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FEATURE | |
Back to Facility Manager
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“While the phrase “minor league” conjures visions of farm teams slugging it out on the baseball diamond – cold beer in fans’ hands juxtaposing players’ dreams of being “called up” to the majors – grand slams are being hit across the country as facilities take advantage of the dollars flowing in from a growing appetite for minor league sports. For urban and rural communities alike, stadiums are scoring fans -- and their disposable income – by offering residents hockey, lacrosse, soccer and basketball, among other sports. Adding arena football, women’s basketball and motor sports to the mix quickly highlights the variety of programming opportunities arenas can tap into on their journey to the end zone…err, black zone of profitability. Annually, more than 77 million people in the United States, Canada and Mexico attend at least one minor league sporting event. In fact, minor league sports are the fastest-growing sector of the sports business, according to online magazine Minor League News. Senior Editor Brian Ross attributes interest in the minors to the development of what he dubs the “casual fan,” someone who attends less than a dozen games annually. “The minors attract fans disaffected from major league sports’ high cost to attend and the overly cautious brand of play that high-dollar athletes engage in these days,” he says. “Plus, they’ve improved parking, food choices and the number of bathrooms. There also are kid zones with places for the little ones to play.” According to Minor League Baseball, 38.6 million fans attended a game in 2002. Arena football has seen a similar level of success with attendance up 15 percent last year. If that doesn’t make an accountant excited, consider this: about five years ago, such a franchise could be purchased for approximately $400,000. Today, the price tag exceeds $12 million. The growing interest isn’t surprising to sports marketing consultant David M. Carter, principal of The SportsBusiness Group in Redondo Beach, CA. “What you’re seeing is a combination of the minor leagues doing things right and the major leagues doing things poorly,” he says. “The minor leagues have provided the right kinds of facilities and the right types of experiences. Meanwhile, the professional leagues have turned off fans and left many wanting. Their fans are tired of being priced out of the market and sick of suffering from poor customer service. Those are the exact areas in which the minor league thrives.”
Community Support For Minor League Sports
“In many cities, like Omaha and nearby Des Moines, the facilities for the minor league teams were initially built during the ‘50s,” says Dixon, who oversees the $291 million Qwest Center, which opened in 2003. “This prevented us from generating the level of revenue and interest we’re seeing today.” Spanning more than 422 acres and offering more than 1.1 million square feet of available space, Qwest Center encompasses both a convention center and a 17,000-seat arena. It also is home to the men’s collegiate basketball team of Creighton and the University of Nebraska at Omaha’s Mavericks hockey team. Plus, work is currently underway to secure a minor league tenant for the Omaha Civic Center, Dixon says, with potential contenders including soccer, hockey and basketball teams.
Revenue Sources By its very nature, however, continued success in minor league sports can be difficult to achieve since those players often are recruited to play at the highest level, especially in baseball. But win or lose, according to Carter, the facility can profit simply from having a minor league team. Dixon concurs. “Success is not just about the sporting team playing in your facility,” he says. “It’s about having fun and eating good, affordable food. It’s about good entertainment. What it comes down to is really focusing on the environment that you’re providing.” Another significant source of cash flow can be selling the right to name the local sports facility to a sponsor interested in targeting potential attendees. “Naming rights are very important to the bottom line,” says Kling, where they are actually in the process of negotiating for a new sponsor since the contract with Bank of America has expired. “But having said that, it is easier said than done. It involves finding the right match with the right company that can send the correct message.” The right to name Qwest Center in Nebraska, which opened last year, didn’t come cheap at a price tag of $14 million. In this case, however, the money didn’t go to the bottom line. Instead, the funds were rebated back to the city in exchange for its contributions to help fund the new facility, Dixon says. These facilities aren’t alone. Consider the 12,000-seat SBC Bricktown Ballpark in Oklahoma City, which hosts AAA baseball, and the 250,000-square-foot Budweiser Events Center in Larimer County Colorado, where the Colorado Eagles hockey team and the Colorado Chill, a women’s basketball team, both play. In Las Vegas, by contrast, the Orleans Arena actually decided to forego selling the naming rights and instead chose to reinforce its own brand, says Steve Stallworth, vice president and general manager of the home to the Wranglers hockey team. The facility, which is owned by Coast Casinos, has been open less than one year. “Early on, we were pitching around the idea of selling the rights to name our facility,” Stallworth says. “But we had second thoughts and ultimately decided for our hotel and casino to have our name only.”
Success In The Off-Season Throughout the country, a variety of approaches are being used to achieve this interest, both on and off the field. At its very core, this requires developing a strategy based on fundamental marketing. “It is important to fully understand your market, which means knowing who you are and what you can go after,” says Kling. “That also means knowing where you can’t compete. “In our case, we were designed to be a sports facility. So we have recently renewed our focus on sporting events, and aren’t as focused on bringing in concerts, especially since we are already over-saturated with concert facilities in our area. We are now focusing on what we can do best in our facility by taking into account our location and our capabilities.”
Reinforcing the value proposition also can work. “Increasingly, we’re seeing hockey become a family sport in our market,” Kling says. “It’s wonderfully fun to watch, plus it’s affordable. That’s important when you’re talking about taking the whole family.” In Omaha, one way they try and avoid sticker shock is to make the prices of costly events known as far ahead of time as possible, says Dixon.
Get Funky “We’re going after everything we think makes sense, but we’re also doing some unique things that are a bit out of the ordinary,” says Stallworth in Las Vegas, where his facility offers more than 8,000 free parking spots and $2 hot dogs. “We like to go after the events that are really off the radar screen of the ‘big guys’ in our market and can fit into a facility of our size.” One event that clearly falls in that category is a “Pimps and Ho’s” party that drew 8,000 attendees last year. He says the party will definitely be repeated this year. Other unique offerings to prevent a dark house include 10K runs, auto shows in the parking lot and a local “taste” festival featuring area restaurants and live music. Some have added equestrian events, high school graduations and touring rodeos to the lineup. “The goal is to turn the lights on in an inexpensive fashion without demeaning the facility,” says Carter. “This allows you to pick up ancillary, event-related revenue.” In Providence, Schadone looks beyond the traditional advertising vehicles to ensure events are heavily attended. “We take each event and say, ‘What is the best way to get the community involved in this event and get them excited?’” she says. Such grassroots efforts have included working with the local recreation department and participating in the local school district to drive awareness of upcoming events.
Carter takes it a step further and encourages facilities focused on the minor leagues to appreciate the niche and the lucrative nature of the business. “The key for the minor leagues is to not lose focus and to remember their place in the sports landscape,” he says. “Remember what the patrons want and don’t start believing that you’re associated with the bigger league – it can get you into trouble and you’ll lose your focus. This is a great place to be, where the minor leagues are. The key is to remember this and enjoy it. Don’t spend time trying to trade up.” Rani Cher Monson is a Dallas freelance writer. |
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© 2002-2004 International Association of Assembly Managers 635 Fritz Dr. Coppell, TX 75019 USA Phone: 972/906-7441 Fax: 972/906-7418 |
“The secondary and tertiary markets are now seeing the benefits of the building boom of the early- and mid-‘90s,” Dixon says about the replacement of aged sports stadiums with state-of-the art facilities, which came equipped with revenue-generating luxury suites and the ability to capitalize on lucrative naming rights deals.
Cheryl Schadone, marketing director for the Dunkin Donuts Center in Providence, RI, says knowing your audience and market is the key to succeeding year-around. “We have a strong, family-oriented market,” says Schadone of the draw to the downtown facility, which attracts more than one million visitors annually to its 14,500-seat venue, which is home to the Providence Bruins hockey team. Typical family events include Disney on Ice and the circus. “We continue to see an increase in the number of families attending events, particularly for hockey.”
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