SBJ/June 18-24, 2012/Franchises

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  • Kings are the foundation that AEG built on

    Despite establishing a reputation as one of the most successful leaders in professional sports, AEG President and CEO Tim Leiweke has said his work would be incomplete until the Los Angeles Kings won the Stanley Cup.

    That desire became reality for the team’s governor last Monday, when the Kings defeated New Jersey and won the Cup Final in six games.

    The day before the Kings’ championship parade through Los Angeles and celebration at Staples Center, staff writer Christopher Botta spoke with Leiweke about the Kings’ success on and off the ice and what it means to AEG — including, quite possibly, the return of the NFL to Los Angeles.




    Now that it has happened, can you explain why the Stanley Cup was so important to the company and what it means to you now?
    LEIWEKE:
    AEG has become a large and good company, but we all started with the Kings and Mr. [Phil] Anschutz buying them in 1995 and taking them out of bankruptcy. The goal was to rebuild the organization and eventually use it to build the Staples Center and make the arena the centerpiece for L.A. Live. If you follow the chain, every decision we made in this company somehow goes back to the Kings. The Kings are the foundation we built this company off of.

    From a public standpoint, especially in Los Angeles, the Kings are the most visible asset we have. Even though we own a third of the Lakers, and even though we have the Galaxy and we have a lot of other things like L.A. Live, the reality is there are more words written and more impressions created on our stewardship of the Kings than anything else we do. As the image of the Kings goes, so does the image of AEG in L.A.

    The Kings have their Cup, but “we have to win a few more to have a legacy.”
    Photo by: GETTY IMAGES
    Before the Kings achieved the ultimate on the ice, the organization was hailed during the playoffs for its social media work, and your tickets and sponsorships sales were on a roll. Did you see everything coming together as well as it did?
    LEIWEKE:
    Looking at the way we grew the business — the new season tickets, the new sponsors, our TV ratings, our new TV deal, our commitment to using social media as a platform — I’m proud of the way we took advantage of this opportunity. When you look at a 25 share [for TV locally] on Monday night, it tells you an awful lot about how well our team seized the moment.

    How are Kings’ merchandise sales going?
    LEIWEKE:
    We set an all-time record in Staples Center on Monday night, far surpassing anything we’ve ever done in one night with the teams and concerts. Just for the Cup Final, through the day after winning the Cup, we’re at $2.5 million — just at our arena store. I expect we’ll surpass $4 million after the totals come in from the parade and celebration for season-ticket holders we’re hosting at the arena. Pretty amazing and heady stuff.

    Kings’ season tickets are close to sold out for next season. Selling the few remaining tickets over-the-counter won’t be a problem. Sponsorships sales are strong. Can complacency become a hurdle?
    LEIWEKE:
    The Lakers have taught us a lot about dynasties. You can’t have a better professor than Dr. [Jerry] Buss. He is a brilliant example in what it takes to compete every year. We have an opportunity with all these great young players like Jonathan Quick, Drew Doughty, Dustin Brown and Anze Kopitar. From a marketing standpoint, we want to be seen right there with the Lakers and the Dodgers. It means we’ve got work to do, because we’re not there yet. It means we have to win a few more to have a legacy and that kind of standing in this community.

    With this kind of momentum for AEG, has your optimism increased that you can bring an NFL team to Los Angeles?
    LEIWEKE:
    We’ve made a strong statement about the way the “campus” [Staples Center and the L.A. Live district] can handle this activity, especially in mid-May with the Kings, Clippers and Lakers alive in the playoffs and the arena packed for all of them. We’ve now seen everything at L.A. Live and Staples Center: NHL and NBA championships; the Grammys; we’ll have the NCAA basketball regional next year.

    This is the right place for football. This is the epicenter for sports and entertainment in Southern California. Our ability as an organization to be successful long term with the NFL should give the NFL great comfort. This is the right location and the right organization for the NFL to never have to worry for 20, 30, 40 years about football here. That’s what we bring to the table. So yes, this Kings victory helps us.

    Have you thought about what you want to do when you have the Stanley Cup for the day?
    LEIWEKE:
    You always think about it in the back of your mind before the title comes, but you never want to get ahead of your team. For me, it’s all about these players. I’m going to have a better time watching them celebrate with the Cup than anything I could possibly do with it.


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  • Sponsors get piece of MLS rivalry

    Mike Golub, a former chief marketing officer with the New York Rangers and longtime NBA executive, has been witness to some of the most intense rivalries in pro sports. Now COO of the Portland Timbers, Golub believes the rivalry between his MLS club and the Seattle Sounders matches the best for its business and civic impact on the region.

    “The passion is authentic,” Golub said recently. “The effect these two teams have on the area is immeasurable. When we play each other, the communities come alive and tickets are almost impossible to get.”

    Portland’s passion for the Timbers is played out in spades when the team plays its Northwest rival the Seattle Sounders.
    Photo by: STEEL BROOKS / PORTLAND TIMBERS
    Such will be the case Sunday, when the Timbers host the Sounders in the clubs’ first meeting of the year. The Timbers, in their second MLS season, have sold out all of their home games and have a waiting list for season tickets after capping full-season sales at 14,750. The 22,000 seats at Jeld-Wen Field for the matches against Seattle are by far the season’s most in-demand. When the team hosted an on-sale event for its remaining tickets, a line of more than 5,000 fans wrapped around the stadium, with most of the interest for the Timbers’ pair of home matches with Seattle. (They also meet at Jeld-Wen Field on Sept. 15.)

    Tickets for Sunday’s game, ranging in face value from $25 to $85, were fetching more than $200 last week on StubHub.
    The hysteria demonstrates the importance of local rivalries. Sponsors have benefited, too. When Seattle-based Alaska Airlines last year announced its jersey sponsorship of the Timbers, the reaction was powerful.

    “We actually got some hate mail,” said Joe Sprague, Alaska Airlines vice president of marketing. “People in Seattle couldn’t believe we were sponsoring a Portland team. But we knew it was one of the best decisions we’ve made. You sponsor a sports team to engage with the community. Xbox already had a deal for the Sounders’ jerseys that everyone was happy with. By being on the Timbers’ jerseys, we’re a part of this amazing rivalry.”

    Alaska Airlines’ partnership, which is in the second season of a multiyear deal, is its biggest with a sports team. The brand is also the official airline of the Seattle Mariners and a Seattle Seahawks sponsor. With the Timbers, the airline has spots on regional television broadcasts plus in-stadium signage and field-level digital signage.

    In a tale of well-executed activation, that field-level signage helped the airline earn approval for service from Seattle to Washington, D.C.’s Reagan National Airport.

    “When you apply for service to a particular city, the Department of Transportation takes community support under serious consideration,” Sprague said. “Using our digital signage [and a designated URL], we asked Timbers fans to appeal to the DOT for service from Seattle to Reagan. We were able to track the response and found that a few thousand Timbers’ fans wrote to DOT on behalf of Alaska Airlines.”

    The airline was approved for flights from Seattle to D.C.

    “[Timbers owner] Merritt Paulson and the team have really delivered on their promises of activation,” Sprague said.

    Alaska Airlines will not be alone in its activation on Sunday. Portland General Electric is the presenting sponsor of the game. Other plans unique to Sunday include Vitaminwater distributing samples of its product as fans exit the stadium, and Papa Murphy’s Pizza launching its Timbers-inspired Lumberjack pizza at area locations on Sunday, with promotion in-stadium and on the game’s radio broadcast.

    The rivalry games bring other positive effects. During the week of Portland’s home game last season with Seattle, the Timbers’ website reported an increase in traffic of more than 50 percent. All three games between the clubs this season are being broadcast on national television: The games on Sunday and Oct. 7 are on ESPN, while the Sept. 15 match is on NBC.

    “The Portland-Seattle rivalry is one that I’d measure against any rivalry and sporting event in the country,” said Brad Pursel, MLS vice president of club services. “Jeld-Wen Field is going to be electric with the Timbers Army in full splendor and a large number of fans traveling from Seattle. It is a really special environment there.”

    Soon after Portland was awarded an MLS franchise in March 2009, executives from the Timbers, Sounders and Vancouver Whitecaps — who also began MLS play in 2011 — began meeting regularly to discuss how the Pacific Northwest rivals could work together to grow their businesses. The league’s 75-mile marketing radius circle for clubs, with exceptions for New York-Philadelphia and the two Los Angeles teams, is not a hindrance, as Portland and Seattle are about 150 miles apart.

    The teams estimate they have a dozen mutual sponsors.

    “It’s a very positive environment,” Golub said. “We may be rivals on the pitch, but we discuss everything within reason. Only good has come from it.”

    The rivalry is just as vital for Seattle. The Sounders leverage the Oct. 7 home match with Portland in their most popular ticketing plan with a friendly against Chelsea FC and MLS matches with the Los Angeles Galaxy and Vancouver. Amtrak, a team sponsor for three years, held a sweepstakes around Sunday’s game and received 2,711 entries, up slightly from last year’s contest. One winner received tickets, hotel accommodations and round trips on Amtrak Cascades, which runs from Eugene, Ore., to Vancouver.

    “Amtrak Cascades is a state-sponsored service, so the excitement this rivalry brings is important to us,” said Laura Kingman, marketing and communications manager of the Washington State Department of Transportation. “Our research shows that their fans are our customers.”

    Said Sounders owner and general manager Adrian Hanauer, “It’s been great to watch our fans take ownership of the rivalry.”

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