DETROIT (Reuters) - The National Hockey League believes its growth has just begun, with more coming from a bigger push overseas, online and eventually with a new broadcast TV deal, a top executive said.
The North American sports league, with about $2.8 billion in annual revenue, is coming off a year with strong TV ratings and 66 percent growth in advertising and sponsorship revenue.
This season, it is counting on a new HBO miniseries and a bigger presence on NHL.com and other digital platforms to help draw more fans globally, Chief Operating Officer John Collins said in a telephone interview. It’s off to a good start as season-ticket renewals are up 4.2 percent from last year.
“We’re pretty well-positioned,” Collins said. “The NHL fan demo is the cream of the sports demo; it’s men 18 to 34, more affluent, more tech-savvy than fans of other sports. There was really no reason for advertisers to not spend more heavily on the NHL.”
The NHL has worked to turn fans who tend to root on a regional basis, focusing on their own teams, to a more national viewpoint, much like the National Football League has done.
“Nobody ever canceled their Super Bowl party because they don’t like the two teams in the game,” Collins said.
The NHL has revved up marketing on its Winter Classic, the outdoor hockey game played annually on January 1. The 2010 game was played at the Wrigley Field baseball park, and next year will be played in Pittsburgh, when superstar Sidney Crosby and the Penguins host Alexander Ovechkin’s Washington Capitals.
To drive the hype even further, the NHL is again stealing a page from the NFL — with its “Hard Knocks” reality show — by giving viewers on HBO a four-episode behind-the-scenes look at the runup to the 2011 game.
“There’s a concerted effort to be more of a premier entertainment brand, to be more relevant beyond just the existing hockey fan,” Collins said.
The NHL is also working to make the NHL.com website more attractive after its redesign in 2008, and it hopes to have the number of U.S. households with the NHL Network TV channel hit 50 million by season’s end from 38 million now, Collins said. The idea is to give hockey fans content wherever they want at whatever time they want it, he said.
The NHL’s success in the last three years has helped it sign $330 million in new advertising and sponsorship deals with the likes of Anheuser-Busch InBev, Honda Motor Co, Geico and Cisco Systems.
Not everything is going well, however, as Forbes last year estimated almost half the league’s 30 teams lost money during the 2008-2009 season, and the NHL still hopes to sell the Phoenix Coyotes team it bought out of bankruptcy last year.
However, league officials are salivating at the prospect of a new U.S. TV deal after this season, as one team owner told Street & Smith SportsBusiness Journal he expects an increase of at least 50 percent in the rights fees paid.
Comcast’s Versus signed a three-year, $207.5 million deal after the lockout that canceled the 2004-2005 season and extended that deal for another three years. General Electric Co’s NBC also broadcasts games under an ad revenue-sharing deal, but does not pay a rights fee.
Comcast is working on closing its deal to buy control of NBC Universal, and both Versus and NBC have expressed an interest in keeping the sport on their networks. However, Walt Disney Co’s ESPN, which holds the expiring international broadcast rights, is expected to make a strong push as well.
The NHL also believes overseas fans could boost the league’s value, and it is tailoring online and other digital content so fans in Sweden or Russia can watch plays by top league players from those countries. The NHL signed a similar deal with Elisa Corp in Finland this week.
Reporting by Ben Klayman in Detroit, editing by Matthew Lewis