Why the XFL is going into NFL markets

It’s all about the money.

On December 5, the XFL made official its eight markets for the 2020 season: Dallas, Houston, Los Angeles, New York, Seattle, St. Louis, Tampa, and Washington, D.C. On the same day, XFL Commissioner Oliver Luck was interviewed by New York Sports Day’s Peter Schwartz, where he said this about choosing New York as a market:

“I don’t know if you can start a league without being in New York. … This is our most important city. … I just don’t know if you can launch a league and try to have a national footprint, even a small national footprint like ours would be initially; I think you have to be in New York.”

The quote highlighted a major difference in how the XFL is thinking about the placement of their franchises with how a lot of the general public is looking at it.

Notably, seven of these eight cities are home to NFL teams, with only the recently-vacated St. Louis being the exception. New York and Los Angeles have two apiece. A common reaction I’ve seen to this portfolio has been surprise and skepticism, centered around the fact that the XFL didn’t target more markets without NFL teams. After all, it’s not the fans in New York and Los Angeles that need football, it’s the fans in cities like Albuquerque and Omaha, right?

In a certain sense, that’s true. But in another sense, it misses the big picture.

What is the XFL’s goal?

You can be forgiven for looking at the XFL as a vanity project, but the goal — the reason the XFL exists — is to make money. Whether that’s a realistic goal is a separate conversation, but make no mistake: the point of all of this is to turn a profit.

If the primary goal is to make money, then where is the money in football?

For a long time, the answer was in selling tickets, but that dynamic has long since flipped: the money in football is in broadcasting rights. The NFL’s least valuable property — the much-maligned Thursday night broadcast — has just started a contract with Fox that’s worth around $3 billion over five seasons. That’s obviously not what the XFL can hope to earn, but consider that the American Athletic Conference’s annual deal with ESPN is worth about $18 million annually. Only time will tell what the XFL’s ceiling might be, but this is where the league is, rightfully, pinning its hopes.

If the money is in broadcasting, then what underserved market is the XFL trying to capture?

It’s easy to look at the football landscape and think of the likes of Portland and Tulsa as the underserved markets; in a certain sense, that’s absolutely true. But that’s not the market the XFL is targeting: they’re chasing the 80 million fans, to cite Charlie Ebersol, that watch NFL and college football in the fall and then stop watching sports entirely until the next football season. It’s these consumers that are theoretically underserved for six months of the year, and they aren’t any better served in Tampa than they are in Orlando.

If the target consumers are television viewers, then what purpose do the home markets serve?

From this perspective, the home markets themselves serve a different purpose than just selling tickets and merchandise: the home markets’ primary role is to create a strong television product. There are a few ways that is accomplished:

Market Size and Out-of-Market Brand Awareness

By definition, this favors big markets.  The larger cities not only deliver eyeballs in their own market, but they’re also brands that people outside of the market are more likely to have strong feelings about. A given fan in, say, Boston is more likely to be able to get invested in a game involving a team from New York or Los Angeles than they would a team from Sacramento. Maybe they hate the Yankees, or maybe their wife is from Los Angeles. Statistically, a given person is more likely to have a connection to a larger market. These are fixed advantages for the big markets.

Regional Distribution and Television-Friendly Venue

Other things to consider are regional distribution (spacing your teams so as to cover as much of the country as possible) and having a venue that looks good on television. These are market-size neutral; neither big or small markets carry an inherent advantage.

Crowd density and energy level

Finally, you need a market that can fill your stadium and provide a energetic environment. Nobody knows better than WWE and Vince McMahon how much a “hot” crowd can improve the quality of a broadcast, and it’s here that the smaller markets get their chance to distinguish themselves: As the argument goes, a city without an NFL team could theoretically fill their stadium and create a wonderful backdrop for a broadcast. Meanwhile, a city with an NFL team might be apathetic, and the stands might remain empty.

So, should the XFL expect non-NFL markets to outperform NFL markets at the gate?

No! In fact, quite the opposite. The XFL has good reason to believe they’ll be able to draw just as well in NFL cities as they would in non-NFL cities, because that’s exactly what happened in 2001. NFL cities averaged 26,341 fans per game compared to the non-NFL cities’ average of 21,652. Those averages take into consideration Chicago, which finished last in the league in attendance thanks to the cold winter weather and an 0-5 start.

In Summary

  • The XFL’s goal is to make money, and the money in football is in broadcast rights.
  • This means the XFL is targeting television viewers without football to watch, not football fans without games to attend.
  • In turn, this means that the home markets are evaluated for their potential to create a strong television product.
  • Of the factors that go into to evaluating a market’s potential to contribute to a television product, the only area that a small market might even potentially hold an advantage is the ability to fill a stadium.
  • The XFL’s experience in 2001 instructs them that NFL markets will likely perform just as well, if not better, at the gate as non-NFL markets.

Bonus: Does the AAF have reason to believe that they will perform similarly well in NFL markets?

The AAF is following the same line of thought as the XFL: their path to profit also lies in broadcast revenue. But that league chose a less aggressive portfolio: two NFL cities (Atlanta and Phoenix) among its original eight markets. Why?

The AAF has another data point to consider. The first league to make a serious run after the XFL’s 2001 attempt was the UFL. They tried four of the best XFL markets (Las Vegas, New York, Orlando, San Francisco) in 2009 and got murdered at the gate. They eventually found a modest following in minor league cities such as Hartford, Omaha, and Virginia Beach before folding under a sea of debt.

There were many differences between the two — not the least of which was that the UFL inexplicably decided to run a fall schedule — but the biggest by far was the difference in the two league’s abilities to raise awareness. The XFL’s hype machine was basically so powerful that they lost control of it. The UFL couldn’t have generated a headline if their league’s life depended on it. Which it did.

The lesson to learn here is that you need to be strong enough to penetrate a major market. The XFL, thanks to the gravitas of WWE and Vince McMahon, was able to do it in 2001 and can be confident they can do it again in 2020. The UFL was not in 2009. The AAF is probably right to figure that it will land somewhere in the middle, which is why they chose a less aggressive starting position. But as the AAF’s status (hopefully) grows, I would fully expect that their expansion plans include moving up the food chain, not down.

Two ways the XFL can improve upon the AAF’s branding process

Splitting the work among local designers and executing an open branding process can both yield significant benefits.

The Alliance of American Football released the logos and color schemes for its first eight teams in a pair of unveilings on September 20 and September 25. Some turned out better than others, but rather than getting too deep into the weeds critiquing the individual logos, I would like to take a step back and examine the overall process the league used:

  1. Hire a designer
  2. Work privately with that designer to design all eight brands
  3. Release the final product to the public

This is the standard in the industry, so I hope nothing I write comes across as accusing the AAF of cutting corners. This was a professional, serious branding process, and after the UFL’s “effort” in 2009, that shouldn’t be taken for granted.

But as the XFL looks for ways to improve upon the AAF’s performance ahead of their own 2020 launch, I see two big opportunities for improvement:

Split the work among local designers

The biggest issue with the AAF’s work is that all eight logos are pretty clearly done by the same hand. The designer, Joe Bosack & Co., was eminently qualified and produced some strong work, but there’s a cost associated with the sameness. I talked a lot about this theme here, but to summarize: the fan-team connection is the foundation on which sports are built, and anything that makes the teams feel like units of the whole rather than independent clubs compromises that relationship.

The BIG3 made diversity a priority.

A better effort was executed by the BIG3. Creating unique identities was especially important for the 3-on-3 basketball venture, as the eight teams aren’t based in a single city but rather travel the country together. Both the designer, Todd Radom, and the founder, Ice Cube, spoke specifically to the importance of creating diversity in this June 2017 ESPN piece:

Another priority was avoiding the cookie-cutter look that often results when designing uniforms for an entire league at once. “The teams had to look separate,” said Radom. “They should look like each one came from a different designer, if possible, because each team deserved its own look, its own feel.”

“I wanted a mix of styles,” said Cube. “I wanted to start from old-time basketball, back when the game first started, all the way up to a modern look. What was cool about working with Todd is that he’s able to give you all those different styles, all those different eras of basketball.”

Taking this a step further would be actually contracting eight different designers to design the eight different logos, which guarantees authentic diversity in the look and feel of each team. And splitting the work allows for a final optimization: contracting local designers for each market. As critical decision on imagery and colors are made, working with firms based in the host cities gives a league the best chance of coming up with a brand that resonates with local fans and steers clear of stereotypes or misconceptions.

Precourt Sports Ventures turned to the Austin-based Butler Bros to design Austin FC

An example of this recently played out in Austin. Precourt Sports Ventures (PSV), the ownership group of the Columbus Crew, recently unveiled the name and badge for Austin FC ahead of its planned move to the Texas state capital. PSV eschewed national designers in favor of the Austin-based Butler Bros, whose portfolio includes local favorites like Tacodeli. The result has been an instant hit locally and helped bolster support ahead of a crucial Austin City Council vote that secured PSV’s right to build a new downtown stadium in the city. The local bona fides of the designer played a critical role in that reception.

Would the XFL consider it?

Branding is a hard process, and working with eight designers is much more complicated than working with just one. The temptation to keep all the art under one roof will be especially strong for the XFL, as they already have easy access to WWE’s fantastic arts department. The league would be wise to resist.

Execute an open branding process

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The Open Branding Project provided updates on the progress of Baseball New Zealand’s rebrand.

Providing public updates on the status of the branding process contravenes the standard practice of only releasing the final product, but this very concept was recently executed by designers Brian Gundell and Brandon Moore for their redesign of Baseball New Zealand. The duo provided frequent insights into the status of the project before eventually delivering the final product. From their initial post explaining the project:

We believe there are 3 factors that attribute to a poor launch of a brand identity … 1.) It comes as a surprise. 2.) There is poor communication about what honestly went into the work. 3.) The public only sees the final piece and never the process or thought that created it.That’s why [we] want to do what we do best all in the open. We’d like to go through an entire design project and put all that we do on a virtual wall for all to see, in hope of solving the mentioned issues.

I loved reading the Baseball New Zealand updates, but it was watching the AAF’s process play out that convinced me an open process is worth trying with a wider audience.

I receive email alerts from the AAF San Antonio Facebook page, and from the moment the city was announced as the league’s eighth city in June until the league unveiled the San Antonio Commanders name, logo, and colors in September, the chatter had been almost exclusively been of two types: potential players desperately trying to get a roster invite, and fans suggesting names, colors, and uniforms.

For over three months, the AAF didn’t engage with their fans in any way on the topic that was most meaningful to them. Now that it’s time to start moving ticket packages, the San Antonio Commanders need to recreate momentum that has been lost. Moreover, for fans who had their hearts set on a different name, colors, or imagery, the Commanders now need to overcome a sense of disappointment.

An open process addresses both of these points, making it a marketing and engagement strategy in and of itself. Fans are engaged on the exact topic that they are most invested in, and as critical early choices in the branding process are made, fans get insight into why a decision may have been made and a chance to make peace with it early.

Would the XFL consider it?

One of the biggest differences we’ve been able to observe thus far between the XFL and the AAF has been the former’s openness. While the AAF made its public debut as a mostly fully-formed idea in March, the XFL announced its intention to return over two years ahead of time with little more than the league name settled. The AAF did their brainstorming in private ahead of their big initial announcement, while the XFL has been giving the public small glimpses into the work of their Football Reimagined Committee.

As anyone who’s ever had to deliver an update on a big project can tell you, the updates themselves can be a fair amount of work. Exposing yourself to criticism at every step of the process can be draining, especially for a league like the XFL that will have so many critics salivating at the prospect of its failure. But the XFL has already demonstrated an inclination toward showing their work, so an open branding process could be a natural fit.

Pulling it all together

If the XFL acted on both suggestions, this would be the resulting process:

  1. Hire eight designers in each of the eight XFL cities
  2. Communicate frequently about the status of each branding process
  3. Finalize the design

There’s a cost associated with both concepts, but the XFL would be wise to balance that against the significant benefits of a branding process designed to cultivate the engagement between the fans and the teams. In the end, that relationship is what will determine the success of each individual team and, in turn, of the league as a whole.

Of Hurricanes and Homogeneity

Amidst a sea of standardized sports merchandise, the Carolina Hurricanes are dipping their toe into unique apparel.

Toward the end of this SportsLogos.net story about the Carolina Hurricanes owner soliciting fan feedback for a third logo was this tidbit (emphasis mine):

“We are revamping our apparel line to feature more than just some of the league-wide gear,” [Mike Forman, the Hurricanes Sr Director of Marketing & Brand Strategy], “We will be heading into year three of our ‘Homegrown Series’ which includes limited-edition t-shirts designed by t-shirt artists/vendors across the state. And we are working on both player-inspired and now fan-inspired merchandise.”

I hadn’t heard of the program, but a quick search revealed the program’s offerings for the 2017-18 season:

The Hurricanes Homegrown Series returns for the 2017-18 season and features seven games that showcase some of the best that our local community has to offer in t-shirts, food, beer & spirits, art and music.

Each game features a unique Hurricanes t-shirt designed and produced by one of these seven North Carolina clothing companies: Porch Fly Supply Co., Oak City Collection, Recover Brands, Runaway, Humbly Made, House of Swank and Asheville T-Shirt Co. Each shirt debuts at its corresponding Homegrown Game and is sold for $30 in the north end location of The Eye team store (section 112). Each shirt is produced in a limited quantity of 200 and is marked by a unique printed tag that denotes the game and shirt series.

A quick anecdote

Growing up in Alexandria, Virginia, I was a huge Washington Redskins fan. The team wasn’t particularly good in the mid to late 1990s, but the memories of the glory years of Joe Gibbs’ first tenure with the team were fresh, and there was no shortage of Redskins gear at yard sales and gas stations. I couldn’t get my hands on enough of it.

Along the way, I somehow ended up with a t shirt that featured a cartoon collage of Redskins symbols and icons, among them a “Cowboys Suck” sign. Maybe not the classiest shirt ever made, but it was perfect for a 12 year old super fan. I loved it.

My memory is betraying me on the details, but the general gist is that I eventually saw another t shirt of the same format for another team. Instead of a Redskins t-shirt saying “Cowboys Suck,” it was a Cowboys t-shirt saying “Redskins Suck.” Same layout, same artist.

I remember feeling betrayed — the artist who made my t shirt didn’t love the Redskins. They couldn’t have. And if my shirt wasn’t a true symbol of love and support for my team, what was it?

A march toward homogeneity

One of the things that, in my opinion, plagues modern sports is the march toward homogeneity: clubs within a league (or even across leagues) increasingly looking and behaving like clones of the others. This extends to every facet of an organization (see CFL Commissioner Randy Ambrose’s mission to emulate the NBA’s model and standardize 80% of each team’s business plan) and is most readily apparent when it comes to a team’s art. Consider:

  • Bad: The NFL and NBA’s quiet efforts to have teams wear the same shade of a color to save on costs. For example, the Packers have the exact same shade of green as the Jets and shade of yellow as the Steelers on the Pantone Matching System.
  • Worse: MLB having each team wear the same color scheme for holidays and the same uniform template for Player’s Weekend games.
  • Worst: The WNBA dressing each team in the exact same uniform template.

This is all done with good reason: duplicating uniform templates and business plans, including merchandising, saves costs and (theoretically) ensures that each unit of the whole will be adhering to best practices. But for me, at least, my connection is to the team, and pushing a team away from an independent club and toward just a unit of a whole chips away at that foundation.

Now, I’m keenly aware that catering to my personal whims is not always (or even often) a sound businesses strategy, and the numbers seem to back up the practice of standardization. The NFL, MLB, NBA, and NHL have all reached new heights in franchise value and merchandise revenue in recent years. It’s hard to argue that the system isn’t working.

But anecdotally, I know I’m not alone in my distaste for the trend toward homogeneity, and I’ve recently stumbled onto an argument that might back that up.

A business case for putting design first

I’m currently reading Tom Peter’s book “The Excellence Dividend: Meeting the Tech Tide with Work That Wows and Jobs That Last.” Peters, in turn, appears to have read every book ever written, and he quotes a passage from Kevin Roberts’ book “Lovemarks: The Future Beyond Brands.”

Shareholders very seldom love the brand they have invested in. And the last thing they want is an intimate relationship. They figure this could warp their judgement. They want measurability, increasing returns (always) and no surprises (ever). Imagine a relationship with someone like that!

No wonder so many brands lost the emotional thread that had led them to their extraordinary success and turned them into the metric-munchers of the lowest kind. Watch for the sign: Heads, not hearts, at work here …

Peters cites Apple, BMW, and Starbucks as companies who have benefited from prioritizing (and re-prioritizing) design over bottom line efficiency. The idea is that to keep the customers that made you a titan in the first place, you need to respect, cultivate, and nurture the things that made them fall in love with you in the first place.

What does that mean for a sports organization?

In sports, that first love will often be the relationship between a fan and a team. Speaking only for myself, my enthusiasm for sports gear was never really the same after that with my Redskins t-shirt. I support the team, but at an age when my disposable income has never been higher, the only article of Redskins clothing I actually own is a 1937 Turk Edwards replica jersey that I made myself. In many ways, I’ve been lost as a customer.

Does that translate to a larger group? The Hurricanes’ initiative provides an interesting test case, and the early results are encouraging. The Homegrown Series drew an encouraging average of 15,783 fans compared to 12,814 for the rest of the home slate last season. Whether that increase is enough to justify the efforts from a strict financial perspective, I don’t know (although I suspect it is). Regardless, I know no kid in Raleigh wearing one of those shirts will ever pass a Florida Panthers fan on the street and suddenly feel like a sucker. I think that’s an investment in your brand worth making.

More football is good for football

Leagues like the AAF and XFL won’t just be fun while they last; the sport will reap the benefits of their efforts for decades.

Smart Football’s Chris B. Brown recently shared on Twitter a highlight video of the offense New York/New Jersey Knights of the World League of American Football (1991-1992). The team was coached by Mouse Davis, one of the patron saints of the Run and Shoot offense, and quarterbacked by the current coach of the reinging Super Bowl champions, Doug Pederson.

The video reminded me of another WLAF anecdote, this from S.C. Gwynne’s fantastic book The Perfect Pass: American Genius and the Reinvention of Football, which details the rise of the Hal Mumme, Mike Leach, and the Air Raid offense. Mumme was the head coach of NAIA’s Iowa Wesleyan with Leach as his assistant, and the two spent the 1991 offseason picking the brains of other coaches around the country. The road trip included a stop to see CFL legend and coach of the brand-new Orlando Thunder Don Matthews, known to fans as simple “The Don.”

Continue reading “More football is good for football”

XFL explores dropping the facemask

The XFL is toying with the idea that taking away the facemask will force a safer, if perhaps bloodier, style of play. Would it work? And would fans watch?

The XFL’s parent company, Alpha Entertainment, recently sent out a market research survey to evaluate potential ideas for the league. Wrestling journalist Dave Meltzer provided a summary of the contents in the May 13 edition of his subscription-only Wrestling Observer Newsletter, which in turn was synthesized by Deadspin’s David Bixenspan as part of a broader XFL update. Underlines are mine:

As promised, there are various ideas to speed up the game, which include no kickoffs, no timeouts, a 20-second play clock, the game clock only stopping for a change of possession, and fewer flags. One potential tagline for the league listed in the survey was “warp-speed football reinvented,” … No more facemasks on helmets, an innovation that the league’s brass believes will make tackles safer. … New, allegedly safer helmets … no extra point kicks, only plays similar to the two-point conversion … Cash prizes for fans who most accurately call the same plays as the players in an XFL app during games … Team fan clubs that get a special section at the home stadium, can vote on jersey designs and team awards, and have access to pre/post-game meet and greet events. … More official team/league sponsored events and vendor booths/trucks during tailgate parties.

It is hard for those of us who grew up playing and watching football with facemasks to imagine the game without it, but the NFL was in business for over three decades before use of the facemask became widespread in the mid-1950s. Football traces its history back to 1869, meaning that it has still spent more of its history without the facemask than with it. Continue reading “XFL explores dropping the facemask”

The AAF and the importance of broadcast revenue

“For the first time in recent history you’re going to see a league that isn’t predicated on a huge media deal,” says the AAF’s Charlie Ebersol. What does that mean, exactly?

AAF CEO and Co-Founder Charlie Ebersol was recently interviewed by Geoff Calkins of Memphis’ The Commercial Appeal. The answers were among the more insightful given by a league whose officials have generally stuck to a well-crafted script. All underlines are mine:

Q: Memphis has a history of success with spring football leagues, but the leagues themselves don’t have a history of success. Why is this different?

A: A couple reasons. For the first time in recent history you’re going to see a league that isn’t predicated on a huge media deal. So in the past, you look at the history of the two attempts that really had a shot at working and they both got killed because their television partner a) had a short-term deal, whereas we have a long term deal, and b) were not built around fan interaction. What you’ll see is that we are putting the power in the fans’ hands. Had it been in the fans’ hands 17 or 18 years ago, in the previous iteration of the spring league, the league would still be around. They were averaging 20-25,0000 fans a game, which is an enormous number relative to what all other sports do.

When Ebersol says “the two attempts that really had a shot at working,” he’s referring to the United States Football League (USFL) of the mid-1980s and the XFL of 2001. He’s right that the USFL averaged 25,627 fans and the XFL 23,410, both of which outstrip today’s NBA (a league-record 17,978 in 2017-18), NHL (17,446), and Major League Soccer (22,113 in 2017).

Continue reading “The AAF and the importance of broadcast revenue”

Which Florida city will get an Alliance team?

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Jay Gruden led the Orlando-based Florida Tuskers in the 2010 UFL season.

Charlie Ebersol has held back on announcing the Alliance of American Football’s eight cities for the inaugural season, instead planning to unveil that information beginning in April with the hopes of staying visible. However, a number of clues were provided at the Facebook Live Q&A that followed the opening press conference, and the most concrete came from Ebersol himself:

Each team will have the ability to take an allocation from the players that play in their region first and foremost, so our Florida team, for example, will pull from the Jacksonville Jaguars and the Miami Dolphins, the players that played there, that established themselves, as well as the collegiate players at University of Miami and Florida State, etc. Each team will have four NFL teams that are in their “region,” and then they’ll also have college teams in that area.

If you’re going to give on away one home state for free, the Sunshine State was a good choice. As the Alliance seeks to create a national presence, Florida is an obvious building block, and there are enough qualified cities that just naming the state doesn’t quite confirm anything.

Continue reading “Which Florida city will get an Alliance team?”