SBJ/December 13-18, 2010/Franchises

Conjuring a turnaround in D.C.

Leonsis
An hour before a Washington Wizards early-season home game against the Houston Rockets, Wizards owner Ted Leonsis is perched on a wooden stool inside the Verizon’s Center’s plush Dewar’s 12 Clubhouse. He’s clutching a microphone in front of some 40 new season-ticket holders and trading stories with Wes Unseld, the legendary former player and coach of the Bullets-turned-Wizards.

Leonsis, dressed in a blue sport coat and tie, is casual in his remarks as he and Unseld try to bridge the team’s lone NBA championship, won in 1978, to today’s struggling franchise.

Why would Leonsis, the D.C.-area media mogul who bought the Wizards only eight months ago, want to spend time revisiting the team’s mostly dismal past? Because embracing the franchise’s alumni stands as issue No. 7 among the 101 Signs of Visible Change — a list compiled by Leonsis to establish transparency as he works to restore relevance to a struggling franchise.

“We have a double bottom line,” Leonsis says to a crowd plied by an open bar and free turkey sandwiches. “We want to sell the most tickets and the most sponsorships. But this is your team, not my team, and we are in it together.”

It’s a good stump speech: humble yet optimistic for a team coming off a 26-56 record last season and a 19-63 mark the season before. After posing for a few photographs, Leonsis makes a beeline for an elevator that will whisk him down to his courtside seat, where he will spend all game sitting next to hall of famer Earvin “Magic” Johnson, bantering with fans and cheering loudly for his newest high-dollar, high-profile investment.

Leonsis’ all-access style couldn’t be more different from that of late Wizards owner Abe Pollin, who often cut a solitary figure while watching games from the owner’s box. Pollin’s paternal-yet-distant manner made it all but impossible for the Wizards’ long-suffering fans to imagine the opportunity to yuk it up with ownership. No Wizards employee could recall Pollin chatting with season-ticket holders before a game, like Leonsis did last month. It wasn’t his style.

“That wasn’t Mr. Pollin’s personality,” said Roger Moskowitz, senior director of corporate sponsorships for the Wizards. “Ted’s vision is to look at what he did for the Capitals in rebuilding the Wizards.”

Based on the large swaths of empty seats inside the Verizon Center so far this season, Leonsis knows he is in the infant stages of remaking the Wizards. But the former AOL vice chairman turned local sports mogul is determined to rebuild the team one handshake or, even more appropriate for Leonsis, one e-mail at a time.

Leonsis likes to point out that since he bought the Wizards and the Verizon Center in April, following the death of Pollin, who had owned the team for 45 years, he personally has received 4,000 e-mails from fans. He regularly uses his Ted’s Take blog (tedstake.com) to ask for fan input.

Whether you want a new starting forward or a new flavor of Dippin’ Dots sold inside the Verizon Center, go ahead and e-mail Leonsis. He’ll get right back to you.

“Nothing is too big or too small,” Leonsis said.

Conversion effort

That sense — that nothing is too small to merit attention — is a dominant theme for Leonsis these days. He frequently goes back to it during a 60-minute interview that he conducts in a conference room adjacent to his Verizon Center office.

The owner of three professional sports teams and a 20,000-seat arena, Leonsis seems more eager to talk about newly painted garages and more fan-friendly urinals than about the specific business metrics that the Wizards have attained. Almost in passing he references the team’s new season-ticket and sponsorship goals, but he becomes much more animated when he talks about the positive feedback he received from his decision to have vendors sell beer in the stands, something that previously was not allowed at Verizon Center.

“Ted is very fan-centric and he is active in the digital world,” said NBA Commissioner David Stern. “That is very important and helpful for building a fan base. He will turn around the Wizards faster than you think.”

Leonsis makes a point to listen to the fans. He requires all of his employees to respond promptly to e-mails, regardless of whether they are positive or negative. During an interview for this story, Leonsis smiles broadly as he talks about an e-mail he received complimenting Verizon Center’s new sound system. He chuckles as he recalls another e-mail from a fan thanking him for the newly installed cup holders above the urinals.

It’s a level of engagement and transparency that already has paid dividends for the owner, who regularly receives standing ovations from fans when he is pictured on Verizon Center’s video scoreboard.

Leonsis used engagement and transparency to turn the Capitals into one of the NHL’s most successful franchises, and he’s certain it will work to retool the Wizards in the NBA.

“We’re going to do lots of things different,” Leonsis said. “Rome wasn’t built in a day, but my expectation is that in two or three years, as the team continues to improve and our infrastructure gets better, we’ll sell out every game, we’ll start to have backlog — a waiting list — we’ll start to get more sponsors, the team will do better and overall we’ll get that virtuous cycle going. And the Wizards, because this is a basketball-crazed community, will become an iconic brand.”

Leonsis is convinced that he has the blueprint to turn the Wizards around. He bought the Capitals in 1999 in a deal with Pollin that also gave him a 44 percent stake in the Wizards and the teams’ shared arena, along with the right to buy majority control of the Wizards and the facility from Pollin. He exercised that right earlier this year and brought the Capitals, Wizards, Verizon Center and the WNBA Mystics all together under an operating unit called Monumental Sports & Entertainment.

He appointed Raul Fernandez and Sheila Johnson as vice chairs of Monumental, and he upended the Wizards’ front office by naming longtime Capitals executive Dick Patrick as Monumental’s chief operating officer. Jim Van Stone was tabbed to oversee Monumental’s newly consolidated ticket-sales efforts. Gregg Bibb was named executive vice president of business operations for the Wizards.

In total, Monumental has a staff of about 450 employees, and while some longtime employees who worked under Pollin have left the organization, the total number of staff is flat from last year.

When Leonsis took control of the Capitals in 1999, he was a neophyte, unaware of the nuances that come with owning a professional sports team. Almost immediately, he set to spending money in the free agent market, signing high-priced players such as Jaromir Jagr, in a futile attempt to build a championship contender.

After a couple of frustrating seasons, Leonsis learned one of his most expensive lessons as owner. He eventually got rid of the costly free agents, opting to rebuild the Caps through the draft, development of young players and a little bit of luck. In 2004, the Caps won the draft lottery, which allowed them to pick a player who has gone on to become one of the league’s biggest stars: Alex Ovechkin.
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