What’s Next for Coyotes Sponsors?

As the owner of a sports marketing consulting firm, I occasionally need to remind myself to write dispassionately about an industry that evokes a lot of emotions. Like many of you, I see the loss of the Coyotes franchise as a big negative for the fans and for the market in general. Hockey is a great sport with great fans and it’s nothing less than heartbreaking to see it fail in Phoenix. It’s also problematic to see the franchise move to a market that is four times smaller than ours. And finally, it’s interesting to note that few, if any, civic leaders have spoken up to lament the team’s departure. 

Perhaps this is because the ownership group was malfeasant, if not downright incompetent when it came to running the team. That seems to be the consensus for people in the know. As tempting as it might be to spend the next few paragraphs writing about their ownership, I’ll pivot to what it means to the Phoenix sports market to suddenly have this glaring void in our professional sports portfolio.

Phoenix was one of twelve US cities with four professional sports teams playing in their metropolitan area. That distinction alone is nice but it’s way more relevant to the businesses, municipalities, rights holders, sponsors, and fans that benefited from having all four professional leagues represented in our market. 

It’s not rocket science to understand that professional sports teams provide a benefit to restaurants, bars, and retail stores in a given market. Undoubtedly, that loss will be felt by Valley businesses in the years to come. All that commerce generates tax revenue which is beneficial to the municipalities. They’ll have to find other means to replace that revenue (they always do). 

Rights-holders are another story. The Coyotes were carried by the ABC affiliate (Channel 15). This station is owned and operated by E W Scripps which, if you don’t know, is one of the larger media companies in the United States. The station here in Phoenix has a sales staff who sold this product to local and national advertisers. Losing the rights to a professional sports team is a financial blow to the good people at Channel 15 and unfortunately, they won’t be able to simply increase your taxes to make up for that loss of revenue.

What’s most relevant to what we focus on here at Line Drive is the effect the Coyotes’ departure will have on sponsors. At last count, the Coyotes have approximately sixty active sponsors. Some national, some local but all looking to benefit from their relationship with the team. 

These sponsors weathered multiple bad moves by the team, negative press, anemic TV ratings, a micro stadium, and a playoff drought that saw nine (9) appearances in twenty-seven (27) seasons. The team never really found a way to win, on or off the ice but sponsors held tight because of hockey’s three most glaring attributes: it’s a GREAT GAME with LOYAL FANS and PLAYERS who tend to be positive members of the community.

Whereas national sponsors will in all likelihood follow the team to Utah where the team will play in a smaller market but a bigger arena, local sponsors will have to decide if and where they should take their current hockey investment. I am certain that every sports franchise in the market has printed out a hit list of Coyotes sponsors that they plan on pursuing. That’s standard and I truly have no issue with that. 

However, and perhaps more importantly, if I was a Coyotes sponsor I’d be super discerning about what I’ve lost and what I’m going to do to replace it. You can’t simply plug your investment into a different sport and expect the same result. It’s really a good time to take a step back to evaluate your investment options in order to repurpose it with an organization that will generate a greater ROI than your Coyotes investment. 

This might be a good time to consult with a sports marketing consultant (just saying). What you shouldn’t do is rush to reinvest these funds with another team or media entity that won’t provide your brand with the ROI you need. We’re fortunate to still have a wide array of options in our market which actually makes the process more challenging and candidly, more important, for your brand to get it right.

If I was a sponsor seeking a new home for my investment I would take into consideration a number of factors including my primary demographic audience; on-site activations and assets available to engage said demo; offsite activations and assets; hospitality needs; competing brands; the sport’s trajectory; community involvement/engagement by the team; and how the season corresponds to your sales cycle.

It’s truly more complicated than simply picking your second favorite team or the most competent rep who calls on you. Now is the time for you to win in business by making good decisions … something the Coyotes just couldn’t seem to do.

If your business is looking to invest in sports marketing or you want a second opinion on what to do with your Coyotes investment, contact me at ed.olsen@linedrivesportsmarketing.com or call my cell at 602.284.6722