How PNC's Gridiron Gamble Could Pay Off in Chicago

An out-of-town bank has put the Chicago market into a multimillion-dollar Bear hug.

PNC Financial Services Group, a big regional bank based in Pittsburgh, this spring became the official bank sponsor of the Chicago Bears professional football team. An also-ran in deposit share after entering the market less than a decade ago, PNC hopes that teaming up with "Da Bears" will win over more retail and business customers.

PNC has taken its lead from other banks that have aligned themselves with local sports icons after entering new markets — like M&T, a New York bank that used a football-related marketing agreement to blend itself into the Baltimore scene after a major acquisition.

Sports sponsorships fell somewhat out of favor during the years following the financial crisis, but they have reemerged as a leading strategy for banks looking to attract customers to their mobile banking, wealth management and other products in ways other than traditional advertising.

Partnering with a sports team can alter banks' images, helping them stand out among a multitude of competitors offering similar products and services.

"Banks don't have much of a personality and a sponsorship gives a personality to the brand name," said Jed Pearsall, president of Performance Research, a company that specializes in sponsorship research and analytics.

However, marketing opportunities are expensive propositions, so banks like the $351 billion-asset PNC have to be careful in the arrangements they carve out to ensure they get their money's worth.

PNC's deal — which has many elements, but no stadium-naming rights — is expected to cost it between $25 million and $35 million for the duration of the partnership, which could be as long as 10 years, according to The Chicago Tribune. PNC would not confirm these figures.

Inside the Deal

Under agreement, the Bears' headquarters will be renamed PNC Center at Halas Hall — the first naming rights agreement in team history. The facility features a broadcast studio and events space.

The team's game-day home, legendary Soldier Field, maintains its traditional name, but a seating section will be named the PNC Suites at Soldier Field. PNC will also have ATMs at the stadium.

Additionally, the Bears organization will use PNC for its own banking services; PNC will offer affinity cards for the Bears in 2016; and the bank will sponsor the team's main and Spanish-language radio broadcasts.

PNC is a veteran of major sports sponsorships. It is already a partner of two other National Football League teams: the Cleveland Browns and the Pittsburgh Steelers. The company also holds naming rights for the Pittsburgh Pirates' PNC Park and the PNC Arena in Raleigh, N.C., the home of the National Hockey League's Carolina Hurricanes.

But the deal with the Bears arguably has much higher stakes. PNC entered the Chicago market by buying the troubled National City Corp. in 2008. Before being purchased, National City was the fourth-largest bank in Chicago, with $11.3 billion in deposits. Today, PNC is No. 8 in the Chicago area with just $10.9 billion in deposits.

What's more, PNC has replaced Chicago's largest bank by market share, JPMorgan Chase, as the Bears' banking partner.

"It was clear from the first time we spoke with the Bears that they believe they can help us drive revenue growth in all of our major business areas," Scott Swanson, PNC regional president for Illinois, said in an email to American Banker. "This partnership will help PNC realize our potential for growth."

Sponsoring a sports team can provide access to other team sponsors, which can facilitate business relationships with regional stakeholders, according to William Chipps, a senior editor at sponsorship research firm IEG. But perhaps the biggest reason a bank like PNC, which is based in another city, would align itself with a pro sports team like the Bears is to assert its connections with a community.

"Banks really have to position themselves as dedicated to community," Chipps said. "If a company is moving into a new market or spreading, a partnership with a pro sports team is a great way to let people know what's going on here."

The M&T Model

And perhaps no bank has asserted a community connection through a sports sponsorship better than M&T Bank with the Baltimore Ravens. M&T scored naming rights for the Ravens' stadium in 2003, shortly after it acquired Baltimore's second-largest bank at the time, Allfirst Bank.

Using the connection with the Ravens to introduce itself to the city, M&T managed to become the largest bank by market share in the city.

When M&T came to Baltimore "nobody knew who they were — they were just another outside bank," said Howe Burch, president of TB&C Advertising. "Now people perceive them to be a community bank even though they're based out of Buffalo, and they've done that by leveraging a very strong relationship in a community partner with the Ravens."

Burch noted that the Ravens are the dominant sports franchise in Baltimore, having won a Super Bowl and garnered a lot of goodwill.

What made M&T so successful, though, is that it capitalized on its relationship with the Ravens through advertising pushes, including its "Raise the Green Flag" campaign and special offers for Baltimore residents, experts said.

"If you spend all of your budget just on the naming rights and have nothing to activate it with, you've made a big mistake," Pearsall said.

Still, for all their positives, sports sponsorships can have some pitfalls. Burch warned that PNC should be careful about who within the Bears franchise it chooses as spokespeople, since that becomes yet another investment.

M&T learned this lesson the hard way. Two of the Ravens spokesmen that the bank chose were Ray Rice, who later became embroiled in a domestic-abuse scandal, and Haloti Ngata, who was traded away.

After these mishaps, the bank eventually chose Ravens coach John Harbaugh as its team spokesman, Burch said, because he had "a long-term proven record of success."

Those stumbles remain minor though, and M&T remains committed to the team, having renewed its sponsorship last year in a $60 million deal.

PNC officials hope to look back one day at their agreement in Chicago and be able to say it did what it was supposed to do.

"We are obviously not the biggest bank in town, but we view this relationship as a platform that reaches all our constituencies and holds enormous potential," PNC's Swanson said. "It will help us to win in Chicago."