SBJ/March 5-11, 2012/Opinion

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  • Cartoon: Loophole

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  • NBA succession, new arena, growth in spotlight at All-Star

    In my two days in Orlando for the NBA’s All-Star Weekend, one topic was prevalent: How much longer will David Stern continue as commissioner? Stern has been the standard of the modern-day commissioner, but after being in the job for 28 years and nearing the age of 70, it’s clear that he is positioning himself — and the NBA — for his exit.

    Most people I spoke to offered a range of one to two years, while one ventured as far out as 2015 for Stern’s departure. We all know that David Stern is his own man, who will leave when he’s ready to leave. But it can’t be underplayed how much the recent labor talks and two-month lockout took out of this tireless CEO. It’s been well-documented that the league has changed and the aggressive new breed of owners are not the same group — nor do they have the same point of view — as the owners who Stern worked with for years. And eventually, one would think he would want to shift to the sidelines and enjoy some carefree days.

    So while I thought Stern’s public energy was considerably better in Orlando than it was last year in Los Angeles, for anyone who witnessed his state of the league address, it was telling how he used it to aggressively and publicly promote his preferred successor, Deputy Commissioner Adam Silver. Starting with his opening remarks, “Adam gave me the note cards,” Stern continually touted his longtime confidant. He called him “a first‑rate, top‑of‑the‑class executive, not just sports executive,” but a “media and sports executive,” with international expertise.

    Silver (left), with Stern in December, has honed his skills at the commissioner’s side for 20 years.
    Photo by: NBAE / GETTY IMAGES
    Stern added that a good CEO should “provide his board with a spectacular choice for its successor, and I think I’ve done that, and that’s Adam.” At that time, the obviously uncomfortable Silver whispered a classy, “Thank you,” to Stern.

    From this vantage point, it was encouraging to see Stern use his often overlooked charm to tout one of the most highly regarded but below-the-radar sports executives. Silver, in my view, has all the smarts, diplomacy and talents to be a successful leader of the NBA for years. He’s not nearly as charismatic — or polarizing — as Stern, but he knows the league and its constituents, loves the game, has built the relationships and engendered years of good will and loyalty from staffers. He took a lead role in the CBA negotiations, which was a huge step in proving himself to ownership. And behind his kind, affable nature, he is known as a very tough and shrewd dealmaker — a skill honed by spending 20 years at Stern’s side.

    I have no idea whether the new ownership dynamic that permeates the NBA will rubber-stamp Stern’s nomination of Silver — they might keep him on ice to prove a point of who is in charge. But those of you who know Silver know his love of running. He’s got the stamina to last on such an arduous course, and while far be it for me to suggest anything to NBA owners, they would choose well to let this long-distance runner lead them.

    ■  ■  ■

    If you haven’t seen the Amway Center in Orlando, make a point to.

    All sports executives make the rounds to see the latest venues, but anyone interested in consumer entertainment must visit this facility. It’s easily one of the finest facilities I have ever seen. It opened in October 2010, but I finally toured it over All-Star Weekend and I couldn’t be more impressed by the visuals, variety and flexibility of the building.

    First, visuals. The center-hung scoreboard is one of the most underrated jewels in sports. Everyone talks about Cowboys Stadium, but this building has the tallest HD video board in any NBA/NHL arena, produced by Daktronics, and it’s spellbinding, perhaps even more powerful because it sits in a smaller venue. All of the LED signage through the facility is powerful.

    Second, variety. The variety of seating/pricing options, variety of food concessions and the variety of experiences. From the Gentleman Jack Terrace and One80 Grey Goose Lounge, both with spectacular outside decks, to the Budweiser Baseline Bar, to Stuff’s Magic Castle children’s play area, the building offers multiple touch points for consumers.

    Third, flexibility. Building operators have the ability to change elements of the facility based on usage and flow.

    At first glance from the outside, the building looks nondescript, but go by it at night along I-4 and you see that it serves as a brilliant and vibrant anchor to Orlando’s Church Street.

    Populous, the Magic and the city had a lot of time to plan this facility, and you can tell that a great deal of thought went into it. Do yourself a favor and see this building.

    ■  ■  ■

    As noted in the main story from Orlando this week, there was a general sense of optimism from the NBA and partners on the state and future of the league’s business. That should be the case fresh off a labor deal and with a real opportunity for growth around an appealing and talented group of star athletes.

    One area of interest to me is how the NBA refocuses on its international growth. If you brought up the recent New York Times Sunday Magazine story on the struggles of NBA China to fulfill early expectations, you were met with sensitive responses from league officials who thought it was either unbalanced or inaccurate. But there is no doubt that the global economic slowdown took some of the shine off the league’s global business.

    Silver and Mark Tatum, NBA executive vice president of global marketing partnerships, were in China in early February meeting with business partners. I expect to see some news shortly regarding this area, at the very least, the league is expected to pick up its slate of exhibition games in China and Europe next year as it renews its efforts to push the game overseas.

    Abraham D. Madkour can be reached at amadkour@sportsbusinessjournal.com.

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  • NFL misses promotion opportunity with every blackout

    The NFL television blackout policy is an archaic method of selling tickets. Perhaps at one time, prior to huge television deals, enormous naming-rights deals and oversized sponsorship agreements, the league could argue that it protected the teams and itself from freeloading fans who could watch the action on TV and not support their team with their wallets.

    That was then, and this is an entirely new and improved NFL. The NFL is a moneymaking machine where the greater parts of the whole ensure safety and profitability for the weakest links in the chain.

    Prior to 1973, all NFL home games were blacked out because it was believed that TV would prevent fans from heading to the stadium to watch the games and, more importantly, buy tickets. Pete Rozelle succumbed to the pressure of Congress and President (and Washington Redskins fan) Richard Nixon, and the 72-hour sellout rule came into effect. It allowed everyone to see what was hiding behind the curtain: Having home games on TV did not stop folks from going to the stadium of their favorite team on Sundays (and occasionally Monday nights). TV wasn’t the culprit; the team’s performance and how it was marketed was the conduit for lower ticket sales.

    A recent statement from the NFL says, “The League’s blackout policy is designed to promote broad attendance and to make each game a special event. Anyone who has been at football games half-filled versus one packed with cheering fans will attest to the qualitative difference in the experience, regardless of the quality of play of the teams.” This statement is one that a sleight-of-hand magician would use to get his audience to look in a different direction. I don’t care how packed a stadium is, when your team is losing, the stadium goes dead quiet and the excitement wanes. Again, TV is not the culprit for lack of sellouts.

    As a former chief marketing officer of an NFL team, I can find multiple reasons why having the games on TV means more to the bottom line of the team and the league than not airing the less-attended games.

    Cincinnati’s win over Buffalo on Oct. 2 was one of six home games blacked out last season.
    Photo by: GETTY IMAGES
    First and foremost, airing the games is promotion of the team and the league and helps build fan avidity and loyalty to the product. If the permeating thought is that a blacked-out game equals a bad TV broadcast, it does not. There have been many games that have been great contests resulting in victory for the home team that the majority of its fans never got to witness. So while blackouts are punishing your core fans, they are also not assisting in the conversion of a team’s less avid fan into a more interested and participating fan.

    It also denies younger fans, who would not normally attend a game, exposure to the brand and begin the process of a lifetime of brand experiences. Even if you believe TV blackouts are a short-term solution, they have long-term negative effects on the avidity of a fan.

    The entire concept of blacking out games is a form of punishment to fans, when they have not done anything wrong. This is a bad message to your consumer, not to mention deplorable customer service and fan relationship building. The message is that since the NFL is not getting its way, regardless of the team’s efforts, it will stomp its feet and take its ball and pout unless you do what it wants and come to games. It’s 2012 and the fans are educated consumers; they can’t and shouldn’t be treated that way.

    Great relationship building would be to thank them and provide other mechanisms for them to want to come to games, perks and other special opportunities that provide good will and mimic winning. If you want your consumers to drink out of the NFL faucet, does it really make sense to shut off the spigot?

    The NFL talks about in-stadium experience and excitement. Games that are not sold out allow teams to reward fans who are there. Ticket sales reps can go into the upper decks and give seat upgrades to the fans who came, not only thanking them for their support, but also making the experience one that they will want to come back and enjoy. This also helps pack the lower bowl to intensify the atmosphere and give a better showing to the TV side of the stadium.

    Positive reinforcement and a fun experience will get fans to come back. There are many losing teams that create an atmosphere folks want to experience regardless of on-field performance. You want your fans to take this spectacular treatment viral in order to help sell tickets.

    The NFL is a marketing machine, so why would it take away one of the most effective ways to promote its product and expose its brand? TV is one of the key components as to why the NFL is so popular and powerful. Taking it away is counterintuitive and, quite frankly, lazy. TV is an asset that promotes the concept of attending a game. It’s clearly time to stop thinking in black and white and to throw TV blackouts out with the big box TVs we used to own.

    Lou Imbriano is CEO and president of TrinityOne Inc. (Trinity1.com) and author of “Winning the Customer: Turn Consumers into Fans and Get Them to Spend More” (McGraw-Hill, 2011). Follow him on Twitter @LouImbriano.

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  • Success stories pack emotional punch for fans, marketers

    The ascendance of Jeremy Lin has been one of the most dominant sports stories for the past month, and the impact it is having is remarkable. Sure it is affecting ticket sales and jersey sales as well as TV ratings, but that’s just the beginning.
    The impact of his and the New York Knicks’ success extends to:

    Playing a catalyst role in the negotiations between the MSG Network and cable providers, specifically Time Warner Cable.

    Drawing attention to Taiwan as a sovereign state and not part of China.

    Playing out the NBA global vision not only for Asia but throughout the world.

    Jeremy Lin’s success story has had an impact on the NBA, the Knicks and fans everywhere.
    Photo by: GETTY IMAGES
    Propelling All-Star Weekend television ratings to lofty heights.

    Showing the true value and impact of dynamic pricing.

    Demonstrating that we are always hungry for a Cinderella story.

    Those of us in my age bracket are aware that this is a story that has been told before (and will be told again and again in the future).

    For example, Johnny Unitas was cut by the Steelers and playing sandlot football before being signed by the Baltimore Colts and becoming a hall of famer. Kurt Warner was bagging groceries and playing for the Iowa Barnstormers in the Arena Football League before joining the St. Louis Rams and Arizona Cardinals in three Super Bowls.

    Mark “The Bird” Fidrych burst on the scene for the Detroit Tigers in 1976 as a dominant player (although for a very short time due to injuries). Fernando Valenzuela won the Rookie of the Year, the Cy Young Award and a World Series title with the Dodgers in 1981. Valenzuela was so popular — a phenomenon known as “Fernandomania” — that attendance increased by an average of 9,000 fans whenever he pitched in road games. Much like Jackie Robinson for African-Americans and Roberto Clemente for Puerto Ricans and other Latinos, he became a cultural icon in the Latino community in the United States and a hero in his home country of Mexico.

    The Lin story has its own elements — an Asian-American, not recruited out of high school, played at Harvard, cut by two NBA teams, played in the NBA D-League and (my favorite) sleeping on a couch in his brother’s apartment while waiting for his NBA minimum $750,000 salary to become guaranteed. The fact that he plays in New York, combined with all these elements and with his impact on the Knicks (winning seven of his first seven starts) created the global “Linsanity” and an Internet explosion.

    As marketers, we understand the emotional and immediate responses to this type of a story. Consider the Detroit ad campaign featuring Chrysler, which began in 2011, and was again featured on Super Bowl Sunday with the assistance of Clint Eastwood. It is a story of a city that was carried to great heights and prominence by the automobile industry only to lose economic influence, population
    Marketers understand the emotional connection a campaign, like Detroit’s, can create.
    and success because of the growth of automobile manufacturers outside the U.S. This led to the financial decline (and filing for bankruptcy protection by two) of these same corporations that had been the lifeblood of Detroit. The initial message was “Imported from Detroit,” and was morphed into an “It’s halftime in America,” alluding to a watch for a great second-half comeback. The appeal has been twofold: The message is patriotic but also hails the rise of the underdog coming back and being viable and successful once again — the American automotive industry and the city of Detroit. The facts? General Motors earned its largest profit ever in 2011, two years after it nearly collapsed. Strong sales in the U.S. and China helped the carmaker turn a profit of $7.6 billion, beating its old record of $6.7 billion in 1997 during the pickup and SUV boom. And Chrysler Group earned its first annual profit as an independent company since 1997.

    What can we learn as sport marketers and, more importantly, what can we do?

    1. We need a genuine story that is believable about our product or service that others will tell and retell because of its appeal. Not every team will have a Jeremy Lin underdog story. Others, like the Washington Nationals with Stephen Strasburg, will have a phenom story about the ability of one of their players. That story speaks to the uniqueness of Strasburg’s talents.

    2. If the story has an emotional appeal, it might create a strong interest on a variety of levels. Consider Lance Armstrong: surviving cancer, being globally successful on the cycling stage, and then converting his personal and professional achievements to create the Livestrong Foundation to help others in their struggles against cancer. More than 80 million of the yellow bracelets have been sold at $1 each to raise money to fight cancer, and a visit to the website shows that there is a significant menu for involvement offered to anyone seeking to raise or donate funds for this cause. The V Foundation is a similar example, teaming with ESPN to create a broad media and events platform to tell its story.

    3. Is the story important? Does it have the ability to live on after the initial telling and coverage of the story? Everything has a lifespan that is dependent upon a number of things — competition, authenticity, popularity and acceptance.

    All of the examples we have discussed fit these criterion. The Lin story, because of the Internet, social media, ethnicity and playing in the sports media mecca could be a very interesting story. Let’s see how many chapters will be written.

    Bill Sutton (wsutton@bus.ucf.edu), effective May 6, will be the founding director of the Sport and Entertainment Management MBA/MS Program at the University of South Florida in Tampa, and principal of Bill Sutton & Associates. Follow him on Twitter @Sutton_Impact.

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