NCtrend: Money baller
Saturday, Nov. 29, was a big day for instate football rivalries in the South — University of Georgia versus Georgia Tech, Ole Miss versus Mississippi State and Alabama versus Auburn — and Ben C. Sutton Jr. was part of the action at each game. The president of IMG College LLC, the Winston-Salem-based sports marketing agency, hopscotched by private jet from Athens, Ga., to Oxford, Miss., to Tuscaloosa, Ala., for the pregame festivities and first half of each contest. Their staggered starting times allowed him to hobnob with school officials and the sponsors who spend big bucks to advertise in their stadiums, where his company controls marketing rights. Meanwhile, his crew in downtown Winston-Salem was transmitting 92 college football and basketball games and coaches’ shows to radio stations across the country. IMG College’s multimedia unit produces more than 35,000 hours of radio programming per year, making it the nation’s largest independent sports network.
“We have lightning in the bottle,” says Sutton, 56, who considers the multibillion-dollar college market — from sales of logo sweatshirts and stadium cushions to scoreboard advertising and schmoozing in luxury boxes — “still a very immature business.” He cites this month’s inaugural football playoffs, which are generating excitement among the 190 million fans of collegiate sports. “It is water-cooler talk everywhere,” he says.
Last year, Sutton signed a five-year contract and added the title of chairman to that of president following the departure of his boss, George Pyne, who had been president of New York-based IMG Sports and Entertainment. Pyne was one of several executives who left IMG Worldwide Inc. after its acquisition by Beverly Hills, Calif.-based William Morris Endeavor Entertainment LLC and Menlo Park, Calif.-based Silver Lake Management LLC. Sutton has come a long way from Burlington, where he was born, and his childhood home of Murfreesboro, where his father and namesake was finance chief of what’s now Chowan University. Back then, tickets to Atlantic Coast Conference games were relatively easy to come by, so father and son attended many — including N.C. State’s overtime victory over Maryland in the conference tournament on the way to a men’s basketball national championship in 1974 — and Sutton became a sports nut. “I’m an ACC and Tobacco Road guy,” he says, despite his company’s licensing affiliation with more than 200 colleges, conferences and bowl games nationwide.
He attended Wake Forest University, his parents’ alma mater, where he majored in history, joined Kappa Alpha fraternity and spent football Saturdays in black top hat and tails leading cheers as the Demon Deacons’ “mic man.” He worked part time in the athletics department, where, after graduating from law school in 1983 and considering a legal career, he took a marketing job under Athletics Director Gene Hooks. “He didn’t seem like a guy who would handle real-estate closings and sign wills,” says Jerry Myers, a Raleigh lawyer who shared a house with Sutton during law school and still socializes with him and his wife, Sally. As he advanced to assistant athletic director, Sutton saw opportunity in the fractured way Wake Forest made money from marketing sporting events. Different companies were responsible for generating advertising revenue from different sources, such as scoreboards and play-by-play broadcasts. “If you had all of this stuff batched together, it seems like the school would make a lot more money,” Sutton says. He did just that, and then persuaded Hooks and former university President Thomas Hearn to let him take over marketing with an independent company.
In 1992, its first year, and with Wake Forest as its only client, International Sports Properties Inc. generated $700,000 of revenue. Adding schools, he figured, would make ISP more attractive to advertisers, so he recruited Virginia Tech, Marshall, Cincinnati and Alabama as clients. “The model was so different,” he says. “Nobody else was doing this.” By 2001, the client roster had grown to 18. There were 60 on it in 2010, when Sutton sold the business to IMG Worldwide. Combined with previous acquisitions, it became IMG College, which had revenue “north of $500 million” in 2014, up from $483 million a year earlier. Sutton projects sales growth in excess of 10% in 2015.
IMG College faces new rivals, including San Diego, Calif.-based JMI Sports LLC, which last year grabbed the multimedia rights to the University of Kentucky from Sutton’s company, signing a 15-year, $210 million deal. He envisions boosting growth by putting advertisers closer than ever to the games themselves: sponsors hanging out on the sidelines during pregame, serving as coin flippers to determine which team gets the opening kickoff and receiving honorary game balls. Sponsors include AT&T Inc., Chevrolet and Hyundai Motor Co., according to IMG College’s website. “There is a thirst for experiential opportunities around college football,” says Sutton. He’s also plotting an acquisition this year that would enable IMG College to create plush hospitality suites, putting college football in the rarefied ranks of the National Football League, National Basketball Association and Professional Golfers’ Association. “I see these things as opportunities to scale up our business,’’ Sutton says.
The deepening relationship between business and sports raises a red flag: the influence of big money in collegiate athletics. UNC Chapel Hill faces a major academic-fraud scandal involving nearly two decades of no-show classes that kept players eligible in its revenue-producing basketball and football programs. A growing number of “pay for play” proponents press schools that pay coaches millions of dollars a year to compensate their athletes on top of scholarships. “There is a presumption that money necessarily corrupts, and I don’t buy that,” Sutton says. For every dollar of revenue that IMG College collects, 65 cents goes back to the schools, helping to fund programs that can’t pay for themselves, he says. For many athletes who don’t go on to professional careers, college provides “a life-transforming opportunity. If you take the best 10 teams and the best 10 players off of those teams, maybe they don’t see it that way. But if you look at the rank and file, the rest of the kids who play on those teams, sports is a means to a very happy ending.”