European Hockey Attendance since 2008 & Business

[Albatros]

Hannover Scorpions sold their DEL license, the Indians used to play in the DEL for a couple of seasons in the 1990s but they just got relegated and have maintained a relatively stable existence by hockey standards.

 

[Maverick41]

Why did they not have any promotion/relegation for those seasons?

Thanks for the info as well.

It is a bit more complex than this, but here is part of the reason (as I remember it) in a cliff notes version:
Both the costs (salaries, etc.) and revenue had been growing in the DEL while they (in particular the revenue) stagnated or even decreased in the lower leagues, which lead to a pretty big gap between the DEL and the rest of the leagues.
That meant for teams that were promoted they had little chance to compete and had to overspend to even try. And many teams that were relegated ended up bankrupt, because they were often still saddled with big contracts they could not afford to pay in the lower leagues. Relegation also meant most of the time that sponsor money dried up and attendance shrunk. A bunch of teams went through insolvency.
The league thought it would help to just take out the risk of relegation, and of course most of the bigger teams were all for it.
So, they abolished promotion and relegation, but pretty much nobody was really happy about it, especially not the fans. And almost from day one there was a push to bring promotion and relegation back in some form. Now they are finally getting it done (sort of).

 

[golfortennis]

It is a bit more complex than this, but here is part of the reason (as I remember it) in a cliff notes version:
Both the costs (salaries, etc.) and revenue had been growing in the DEL while they (in particular the revenue) stagnated or even decreased in the lower leagues, which lead to a pretty big gap between the DEL and the rest of the leagues.
That meant for teams that were promoted they had little chance to compete and had to overspend to even try. And many teams that were relegated ended up bankrupt, because they were often still saddled with big contracts they could not afford to pay in the lower leagues. Relegation also meant most of the time that sponsor money dried up and attendance shrunk. A bunch of teams went through insolvency.
The league thought it would help to just take out the risk of relegation, and of course most of the bigger teams were all for it.
So, they abolished promotion and relegation, but pretty much nobody was really happy about it, especially not the fans. And almost from day one there was a push to bring promotion and relegation back in some form. Now they are finally getting it done (sort of).

So having followed AFC Bournemouth who got promoted in 2015 for the first time ever to the English Premier League, and stayed up far longer than anyone expected, I've been hearing a bit about the pro/rel situations. My understanding is that contracts have a relegation clause which automatically reduces players salaries, and that teams receive "parachute payments" over a few years to help soften the blow, because as you describe in the DEL, attendance and sponsorship declines.

Obviously the money in total is in a completely different stratosphere, but is the money gap in the DEL vs the next level a similar proportion? Is there something that prevents a relegation clause in contracts?

I guess the one question I do have about any of the European leagues, are any of them in a situation similar to La Liga in Spain where Barcelona, Real Madrid and one other club(Valencia?) receive a disproportionate amount of television revenues? To the point they almost control the league.

 

[Fjorden]

Are the European hockey teams as influenced by market size, etc, like NHL teams? Or does a city like Berlin have multiple teams and so they really don't have massive revenue discrepancies?

Is European hockey similar to soccer(football) where you can just start a club, and work up through the leagues, or is it more like the NHL where you need to buy an expansion team or an existing team?

Yes you can start a team and get promotoed like in soccer.

But I will give you an example under. In norways soccer league the teams are nicely spread out through the whole country lik in the NHL. In hockey almost all the teams are very strongly centralized around the capital Oslo.

The soccer teams in norway have an ok income, they can have full time proffesional players that earn more money than an average worker. Since the soccer teams are nicely spread out throughout the country like in the NHL it's easier for the teams to get sponsors as the local market will more easily sponsor the local team.

However in hockey in Norway where almost all the teams are gathered in a very small geographical area. The sponsor market and the fan market is very saturated because of that. It's to much competition for sponsors and fans in a small area. I will also say that the tv money in hockey are much less than in soccer, and one reason is that hockey isn't spread out through the whole country like soccer. A team like Stavanger oilers who are alone on the west coast and also have a good arena can raise a sponsor budget about 6 million $, others in the Oslo area about 1 million $ because of too much competions in the sponsor market and in the fan market.

The reason for this centralization in hockey is because other parts of the country dosen't have accesss to decent arenas. Without a decent arena it is impossible to start a financially sustainable club. That is a must have.

However I see only great potential for growth in norwegian hockey if we can build modern venues in other parts of the country as well, we will like in soccer in norway, or like the nhl get access to more tv money, more fans, and more local talent development if we do that. I also added the map of the swedish league where you can see that the team are nicely spread out through the whole country. So in Sweden they have local teams that get access to local sponsors, fans and tv wievers.

So having to many multiple teams in a small area without any spread is not a very good model because it will be to much competiton for fans, tv wievers and sponsors in a small area, the market will saturate. And you'll not have access to large parts of the potential tv market, fan market, sponsor market. People tend to follow their local team.


Soccer (temas nicely spread out throughout the country)

Hockey norway(extremely centralized)

Sweden SHL(Teams Nicely spread out)

 

[Rigafan]

Now that is interesting. Any idea why the license thing is there? Is it basically a money grab?

When we were waiting for a train north from Edinburgh, the fellow working the station told us he was a big hockey fan, and pointed out the arena that was in view of the station. Do the Scottish clubs play in the same league?

@Barclay Donaldson has mentioned about the license arrangement.

Edinburgh Capitals would have been the team the person meant, they used to play at the Murrayfield ice rink (its 'famous' for being so old it still has concrete boards around the rink, so you don't want to be checked to hard into them) but, unfortunately and for a number of reasons the team went bankrupt and no long plays.

Scotland has quite a lot of hockey teams/leagues and a decent set up. In the EIHL they have Glasgow Clan, Dundee Stars and Fife Flyers at present.

 

[Matt UK]

Scotland seems to be rich in hockey tradition but all three of their Elite League teams have low budgets and aren't considered as being a by team. Unfortunately, there is uncertainty around Glasgow Clan's future, as their arena could be shutdown by a third party. They're currently trying to negotiate the operational rights.

 

[vorky]

 

[vorky]

 

[Albatros]

Jokerit with better attendance figures in Mestis without a home arena than what top KHL teams are able to achieve.

 

[vorky]