was on the rise and winning week in and week out, being in this hot new neighbourhood in Washington…all of that combined with Rooney elevated us in terms of the opportunities we have on the business side to grow and partner with different companies. In every conversation with potential partners, his name is brought up by them…and by us.
“None of this works unless he helps makes us better – and he’s obviously done that. His impact on the field helps us reintroduce ourselves on the business side.”
Forbes’s valuation of the club rose to $265m last year, from $155m in 2016. “These are the most exciting years in the club’s history in terms of the richness of opportunity to build this business,” says Levien. “Certainly, there were some exciting years in the beginning [DC United won three of the first four MLS Cups, from 1996 to 1999] and now we’re in a massive upward trajectory where there are big opportunities for us ahead.”