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Volume 21 No. 1

Leagues and Governing Bodies

Continuing to augment its lacrosse portfolio, ESPN will showcase as many as 60 games over 10 nights from the 2014 Federation of International Lacrosse Men’s World Championship in Denver, which organizers are calling “the largest lacrosse event in history.”

The semifinals and finals from Dick’s Sporting Goods Park in Denver next July will be carried live on ESPNU, with the remainder likely airing on the broadband ESPN3 outlet. The last time the event was held, the 2010 world championship from Manchester, England, had only the championship game live on ESPNU.

U.S. Lacrosse COO Bill Schoonmaker would not reveal specifics on the business arrangement with ESPN beyond saying that ad inventory would be sold by both ESPN and U.S. Lacrosse. However, a source at the all-sports network said that no rights fee is being paid, nor is U.S. Lacrosse paying production costs.

ESPN can now add this event to its other lacrosse programming, which includes extensive coverage of the NCAA Final Four.

There may be as many as 40 nations competing in the world championship, compared to 29 in 2010.

Since the sport has been growing at record levels in the U.S., and well outside of its traditional Northeastern base, officials at the governing body are hopeful that the first world championship in America since 1998 will jump-start the sport commercially.

U.S. Lacrosse estimates that the world championship will attract 150,000 spectators and have a local economic impact of $50 million.

The event, which features national teams, joins ESPN’s NCAA Final Four coverage.
U.S. Lacrosse and ESPN are selling low- to mid-six-figure annual sponsorships to the governing body and the world championship, targeting the telecommunications, financial services, rental car and airline categories.

“The message we’re taking to [potential] sponsors is that we’re growing, our premier event is here, and this is the best time to get involved,” said Schoonmaker, citing statistics that indicate U.S. lacrosse participation is growing at double-digit rates while most other sports are facing declining participation.

Growth in the sport is also evident within the governing body itself.
Since joining as COO five years ago, Schoonmaker has seen the group’s membership swell to 420,000 and the U.S. Lacrosse employee count increase from 45 to more than 80.

Looking to eventually build a new headquarters and training center, the governing body late last year purchased a 12-acre parcel of land in Sparks, Md., for around $4 million. Now it’s mounting a fundraising campaign to raise $15 million, much of which would be used to build a new headquarters, a hall of fame and a national lacrosse training center, which could serve as a home for the national team. There is no firm timetable for construction, however.

U.S. Lacrosse currently is based in Baltimore.

The NFL’s annual kickoff celebration has become a mini-national holiday in just 12 years, since its inaugural event in Times Square in 2002.

This year, even with the Baltimore Orioles refusing to relinquish a home date so that their neighboring Ravens could host the NFL opener, there’s still enough interest to hold a season-opening NFL Kickoff celebration in the hometown of the Super Bowl champs — even though the Ravens will be playing 1,700 miles away in Denver.

The NFL’s season-opening push includes a celebration in Baltimore and a fashion show of women’s licensed apparel in Manhattan.
Similarly, the league’s Back to Football effort showcasing the start of the season has grown in size and stature since its 2010 launch.

While no advertiser is confusing NBC’s opening telecast of Ravens-Broncos

with a Super Bowl telecast, marketers are realizing the opportunity. Bud Light, Microsoft, Pepsi, Verizon and Visa are among the league’s partners launching NFL-themed national TV ads. Overall, 12 league sponsors are launching NFL-themed creative for opening week.

“Kickoff will never be the Super Bowl, but it’s become a powerful bookend for the season,” said Peter O’Reilly, NFL vice president of fan strategy and marketing. “When you look at how so many of our partners [are] using it, Kickoff has become another place for those associated with the NFL to be seen.”

Echoed John Brody, NFL senior vice president of sponsorship and media sales, “For our sponsors, it’s become a creative beachhead. Super Bowl is a national holiday, and we’re slowly building another for Kickoff. We’ve got three different P&G brands [Tide, Old Spice and Gillette] launching NFL campaigns.”

Along with activation, Brody said that revenue related to NFL Kickoff was up.

Pepsi, which will end the season as sponsor of the halftime musical performance at the Super Bowl, helps begin the season in Baltimore with an amalgam of music and football. The festivities in Baltimore end Thursday with a Keith Urban concert on a floating stage in the city’s Inner Harbor.

Three days of events start Tuesday and include a 5K Back to Football run; a Verizon-sponsored flag football game; a Play 60 Youth Football Festival; the debut of NFL Films’ “America’s Game: Baltimore Ravens” film; a community improvement project; and a two-day sponsor activation zone in which 15 league partners will participate, up from 12 last year in New York’s Times Square.

Cowboys, Kaepernick lead
the way in offseason sales

For those looking for new NFL licensing trends, Fanatics, which administers e-commerce for the league along with 12 teams, notes that on its own site, top-selling teams during the offseason (April 1-Aug. 26) were the Dallas Cowboys, San Francisco 49ers, Pittsburgh Steelers, Green Bay Packers and Chicago Bears, while the top-selling players were Colin Kaepernick, Robert Griffin III, Peyton Manning, Russell Wilson and J.J. Watt. 

The strong finish last year by the Seattle Seahawks propelled them to a 450 percent increase in offseason sales on

— Terry Lefton

Consumer products also will be involved, as NFL Shop at Kickoff in Baltimore sees New Era promoting its fitted cap offerings. But there will be no traditional retail at the sponsor activation area. Those fans wanting to purchase caps will be directed to by clerks using tablets from new NFL sponsor Microsoft.

NFL consumer products chief Leo Kane said that with two versions of EA’s “NFL Madden” being released this season, continued strength from second-year on-field licensees Nike and New Era, and demand for licensed domestic “homegating” products seemingly unabated, he’s projecting “solid, single-digit growth” for the NFL’s licensing business.

As part of its women’s initiative, the league is staging a women’s licensed NFL apparel fashion show in Manhattan, working with Vogue. It will again run institutional ads featuring licensed garb for women and, for the first time, those ads will run during games.

However, the opportunity presented by a Super Bowl in New York may be the biggest focus this season, with the NFL looking to push product into every level of retail in and around the city. Licensed Super Bowl merchandise has already been available for months at most traditional sports, including airports.

“That should be a huge multiple from any Super Bowl,” Kane said.

The NFL this week is unveiling its first package of benefits for the league’s roughly 1 million season-ticket holders, a program called The Membership Club.

The program provides for any NFL season-ticket holder to get RedZone for free on his or her cellphone. Additionally, season-ticket holders will be able to access RedZone whether in their team’s stadium or not, and they will have access even if they use a carrier other than league sponsor Verizon, said Brian Lafemina, the NFL’s vice president of club business development.

Verizon, through its sponsorship of the NFL, has exclusive rights to show RedZone via mobile, so the season-ticket holder plan is an exception.

Electronic Arts also is getting into the act. For those season-ticket holders who buy EA’s “Madden” game, they will receive access to a free download to supplement the purchase that could include additional players or teams, Lafemina said.

EA officials said details on the download were being finalized but that the idea is to “give fans exclusive downloadable content to enhance their Madden experience.”

Verizon officials could not immediately be reached for comment.

“Our partners Verizon and EA support this initiative,” Lafemina said when asked specifically about Verizon opening its access to RedZone.

The NFL also will make NFL Rewind, its digital subscription product that allows fans to watch every regular-season game on demand online or via tablet, available to season-ticket holders. Rewind costs $69.99 for subscribers. The NFL did not say whether Rewind would be free to season-ticket holders or discounted.

Lafemina described the first offerings of The Membership Club as only phase one, saying at the beginning of each league season that season-ticket holders will enjoy more perks.

The NFL has recently adopted a new internal term for season-ticket holders, calling them instead season-ticket “members” (thus the name The Membership Club). Several clubs have made the terminology switch, which is designed to convey a fuller array of benefits and inclusion that comes with buying season tickets.

Encouraging fans to come to NFL stadiums is a league priority as, like other sports, the NFL battles advanced in-home entertainment systems that make it less alluring to attend games.

The NFL is fighting this trend on two fronts. One is to offer entertainment available only in stadium, like locker room audio and camera feeds not seen on TV, and via apps that offer camera angles and other choices not possible at home. The second is The Membership Club, offering enticements that come with season-ticket ownership.

Individual clubs across the league already are acting in this regard (see Tampa Bay story). The league’s plan is to provide more umbrella coverage, offering season-ticket holders the same package of benefits no matter their team.

RedZone provides whip-around game coverage, taking fans to action across the league and with a focus on coverage when a team moves inside its opponent’s 20-yard line. RedZone airs between 1 p.m. ET on Sunday and the end of the day’s late-afternoon games. In-stadium, the coverage would give season-ticket holders a way to see action and highlights from other games while simultaneously attending a home team’s game.

The NFL, in partnership with Fanatics, launched a mobile version of its online shop in early August. During the first two-week period that the mobile site was live, the NFL saw a 35 percent increase in purchase conversions by smartphone users as compared with the two weeks prior.

“This tells us that the site is more shoppable,” said Josh Feinstein, the NFL’s director of consumer products. “The goal is to optimize the site to try to convert as many people as we can while they’re there. Before the switch [to the mobile site], customers were accessing the full site from their phones, which was not the greatest shopping experience.”

Now when smartphone consumers access, the site will detect the phones and automatically transfer the consumers to the mobile site. The new site works only with smartphones; tablets still go to the traditional site.

The new mobile shop features a grid layout with clickable team logos. Graphic size and visibility keeps mobile in mind. Users can easily navigate into their team’s section to find merchandise categories and narrow down their selection. Filters allow fans to shop by player, choose their price range or look for customizable products.

Smartphone traffic to has seen a rapid increase since 2011, when only 15 percent of visitors came from those devices, generating less than 2 percent of the site’s overall revenue. Those numbers have since skyrocketed, with smartphones accounting for more than 42 percent of traffic to the shop and 13 percent of the revenue in 2013 (see chart.)

With the upgrade to the mobile site, purchase conversions are expected to increase due to ease of navigation and layout.

“Our ultimate goal is to give fans a better and easier shopping experience,” Feinstein said. “When you go to the mobile store now, it’s very easy to find your team and the category you want.”

The new mobile site should answer the call of smartphone shoppers, making their experience simpler and faster. The NFL will conduct a customer survey in the coming weeks to make sure their fans agree.

Amie Sheridan is a writer in Philadelphia.

NHL Commissioner Gary Bettman’s salary and benefits climbed to more than $8 million for the 2011-12 season, the most recent full season prior to the 2012-13 lockout, according to the league’s newly available tax filing.

Bettman received more than $8.3 million in salary and benefits during the fiscal year ending June 30, 2012. His total compensation the previous year was $7.98 million.

By comparison, the salary of NFL Commissioner Roger Goodell is close to $30 million, according to that league’s most recent tax return. MLB Commissioner Bud Selig, whose salary is no longer publicly available through tax filings, is believed to make more than $20 million annually. NBA Commissioner David Stern’s salary has never been made public.

Bettman’s base salary for the 2011-12 season was $6,395,521. Payment defined as other compensation was $1,816,628. He also received $65,795 in deferred compensation and $28,800 in benefits.

Bettman’s salary has more than doubled over a period that has seen the league’s total revenue increase from $2.1 billion in 2003-04 to $3.2 billion for the season of this latest tax filing. In the lockout-canceled season of 2004-05, Bettman made $3.7 million.

In March, the league projected $2.4 billion in revenue for last season, which was shortened to 48 regular-season games for each team because of another lockout.

The annual tax filings cover the NHL’s central business operations and do not include the team-level and other businesses that play a part in totaling projected league revenue each season. Additionally, the filings do not include the revenue and expenses of NHL Enterprises and the NHL Network, which are not tax-exempt groups and therefore do not have the same IRS filing requirements.

The NHL declined to comment on the latest filing, which reported compensation for nine of the league’s top officers. NHL Deputy Commissioner Bill Daly made $3.26 million in 2011-12, a $400,000 increase from the previous season. Chief Operating Officer John Collins saw a $600,000 increase, to $2.9 million, which included $1.75 million in bonus and incentive compensation that is directly tied to the league’s business growth.

On the whole, the league posted a loss for its business of $3.6 million for 2011-12, versus a loss of $14.8 million the previous season. Expenses rose from $103.9 million to $106.0 million, while revenue increased from $89.1 million to $102.5 million. One source said factors such as club dues, interest on loans and royalty payments to NHL Enterprises are among the elements that affect the league finances annually.

As part of the tax filing, the NHL also listed its five highest-paid contractors, which were paid a total of just under $10 million. The top two were for legal services, totaling $6.5 million: Skadden, Arps, Slate, Meagher & Flom at $4.3 million, and Proskauer at $2.2 million.