Is being a fringe playoff/non-playoff team the best way to maximize profits?

[YoungNastyman]

No. Selling tickets to playoff games, and re-igniting a fanbase of millions, drawing in new fans, and increasing TV deals and merchandise sales is how you maximize profits.

THIS

Because truth.

 

[Leafidelity]

Unless your job experience ends at MacDonalds, you know that anyone successful in business has healthy amounts of ego and pride. I can tell you 100% that every single member of MLSE wants to win a championship every single year. If they didn't they probably wouldn't have gotten themselves into a position to own shares in an NHL team in the first place.

 

[nsleaf]

I am quite sure MLSE brass want to win, but it must be a comfort to them that even though they lose a lot, the profits continue to roll in.

 

[Grant]

For a non hockey markets, the way to maximize profit may be to only spend to the cap floor with little money in management + scouting + development (a team like florida perhaps, they don't actually lose money as they claim). But in a hockey mad city like Toronto that is not the answer. Playoff games bring in a lot of extra money. Between tickets + concessions, the leafs probably bring in nearly 10m in additional revenue per playoff game.

 

[bunjay]

Nothing would be more profitable for MLSE than winning a Stanley Cup.

 

[charliolemieux]

Nothing would be more profitable for MLSE than winning a Stanley Cup.

Exactly.

 

[K19*]

Leafs ownership traditionally and currently want to win a championship, but they don't want to tarnish "the Leafs brand" to get there. They'd rather try for the playoffs every year, and retool on the fly to get there, instead of doing a scorched earth rebuild because that would tarnish the brand. That's why the Leafs are pathetic and regarded as a joke around the league.

 

[Bluelines]

The best way to maximise profits is to move those southern teams that live off the Leafs profit sharing to a sustainable market like Seattle, Quebec City, etc...

 

[colchar]

However there is some truth behind the belief because if you were a starving fan with lots of money would you pay $10 for a hot dog? If you were full and satisfied you certainly would feel less compelled to pay those ridiculous prices.

So in Toronto making the playoffs is seen as an accomplishment for a starving Leaf nation fan base as a level of acceptable success, whereas Detroit making the playoffs is a minimum expecting level from each season, as their fans are a lot less starving then Leafs are. A 1st round loss in Toronto a major success story after missing 8 of 9 years altogether.. A 1st round loss in Detroit is not even worth showing up for by fans and seen as a failed year for Wings fans. However everybody loves a winner..

Yeah right...they gave up millions in those non-playoff years just to make a little money the one year they got in. Right, sure they did.

Toronto could make it to the Cup finals every year for two decades and it wouldn't diminish demand for tickets.

 

[pooleboy]

in a sense that they aren't trying to rebuild/get a good pick and always have a team that should be "competitive" yes its the best way to maximize profit.

 

[asdf]

Unless your job experience ends at MacDonalds, you know that anyone successful in business has healthy amounts of ego and pride. I can tell you 100% that every single member of MLSE wants to win a championship every single year. If they didn't they probably wouldn't have gotten themselves into a position to own shares in an NHL team in the first place.

If every member of MLSE is so hyper-competitive that they want to win a championship every single year, then why haven't they done it or even come close? It certainly isn't for a lack of resources.

I have little doubt (I would say no doubt but I am not 100% certain what their motives are) that they want to win, who wouldn't? But there's a difference between wanting it, and actually doing something about it.

I wish I could find the post, but I remember reading a story from a poster here about how they met a current or former Blue Jays executive at a charity dinner. That executive said something to the effect of them not wanting to win, or how winning the World Series was not good for them in the long run because of the effect it had on their fanbase.

This argument comes up often and it always goes the same way. Some people say MLSE doesn't care about winning, other people counter how absurd that is because winning equals more money and if MLSE truly didn't care they would spend to the cap floor, etc. Round and round we go.

I don't know if anybody really knows what their motives are with any certainty except the MLSE executive and bean counters. Personally I think they would like to win the Stanley Cup, but they would like to sort of have it fall in their laps, instead of going through a rough 5, 6, 7 years. Do like the Ducks did in 2 years. Acquire a bunch of players including 2 top-3 defencemen, then win a Stanley Cup. That's probably why they went after Burke.

 

[The Apologist]

If every member of MLSE is so hyper-competitive that they want to win a championship every single year, then why haven't they done it or even come close? It certainly isn't for a lack of resources.

I have little doubt (I would say no doubt but I am not 100% certain what their motives are) that they want to win, who wouldn't? But there's a difference between wanting it, and actually doing something about it.

They ARE doing something about it.

They've hired the best gms, the largest scouting staffs, spend as much ad they can every year, hire the best coaches for both pro and farm, build state of the art arenas, bring in special trainers, what more do you want?

To suggest MLSE isn't trying IS absurd.

It takes a **** load of luck to win a Cup.

Pittsburgh is considered a stacked franchise, two of the best players in the game, one Cup.

Boston is a model franchise, one Cup.

LA rode a hot goalie to one Cup..

Chicago has somehow gelled into this massive superpower, based on a guy who went THIRD overall. If it wasn't for the massive Staal hype train, Toews could very well be a Penguin right now.

Detroit, New York, Chicago, all waited over 40 years between Cups, but it wasn't from lack of trying.

There is no tried and true method to win. If there was, everyone would do the same thing every single year.

 

[ConnorTO]

what if i told you that playoff tickets cost a lot

 

[namttebih]

if we make the playoffs enough over a long enough period, the demand for regular season games will go down, wont it?

Yes because the absolute max 16 extra home games a year will oversaturate the market...

 

[asdf]

They ARE doing something about it.

They've hired the best gms, the largest scouting staffs, spend as much ad they can every year, hire the best coaches for both pro and farm, build state of the art arenas, bring in special trainers, what more do you want?

To suggest MLSE isn't trying IS absurd.

It takes a **** load of luck to win a Cup.

Pittsburgh is considered a stacked franchise, two of the best players in the game, one Cup.

Boston is a model franchise, one Cup.

LA rode a hot goalie to one Cup..

Chicago has somehow gelled into this massive superpower, based on a guy who went THIRD overall. If it wasn't for the massive Staal hype train, Toews could very well be a Penguin right now.

Detroit, New York, Chicago, all waited over 40 years between Cups, but it wasn't from lack of trying.

There is no tried and true method to win. If there was, everyone would do the same thing every single year.

Have they really done these things though? Serious question. Like trainers; I have seen the trainers get criticized due to lack of conditioning the team has. Or scouting staff; they may spend the most on this but we certainly haven't seen the results of it, though I guess it take time. The only time they hired somebody that could be considered the best GM was when they hired Burke and it looks like that was because they wanted to get into the playoffs ASAP.

That's the thing, of those teams you listed, I agree that luck played a part in their success, but you could say that about any team. It seems like every team gets lucky every now and then, except the Leafs. You have to wonder why that is. Maybe it's because they aren't putting themselves in a position to get lucky.

I'm not an advocate that a tank rebuild is the only way to build a contender, but it is a path that MLSE seems loathe to go down for whatever reason. Likely because it affects their business. This is what I mean when I say they aren't trying. They don't seem like they have a 'win at all costs' mentality. It's more like a 'win if it makes financial/business sense' mentality.

 

[hfman]

No. Selling tickets to playoff games, and re-igniting a fanbase of millions, drawing in new fans, and increasing TV deals and merchandise sales is how you maximize profits.

this is one side of the argument. The other side is that they sell out every game anyways, so why bother to spend more to win more.

The thing that everyone is forgetting is just how big the ownership group really is.

Rogers owns all the TV deals going forward.. they own the Lerafs..Raptors..Blue Jays..FC.. they provide most internet/tv/phone services all across Canada... and that's just Rogers. What about Bell? Same.. they provide equal internet/TV/phone services to all of Canada.. they own TSN and its TV deals... this list goes on and on.

See how big the Leafs' owners are now? The Maple Leafs are just a *small* part of their portfolio. Rogers and Bell are making billions and billions everywhere else in their business. The Leafs sell out every game. Awesome for them. Could they make a bit more by making the playoffs? Sure. But the money that Rogers/Bell "lose" by not making a playoff round or two, they make up elsewhere in their empire -they'll jack up your internet services by 3 dollars next month. Or Maybe the Jays are doing a bit better, and selling an extra 7,000 seats every game - so no worries if the Leafs aren't making the playoffs, they have a huge arsenal of other business to make up for it quite nicely.

Every business on the planet knows they could always make more $$$. Every one of them. But when you're a company that owns every sports team in the city and provides all the digital media services to the entire country, you're always in the boat of "well, we're losing some money here, but we're making up for it there. We can't win 'em all."

The Leafs are a small blip on their radar. THIS is why the city knew this whole Rogers/Bell takeover was the worst thing for the hockey team. The ownership is so huge, that every section of their business (Raptors, Jays, Leafs, FC, internet, etc) receives less attention than if they were the only business the owners were running. If Rogers ONLY owned the Leafs, and depended on the Leafs for their survival, you can bet the Leafs would be winning - because otherwise Rogers would be out of business. So when the Leafs miss a round of the playoffs, it's okay, because they're gonna make back that extra 10 million by selling more Jays seats, jacking your internet rates by 3 bucks and "oh yeah, the Raptors made a round of the playoffs so we made up for it there, too". Rogers/Bell knows they can't win em all, no one can. Everyone knows that. Win some, lose some. When the Leafs lose it's okay, because they have plenty of other revenue streams that offset that "loss" - wise business practices. But terrible, terrible for the hockey team.

 

[Derrty]

Detroit is in shambles, no comparison.

 

[nsleaf]

Just how much extra profit will an extra 16 play-off games generate? How much is that compared to the year's over-all profit. Any accountants out there?

 

[ACC1224]

Just how much extra profit will an extra 16 play-off games generate? How much is that compared to the year's over-all profit. Any accountants out there?

I'd say a very conservative estimate would be 10 mil per game, it's probably higher.
I don't know that a Team has ever played 16 Home Playoff games though.

 

[FerrisRox]

We see red wings fans not even fill up the arena for playoff games (cause they are always in). I'd assume they'd care even less about regular season games.

Leafs make the most money and its hard to buy a regular season ticket.

Is there more demand for regular season games when your a fringe playoff team?


Maybe this is MLSE's goal (and always has been?)

Players do not draw a salary in the post-season. They get paid through the season but there is no salary for playoff games meaning owners get to pocket the full gate for each and every playoff games.

The Montreal Canadiens are clearing close to $2 million for each home playoff game this spring, for example.

 

[The Apologist]

Have they really done these things though? Serious question. Like trainers; I have seen the trainers get criticized due to lack of conditioning the team has. Or scouting staff; they may spend the most on this but we certainly haven't seen the results of it, though I guess it take time. The only time they hired somebody that could be considered the best GM was when they hired Burke and it looks like that was because they wanted to get into the playoffs ASAP.

That's the thing, of those teams you listed, I agree that luck played a part in their success, but you could say that about any team. It seems like every team gets lucky every now and then, except the Leafs. You have to wonder why that is. Maybe it's because they aren't putting themselves in a position to get lucky.

I'm not an advocate that a tank rebuild is the only way to build a contender, but it is a path that MLSE seems loathe to go down for whatever reason. Likely because it affects their business. This is what I mean when I say they aren't trying. They don't seem like they have a 'win at all costs' mentality. It's more like a 'win if it makes financial/business sense' mentality.

Really? Only Burke?
Cliff Fletcher? No?
JFJ was supposed to be one if the best talent scouts and capologists. People often neglect that fact.
Nonis isn't exactly chopped liver.

As for the trainers and scouts, are you suggesting they're spending the most money and NOT hoping for success? Does that make sense to you at all?

MLSE most certainly does have a 'win at all costs' mentality, which is why they spend so much. No business spends more than they have to without a reason. MLSE and the Leafs could struggle like they do while spending way less and we'd all still line up at the gate.

Their biggest downfall (much like NY, Mtl, and probably soon to be Detroit) is that Toronto does not believe that 'tanking' is a necessary evil for them, as there's always enough money to buy another opportunity.