While the springtime sports boom is no doubt exciting for sports fanatics around the world, this season should be equally exciting for investors. Many companies strategically align themselves with popular sports programs to increase brand awareness, and this can often mean big things for brand enhancement and sustainability.
The best part is that an investor does not have to even look at sports-related companies to benefit. Church & Dwight (NYSE:CHD), developer, manufacturer, and marketer of household and personal-care products and owner of brands like Arm & Hammer and Trojan, recently announced a partnership with Major League Baseball.
The deal means added exposure for some of Church & Dwight's signature products. And it's yet another reason investors might want to consider the relatively small company over larger competitors like Colgate-Palmolive (NYSE:CL) and Procter & Gamble (NYSE:PG).
Church & Dwight recently signed a multiyear sponsorship deal with Major League Baseball Properties, or MLBP. The agreement makes popular brands Arm & Hammer and OxiClean the MLB's official laundry detergent and stain remover, and the company will sport the MLB logo on select products.
The deal, which represents the largest sponsorship for the consumer-goods company to date, is perfectly timed, as the baseball season just kicked off with opening day on March 31. As fans across the country swarm local stadiums to cheer for their teams, and as even more folks watch from home, Church & Dwight stands to gain significant exposure for several of its leading brands.
Church & Dwight CEO Jim Craigie explained in the company's press release:
This partnership allows us to combine the power of two great American icons to reach families in a new way. Whether young or old, player or spectator, baseball is a sport inextricably linked with having fun and getting dirty -- and no brands can better solve for the getting dirty aspect than Arm & Hammer and OxiClean.
Additionally, Church & Dwight and MLB are collaborating on the league's "Breaking Barriers" program, which recognizes students from grades four through nine who persevere and overcome barriers in their everyday lives. From 2014-2016, Church & Dwight will donate $150,000 annually to the cause.
Small company, big brand potential
One of the more interesting aspects of Church & Dwight is its incredibly popular brands despite the company's small size. This is especially remarkable when compared to industry titans P&G and Colgate-Palmolive.
The following is a breakdown of Church & Dwight's most popular brand names compared to those of both aforementioned competitors:
|Church & Dwight||Colgate-Palmolive||Procter & Gamble|
|Arm & Hammer||Colgate||Bounce|
|First Response||Irish Spring||Head & Shoulders|
While Procter & Gamble is the clear leader here, with too many popular brands to even list, Church & Dwight's product mix is very diverse and strong. This is especially impressive when we consider the company has a market capitalization of only $9.5 billion compared to Colgate-Palmolive's $59.6 billion and Procter & Gamble's $218.5 billion.
The smaller company is expected to outgrow its larger competitors in 2014 as well. Church & Dwight is expected to grow revenue 3.2% and earnings per share 9% versus Colgate-Palmolive's 2% and 5.6%, respectively, and Procter & Gamble's 1.1% and 4.2%, respectively.
Bigger is not always better when it comes to investing. In many ways, a smaller company is better for growth investors, particularly a business with such powerful brand recognition among consumers as Church & Dwight.
The company is making strides, increasing its already strong brand awareness through clever marketing tactics like the recent sponsorship deal with MLB. As fans the world over begin to watch baseball in 2014, Church & Dwight's brand strength will only increase, making it an ideal growth alternative to larger industry peers.
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Philip Saglimbeni has no position in any stocks mentioned. The Motley Fool recommends Procter & Gamble. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.