This article is part of Next, The Globe's five-day series examining the people, places, things and ideas that will shape 2013.
There will be pain.
That is the message from top marketing and sponsorship executives who are following the NHL lockout and looking to its conclusion – whether that is a shortened season starting in January, or another full year is wiped out.
Fans are fed up. Sponsors are fed up, too.
And for the first time, the league could feel some significant blowback when it attempts to relaunch from its third prolonged work stoppage in just 18 years.
“Without a doubt,” S&E Sponsorship Group president Brian Cooper said, when asked about the potential for a negative response from NHL fans and sponsors. “It’s inevitable for any brand taken off the shelf. But not only taken off the shelf, one that has some ambiguous cloud of uncertainty around it or negative light shone on it.
“I think the product’s great. I think the NHL’s great and a lot of fans think the way I do, but there’s been an emotional connection and a trust that has been tested. In some cases, people feel betrayed.”
Unlike 7 1/2 years ago, when the NHL relaunched with new rules, new stars, a new financial system and watched as revenues quickly went up, the league has little in its arsenal whenever it returns from this latest stoppage.
The collective agreement will be somewhat different, but other than perhaps slightly more competitive balance, the changes experienced by fans will be minute.
Instead, it’s believed the league will come back meekly, perhaps offering more of an apology than the last time, when the message “Thank you fans” was scrawled on the ice in all 30 buildings.
“Dare I suggest that they feel sorry for what they put their fans through?” said Paul Swangard, managing director of the Warsaw Sports Marketing Center at the University of Oregon. “It’s sort of like a bank account, and instead of money you’ve got goodwill in the bank. If you spend it and don’t rebuild it, you’re eventually going to run out of money.
“There would potentially come a time – maybe not in the Torontos, Montreals and New Yorks – that there won’t always be a core fan base. A little humility at the end of this, setting the right tone with fans, will help show players and owners are at least appreciative of the level of investment they’re giving.”
Whatever damage is done to revenues will likely affect the on-ice product, too. The players’ share looks to dip to 50 per cent from 57 per cent, which will mean a lower cap (likely in the $65-million U.S. range) in the first few years, and significant pain for teams that have committed a lot of payroll to players beyond the 2012-13 season. (The Vancouver Canucks, for example, has committed more than $55-million in 2013-14 to just 13 players.)
That would mean some of the higher-salaried clubs will have to toss bodies overboard – likely for little in return – to the benefit of teams with plenty of cap space.
Then, there’s the implications of a strict term limit on player contracts, which could range anywhere from five to eight years, depending on how negotiations progress. Such a move would wipe out the advantage many high-revenue teams have had in terms of front-loading deals and mean salary cap hits for star players would go up.
It’s also likely the wealthier teams would begin compensating some of their depth players with longer contracts, meaning some teams could potentially have eight to 10 players on five- or six-year deals.
In theory, those shifts in the CBA should give teams on the lower end more of a fighting chance when it comes to signing free agents and retaining their own talent.
Teams such as the Florida Panthers, Carolina Hurricanes and Nashville Predators should be able to compete better, as was the case at the start of the last agreement, when the Hurricanes and Anaheim Ducks won the first two Stanley Cups under a very low salary cap.
As revenues rise, however, the imbalance is likely to again grow, and the wealthier teams will be able to continue to sink more and more money into areas outside of the cap: management, scouting and the minor-league system.
Perhaps, however, that should read “if” revenues rise. That wasn’t really an issue the last time around, with the league growing by an average of more than 7 per cent a season under the last CBA.
Few forecast that kind of explosive growth again, but there’s also optimism the NHL will eventually be able to regain its footing, especially if the end result of this fight is a half-season of games.
The hard-core hockey fans are especially forgiving, the experts say, and despite some thinly veiled threats in recent weeks, they are unlikely to give up for good.
“Until I see a galvanized base of fan revolt, I’m more confident than pessimistic that things will return,” Swangard said. “The NHL has a great product on the ice. They give consumers a decent value for their entertainment value. And there’s a cultural phenomenon there.
“There’s ultimately damage that’s occurring every time this happens. The negative passion that fans apply to these labour situations seems to get angrier and angrier and, yet, it’s that anger that shows what makes the sports world so unique: The level of customer loyalty,” he said.
“You wouldn’t accept this in almost any other line of business. But for your favourite sports team, there’s something intrinsically stronger that binds us to that product that makes us hard to walk away.”
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