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Wednesday, October 31, 2012

{allcanada} LOSS OF WINTER CLASSIC COULD BE COSTLY FOR NHL

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The Globe and Mail expresses that since this is the NHL's second lockout in seven years, and the loss of the entire season for a second time is now a possibility given the stalled labour negotiations, there is a danger people from both groups - sponsors and fans - will turn away and never come back.

"One of the bigger problems the NHL has with its sponsors is a lot of people remember the last lockout [2004-05] and if they go through another year like that, people won't be as forgiving," said Bob Stellick, the head of Stellick Marketing Communications Inc., a Toronto firm which handles marketing, communications and media relations for major corporations and sports groups.

"If there's another year without hockey, they may ask, 'Why am I a sponsor?'"

When ticket, merchandise and other sales from a potentially-cancelled Winter Classic are added, the league is looking at the loss of at least $15-million. While the host Red Wings get a share of that revenue, most goes into the NHL's hockey-related revenue.

However, David Carter, the executive director of the University of Southern California's Sports Business Institute, agrees with Stellick when it comes to the real damage.

"[Sponsors] are about using the backdrop of sports to sell products – and controversies, to include a sport going dark, drive them crazy," Carter said in an e-mail. "They have other avenues to reach consumers and you can bet they are determining how best to retrench.

The NHL has been trying to become a mainstream sport with the U.S. public for decades, wooing the casual fan with varying degrees of success. The Winter Classic is a hit in the U.S., and practically equal with the Stanley Cup final in the eyes of casual fans (even though technically it is just another regular-season game). Carter thinks the NHL is playing with fire here as well.

"By cancelling the game, both hard-core and casual fans will revisit their interest and future spending on the game," he said. "This, in turn, affects the rest of the industry because the more disenfranchised fans become the longer it will take for the NHL to rebuild its fan bases."

However, a person who was once intimately involved with NHL finances and played a large role in the 2008 Winter Classic in Buffalo thinks the league will be able to soothe its sponsors.

Larry Quinn, the former managing partner and minority owner of the Buffalo Sabres said the NHL spent a lot of time preparing its sponsors for a potential cancellation.

"I'm sure everyone's frustration level is high, but I'm also sure the league made them understand the parameters," Quinn said. "Any sponsor committed to the kind of dollars involved was certainly well aware and probably briefed by the NHL.

"My gut tells me they'll hang on to their sponsors."

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