Scott Takes: The NHL is selling out…and that’s not a bad thing
Everyone has a price.
Such is life in a COVID-stricken capitalist country.
Despite just a few years ago vowing that selling ads was nowhere on the NHL’s radar, commissioner Gary Bettman and the league are the latest to bow their head to Big Business in hopes of recouping the severe losses of last season.
Just a few years ago, NHL Commissioner Gary Bettman said he would never do such a thing. He preached, “We take great pride in our sweaters. We think they’re the best in all of sports, and (adding jersey ads) is not something we’re running off to do. We think what we have is special. We talk about history and tradition and how special hockey jerseys are,” Bettman said.
“It would take an unusual circumstance—which I would define as ‘a lot of money that I’m having trouble comprehending right now’—for us to even be thinking about it.”
Turns out, “a lot of money” to Bettman is revenue equal to a reported $15 million dollars for the upcoming 2021 season, and this past year could certainly be classified as “an unusual circumstance.” Also, to be fair, he didn’t sell ads on the jerseys. Instead, he’s defending the sanctity of the sweaters and instead trading a pile of cash for small sticker ads placed on either side of players’ helmets.
The reactions to this news are, well, how one might expect. Some understand advertising is a necessary evil and that this small, relatively-unnoticeable corporate decal will do wonders for at least helping the NHL recoup some losses (and jobs) from the 2020 season. Others have gone scorched-earth and simply just cannot believe the audacity of the league.
How could he?! They’ve sold us all down river! They’ve blasphemed the sanctity of this league. That money-grubber Bettman sold out!! What’s next? Is the NHL going to start advertising like those skating billboards over in the European leagues? How long until the Avs are renamed ‘The King Soopers’ Colorado Avalanche brought to you by the Molson Coors Beverage Company’?!
Hold your horses there, Karl Marx. This isn’t a fight between the proletariat and the bourgeoisie. Sure, the NHL did sell out — and make of that connotation what you will — and that’s OK. That’s kind of the point. Desperate times call for desperate measures, and in the year 2020, we’re all seeing the cobwebs and dust clouds billowing out of our wallets.
Look, it’s not that bad. No, the NHL isn’t going to follow the European model of hockey advertising. Could it get to that point? Maybe. I’m not saying it’s not entirely possible. And perhaps that is what us hockey fans are most afraid of. But given Bettman’s hesitations in the past to sell advertisements on his players, I’d imagine we’re many, many years away from that. At the end of the day, we’re talking about a tiny 2-inch-by-2-inch sticker.
The league is already littered with branding. No one bats an eye at the Adidas logo on the backs of NHL jerseys or the CCM logos that adorn players’ skates and sticks. Or if you’ve attended an Avalanche game at P̶e̶p̶s̶i̶ ̶C̶e̶n̶t̶e̶r̶ Ball Arena in the past, your eyes will meet 150 different logos, brands and sponsorships by the time you finally sit in your seat with your $11 Bud Light tallboy. Advertising is the way of the world, and as someone who works in the marketing and advertising realm, I could tell you all about how much money sponsorship marketing and ad spend can bring in. It really is a requirement of any business if it hopes to survive.
The NHL is still largely a gate-driven sport. In doing some research across the web, an NHL team brings in an average of about $1.7 million per home game. Over 75 percent of that revenue is generated by ticket sales (about $1.3 million). Given the cancellation of about a dozen regular-season games last year, we can do the math on how much the NHL lost there. I’m not even accounting for the fact that prices are usually jacked up in the Stanley Cup playoffs. Some estimations had the NHL losing upwards of a billion dollars(!) had it not been for pulling off the playoff bubble. By playing the postseason, the league was able to at least mitigate some of the losses by keeping their television deal money. Still, major losses were incurred.
All in all, the NHL faced its first decline in 20 years because of COVID-19.
And that brings us back to the helmet ads.
These marketing stickers are primarily designed to make good for naming rights sponsors and other team partners to rake in for that lost exposure last year. Of course, the NHL will get its cut, but this is mostly a make-good deal for just the 2021 season. However, the NHL has said it will explore the option of extending this helmet-ad campaign past the 2021 season, as the league collects data on how lucrative these little stickers can be. I fully expect this to be the tip of the iceberg as the NHL seeks more aggressive ways to rebuild and strengthen its revenue stream.
These sticker sponsorships and their reported $15-million value will barely make a dent in the net losses felt last year and those that will be felt this upcoming season. It could go a long way in the future, however. Perhaps this is just the beginning of what could be a deluge of on-player advertising, and as the seasons go by, players begin to look more and more like NASCARs instead of hockey players. This won’t be happening anytime soon though.
For now, take it for what it is: A (quite literally) small, savvy marketing campaign that will help the league save sponsorships, net-losses and, along with it, jobs. Besides, you’ll hardly notice the branding at all coming through on your TV screen, aside from maybe the occasional closeup. What’s the big deal?
I don’t know about you, but I’ll take a small helmet sticker if it means it won’t cost $300 to sit in the nose-bleed seats at Ball Arena and lower-bowl tickets won’t cost a mortgage payment. Just a thought.