Coyotes Owners Talk Attendance

Craig Morgan caught up with Anthony LeBlanc and George Gosbee on the final day of 2013. Click here to read his story.

We went through Craig’s interview yesterday, adding words to Craig’s more professional effort. We talked about the business of hockey and how common misconceptions are harped upon by “out clause” proponents and other naysayers. We tried to clarify that the NHL hockey business is more complex than most naysayers are willing to admit and that the NHL as a league is more of a whole than it is a fractured consortium of independent teams.

Because it’s so often discussed and despite the fact that we determined yesterday (click here) tickets are not the primary revenue source for an NHL hockey club, we’ll take a stab at the free tickets and attendance negativity today.

 Coyotes Giving Away 2,000 Tickets Per Game

A rumor is making the rounds that the Coyotes are giving away tons of tickets. Implications have been made that the number of free, and thus not subject to city surcharge, tickets exceeded the 1,750 number agreed upon with the City of Glendale.

Neither LeBlanc nor Gosbee spoke directly to the actual number during their sitdown.

Morgan:

There have been rumors that you are giving away an inordinate amount of complimentary tickets?

LeBlanc:

“Have there been games where we have comped a fair amount of tickets? Absolutely. We went into this expecting comps for some games but we also had the expectation that the comps would average out exactly where we agreed to with the City of Glendale and that is still what we anticipate. I can’t tell you the exact number because that is confidential information, but our average number of comp tickets is substantially below the average being bandied about.”

Gosbee:

“I’m not sure where this giving away huge numbers of tickets rumor has started, but it’s less than in any seasons past. That’s the way things used to be done around here a while ago, but to be honest, there’s no incentive now. You used to have to reach the 14,000 per game benchmark for the league’s revenue sharing, but that’s not the case any more. The league changed that.

“Our owners aren’t even giving away tickets to friends. We instituted this culture where if you want tickets, you can go buy them and then give them away. That’s the culture that we set. We don’t want to do what they did in the past.”

Addressing Rumors

Anthony’s first “absolutely” statement is the one clipped out of the entire story by the trolls for consumption by their faithful donkeys. Yawn.

The “average being bandied about” is 2,000 tickets per game, which is double the amount assumed in the agreement with Glendale.

Mr. LeBlanc states unequivocally the number of comped tickets is substantially fewer than 2,000. His use of the word “average” makes it clear, to me at least, that SOME games have had MORE than 2,000 tickets handed out.

My guess is the packed Canucks game, for one, was bolstered with a lot of freebies. I wouldn’t be surprised if it was more than 2,000.

If you are a between the lines reader, Mr. LeBlanc suggests the Coyotes will measure their 1,000 tickets per game compliance on the average number of comped tickets per game rather than on an individual game basis. The 1,000 ticket number agreed upon with the City of Glendale is detailed on page 18 of the “Professional Management Services And Arena Lease Agreement”. Click here if you’re inclined to read it.

I’ve seen that “okayed freebies” ticket number quoted higher elsewhere on the Interwebs, at 1,750. Unless it was changed since the 7/8/2013 timestamp on this document, it’s wrong, perhaps a leftover from the prior Jamison deal before the terms were renegotiated (for the executed current agreement) to be more favorable to Glendale.

So, unless one is willing to hint that Mr. LeBlanc is a bald faced liar, the Coyotes will NOT be giving away more than 1,000 tickets for “hockey events” unless they compensate Glendale for their losses.

Does that mean the team CAN’T give away more? No, as long as they’re willing to make Glendale whole for the difference.

Mr. Gosbee continues, saying that the number of comped tickets is less than in ANY seasons past.

So, if attendance isn’t the be-all and end-all of NHL hockey team success, why would one give ANY tickets away?

Build The Base

Let’s pretend you’re a marketing professional with a ton of real world experience, like LeBlanc, and your job is building acceptance of your product. Your product is the Coyotes NHL professional hockey team.

Your area has thousands of permanently and temporarily transplanted Canadians who continue to choose NOT to come to NHL games on a regular basis. You have a Canadian team coming to town.

Would you hand out a bunch of tickets to those Canadian people to entice them to sample your product and, hopefully, patronize your arena more often? You’d sure have to give it serious consideration.

The free ticket thing is a slippery slope. While your building would be more full, you risk alienating season ticket holders who paid a lot for their seats and have stuck with a mortally wounded franchise for years.

The other side of that coin is that, to survive, a LOT of new people have to become Coyotes fans. If there’s a market that seems so potentially lucrative and also so untapped (the Canadian people that live here), wouldn’t it be stupid to not try a campaign including freebies to get them coming to see a sport that they have been obsessed with all their lives?

Coyotes And Glendale

Here’s where the ultimate success of the Coyotes and that of their deal with Glendale potentially divide. The basic assumption ascribed to by many is that butts in the seats is the difference between life or death for the Coyotes. It clearly isn’t, at least not in the short term.

Glendale’s revenue from the Coyotes, however, is nearly completely tied to people attending events. It would be more accurate to argue that Glendale is more reliant on Coyotes attendance than the team is.

The Coyotes have significant additional revenue beyond ticket sales that’s unshared with Glendale. The City, for example, isn’t getting a taste of the gigantic Canadian TV contract.

The naming rights (for the entire arena and the internal stage) portion of the management deal is the largest component that isn’t directly tied to a ticket in a hand walking through the door of the arena. Parking is, ticket surcharges are, you get the idea.

That said, there’s no incentive for the Coyotes to do anything other than their level best to make the deal with Glendale work for a long time. Examining the first quarter (and a short “quarter” at that) results vis-a-vis revenue to Glendale is a fool’s errand other than to look at general trends.

When the second half of the hockey season is closer to an end, we’ll all have a better idea what to expect. Some numbers aren’t even due until the close of Glendale’s fiscal year in June. By then, it’s possible the Stanley Cup will be in the house.

WELCOME BACK CAPTAIN SHANE DOAN!