This seems like a good thread to present an excellent book I just finished reading... 'Marketing Outrageously' by Jon Spoelstra... In Chapter 5 (starting on page 73 and ending on page 84 it presents a little story called 'Emergency in Edmonton'...
I wish that I could type out the whole thing for you guys, but I don't think the mods would like it...
To summarize:
- Sports marketing genius Jon Spoelstra got a call from Peter Pocklington of the Edmonton Oilers...
- Peter communicated that he was 'in trouble'... that he didn't want to move the Oilers, but he wasn't sure if they could survive in Edmonton... He wanted Jon to come to Edmonton to see if the Oilers still had a chance...
- The team was in terrible financial shape - since Gretzky left (7 years before), season tickets were down to 5,500 from their peak of 14,000 - etc... But what was surprising is that the first signs of financial trouble was after they one their first Stanley Cup (they won 5 cups in 7 years)... But as soon as they won their first one, they started selling fewer season tickets... THIS was a warning sign - that nobody saw... Everybody in the Oilers brass (including Sather) said that the reason for the decrease in season tickets was 'the fans felt the first Stanley Cup was enough'... After EACH YEAR the Oilers won another Cup, the number of season tickets went down!
- Jon didn't support the Oilers answer for the 'declining season ticket purchases despite their success' dilemma... Jon analyzed the problem (must read in this book for those who find this stuff interesting)...
- Jon's solution was to do two things: (1) for the Oilers to pay him a lot of money to turn the financial ship around; and (2) for Peter NOT to talk to the media for 6 months...
- Jon started with the ticket sales staff - increasing the number of staff members (from 2 to 15); injected enthusiasm by giving the sales staff something popular to sell (even though the current team wasn't good, they developed a ticket plan that was very popular)... Unlike most teams, many of the Oilers' season ticket holders were fans, not corporations... Most of the time, these fans used to share these tickets with other fans... When they couldn't find another 'season ticket partner', they stopped buying season tickets... The fans love hockey, but they can't afford the whole season ticket package... The new season ticket package solved this problem - the new season ticket package found the extra partners they needed to share the cost for season tickets... Now, every hockey fan in Edmonton could afford to go to the games... The ticket staff was overjoyed!; Improved training of the salespeople; Made a lot more sales calls on new leads...
- Season ticket sales went quickly and easily from 5,500 season tickets to 13,000... By increasing this much, the Oilers reached an attractive target - they now qualified for the NHL financial assistance package for Canadian teams (because of the difference in $ values between the Canadian and US dollar)...
So, the Oilers used to market themselves as 'if you win the fans will come'... But that ended up being wrong... The rule is really 'if you win, the fans may or may not come...
Although the Oilers had one of the greatest products in the history of the NHL (the 80's dynasty)... the number of season ticket renewals fell each time they won another cup!
A lot of that had to do with rising ticket prices, but if the Oilers had built and trained a sales staff the way that Jon Spoelstra did, over the years, the Oilers would have kept themselves very financially strong...
A team like the Oilers can adapt and be successful, dispite being a small market team with escalating salaries... It just takes a bit more creativity... I assume that ticket prices are at an all-time high... How about if the Oilers raised the prices for season tickets, but shared them amongst more 'season ticket holder partners' (i.e. 5-game packs that the salespeople could sell)?...
I'm all for changes in the CBA (anything but a hard cap!), but I do think that the Oilers basically put themselves in their financial position... Over the years, the Oilers didn't have the creativity and insight to adapt...