MLS Single Table - part 2 of 2

In the second part of my analysis of the financial underpinnings of MLS teams, I look at the top seven teams in MLS. Teams were ranked on a 10-point scale (10=high) in five categories: Ticket Sales, Stadium Situation, Corporate Sponsorship, Designated Player/Coach and Intangibles.

7. New England (26 points). The Revs are cursed and blessed with ownership by the NFL’s Patriots. The soccer team’s finances have always been sufficiently attended to by the image-conscious Kraft family, but never with enough focus to elevate them into the league’s elite. Plus, their poor on-field play in early years compromised great crowds (the Revs led MLS in average attendance in 1997). Recently, the Revs’ four losses in MLS Cup finals have created a hard-to-manage level of expectation amongst their fans. As Yogi Berra might say, “they can’t win until they win.” The NFL overlay has provided some big-name sponsors for the soccer team, but not enough for a jersey sponsor. All in all, it’s hard to believe that the Revs have maximized their corporate potential. The biggest crime is subjecting fans to 60,000 empty seats at Gillette Stadium each game – the Revs have some great fans who deserve a soccer stadium. The one time Gillette was full for an MLS game (’01 MLS Cup) was one of the best environments in MLS history.

6. Real Salt Lake (30 points). It’s hard for me to be impartial on this one because I’m proud of the economic foothold RSL created in the state of Utah. That the ’08 edition ranks fourth in season ticket sales according to the Sports Business Journal last month, is impressive considering the small market – and the team’s disappointing three-year record. The September opening of the new stadium in Sandy (about 10 miles south of downtown Salt Lake) will put an end to three years of spending extraneous energy on Capitol Hill and the region’s painfully slow political process. Although the Xango jersey sponsorship isn’t the biggest in the league, I hold that it was critical for a team and sponsor to step forward with the “first” deal – to provide a baseline by which the others would follow. Plus, without a Fortune 500 company in the state, RSL realistically didn’t have too many options (as I’m sure they’re finding on the stadium naming rights pitch) – and was right to formulate the Xango partnership when they did. Bonus points also for the Real Madrid relationship. Finally, I’m certain Mr. Checketts will open the wallet for the appropriate designated player as soon as the stadium revenues start flowing.

5. Houston (32). Although only starting their third season, Houston looks like the club that can’t do wrong. They win. They draw strong crowds to an adequate-sized facility. The Dynamo appear to be on the verge of a downtown stadium. Amigo Energy stepped up to sponsor the team’s jerseys. Not a bad turnaround for a club that misfired badly by introducing itself as Houston 1836 and offending much of their Latin American fan base. Oliver Luck deserves credit. Somewhat quiet within MLS circles, he’s concentrated his energy on forging a new stadium, while Chris Cannetti and Dom Kinnear have done well to manage the business and soccer sides respectively. The Dynamo has climbed to fifth in the league in season tickets (and are likely to surpass RSL) – and the passion and size of their post-season crowds demonstrates the depth fans’ loyalty. All that’s left for Houston to do is introduce a Texas-sized DP to match their new part-owner, boxing legend Oscar de la Hoya.

4. Chicago (33). The Fire’s 2008 season ticket numbers are an embarrassment, but the team proved it (with a huge assist from Cuautemoc Blanco) could draw crowds down the stretch last year on the basis of group sales and walk up. To crack the MLS Top 3, the Fire should solidify its season ticket base and continue to build its deep tentacles in the Chicago soccer community. After all, the team has history and tradition going for it – and the assembly of Fire legends Hamlett, Armas, Shore and Jeffries on the bench has been favorably received by the fans. I’m sure John Guppy leveraged a massive spend out of Best Buy for the shirt sponsorship – partially making up for the club’s below-average stadium naming rights deal (although the team possesses the sweetest lease in MLS at Toyota Park). Finally, as much as I initially scoffed at the team’s massive investment in Blanco, Salt Lake fans, among others, can attest to the Mexican icon’s game-changing skills on the field and at the box office.

3. D.C. United (35). United earns a top-three position for incredible consistency - a perennial attendance leader, an impressive case of trophies, a well-established brand, strong management and an engaging and evolving roster of players including some MLS’ best-ever imports in Moreno, Etcheverry, Gomez and Luciano Emilio, among others. DC’s two major drawbacks are a lack of corporate support (where’s the jersey sponsor and/or a decade-long marketing partner?) and no clear-cut plan to build a stadium. It’s easy to forget that this club is on its third ownership group – but perhaps the current group will finally get the stadium done. No executive in MLS is as closely tied to the identity, ebb and flow of his team as Kevin Payne. And even those who have found themselves on the wrong side of one of his bombastic rants have been pulling for him to recover from his recent heart surgery.

2. Toronto FC (45). And all of a sudden there’s a quantum leap to the top two teams in the MLS Financial Single Table. TFC absolutely redefined the notion of the “splash” that an expansion team could and now SHOULD make. I thought Chicago in ’98 was a pretty cool place to be. Salt Lake in ’05 was a dream come true for me and many Beehive State soccer fans. But TFC set the standard the Peter Wilt and I once planned for – selling every seat, every game in a new soccer-specific stadium. What the Maple Leafs Sports & Entertainment group, led by the humble and humorous Paul Beirne, did earns TFC the first perfect “10” in any category – and they earn three: ticket sales, stadium situation and corporate support. They earn a “9” for intangibles – this organization has a day-glo bright future, especially if they start winning. They’ll start winning, right Leafs’ fans? My old friend Mike Thompson would probably remind me that the Leafs haven’t won a Stanley Cup in nearly 40+ years – let’s hope Team For Canada doesn’t make the faithful wait that long.

1. Los Angeles Galaxy (47). From my days at AEG, I feel like I know this club and market pretty well. Consider this: In MLS’ 12 seasons, the Galaxy has been the league leader in attendance in eight of them. Sure, they early years benefited from July 4th at the Rose Bowl, and they’ve had their share of doubleheaders, but for FIVE years now, they’ve called a relatively small venue, Home Depot Center, their home. They score 10 for ticket sales. And the venue? A second perfect 10. Although I think the “cathedral” synonym that Tim Leiweke throws at it is hyperbole, HDC dazzled soccer fans who secretly feared that every new stadium would look like Columbus. HDC feels like it’s been around for a decade already… is the classy jewel on a pastoral sports campus… and was PRIVATELY funded in a magnanimous effort by the incomparable Philip Anschutz. (Plus, the $70 million or so that Home Depot paid to name it –TEN times more than the Fire got from Toyota – set a great bar for the league to live up to.) Corporate support? Another 10 thanks to HDC, Herbalife and a certain #23 who sent Galaxy revenues into another stratosphere last year. You can question whether the extensive Asia travel this spring is the best way to prepare for an MLS season – but the dollars undoubtedly speak loudly. I didn’t give LA a “10” for use of Designated Player, not just because they have three (which MLS execs publicly bemoan but privately chuckle over.) Beckham’s value has already been demonstrated (although him winning a meaningful game in Galaxy colors would be nice)… Then you add Ruiz and Donovan to the same team? That’s dynamic. Ok, five years ago would you have predicted that Alexi Lalas would be a GM and Ruud Gullit an MLS Coach? Star-studded City of Angels – you have a veritable constellation down in Carson. As for intangibles, I say the Galaxy’s got ‘em. So what’s the real challenge in LA? They have to win. Mr. Leiweke won’t tolerate a slow start this year, so I think you could see Steinbrenner-esque turmoil this year. But the Galaxy can throw money after money and keep trying until they get it right.

Finally, a quick note on the two expansion teams…

Seattle ranks in my top 7 already. They will put up Toronto-like ticket sales numbers, have a classy organization headed by a stand-up business leader in Adrian Hanauer, plus an attention-getting funny-guy owner in Drew Carey who actually happens to know a few things about soccer. I’m bummed they seem content with Qwest for the short term, but I wouldn’t be surprised if they’re in a new soccer-specific stadium before DC.

Philadelphia has to show me more… Many people clamor it’s a soccer town, but why do I think the entrenched Phillies/Eagles/Flyers/76ers fans will make it difficult for the Liberty Bell FC (I’m just makin’ it up – don’t go reporting it) to get a fair shake in the media, or of the entertainment dollars? I am not as impressed with their ownership and management – I think they’re a middle of the pack club in many ways. I hope they prove me wrong.

Thanks for weathering the longest two blog entries in ‘Hat Rack history... hope you have your MLS Direct Kick package ordered and your tickets punched to Opening Day in two weeks.

Comments

[Nic]

Houston's original name was 1836, commemorating the first year of Texas independence. The Republic lasted nine years, eventually being admitted into the Union in 1845.

[Logan]

Gotta give Philly a little more credit. Have you seen the numbers that are already signed up with the SOBs [Sons of Ben]? I think securing the park in a town that really wants them there is huge, and they'll pull from other areas that won't get a team, like Delaware and surrounding areas [similar to NE Revs, but probably better]. So, not only do I think this will show support in the stands, but their proximity to DC and NYC means even more heated rivalries and something closer to a derby atmosphere. I think they'll surprise you; I hope they will.

[Steve the Arsonist]

What is the make up of the Fire's lease deal? Or any/everyone else in the league for that matter.