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Volume 21 No. 26

Sports Business Awards

The biggest winners at last week’s Sports Business Awards were the companies that figured out how to profit from new ideas and changing business models.

That explains how an expansion team, the Vegas Golden Knights, won the award for Sports Team of the Year in its inaugural season, prompting team President Kerry Bubolz to say he has challenged his staff every day to do something different. That was evident when, during his acceptance speech, he read a catchy and clever poem recounting the ups and downs — and the tragedy that hit Las Vegas — that the team faced during the year.

The theme also explains how Arthur Blank’s AMB Group — and its $2 hot dog — was honored as the Sports Breakthrough of the Year.

“Mr. Blank is known for disruption, and he’s always challenging us,” said AMB Group CEO Steve Cannon, who oversees Blank’s business empire and accepted the Breakthrough trophy.

AMB Group’s Arthur Blank, 2018 Sports Executive of the Year
Photo: marc bryan-brown

Octagon’s David Schwab, one of the 24 judges who determined the event’s winners, said the theme of figuring out how to deal with corporate disruption was a big part of all the conversations during the voting process.

“The lead was, ‘What am I doing to the current industry environment to make people think differently and to put the business ahead five years from now?’” said Schwab, an executive vice president at the agency. “The hardest part about disruption is that it often affects your daily balance sheet. You’re betting on things that are different from how you do business right now. You’re betting on what you know is important for your business in the future.”

Another awards judge, the XFL’s Howard Handler, sounded the same theme. Handler is a former marketer with the NFL and MLS, and now is project leader for Vince McMahon’s second try at spring football.

“Whether it’s with technology or not, every marketer needs to find a path that depends on disrupting the status quo,” Handler said. “In an industry as mature as sports, that’s an imperative.”

First Look podcast, with SBA discussion at the 15:25 mark:

Michael Eisner, 2018 Lifetime Achievement honoree
Photo: marc bryan-brown

In some cases, the attempts at disruption are a byproduct of advances in media and technology. Sometimes, they’re born out of personal experiences.

After accepting his award for Sports Executive of the Year to cap off a stellar night, Blank reflected on his motivation to develop a “fan-first” pricing plan that slashed costs, moved fans through lines quicker and got them in the stadium earlier.

Blank recalled what it was like, as a father of six children, to take his family to a game. 

“Food and beverage was a great source of frustration, not just for us, but for a lot of fans,” Blank said. “In addition to solving a problem and creating higher-quality food choices that cost less, it was just a good way to say thank you to the fans.” 

At the end of the day, the business of sports really comes down to the emotion of sports.
Michael Eisner

The theme of adapting business models to reach younger consumers also was a factor in traditional media companies that were honored at the Sports Business Awards. NBC Sports won for Best in Sports Media, in part, because of its digital performance during the Winter Olympics.

“We are a legacy media company, but we are also a disrupter,” said NBC Broadcasting and Sports Chairman Mark Lazarus, referencing direct-to-consumer services it owns for cycling, soccer, track and field, rugby and motocross. “People like to call us legacy media. Legacy media can also be a disrupter and grow into the next stage.”

Bob Iger, Disney Chairman and CEO
Photo: marc bryan-brown

The idea of corporate disruption is hardly new, Lazarus said, pointing out that 30 years ago TV broadcasters were considered legacy media and cable was the disrupter. Today, they’re both considered legacy media.

“You’re going to see the same thing go on in the future as we all evolve and become not just legacy, but part of the disruption as well,” he said. “We have to have the courage to do it.”

ESPN took home the trophy for Best in Digital Sports Media largely because of its willingness to expand its programming to new platforms. Just hours after news broke that ESPN would pay $300 million per year for UFC rights, President Jimmy Pitaro was on stage accepting a trophy for Best in Digital Sports Media. ESPN will put most of the UFC fights on its streaming platform, ESPN+, that launched in April.

Michael will be the first to tell you sports are rife with incredible stories: full of heroes and villains, triumphs and tragedies, winners and losers, suspense and unpredictability. But above all, great sports stories have heart. That’s what makes them so powerful, and so accessible.
Bob Iger
Disney Chairman and CEO, introducing his friend and former colleague Michael Eisner

“It’s fair to say that our top priority is expanding our audience,” Pitaro said. “Part of that means us getting younger. We’re trying to identify new content and new experiences that we think will appeal to a younger generation.”

Molly Mullady Arbogast, an awards judge who is president of POV Sports Marketing, pointed to the development of those platforms as one of the biggest issues sports marketers face.

“When you look at the intersection of social and digital, and combine that with how important all of that has become to marketers, that was my biggest challenge,” she said. “And I don’t see that area getting any easier in the future.”

While evolving business models like these are not new, Octagon’s Schwab said the last year and a half has been dizzying for sports.

“Sports in the last 18 months has made huge strides in technologies and innovations,” he said. “You saw that at the event. Every discussion point led with OTT, social platforms, new types of media rights, gaming, betting. None of those were discussion points four years ago. Half of them were discussion points two years ago.”

Brendan Tuohey, PeacePlayers International, honored with the Celebration of Service award
Photo: marc bryan-brown

You in this room have the opportunity to be leaders, not followers, in using sport, a vehicle we all know and love, to unite, inspire and uplift. In a world that seems more fractured every day, we can’t afford to wait for another answer.
Brendan Tuohey
PeacePlayers International co-founder and executive director

The judges’ choices, in addition to harping on the theme of change, created some interesting storylines. Nowhere was the timing more ironic than in the Sponsor of the Year category.

Dr Pepper was the winner, based primarily on the college football creative campaign that featured character Larry Culpepper. Just a day before the awards, the brand said it would not bring back Culpepper for the coming football season, even though the character was responsible for Dr Pepper’s victory.

Blaise D’Sylva, vice president of media for Dr Pepper Snapple Group, accepted the trophy and said afterward that it’s best for Culpepper to go out while he’s still popular rather than waiting until the campaign grew stale.

“You’re always wondering with those kinds of campaigns when you’re going to reach the tipping point,” D’Sylva said. “We’ve got some great ideas for how to keep it fresh.”

Staff writers Terry Lefton and Eric Fisher contributed to this report.

Knights President Kerry Bubolz and other team executives celebrate the team’s SBA award.
Photo: marc bryan-brown

The improbable, historic run of the Vegas Golden Knights to the Stanley Cup Final in their inaugural season has helped make them one of the NHL’s highest-grossing revenue teams, and executives say they believe there is even more room to grow.

“We look at next year as an opportunity to go deeper and wider with everything,” said President Kerry Bubolz. 

“We’re already looking  at what Vegas Born 2.0 is and how we can continue this momentum in our second year.”

The Golden Knights’ first year isn’t even over, but it’s already been an enormous success. Last Wednesday, they won Sports Team of the Year honors at the 2018 Sports Business Awards, the same night they learned that they will face the Washington Capitals in the championship series, which starts this week. The award helped reaffirm one of the most unexpected success stories in sports, both on the business and competition side, and the team’s success has certainly surprised most industry insiders.

“We felt great about the things we could control [going into the season], but what happened on the ice and in the community has just been incredible,” Bubolz added. “Everything has just continued to be a surprise.”

The Golden Knights rank among the top 10 teams in the league in total revenue, thanks in part to more than $90 million in contractually obligated sponsorship income, according to industry sources. That success means that, under the league’s revenue-sharing agreement, Vegas will contribute funds to the pool. To put that accomplishment into perspective, industry sources said that when the franchise was approved for expansion in the fall of 2016, the NHLPA asked the league to bar Vegas from collecting revenue sharing for its first several seasons over fears that it would be a drag on the league.

Much of the foundation for the Golden Knights’ business success was laid even before the team existed. Bubolz noted that the initial ticket drive — which began before the team’s launch was official — drew more than 16,000 paid deposits. This season the Golden Knights ranked in the top five among the league’s U.S.-based teams in gate revenue, with an average single-game ticket price of over $160. The team has more than 14,000 season-ticket holders — its self-imposed cap — and currently has more than 6,000 people on a waitlist, a number that continues to grow, according to Todd Pollock, vice president of ticketing and suites. In addition, all of the team’s premium inventory, including its 47 suites, were sold out for the season.

The majority of the Golden Knights’ season-ticket holder accounts are on multiyear agreements that have price freezes, according to Pollock, but he added that the combination of those on one-year deals, new sales and other single-game ticket sales means the team expects that it will have a 5 to 7 percent increase in ticket revenue for next season.

The team’s sponsorship revenue, which came in more than 20 percent higher than its forecast goal before the season, will also see growth next year as it held out inventory for subsequent seasons, according to Jim Frevola, senior vice president and chief sales officer. Frevola noted that while the bulk of the team’s existing deals are already locked into multiyear contracts, open categories include airline, financial services, quick-service restaurant and spirits.

The Golden Knights already rank among the highest sponsorship-revenue-generating U.S. teams in the NHL, a remarkable figure for an expansion franchise. With the league granting each team the ability to sell four more in-ice ad positions next season in addition to new deals, the Golden Knights could see an increase of more than $10 million to $15 million in sponsorship revenue.

Bubolz said he sees further national and international opportunities for the sponsorship business given the level of exposure the team has garnered in the postseason. “People understood the national visibility that the city of Las Vegas had, but not the team itself, so we’re focusing on the opportunity to speak to more national brands,” he said.

The Golden Knights smashed expectations in merchandising as well, beating initial budget projections by more than 200 percent and finishing first in the league in average gameday per-cap revenue. CMO Brian Killingsworth said the team will look to leverage a burgeoning international audience it is calling “VGK Worldwide,” and data from Fanatics said that people from more than 90 countries have bought Golden Knights merchandise. 

Bubolz said the retail business was “completely unlike anything that has happened,” noting that perhaps the other areas of the team’s business might have higher level of growth opportunities.

One such area is on social media. Currently, the Golden Knights have more than 386,000 Twitter followers, which places them in the bottom quarter of the league. At 2.55 million, the Chicago Blackhawks have the most in the league. 

Of course, the Golden Knights have an opportunity only one other team still does: to grow its fan base by winning the Stanley Cup.

Photo: marc bryan-brown

ESPN Digital Media

Best in Digital Sports Media
Accepted by Jimmy Pitaro
Presented by Daniel Rush

 
Photo: marc bryan-brown

Mercedes-Benz Stadium Food & Beverage Experience

Sports Breakthrough of the Year
Accepted by Steve Cannon
Presented by Shalane Flanagan

 
Photo: marc bryan-brown

AEG Global Partnerships

Best in Property Consulting, Sales and Client Services
Presented by Mark Tatum

 
Photo: marc bryan-brown

15 Seconds of Fame

Best in Mobile Fan Experience
Accepted by Whitney Hansen, the first person 15SOF delivered a clip to at a professional sporting event.
Presented by Derek Schiller

 
Photo: marc bryan-brown

Ticketmaster

Best in Sports Technology
Accepted by Jared Smith
Presented by Derek Schiller

 
Photo: marc bryan-brown

Jim Phillips, Northwestern University

Athletic Director of the Year
Jim Phillips is joined by the Northwestern deputy athletic directors who make up his executive team.
Presented by Ann Rodriguez

 
Photo: marc bryan-brown

Octagon

Best Talent Representation of the Year
Accepted by Phil de Picciotto (second from left)
Presented by Christos Karmis

 
Photo: marc bryan-brown

Major League Soccer

Best in Sports Social Media
Presented by Tracy Wolfson

 

Photo: marc bryan-brown

Endeavor Global Marketing

Best in Sports Event and Experiential Marketing
Accepted by Bryan Icenhower, with Bill Decker (left) and Ed Horne (center)
Presented by Tracy Wolfson

 
Photo: marc bryan-brown

2017 NFL Draft: Philadelphia

Sports Event of the Year
Presented by Jessica Gelman

 
Photo: marc bryan-brown

Little Caesars Arena

Sports Facility of the Year
Presented by Greg Sankey

 
Photo: marc bryan-brown

CAA Sports

Best in Corporate Consulting, Marketing and Client Services
Accepted by Greg Luckman
Presented by Rich Lukis

 
Photo: marc bryan-brown

NBC Sports Group

Best in Sports Media
Accepted by Mark Lazarus
Presented by Meghan Duggan

 
Photo: marc bryan-brown

Vegas Golden Knights

Sports Team of the Year
Accepted by Kerry Bubolz
Presented by John Kosner

 
Photo: marc bryan-brown

Dr Pepper

Sports Sponsor of the Year
Accepted by Blaise D’Sylva
Presented by Jill Gregory

 
Photo: marc bryan-brown

National Basketball Association

Sports League of the Year
Accepted by Adam Silver
Presented by Connor Schell

 
Photo: marc bryan-brown

Arthur Blank, AMB Group

Sports Executive of the Year
Presented by Ben Sutton

 

Best in Digital Sports Media

ESPN Digital Media

 

Sports Breakthrough of the Year

Mercedes-Benz Stadium Food & Beverage Experience

 

Best in Property Consulting, Sales and Client Services

AEG Global Partnerships

 

Best in Mobile Fan Experience

15 Seconds of Fame

 

Best in Sports Technology

Ticketmaster

 

Athletic Director of the Year

Jim Phillips, Northwestern University

 

Best Talent Representation of the Year

Octagon

 

Best in Sports Social Media

Major League Soccer

 

Best in Sports Event and Experiential Marketing

Endeavor Global Marketing

 

Sports Event of the Year

2017 NFL Draft: Philadelphia

 

Sports Facility of the Year

Little Caesars Arena

 

Best in Corporate Consulting, Marketing and Client Services

CAA Sports

 

Best in Sports Media

NBC Sports Group

 

Sports Team of the Year

Vegas Golden Knights

 

Sports Sponsor of the Year

Dr Pepper

 

Sports League of the Year

National Basketball Association

 

Sports Executive of the Year

Arthur Blank, AMB Group

 

Lifetime Achievement

Michael Eisner

 

Celebration of Service

PeacePlayers International

 

 

Judges Panel

Twenty-four independent, outside judges sat on various committees to help determine the winners of the 2018 Sports Business Awards. Earlier this month, the committees met and deliberated on 15 of the 17 categories. Two categories (Athletic Director and Sports Executive) were selected solely by a SportsBusiness Journal/Daily editorial committee.

David Abrutyn, Bruin Sports Capital

Lee Berke, LHB Sports, Entertainment & Media

Marc Bluestein, Aquarius Sports and Entertainment

Karen Brodkin, Endeavor

Kathy Carter

Saj Cherian, Kynetic

Liz DiLullo Brown, Little League Baseball and Softball

Eric Fernandez, 4Front

Jessica Gelman, Kraft Analytics Group

Howard Handler, h2 media marketing

Michelle Harrolle, University of South Florida

Isaiah Kacyvenski, Sports Innovation Lab

Matt Kauffman, The Montag Group

John Kosner, Kosner Media

Steve Lauletta

Molly Mazzolini, Infinite Scale Design Group

Scott McCune, McCune Sports & Entertainment Ventures

Liz Moulton, Korn Ferry

Molly Mullady Arbogast, POV Sports Marketing

Heidi Pellerano, Wasserman

Lara Price, Harris Blitzer Sports & Entertainment/Philadelphia 76ers

Alec Scheiner, RedBird Capital Partners

David Schwab, Octagon

Tina Shah, Turner Sports