SBJ/20090302/SBJ In-Depth

Confident, yes, but can new league survive?

If ever there was an ideal time to start a women’s soccer league in the U.S., it was the last time.

If ever there was an awful time to start any sports league in the U.S., it is this time.

And yet Tonya Antonucci, architect and commissioner of soon-to-launch Women’s Professional Soccer, says she remains optimistic, albeit cautiously so, as the league prepares for its first game at the end of this month.

A league that collapsed under its own weight when the visibility of women’s soccer in the U.S. was at its zenith and the defining female player in the history of the sport was in her prime, now will try it again six years later, sans Mia Hamm, in the worst economic climate since the Great Depression.

Neither the sport of soccer nor the female gender has any reason to expect a pass. Each of the three larger, existing U.S. women’s sports properties — the WTA, LPGA and WNBA — concedes that the sledding has been tough for the past six months. While all sing similar songs of hope for women’s sports under the pressures of a deep recession — lower cost, greater value — none of them would trade places with the startup WPS in this environment.

WUSA was fueled by players such as Mia
Hamm (left), but its finances quickly ran out.

The daunting nature of all this is not lost on Antonucci, a former college teammate of U.S. national team star and TV commentator Julie Foudy at Stanford. Antonucci had a front-row seat for the rise and fall of the last women’s soccer league to launch on U.S. soil, the Women’s United Soccer Association. As general manager of Yahoo’s partnership with FIFA, she oversaw the business dealings of the global Web sites for the 2002 men’s and 2003 women’s World Cups.

She was frustrated, and maybe even heartbroken, when WUSA burned through $40 million in its first year and another $60 million in the next two, and then folded in September 2003.

So when Foudy approached her at a Stanford alumni event late in 2004 and asked whether she would be interested in heading a revival effort, Antonucci committed to it on the spot. Nearly five years later, with most of those pioneering players retired, women’s pro soccer gets its second chance — this time under a drastically different financial model, with a dramatically reduced expense structure that will rely on grassroots promotion rather than brand bomb advertising.

Players walk down the runway last week
as sponsor Puma and the league unveil
team uniforms in New York City.

A better model?

Antonucci says they planned it this way all along, never knowing that the economy would tank, but ever mindful of what happened last time, when WUSA had so much going for it and still outspent its means and overestimated the speed at which it could capture an audience.

“A lot of the effects of the economy are really already priced into the significant cost containment that we applied to our pro formas before the economy did what it did,” Antonucci said. “We learned a lot of lessons from WUSA and we’ve really cut the cost back and set our expectations modestly.”

To start with, the buy-in is modest enough that teams aren’t starting with deep holes from which to dig. The initial seven franchises went for $1.5 million each. The league plans to expand to 10 teams next year, with the new groups buying in for $1.25 million.

Player costs also will be lower this time around. Teams will operate under an annual cap of $565,000, an average of about $32,000 per player for a seven-month playing contract. Players from the U.S. national team will receive a minimum of $40,000 a year.

Q:
Women’s Professional Soccer is set to begin play. What is the likelihood that the league will succeed?
(Responses compared from June 2007 and February 2009 Turnkey Sports Poll)
  June ‘07 Feb ‘09
Extremely unlikely 43.35% 35.80%
Somewhat unlikely 38.78% 37.45%
Somewhat likely 15.97% 22.22%
Extremely likely 0.76% 1.65%
No response/Not sure 1.14% 2.88%
Source: Turnkey Sports Poll, a survey that covers more than 1,100 senior-level sports industry executives spanning professional and college sports.

Of course, it’s not like pricey players were the reason WUSA sank. The highest-paid stars — even Hamm — were willing to play for $85,000 and then took cuts down to $60,000 in an attempt to keep the league afloat. Team caps ranged from a high of $834,000 in the league’s second year down to $595,750.

No, the problem last time was more systemic. WUSA was a league built upon a national media model. It sold multimillion-dollar sponsorships to large companies behind the promise that it would deliver TV ratings akin to regular-season baseball. It signed a sizable rights fee deal with the now-defunct Pax TV network, which few viewers could find. The check cleared, but production costs were high and promotion was zero.

This time, the league will air its weekly national game at the campfire of U.S. footie fans, Fox Soccer Channel, with playoff games running on Fox Sports Net, seen in about 80 million homes. WPS won’t collect a rights fee, but it will get an appointment viewing slot for its regular season and broad exposure for its postseason.

What other sports do they follow?
The chart below, from ESPN Sports Poll, shows the interest that fans of various sports have in women’s sports. To read: 40.7 percent of NFL fans are also fans of the WNBA.
Fans of these sports ...
 
NFL
MLB
NBA
... ALSO FANS OF:
WNBA
40.70%
42.60%
55.80%
WTA
38.10%
40.60%
45.80%
LPGA
33.20%
36.30%
37.00%
 
NHL
NASCAR
MLS
WNBA
47.10%
42.50%
54.30%
WTA
45.70%
38.20%
54.20%
LPGA
41.10%
35.40%
41.00%
 
Col. f’Ball
Col. B’Ball
PGA
WNBA
44.40%
55.00%
48.90%
WTA
40.30%
46.70%
53.10%
LPGA
35.20%
38.80%
61.30%
 
ATP
S. Olympics
W. Olympics
WNBA
57.60%
40.60%
39.80%
WTA
83.50%
40.80%
40.70%
LPGA
52.70%
32.40%
33.10%
Note: Data collected January-December 2008 among ages 12 and older.
Source: ESPN Sports Poll, a service of TNS Sport

“This is a more sound business model,” said Dan Levy, a Wasserman Media Group agent who represents Hamm, along with seven members of the current U.S. women’s national team. “But from an economic standpoint, it’s going to be real difficult. It’s difficult for all properties right now. And here you have a niche property that is a startup. You’re hopeful, but it’s tough.”

Rather than banking on great expectations nationally — as WUSA did when it launched off the Women’s World Cup frenzy — WPS is based on a more modest grassroots model that, over time, might percolate up. Several owners also operate the dominant girls youth programs in their markets, giving those teams a natural connection to the soccer families that they hope will make up their fan base at the outset. Players can supplement their income working camps and clinics, or playing abroad, as some WNBA players do.

The franchise in St. Louis — St. Louis Athletica — is connected with a youth club that is home to 6,000 players, about half of whom are girls. The ownership group, headed by prominent attorney and soccer booster Jeff Cooper, hopes to land an MLS expansion franchise and build an 18,000-seat stadium that would house both teams. Even if that doesn’t happen, Cooper said the women’s team is positioned to stand on its own.

Certainly, this isn’t the economic climate he would have chosen for the launch. But Cooper categorized ticket sales as “very, very strong” and said the team’s positioning as a conduit to women, girls and soccer families has resonated with sponsors

Player Christie Shaner poses with WPS
Chief Operating Officer Mary Harvey
at the league’s first draft.

“No one could have predicted it would be this way,” Cooper said. “But we (WPS owners) sat in a room four or five months ago and everyone looked around and said, ‘Are we committed to this or not?’ And the answer from every single ownership group was, ‘Yes, we are.’

“It will be the school of hard knocks for the first year. But if you make it through that — and we’re confident we will — there’s still that same potential we all saw.”

The connection to local youth programs also is deep for WPS franchises in Chicago, Washington, D.C., and New Jersey.

“Soccer is a grassroots, bottom-up sport,” Antonucci said. “With the number of families and club teams and tournaments and participation around this country, you want people with connections in the community. We have them.”

They’ll need them.

Not surprisingly, WPS has found the going tough on the sponsorship side. Working through Soccer United Marketing, which holds all commercial rights to both WPS and Major League Soccer, the league landed a cornerstone footwear and apparel deal with Puma, but has struggled to fill other categories.

Trends in interest for women’s sports
The percentage of both men and women that say they are very or somewhat interested in the WNBA has declined since 2001, while interest in women’s college basketball and the LPGA has increased.

“Sports marketers are facing some really tough decisions, cutting a number of properties or significantly cutting back on those they keep,” Antonucci said. “At best (they are) sustaining their previous spending. In those cases we know it’s a longer-term conversation that can lead to something in the future. They’re going to sit on the sideline and see how you do.”

Still, Antonucci has hope that WPS’s offer of an attractive demo — soccer families, if she can deliver them — at a bargain price will resonate with sponsors in tight times. And, even if it doesn’t, she says the league is positioned to remain solvent so long as it can sell a relatively modest number of tickets — 4,000 to 5,000 per game — and sell that core base of fans the requisite number of hot dogs, sodas and shirts.

“You see a lot of studies that say people are going to cut down on spending, but the last thing they cut back on is spending on children and families,” Levy said. “I hope that notion protects a league like WPS.

“The corporate support for the big four sports is in question. But this startup league doesn’t rely on that. It relies on good old grassroots marketing and a price point that allows a family to enjoy an afternoon. I’m not saying there are any guarantees here. But I think that sort of model has a chance.”

Long-term view

In times of economic turmoil, the mainstream is a far safer haven than the margin. There isn’t much farther on the margin than a startup league in a sport that, as a professional endeavor, remains more niche than mainstream in most of the U.S.

And yet there is reason to concede that maybe, just maybe, the WPS has a chance to survive, and even succeed, depending upon how you gauge success.

Antonucci says her expectations are modest, and that the architects of the league and owners of its franchises will measure growth in terms of decades, rather than years.

At the WNBA, Donna Orender has been making that same claim since she took the job as president in 2005, but those outside of her circle rarely have seen it that way. The league has taken its share of roundhouse rights to the head and body in its dozen years. This last year brought a haymaker — the shuttering of a Houston Comets franchise that once was seen as a flagship.

“People’s expectations of a business can also define the future of a business,” said Orender, who bristles when asked about the Comets, pointing to the long list of franchises that failed in the NBA and NFL in those leagues’ early years. “In this day of instant snap my fingers, let us not forget that these male sports businesses have been building for a very, very, very long time.”

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