Marketing a Sports Franchise in Toronto

You're right, MLSE only cares about money. Ontario's teacher pension plan will never sell their MLSE rights because it makes too much money. If the concern of taking on so many projects is going to take the focus away from the teams they own, it shouldn't be much of an issue if they're reasonable business people. They will run each part seperate from each other, so it's not like Colangelo is going to have to worry about how the MLSE condo's are doing. So the Raptors won't lose in terms of quality, and it at least seems like MLSE is starting to care about the Raptors by firing Babcock. When they hired Babcock, it really seemed like MLSE didn't care about the basketball part of their company and it resulted in Vince Carter being unhappy. He probably would've still eventually be unhappy and leave but I do think he would've been a bit happier if we hired Dr. J like he wanted.

Looking at Colangelo's moves so far, it seems like he's able to put his mark on the team quite easily, with little interference. Now, things are fine now, because it's the summer, so I agree that we'll have to see how the team plays on the court and see if that will affect any future decisions Mr Colangelo has to make. (ie, if the Raps tank, and he hires a new coach, will the board/Richard Peddie intervine). Good thing to think about.

I think though, as well, the Raptors in general, have a kind of different outlook from the Leafs due to a different cost structure because of their different TV deals, revenue sharing and cap rules. Now granted, the Raptors attendance has been falling the past couple of years, and their reputation has kinda sunk MLSE recently (the Leafs tanking doesn't help either) so of course, they would be rated low by a publication such as Forbes. I do agree that I'm not so sure it matters to MLSE or its owners that the Raptors are super competitive, as long as they continue to turn in a net profit. Could they be making more money? Sure, but at what cost?

But I think hiring Colangelo proves that they're willing to spend money on management to keep the Raptors competitive, even if they don't have any interest in making them crazily popular. I guess your main concernt is that now that the Raps are (seemingly) ascending out of the cellar of the NBA, what will continue to make them push for a championship? Because they've already turned a nice profit even when they were in the cellar, what reason should MLSE have to make the Raps Championship contenders? Well, I think for one thing, Colangelo won't settle for anything less than the top, as evidenced with his time in Phoenix, and of course our star players also want to be at the top for sure. I'm also guessing from the previous playoff years, (I remember a story a long time ago about it) that MLSE gains a lot of additional revenue when the Raps make the playoffs, either from TV revenue, seat/concession stand revenue and whatever other marketing, advertising and merchandising revenue they can gain. Finally, I'm not sure how much it plays into it, but I think Larry Tanenbaum has some actual pride when it concerns the Raptors. I remember last year, during that horrendous opening, how he said he was openly embarassed about the team. And while he doesn't own too many of the shares in MSLE, there's at least one person who directly cares about the Raptors.

Kinnon Yee - Some good points. After writing the piece I realized that much like the whole "Raptors being slighted by the local hockey-biased media" topic, this one can be expanded upon to incorporate other related issues. I too think Larry takes great pride in the team which is very important...I guess I just worry that with too many other initiatives on the go, it makes it a lot tougher to focus on each division...especially older ones. MBA textbooks are rife with examples of companies who lose sight of the original corporate direction by expanding too fast and/or spreading themselves too thin. And as you mentioned Jason, no, I don't directly think Colangelo is worried about how the condos are going...but as fans looking at the Raptors and their owners from a long-term perspective, I just think it would be nice to see some more focus on a winning team. Hopefully Colangelo's hiring was indeed the start of that refocussing...

Of course MLSE wants to make money, last time I checked it wasnt a non-profit concern. But the way to make money in the NBA is to a play a max number of playoff games. Thats where the big money floats in. In the regular season, its all about concessions, tv deals - it all changes in the playoffs.

So MLSE's interest in getting consistently to the playoffs and succeding is the identical to the Rap's fan base upto this point. If the Raps are where Dallas is today, would they ante up way over the luxury tax bar to go for a championship? I think not. And thats the difference between a Cuban and a Tanenbaum.

The public's obession with the teacher's pension plan and their revenue greed is misplaced. The money to be made in professional sports is not in revenues, but in asset appreciation (witness the $1-billion price tag for an NFL franchise.) That is why MLSE might be willing to lose some money on the Raptors (although I'm not convinced they are losing money.)

It's clear that a .500 basketball team in Toronto will draw top 5 attendance numbers, and a 0.329 team will do OK anyway. Petty concerns like wins and losses don't affect the lucrative TV money though.

Because of the quality of the southern Ontario market, and the continuing appreciation of franchise values, basketball will always be secure in Toronto.

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"If the Raptors continue to dwell in the NBA’s cellar but their lack of financial success is offset by MLSE’s other assets (say the Leafs or their new soccer team) then how can MLSE ever truly focus on improving the Raptors?"

The idea that professional soccer in Canada will turn a profit in Toronto stretches the imagination, and ignores the long history of professional soccer in this city.

On another note anyone know anything about the two guys who got training camp invites. Here's the quote from the globe and mail. Unfortunately the article is about embry and doesn;t talk abotu them more than this.

"One of those to get an invitation is 7-foot-2 Polish centre Cezary Trybanski, who was in Toronto yesterday, participating in an informal Raptors workout at the Air Canada Centre. Another is 6-foot-7 wing player LaVell Blanchard, a former player at the University of Michigan who led the Wolverines in scoring (an average of 16.2 points a game) and rebounding (6.8) during his senior season in 2002-03."

http://www.theglobeandmail.com/servlet/story/LAC.20060926.RAPTORS26/TPStory/TPSports/Basketball/

Excellent points Brian! Too few people realise how much money is to be made on the appreciation of the franchise. It's like a house, you get back what you spend and more! Not always, but mostly. And if your franchise can gain value AND rake in the money? Can you say 'Leafs'?

So name one franchise that is worth a ton of money but hasn't won anything?

The Cubs I guess .... The Red Sox until recently .... Not too many others, though the NFL probably has a few ... But even still, the Redskins and the Dolphins try to win, and spend the money to win, they just fail ...

Another largely ignored factor is the ACC. MLSE owns the ACC. The Raptors have 41 home games. Things like box seats, corporate sponsors, property value, are all tied not only to the Leafs, but the Raptors.

The best comparison to the Raptors I can think of is the New York Rangers. The funny thing is, no matter how few people go to the games or watch it on tv, a ton of money and effort was put into the Rangers, all because they're tied to the Knicks and MSG, not to mention CableVision (I believe thats the right station anyway). At one point they were spending 20$ million more than the Leafs, and the stadium wasn't half full. Did they win? No. But it wasn't like they weren't trying.

Besides, we hired Bryan Colangelo. How much evidence of a desire to win do you need? Would he come if he weren't satisfied that they were willing to spend the bucks? Didn't we just spend 250$ million on Vince et al.?

My last point is this: Do we really want people at MLSE paying attention to the Raptors? Wouldn't it better if they let Colangelo do his thing, and just sign the payroll/trade requests as they come in? Isn't that what they're doing as far as we know?

We were smart to ditch Vince and all that payroll. Getting below the cap was huge. The only problem was there were no elite free agents this year.

Everyone wants to win fellas. Now lets enjoy the season!

Have no fear, we'll be talking about Trybanski and Blanchard in tomorrow's piece. We'll also be talking a bit more about this article in light of the recent news of the Raps' season ticket renewal rates...so far so good for the Colangelo plan...

"The funny thing is, no matter how few people go to the games or watch it on tv, a ton of money and effort was put into the Rangers"

The Rangers sell out every game.