The National Hockey League drew record crowds, more television viewers and new sponsors this season by borrowing strategies from the National Football League. Now it needs TV networks to take notice and ante up.
The NHL cut $400 million in labor costs following a season- long lockout four years ago and changed its rules to increase scoring and heighten visibility of players like Washington’s Alex Ovechkin and Pittsburgh’s Sidney Crosby. The Stanley Cup Final begins tomorrow between Crosby’s Penguins and the Detroit Red Wings.
The league’s focus is on attracting sponsors that will ultimately lead to more television money. The league is banking on digital media and special events like its outdoor Winter Classic, played this year at Chicago’s Wrigley Field, and season openers in Europe to excite its fan base and help sponsors reach a bigger audience, said Chief Operating Officer John Collins.
“If we grow our share of the sports advertising marketplace, I think somebody will step up,” Collins said during an interview in New York. “We can be the first domestic league that looks at a global rights offering.”
The NHL projects revenue will grow 4 percent this year to $2.7 billion, with about $675 million coming from national and local television. The NFL received about $3.7 billion in national television revenue this year.
The NHL has national TV agreements in the U.S. with Comcast Inc.’s Versus cable network and General Electric Co.’s NBC, whose agreement includes rights to five games of the best-of- seven Stanley Cup Final.
Digital Draw
The league is right to focus on building its television audience by targeting its young fans with digital offerings, said Neal Pilson, former head of CBS Sports and now a New York- based broadcast consultant.
“By 2013 the digital, Web and mobile audience will be sufficiently larger so the NHL will be able to combine those users with their TV audience to attract sponsorships that will support a major TV deal,” Pilson said in an e-mail.
Collins, 47, spent 15 seasons at the NFL and helped plan the inaugural “NFL Kickoff” celebration in New York’s Times Square in 2002.
It was a hit for sponsors, prompting the league to focus its marketing on big events. In 14 months, the NFL doubled its sponsorship revenue to $1.9 billion, Collins said.
“I see so many similarities to the NFL,” he said. “They know how to lift their passion for a game to a level that is bigger than just their local team.”
Winter Classic
The biggest of the NHL’s showcases is the Winter Classic on New Year’s Day that’s played outdoors and harkens to the roots of the sport when players skated on backyard ponds. It was watched by 2.8 million U.S. households this year, up from 2.5 million in 2008.
The NHL “Face-Off” is a Thursday-through-Saturday schedule of games in North America, Stockholm and Helsinki that will be shown on Versus and CBC next season.
“We like to do things around tent poles, or big events,” said John Lewicki, senior director of alliance marketing for McDonald’s Corp. “This is how we started getting involved with the NHL.”
Collins said the league needs to use digital technology to market the NHL to fans, rather than have its following based on individual teams.
Game Highlights
The NHL now shows game highlights in arenas around the league and is showcasing players with features on the NHL Network and NHL.com.
The league says half its fans root for teams outside their market. To engage them, the league is tailoring information to individuals via cable television, mobile phones and the Internet.
Commissioner Gary Bettman said high-speed Internet will help the NHL overcome what he says is a lack of media coverage. The fan base is large enough to help the league reach its targets, Bettman said. Hockey’s regular-season attendance of 21.48 million almost matched the National Basketball Association’s 21.55 million.
The NHL is smart to pursue the digital strategy, said Robert Tilliss, a sports banker at Inner Circle Sports LLC in New York. The challenge will be getting enough fans to care about league-wide events to get a bigger TV contract.
“Hockey has a mostly local fan base,” Tilliss said. “Whether they can get those fans to become more avid and change the way they follow the game, we’ll have to see.”
Advertisers
Growth in these new digital offerings may already be attracting advertisers.
The NHL brought in Bridgestone Corp., which bought the naming rights to the Winter Classic, because research showed hockey fans to be affluent and tech-savvy, said Phil Pacsi, vice president of consumer marketing for the company’s Americas Tire Operations.
“The NHL is a value buy” Pacsi said from his office in Nashville, Tennessee. “We don’t see the same rating as we do on traditional NFL games, but we are seeing increases in ratings year over year.”
This is good news for the NHL, Pilson said. The more viewers it lures to Internet and television, the more sponsors will follow and the networks won’t be far behind.
“So long as a sports rights holder can sell an attractive audience, the agencies will buy that sport for their clients,” Pilson said.
(Source: Bloomberg)
