Smoothie King buys naming rights to N.O. Arena

After searching for several years, officials have found someone to purchase the naming rights to the New Orleans Arena: Smoothie King, an international company that traces its origins back to Kenner in the 1970s.

The 14-year-old arena where the New Orleans Pelicans play their home games will become the Smoothie King Center, now that the team and the company have struck a 10-year agreement, higher-ups from each group confirmed Wednesday. Neither side would disclose the price tag for the naming rights sponsorship, which Smoothie King will have the option to renew for another 10 years.

New Orleans was one of three NBA franchises that had not sold the naming rights to their home arena, which on average hosts more than 50 non-Pelicans events a year. Only Madison Square Garden, home to the New York Knicks; and the Palace at Auburn Hills, where the Detroit Pistons play, do not have a corporate naming rights sponsorship.

Among NBA cities similar in size to New Orleans, the sponsors of America West Arena in Phoenix and Bankers Life Fieldhouse in Indianapolis pay $866,667 and $2 million a year, respectively, published figures show.

Pelicans officials portrayed Smoothie King’s sponsorship as the franchise’s latest move to independently generate revenue following a deal designed to free the state of Louisiana from making payments to the team each year.

“It’s such a win-win,” said Dennis Lauscha, president of the Pelicans and the Saints, which are both owned by Tom Benson and are not currently receiving inducement guarantee payments. “It’s a win-win on that (long-term) financial viability (of the team). It’s a win-win for the state of Louisiana — and it’s really a win-win because it’s a Louisiana company that we’re dealing with here.”

Meanwhile, Wan Kim, the owner and CEO of Smoothie King, said the sponsorship is “a great opportunity ... to really grow our brand internationally and domestically from New Orleans.” The company is headquartered in neighboring Metairie.

“We are from here,” said Kim, who purchased the company best known for its nutritional smoothies in 2012. “Soon, I’d like to let the world know that we have great brands coming out of New Orleans that are healthy (and promote) an active lifestyle.”

Millions of people will indeed soon hear Smoothie King’s name. The Smoothie King Center moniker will be official after a Thursday morning press conference, and the newly-dubbed building will host Feb. 16’s NBA All-Star Game, which is broadcast internationally.

Interior signs branding the Pelicans’ home as the Smoothie King Center will be up in time for Friday’s 8:30 p.m. game against the Minnesota Timberwolves, which will be televised nationally on ESPN.

When the 2014 NBA All-Star Weekend arrives, temporary exterior “Smoothie King Center” signs will be up, and there will be a pair of 20-foot-tall Smoothie King cups at the building’s main entrance.

“The timing,” Smoothie King President Tom O’Keefe said, “was purposeful.”

Smoothie King furthermore will run two concession stands in the arena, plus one in the Mercedes-Benz Superdome and another in adjacent Champions Square.

The process that culminated in the Smoothie King Center kicked off last year. O’Keefe said he and Kim had just spoken about boosting marketing efforts when O’Keefe attended a downtown luncheon and sat next to Rita Benson LeBlanc, vice chairman of the board for the Saints and Pelicans as well as Tom Benson’s granddaughter.

O’Keefe said he introduced himself to LeBlanc and expressed an interest in a corporate sponsorship. LeBlanc then put O’Keefe in touch with Jean-Paul Dardenne, the Pelicans’ vice president of corporate partnerships.

New Orleans’ NBA franchise had been looking for someone to buy the naming rights to its home arena for years. Benson purchased the team in 2012, when its name was still the Hornets.

The state and the basketball team struck an agreement that was similar to one reached with Benson and the Saints in 2009, under which Louisiana agreed to fund renovations on the Superdome to create new revenue streams and maximize old ones. As a part of that deal, the Saints sold the Superdome’s naming rights to car-maker Mercedes-Benz in 2011. The deal is worth up to $60 million over 10 years.

The deal with the basketball team involved a renovation, too — in this case, a two-phase, $50 million refurbishment of the Pelicans’ home arena. The first phase, which cost $35 million, was unveiled in the fall and focused on the club and suite level.

The chance to entice a naming-rights partner was another facet of the arrangement. All of that was in the background when Dardenne linked up with O’Keefe and Smoothie King.

Smoothie King was one of “two or three” businesses that entered into contention for the naming rights, said Dardenne, who didn’t reveal the others. O’Keefe added that the Pelicans and Smoothie King were “drawn together” because of similar experiences.

For example, the basketball team was constantly the subject of relocation rumors until Benson bought it. Smoothie King, too, nearly left the New Orleans area.

Kim, a native of South Korea, was a graduate student at Boston University when he learned about Smoothie King, which was founded in 1973 in Kenner by Steve and Cindy Kuhnau. Kim became a franchisee and opened more than 100 stores in his home country before the Kuhnaus sold the company to him.

Kim considered relocating the headquarters of Smoothie King — which has more than 600 stores across the U.S. and in Asia — to either Atlanta or Dallas. But he instead opted to move the headquarters from Covington to Metairie, where he lives with his family.

“Today’s a touching moment,” Kim said about the naming rights he ultimately purchased. “We not only decided not to move out, but we are pretty much telling you our root is here, and we are sticking with it.”

There was something else beside the similarities. As Dardenne recounted, Benson and his wife, Gayle, drank smoothies from Smoothie King at Audubon Park on their first date.

After Smoothie King and the Pelicans decided they were interested in pursuing the sponsorship, the two sides spent several months seeking approval from the NBA. The NBA tested every product offered by all Smoothie King stores, which also sell nutritional supplements and related items.

The NBA verified that all Smoothie King products complied with the league’s substance policy.

“Literally, there were (more than) eight months of rigorous testing,” LeBlanc said. “And they have the gold (stamp) of approval of the National Basketball Association.”

O’Keefe remarked, “It did take time, but good things are worth waiting for.”