NHL dropping All-Star Game makes all the sense in the world
Discussions about scrapping the NHL All-Star Game between the league and NHLPA could have some legs to them if other circumstances play out in the right way.
For many hockey fans, nixing participation in the Winter Olympics was unwelcome news. That could be surpassed by the possibility dropping the NHL All-Star Game festivities altogether. From a business perspective, however, it might be the clear direction to take.
According to Mike Johnston of SportsNet, the league and the union are having discussions about putting the All-Star Game on ice. The most likely reason for that exploration is the NHL’s interest in continuing to build its brand outside of Canada and the United States, specifically Europe for starters.
This news falls in line with the league’s decision not to allow its players to represent their home countries in the 2018 PyeongChang Winter Olympics. Like how that decision is tied to the NHL’s preference to develop its own international tourney, the World Cup of Hockey, this action is being explored because the league sees more potential revenue elsewhere.
Fans should understand that this is just one of many potential changes that get discussed behind closed doors by leagues like the NHL on an on-going basis. Many of them end up in no action being taken.
The fact that the discussion has included the players association is reason to take it somewhat seriously, and is the exact reason why dropping the All-Star Game is being included in the discussion about international marketing.
For fans to further understand this news, it’s necessary to detach themselves from their own situation and put themselves in the shoes of an NHL owner or league executive. While the coaches, equipment staff, medical staff and players are very much involved in the business of hockey, team owners and league staff aren’t. Their business is marketing that hockey.
In an ideal world for the NHL, the league could both maintain a robust All-Star Game week and upsize its footprint to sports fans around the globe. The world isn’t ideal for anyone, however, even people who own NHL franchises.
In order to get the PA to commit to additional demands, there have to be concessions. If the league wants to send multiple teams to the United Kingdom or Norway for regular season games, for instance, there’s going to have to be something that the owners concede in order to get the players to agree to not only make the travel, but other related items as well.
It’s likely that a European tour would involve extra media and promotional appearances as well as social media and television recording sessions.
Killing the All-Star Game would be a suitable concession, as that would alleviate players of the burden that the event places upon them. It only makes sense, however, if the path to the goal is clear.
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The NHL All-Star Game does bring in a good amount of revenue and does the same for players whose contracts contain corresponding performance incentives. Teams which play host to the festivities enjoy a nice revenue boost as well. All that could be overshadowed by opportunities abroad, however.
In European markets like the UK, the potential exists for revenue which could dwarf what the NHL makes off its All-Star Game festivities. As an example, Fly Emirates just agreed to a record five-year, $280 million euro ($331 million United States dollars) sponsorship of Real Madrid last month.
Putting NHL regular season games in Europe would create room for new media rights agreements, merchandise licensing, and in-arena sponsorships. All that new revenue could easily outperform what the NHL makes off the All-Star Game several times over.
As the NHL has yet to officially make any announcements about European partnerships of this kind, all of this is still in the realm of “what-if.” In order to truly execute the All-Star Game, many details would have to be worked out like what to do about all the players who have performance bonuses tied to the event.
If enough European companies are willing to sign contracts which make something like holding regular season games on the continent profitable, the NHL and the NHLPA will work it out.
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The NHL itself isn’t in the hockey business as much as it is in the business of marketing hockey. For a league that wants to have a strong presence all over the world, dropping the All-Star Game could make all the sense in the world.