SPECIAL REPORT

THE SELLING OF SPORTS

MARY NEMETH,JAMES DEACON,RAE CORELLI September 26 1994
SPECIAL REPORT

THE SELLING OF SPORTS

MARY NEMETH,JAMES DEACON,RAE CORELLI September 26 1994

THE SELLING OF SPORTS

Labor strife has highlighted the way money makes the sports world go round. From merchandising to TV coverage to player contracts, the goal of the game is a dash for cash — and hockey could be its next casualty. A sampling of the action:

Clothes make the fan

High on a wall in a downtown Toronto sports store is a simple blue-and-white hockey jersey with a maple leaf emblazoned in the centre and goalie Felix Potvin’s last name in bold lettering across the top. Below it hangs shirt after shirt featuring rap-

tors and grizzly bears, all bared fangs, powerful claws and fanciful colors—purple, red, socalled spirit turquoise and B.C. bronze. Merchandise of the Toronto Maple Leafs hockey team and of the new Toronto Raptors and Vancouver Grizzlies basketball franchises together generate most of the sales in a store that carries gear from virtually every major professional team in North America.

And yet the marketing for those commodities could not be more different. “The Toronto Maple Leafs jerseys are selling on team and player loyalty—the fact that we have the Doug Gilmours and Felix Potvins,” explains manager Paul Salivar. “But the basketball stuff has to be driven by the logo and the fact that it’s new.”

It used to be that loyalty to player and team was the only way to sell a club’s colors. And the popularity of merchandise from the Maple Leafs or from retired superstar Michael Jordan’s old team, the Chicago Bulls, is evidence that some vestige of that imperative endures. However, a seismic shift in merchandising in recent years has not only altered the complexion of sportswear, but also boosted league coffers—revenues from licensed goods are shared equally by all teams in each of the major leagues.

It all started in the late 1980s with a sudden rush on the Los Angeles Raiders’ black-andsilver gear and its tough outlaw image. “I think the Raiders fell into it by accident,” says Larry Donen, managing director of Winning Spirit, the official merchandise vendor for several Vancouver teams, including the Grizzlies. Expansion teams noted the potential for sportswear as chic, using color charts and focus groups to design logos and uniforms—hockey’s San Jose Sharks, basketball’s Charlotte Hornets and baseball’s Florida Marlins all turned out in variations of trendy teal. Now, Canadian clubs are following suit: Toronto and Vancouver youths have been snapping up merchandise for basketball teams that have not signed a single player.

The Raptors held a contest to help name their team, extracting maximum publicity; the Grizzlies sought inspiration from local native art. In designing their logos, both teams consulted the creative gurus at the NBA, whose licensed products—everything from key chains to T-shirts and designer leather jackets—raked in $3.8 billion in 150 countries last season (including about $100 million in Canada). That compared with $3.9 billion worth of pro baseball paraphernalia and $1.4 billion of NHL products.

The NBA has also been adept at selling tickets and generating TV revenues—trading on a handful of salable stars to promote the league. The player-less Canadian franchises are now using the likes of Orlando’s Shaquille O’Neal and Phoenix’s Charles Barkley in brochures and in upcoming TV ads. ‘Those names are widely recognized, and not just by sports fans,” says Grizzlies marketing director John Rocha. “They’re part of pop culture.” The Grizzlies are relying on their jazzy logo, as well. “It’s a powerful trademark which creates an identity,” says Rocha. In that way, he adds, “it’s no different than a consumer products company that has to create a brand identity for its product, whether it’s toothpaste or soap.” That may not be the stuff of sporting legend. But it’s good fashion—and business—sense.

The live eye

When The Sports Network went on the air in September, 1984, its news anchors wore dark blazers, white shirts and discreet ties— and were discouraged from adding editorial comment to their reporting. Those edicts have softened somewhat—anchors do not all wear the same outfits anymore—but the conservatism remains. “We get accused of taking ourselves pretty seriously at times,” says Gordon Craig, founder of Toronto-based TSN and now president and CEO of its parent company, Labatt Communications, Inc. “But we are invited into everybody’s living room, so we want to be presentable, and not look like clowns.”

They look like anything but. Sports divisions, once derided as the “toy departments” of TV organizations, now have credibility where it counts—in ratings and on the bottom line. U.S. networks pay billions for broadcast rights to football, basketball and baseball. The National Hockey League, a

comparative poor cousin, last week sold its U.S. network and cable TV rights for nearly $300 million over the next five years. Hockey Night in Canada is the single biggest revenue-producer for CBC. Why? Because sports programming delivers huge audiences. Millions tune in to football’s Grey Cup and hockey’s Stanley Cup final. The Toronto Blue Jays’ World Series victories in 1992 and 1993 produced near-record Canadian ratings. And TSN has cashed in on that enthusiasm: in 1993, it earned $38.2 million from overall revenues of $119.4 million—triple the profit and four times the revenue generated in 1988.

Not everyone took Craig seriously when he made the network’s first application for a

licence a decade ago. CRTC commissioners laughed out loud when told the network would televise everything from big-league sports to tractor pulls and darts. But Craig, who in a distinguished career at the CBC had produced such events as the 1972 CanadaSoviet Union hockey series and the 1976 Summer Olympics from Montreal, was confident that an allsports station would take hold. “I always believed that sport was a cornerstone of our culture,” he says. “There’s absolutely nothing that brings this country together, that gets over language barriers, religious barriers, geographic barriers—whatever—better than something like that ’72 hockey series or the Olympics. Those are the events that the country talks about around the water cooler the next day.” In fact, TV is sport’s perfect partner: coverage has increased, rather than sated, fans’ appetites for live action. In 1993, for instance, 150 of the Blue Jays’ 162 regular-season games were shown on television in Canada, yet more than four million fans pushed through the SkyDome turnstiles to watch the games live. “A lot of that comes from TV, because people can follow their teams even when they are on the road,” says Jays president Paul Beeston. “The more games we can get on TV, the better it is for us.” Fuelling that phenomenon is a growing number of female enthusiasts. Craig says that women now comprise more than 40 per cent of TSN’s viewers, as opposed to less than 25 per cent when the network started.

The loss of 35 regular-season Jays and Expos games hurt TSN, although spokesmen would not say how much it cost them. And the network will have to scramble if the hockey season is stalled by a lockout. But more worrisome than program juggling is whether fans’ ardor will survive the labor strife in pro sports. “I don’t think fans will ever turn their backs on NHL hockey or not pay what the Leafs or Canadiens charge for a ticket to a game,” says Craig. “But maybe there will be fewer of them, in time.” Maybe—but TV is the ideal medium to lure back even the most disillusioned fans.

The Hulls of hockey

So what happened to the goodwill between the owners of baseball and hockey teams and their millionaire laborers? Hockey’s famous father-and-son Hulls, Bobby and Brett, offer opinions that suggest one answer: nothing happened, because there was not all that much goodwill to begin with and ever-increasing payrolls simply exposed the turmoil of a long and often sour marriage. “The owners were mainly concerned about stuffing their pockets with money and making it off us,” recalls Bobby Hull, now 55 and living near Belleville, Ont. “They were a tight-knit group, but likely not as back-stabbing as they are now.”

The elder Hull, holder of numerous records and Hall of Fame inventor of the 120 mile-perhour slapshot, spent 23 years in the National Hockey League and the now-dead World Hockey Association (WHA). Son Brett, the 30year-old right-winger of the St. Louis Blues and the league’s most valuable player in 1991, is rapidly acquiring his own opinions about the NHL and how the owners spend their money.

Two things, said Hull, show the league’s “complete and utter lack of respect for the players.” The first is the rumored demand that the NHL Players’ Association accept a rookie salary cap. The second is the fact that unsigned players have to pay their own way to camp. “The words I keep hearing are ‘salary cap’ and ‘rookie salary cap,’ ” he said. “If the players agree to either, they’re out of their minds.” As for the youngsters, said Hull, “you want me to pay my own expenses, I can handle that. But kids just out of high school or college, how are they supposed to handle that?”

Hull is a St. Louis celebrity. But he and club officials recently began sniping at each other, and there are persistent rumors that he will be traded. If he makes an acrimonious departure from the Blues, it will be a familiar scenario. His father made no friends among NHL owners when, in June, 1972, he jumped from the Chicago Blackhawks to the Winnipeg Jets of the fledgling WHA—a move that forced NHL owners to begin boosting player salaries dramatically.

It was a bitter divorce. The Blackhawks, says the elder Hull, “didn’t even offer me a contract after 15 years of playing for them. I wanted to finish my career in Chicago. They’d have the public believe that I was holding them up for a million dollars but that’s bullshit. I told the WHA I wanted a million dollars just to get rid of them.” Instead, the league and the team came up with $2.75 million and Hull waged war on ice for another eight years.

And now? “It’s not a game any more, it’s big business,” Hull senior said. “All the kids talk about is how much money they’re making

and how much more they want than somebody else, instead of how well they’re entertaining the 20,000 people in the building.” Even the fans have changed. “In Toronto,” Hull reflected, “they used to be very subdued. After I was out for awhile, I went to Maple Leaf Gardens and here were a bunch of people in jeans and leather jackets hollering for Wendel Clark to punch somebody.” In the high-stakes arena of professional sports, both players and owners have now dropped the gloves.

MARY NEMETH

JAMES DEACON

RAE CORELLI