First Look podcast: World Congress 2017 PBC plots path to maximize distribution NBA Turnstile Tracker Baseball returns to Kinston, N.C. David Stern investing in tech startups NBA regular season sees ratings drop Faces and Places at World Congress Are sponsors wary of outspoken athletes? On Deck With: Mike Unger, USA Swimming Labor & Agents: Rosenthal takes charge
SBJ/January 28-February 3, 2013/FranchisesPrint All
Less than three years after he retired as a player with the Los Angeles Galaxy, Chris Klein has been named the team’s president.
Chris Klein (right) moved into management after retiring as a player in 2010.
Photo by:GETTY IMAGES
Klein was scheduled to be introduced as president to Galaxy staff late last week. A formal announcement of the promotion was slated for today.
The Galaxy has not had a team president since Tom Payne left the club early last year.
Klein, 36, had held the title of vice president for the last 11 months after a two-year stint as senior director of the club’s training academy. He said he’s had his eye on a managerial career since becoming a member of the Galaxy in 2007.
In 2010, he was on the executive committee of the MLS Players Union when a new collective-bargaining agreement was reached with the owners.
“When I retired as a player, my goal was to make a difference in MLS as an executive,” Klein said. “I learned a lot from Tim, and he gave me a chance.”
With Klein as Galaxy president and Luc Robitaille as president of business operations for the Los Angeles Kings, also owned by AEG, the company now has two former athletes heading the corporate staffs of its teams. “My belief is that the best stewards of the game are those who played the game,” Leiweke said.
Klein will work closely with new AEG Sports COO Kelly Cheeseman, who was named to that post earlier this month after 4 1/2 years as vice president of tickets sales and service for the Kings and AEG Sports. Klein also will support the efforts of Galaxy coach Bruce Arena, who has led the team to MLS Cup titles the last two seasons.
“I’ll be the day-to-day face of the business operations of the Galaxy,” Klein said. “I want us to be as successful in business as Bruce has led our team to be.”
Leiweke said he has three goals in mind for Klein.
“One: Stay relevant in a 12-team town in Los Angeles,” Leiweke said. “Two: Stay relevant in L.A. while breaking even. And three: Stay relevant in L.A. while breaking even and with an eye where MLS is going — development from within.”
According to Leiweke, the Galaxy has lost money in recent years because of its signing of designated players — MLS’s maximum-three salary cap exemptions, so stars can be signed — such as David Beckham, Landon Donovan and Robbie Keane.
“We’ll continue to sign great players as DPs,” Leiweke said, “but under Chris, you will also see more player development.”
Off the pitch, one of Klein’s biggest challenges is to increase season-ticket sales. According to Cheeseman, one of the club’s primary offseason goals is to increase full-season sales 30 percent from the current 7,500.
“He’ll get us there,” Cheeseman said of Klein. “He’s calm, insightful and brings the perspective of a player. His promotion makes complete sense because it improves and streamlines AEG Sports.”
The pending sale and possible relocation of the Sacramento Kings to Seattle is throwing the team’s marketing efforts into a lockout-like mode at a time when the club, like all NBA franchises, is rolling out its season-ticket renewal efforts.
A final decision on the Kings’ fate for 2013-14 likely won’t come until April, yet team officials plan to begin their season-ticket renewal work on March 1, just as they have in past years. To retain some semblance of a season-ticket base during the upheaval, the Kings are considering asking fans this year to pay only a nominal, and fully refundable, deposit of between $100 and $250 to retain their season tickets for 2013-14 should the team stay in town. An exact deposit price was still being decided.
During the lockout before the 2011-12 season, NBA teams similarly sought deposits on season-ticket renewals conditioned on the uncertain status of the coming season being resolved at a later date.
The strategy for the Kings comes as a group led by Seattle hedge fund manager Chris Hansen waits for league approval of a sale agreement to buy 65 percent of the Kings from the Maloof family for a reported $341 million. Hansen intends to bring the NBA back to Seattle and play in KeyArena until a new arena is built. The deal must be approved by the NBA’s relocation committee by March 1 and then win approval from NBA ownership. That action could come during the league’s board of governors meeting in mid-April.
Meanwhile, as the NBA studies Hansen’s agreement, another effort led by a group of local business leaders and Sacramento Mayor Kevin Johnson was emerging last week seeking to counter Hansen’s offer and keep the team in Sacramento. Pittsburgh Penguins co-owner Ron Burkle and Mark Mastrov, founder of 24 Hour Fitness, also have been associated with the effort to keep the Kings in Sacramento.
Not all team operations have been affected by the Kings’ looming lame-duck status at this point. The team’s sponsorship renewal efforts, for example, typically don’t begin until after the regular season ends, and suite leases at Sleep Train Arena run through September.
Kings officials, citing the pending ownership change, declined to comment on any strategies related to the franchise’s possible sale and relocation.
What is clear is that the team’s uncertain future, along with its 16-27 record as of Thursday, hasn’t helped at the gate. It stood last in the 30-team NBA last week, averaging 13,153 fans per game compared with a leaguewide average of 17,121.
Marketing a franchise facing possible relocation also isn’t new to the NBA. The former Seattle SuperSonics relocated to Oklahoma City two years after Clay Bennett bought the franchise. Bennett, an Oklahoma City native, closed on his purchase in October 2006 and, after failing to land a new arena deal in Seattle, gained approval to move the club to Oklahoma City for the 2008-09 season. In January 2001, the former Vancouver Grizzlies were sold to Michael Heisley and relocated to Memphis in time for the 2001-02 season.
“You first must be respectful of the season-ticket holders, fans and sponsors that are doing business with the team every day,” said Andy Dolich, who ran the business operations for the Grizzlies when the team moved. “There is the fog of moving around the franchise, but you also market who is coming to the arena, whether it is LeBron James or Carmelo Anthony, because people love the game and they still want to see it. But [running the business operations] becomes more triage than long-term care.”
The Chicago White Sox have signed a three-year partnership with Magellan Corp. in which the Illinois-based steel distributor will become the title sponsor of U.S. Cellular Field’s Scout Seats and Scout Lounge and use the premium-seating areas to promote local charitable and cultural institutions.
Magellan, which will replace United Airlines as the title sponsor of the area, has no consumer-facing profile, and doesn’t even have a website. So rather than focus its marketing energies at the ballpark solely around itself, Magellan has selected five Chicago-area entities that will be prominently promoted through static and rotational signs and other activation.
The groups are Gilda’s Club, a cancer support organization formed in the memory of late comedienne Gilda Radner; La Rabida Children’s Hospital; the Old Town School of Folk Music; the Chicago Council on Science and Technology; and the DuSable Museum of African American History. The club’s own charitable vehicle, Chicago White Sox Charities, also will be spotlighted in the premium areas.
“We embrace the missions and activities of these groups,” said Bob Arthur, Magellan president. “We have a finite customer base, and don’t need to market to the general consumer base. So we’re using this platform to highlight these groups.”
There was no need for the White Sox to extensively prescreen Magellan’s chosen organizations; the club has worked with nearly all of them in some fashion, largely through White Sox Charities.
Financial terms were not disclosed. A key figure in developing the deal was Gail Tucker, White Sox director of corporate partnerships activation.
Magellan was an existing sponsor and suite holder of the White Sox. The company quickly seized upon the opportunity for the Scout Seats, 322 seats situated directly behind home plate, when United sought to shift its in-ballpark exposure to a large outfield sign.
“This was a company that we knew very well and were very familiar with,” said Brooks Boyer, White Sox chief marketing officer. “This is very valuable inventory we have with these seats, and we think it’s going to send a very powerful message. When United made their move, Magellan jumped in right away. With a b-to-b kind of relationship, the most important thing is relationships, and this will create a great deal of awareness.”
Magellan is also aligned with the Chicago Bulls, also owned by White Sox owner Jerry Reinsdorf.