MAJOR HAPPENINGS ON THE MINOR LEAGUE LEVEL
Published May 12, 1995
Pat O'Conner is COO of the NAPBL, the governing body for 19 minor baseball leagues consisting of 214 clubs throughout the U.S., Canada and Latin America. Since '93, the NAPBL has managed a coordinated marketing effort for sponsors looking to get involved in minor league baseball. Office Depot and French's Mustard are two high-profile NAPBL partners. THE SPORTS BUSINESS DAILY spoke with O'Conner this week on the state of the minors in the wake of the MLB strike, and their plans for the future. Excerpts follow: THE DAILY: Is there a saturation point near for minor league attendance and merchandise sales, or can the minors continue to grow? O'CONNER: We have had modern day records in attendance the last few years and our licensed merchandise and apparel sales have grown exponentially. What do we do to continue it, can we forecast the continued growth at the same pace, and is there a ceiling out there? The answer is yes, there is a ceiling, but I don't think we are anywhere near it. Our ballclubs -- the owners, executives, and operators -- have developed quite a bit over the past ten to fifteen years, in the sense that they have kept their operations modernized, continued to maintain a fan- friendly approach, clean ballparks, affordable family entertainment, and make the event an experience and not just a ballgame. But we see consistent room for improvement in each of those approaches. Our clubs are much more sensitive to the fans. They are surveying, doing market research, identifying areas for improvement and taking corrective measures to make sure the fans' needs are being satisfied. Whether it is baseball or the restaurant business or buying cars, a happy customer is much more likely to return and spread a positive impression. THE DAILY: How does the NABPL marketing work? O'CONNER: Each of the 19 leagues has a certain degree of autonomy to operate its own business. But all subscribe to the National Association agreement, which is basically the marriage contract that keeps everybody together and our half of the industry going. From a marketing standpoint, our approach was implemented by our president, Mike Moore, in May 1993 with the hiring of Ron Myers. We are a one-stop shopping opportunity for corporations or businesses or potential advertisers. Through the business we do on a regular basis with the leagues and clubs, we have a built-in conduit, a communication network in place. So our concept is that if you are interested in all the minor league clubs, if you are interested in a geographic location, whatever classification, we have the ability to tailor a package -- in conjunction with the leagues and club -- for just about every client's needs. If we can get with them and identify what they are looking for, what their goals are, we feel comfortable that by working with our clubs, we can put a package together to satisfy those needs. It is much easier for a client or agency to deal with us one-on-one and allow us to carry it down to the clubs. THE DAILY: Are there signs that MLB sponsors are becoming more active on your level because of the strike? O'CONNER: I would not attribute it to the baseball strike. In some instances there may have been funds available that they were compelled to release, but I think it is the fact that we are now becoming a much better known entity and are being received well in the corporate marketing and advertising world. We are reaching 33 million people, there are an awful lot of options available and I think most corporations are somewhat impressed or at least recognize the value of participating in the minor league program. We try to give people "bang for the buck." But I don't necessarily think we have benefited as a result of what has happened at the major league level in hard dollars. When the major leagues left the scene last August there was a void to be filled for the fan which increased recognition of the minor leagues. People rediscovered the minor leagues last fall. ... I don't think it was anything other than the fact that baseball is America's game and people wanted to see baseball and there was a void to fill. THE DAILY: Will the minor leagues benefit in the lack of enthusiasm for the major leagues? Will attendance rise? O'CONNER: It is a little early to say. There are a lot of things to consider with respect to the reaction to Major League Baseball's return and the assumption that for every fan that does not go to a major league game in turn goes to a minor league game. We have just not been very fortunate this spring, the month of April was a terrible month for us with weather. Our attendance numbers are just coming in, and we have not noticed a tremendous increase or one that would correspond with the decrease the major leagues might feel. ... In August of last year maybe we did benefit a little bit more because people were caught up in it, it was summer and it was time to go. The winter was a long cold winter in a lot of ways literally and figuratively. Maybe with some of that frenzy that was there in August, we didn't pick up where we left off, at the major league or the minor league level. THE DAILY: Are there any markets you have targeted for expansion? O'CONNER: We will be expanding in the AA and AAA level in response to the major league expansion (expansion affiliates will be announced in the summer of '96). Our process is to identify the best markets for that through a long, drawn-out process. But with respect to expansion in general, or where we need to go, that's best suited for a decision at the league level. THE DAILY: Are the non-NAPBL independent leagues such as the Northern League, or possibly the UBL a threat? O'CONNER: No, competition is healthy. What it does is it forces us and our clubs to be more effective in the way that we market and run our ballclubs. We are in the business of promoting baseball, and promoting the value and the virtues of the game. Any competition is baseball, and we're in favor of more baseball. THE DAILY: Do you think that the anti-trust exemption will ever be seriously challenged, and what are the minor leagues prepared to do if it is? O'CONNER: It will constantly be challenged, I don't know if it's an issue that will ever go away. Repeal of the exemption, in our opinion, could have serious consequences to the minor leagues, or the national association as you know it today. Elements of our relationship, internally, and with Major League Baseball, are dependant on certain things that without the exemption could be subject to challenge, and possibly, elimination. There are three issues: One, the draft; two, the minor league reserve system as we know it. So, through acquisition and retention, you allow players to develop. ... That is minor league baseball -- player development. Without it, there is a great disincentive for major league clubs to have a 150 players they're trying to develop. Third, the very document that the major leagues and minor leagues use as a guideline for their relationship could be challenged without the exemption. As I understand antitrust, it is to promote competition and protect the consumer. With a repeal, I think players lose, because there will be fewer jobs; and fans lose, because I don't think the majority of our clubs could economically continue without some of the benefits of our relationship as it is today. So, I don't know who wins.