NHL Not Extracting Full Value from Winter Classic Concept

Yesterday the NHL officially confirmed Fenway Park would host next year’s Winter Classic between the Bruins and Flyers. It’s another great choice – historic venue, great hockey town, two traditional teams with tremendous followings – all the makings for another successful event in attendance, ratings, and publicity. The game has become big enough and has enough potential that I feel the NHL should leverage it more, particularly in two areas.

Earlier this spring rumors swirled about a second Winter Classic, hosted in a Canadian city. NBC’s concern over the ratings impact and the NHL’s concern over dilution eventually quashed the idea, however the league is missing an important opportunity. College football used to own New Year’s Day. With the new BCS system they have let the pedal off the gas, cutting back on quantity of bowls played January 1st and putting what is essentially a meaningless game, often a poor matchup, as the sole primetime game. Hockey should carry the momentum and publicity of the Winter Classic concept to become a major player to own New Years Day sports. Keep the early afternoon time slot played in a historic stadium between two traditional teams (no Tampa Bay or Florida – EVER), and then throw in a night cap, under the lights from Canada between two Canadian teams. Remember, a bigger percentage of NHL revenue comes from Canada relative to overall revenue when compared to any other major US sports league. How big a TV rating would a Toronto-Montreal outdoor night game do, or at somewhere like Skydome? Needless to say, the teams would sell as many tickets as they could print.

The NHL also fails by letting NBC control the situation. NBC does so little for the league its absurd. Maintaining a broadcast network presence is a perceived requirement for legitimacy, but the NHL needs to get over that hump and realize broadcast television has little, if any, advantage over big cable networks and a fraction of the power it used to wield. NBC only shares ad revenue with the league, no rights fee. They fail to market the sport well, they dictate the schedule, they treat the sport like a daytime soap opera that desperately needs the network and is grateful for any speck of attention it receives.

Hockey is better than that. Forget NBC, find a way to play a second Winter Classic, assuming the TV rights, attendance, and sponsorship can offset additional costs and generate some revenue. Any positive revenue will be worth the enormous marketing boost. In addition, the NHL should strip the Winter Classic away from the NBC package, and either sell the two games as a New Years Day TV package, include them on a cable deal that has a rights fee where these games could increase that fee, or sell the games individually in each market. These games have some value in the open market, at least enough to warrant a deal better than the ad-share on NBC, and they warrant bigger build-up.

The NHL has an opportunity to become the story on New Years Day, they have some big stars (Crosby, Ovechkin, now possibly Tavares) in big cities to highlight, and great stadiums to play in. They should make it a platform to launch the season into full gear, try to maintain the hype during the All-Star game and hope it can catapult ticket sales and boost TV during the playoff run. At the least, the league can generate more revenue and more positive buzz by further developing the event and for once dictating the terms to NBC, not the other way around.

Tiger Sets Model for Recovering Golf’s Image

Everything in golf comes easier when Tiger Woods is involved – sponsorships, TV ratings, attendance, media coverage, energy, excitement, everything. So it’s no surprise that the tournament Tiger hosts, last week’s AT&T National, and Tiger eventually won on the final few holes, scored tremendous ratings and record attendance. But how they drew the attendance opens the door to how golf should think.

Tiger let kids under 12 and military officers in FREE. It may not directly effect TV ratings, but it certainly helps draw attendance. The overall effect may return positive net revenue. Families on the fence about attending because its an expensive proposition for a family of four, suddenly looks at it as a value entertainment option. Instead of not attending the family comes, the adults pay, and the tournament yields concessions and merchandise revenue from the children. Though tough to quantify, golf as a sport, and the local tournament specifically, penetrates the younger generation, earning new fans, and a lifetime of revenue potential.

In the bigger picture, golf and golfers rely on sponsorships more than other major sports, since it makes the tournaments possible and subsidizes many players. The recession has exasperated sports sponsorships. Commissioner Finchem argued that golf’s charity work is not highlighted, and too much focus placed on sponsorships and spending. Well, I say do something about it instead of complaining and pointing at the media. The sport controls perception to an extent. If they feel community work deserves more attention, emphasize it, talk about it, make sure it’s done publicly. While not exactly charity work, allowing youths and military free entrance qualifies as goodwill.

Indirectly, as positive public perception grows, fans are drawn to the sport. Plus, welcoming the youth demo and executing on the entertainment portion, creates a new segment of interest. The result – better, and somewhat Tiger-proof, TV ratings.

Golf is the rare sport where seating capacity does not limit attendance, so outside of the major tournaments courses should be able to support a few extra people. It’s an easy way to leverage unused capacity to generate additional revenue for the tournament, create positive PR and a fan friendly brand image for the sport, and yield long-term benefits for the sport. Contrary to Jim Brown’s comments, Tiger does take public stands. Not everything needs to be political or racial to have an impact.

Inherent Flaws in Sports Nielsen Ratings

Not exactly a shocking headline, but with the playoffs bringing TV ratings to the forefront it’s relevant. Every news outlet that reports TV ratings for sports events documents both the rating and number of viewers, usually adding the annual change in each number.

Maybe it’s a pet peeve of mine, or I’m making too big a deal of it, however the annual change in the number of viewers is a biased statistic that often masks poor ratings. The Nielsen rating is based on the percent of TV households that are tuned in, a relative measure, while the number of viewers is an absolute measure.

While the viewership number includes households with more than one viewer, the number of Nielsen TV households has grown slightly year over year, which will inherently boost the viewership number. I’m admittedly making a few assumptions here, as I’m not intimately familiar with the intricacies of the Nielsen process. Looking at the year over year ratings and viewership numbers, the only explanations are: more TV households, a change in viewership patterns, and/or change in Nielsen’s viewership calculation.

In any of the above cases, the total viewer number is not a good year over year indicator because it ignores the relative changes in the system. A better metric is share – the percent of TV households watching TV at the time that are viewing a program. Though programming faces different competition each year, its a better indicator of what the population is watching.

With all the inherent flaws of the Nielsen sampling process that the media industry has come to accept – for the time being, at least – harping on this point may not be worth it. But when ratings are decreasing and every story at there makes a point to mention that viewership is flat or viewership is up, the stat must be taken with a grain of salt. The lesson – some sports are struggling on TV more than they lead on.

NBA Cable TV Ratings Proves Point

Games 4 and 5 of both NBA Conference Championship series exceeded 9 million viewers and would have ranked in the Top 10 for the week on broadcast. Game Six for each series, played on the two weakest nights for television ratings – Friday and Saturday – posted solid viewership over 8 million, better than the comparables on broadcast for those nights

It’s a tribute to the NBA, it’s marketing clout, and the star power it rolled out for these two series. The ratings are the latest indicator that line between broadcast and major cable networks is blurry, if non-existent. Sports cable ratings continue to climb, while overall primetime broadcast numbers decline, and sports broadcast ratings continue to drift. The argument that big events must be on broadcast is over. We can still argue Versus against broadcast, at least until they improve channel location and distribution, but the major cable networks are essentially on par with broadcast networks.

That said the NHL announcing a contract extension with NBC is questionable. The Peacock treats hockey like a step-child, shifting the schedule around for horse racing and late night television, skimping on marketing, and not adding any substantial revenue. Take the show to all cable. Add a second network to complement Versus, be it ESPN or a Turner network. The NBC deal is not hard to match. Both cable enterprises bring more much-needed creative, aggressive marketing to the table, and much stronger digital presences than NBC Sports, which would complement the NHL’s progress with digital.

MLB followed the NBA and NHL by putting its LCS on cable last season – and successfully with strong ratings for the Boston-Tampa Bay series. It’s doubtful the NFL will follow suit anytime soon, but football is a different animal. However, suddenly its not impossible to envision a World Series or NBA Finals on cable in the next decade. The networks prove they can bring the ratings, the leagues should listen when they bring more money to the table than the broadcast partners.

More so than ever its about the product and effective marketing, distribution is no longer a differentiator holding back cable.

Life After Phelps For NBC

Many times the best marketing job and the best promotions can only take television ratings so far. Networks need something special to make the leap to the next level. Enter Michael Phelps. He single-handedly made NBC Must Watch TV for the first time in a decade, boosting Olympic ratings to record setting nights for a non-US based Olympics.

Phelps captivated the nation for a week in his pursuit of a record 8 gold medals in Bejing. NBC played their cards perfect, all the starts were broadcast live on East Coast, and Phelps kept winning and smiling for the camera. Saturday everything climax, Phelps set the record, NBC had its highest Saturday night viewership since Empty Nest in 1990. Empty Nest, sure to bring back memories.

Week two, no Phelps, some gymnastics – will viewers continue to tune in? Americans love the story, Phelps was the story, but it’s over. Expect ratings to plummet back to reality with swimming over and gymnastics winding down, as the public shifts focus back to everyday life with any extraordinary story to follow in Bejing.

2008 is the first digital Olympics. NBC’s broadband offering has received more hits than all recent Olympics combined. Impressive, though not overly impressive given the current landscape of streaming video compared to four years ago. Timing kills NBC in this area. Friday night, I missed the Phelps race by about 5 minutes, so I immediately go to NBCOlympics.com, only to find the result and a news article. Anyone can get that from ESPN or CBS, I want the race. It took at least an hour, if not longer to post the entire race, barely over a minute of video. That bothered me. It defeats the whole purpose of streaming video. The three i’s – instant, information, interaction. NBC fails in these three area, compared to what they could offer.

Instantaneous – well, NBC executives who played the Opening Ceremony on 12 hour delay for the same fans who could see it goingo n live in the background of the Today show, have no concept of instantaneous. In 2008, people want information when they want it, not when NBC wents to divulge it. People don’t necessarily need to know the second an event happens, they just want to see and learn things at their own convenience. It may take a few more head bangs against the pavement for TV executives to learn – live streaming does not cannibalize audience, it builds audience. Witholding events from the broadband site to prevent cannibalizing TV ratings is counterproductive.

To compund matters, not everything shown live in the East is live in the West, actually most is just shown on the three hour time delay. That’s fine, just don’t label it live when it’s not. And, when the big events come on, events NBC knows capture the biggest audience, put them on live no matter what time it is on either coast. Today’s technology has taken down the barriers of information flow, don’t try to block that information because it will only hurt the audience if they have to work hard to find out what they want when they want it.

NBC needs to change its mindset for Olympic coverage. The old saying goes, audiences turn over approximately every 15 minutes, so what’s wrong with showing an event live, then replaying it during primetime hours. Maybe more total viewers. Anything wrong with that. NBC shoudl take a more user oriented view of the situation – a 2008 viewer, not a 1996 viewer, and reconsider witholding events from broadband and relying on tape delay.

Perfect Storm Damages PGA Tour

When Tiger Woods announced he was done for the season after an historic US Open performance, all eyes were on golf to see if any eyes would watch without Tiger. Greg Norman helped boost generate some interest at the British Open, yet SUnday ratings still tumbled 15% without Woods.

Back in the States, the final major of 2008, the PGA Championship, already fourth of four in terms of noterity and history was already facing an uphill battle without Woods. How about this for timing: the Opening Ceremonies for the Olympics falls right smack in the middle of the tournament, Brett Favre gets traded on the eve of the opening round, and bad weather prevents the leaders from even teeing off in the third round. Bad things come in threes, well that’s three knockout punches for the weakest golf major.

Golf needs to generate interest outside of Tiger, something they have failed to do this decade, however this weekend there is impossible to guard against. The Summer Olympics is once every four years, and is not always the same weeks of the summer, never mind an Olympics with as much anticipation as Bejing has generated, mostly for non-sports reasons. Plus, the Favre story took over the headlines and reached a peak at the wrong time for golf. They could not have prepared for this perfect storm – except to have people care about the players in contention, and without Tiger there, few do.

Now’s The Time for NFL Network

Quick game of word association, first network that comes to mind when I say NFL Draft? ESPN. First person? Mel Kiper, Jr.  Second?  Mel’s hairstylist. Alright, point taken. ESPN has owned the market on NFL draft coverage, building it from an intimate gathering of football faithful into a full-scale event that overshadows the NBA and NHL playoffs. Over time, ESPN built a strong, devoted community among football fans – arguably the biggest, most dedicated fan base of any American sport. As the go to place for draft coverage, ESPN continued to expand the event, monetizing it more and more each year.

This is the problem for the NFL Network. To become a viable option, the network needs to won the draft. They need to be the go to place for all things draft, drive the ratings, have the exclusive interviews. This year, they stepped up their coverage, both leading in and during the draft, receiving more praise from media critics than ESPN – or less criticism, essentially a compliment by critics. ESPN ratings fell slightly to a 3.4 HH. Various possibilities exist, notably the new 3 PM start time, or possibly the NFL Network is starting to cannibalize ESPN’s loyal following. Adam Schefter was widely praised by fans and critics for his analyst work, preferred over the Todd McShay-Kiper Jr. debates on ESPN.

Owning the draft is one step, next the NFL needs to make a commitment on broadcasting games. Last year’s 8-game package, with some Thursdays and some Saturdays, was non-committal. The one carrot they owned, the Giants-Patriots game, NFL suits gave away to please fans. If the NFL Network wants to be in the business of game coverage – and its in their best interests – the network needs a consistent, enticing schedule. At last week’s network up front, the network announced the 2008 8-game package will start three weeks earlier and include 7 Thursday games and one Saturday. They intend to own Thursday nights, make NFL Network the exclusive destination for all football fans on Thursday’s. Smart move.

NFL Media holds another asset, Inside the NFL, the highly-acclaimed weekly show that HBO declined to renew. The show already has a loyal following within the pay TV community, NFL Network can drag more eyeballs in by broadcasting the show, while strengthening its portfolio.

If the NFL Network intends to become a serious player it needs to develop a strong brand, and a loyal following.  By building the network as the place for Thursday night football, the home of Inside the NFL, and eventually the destination for NFL draft coverage, then developing a robust marketing campaign to strengthen the network’s association with those concepts, the viewers will come in droves. With that momentum, pressure will continue to mount on MSO’s, and NFL network will position itself to gain carriage. The network took a small win in Illinois court when a recent ruling forced Comcast to go to arbitration with the network. Some fans may initially reject the network for controlling content many people can’t view, but the fans will pressure the cable providers – case in point, the YES Network and SNY in New York a few years ago.

NFL suits hold another trump card – digital rights. If MSO’s continue to hold out on moving NFL Network to the digital basic tier, the network can decide to stream games over the Internet, a la March Madness or MLB.tv. To eradicate the fans who pay extra for the network, charge a subscription, or per game charge to watch, as opposed to ad-supported streams.  Follow suit with other programs. Controlling the digital rights gives the league more avenues to grab viewers attention through mobile and digital initiatives. Opportunities to grab more viewers, build the network.

NFL Network must decide if it plan to be a serious player. If so, now is the time to make its move.