Monday, February 20, 2012
On the Packers' corporate growth
By Kevin Seifert
The Green Bay Press-Gazette focused this weekend on a nuance that probably wouldn't have occurred to fans in other NFL markets: Reconciling the growing commercialization of the league's individual franchises with the Packers' history as a small-town operation.
As an unusual small-market operation, the Packers face unique challenges in dealing with the commercial growth of the NFL's franchises.
Through interviews over several months, reporters Pete Dougherty and Rob Demovsky documented the Packers' dramatic rise in size and local revenues in recent years. They noted that the franchise has moved away from front-office executives with local ties and noted at least one instance -- a failed attempt to take over the Packers Hall of Fame -- when its business appetite overstepped its bounds in the eyes of many locals. A few thoughts from my end:
Like it or not, the Packers have followed a clear path set around the NFL. Its teams are the most valuable sports franchises in the world, and their values have risen even in an extended economic downturn. They are part of a $9 billion industry, and it's probably unrealistic to think they would resist growth in a free market.
The Packers' biggest source of revenues will always be their share of the NFL's television revenues, a stream that keeps the franchise afloat and has largely replaced the stockholder bailouts that defined its earlier history. The team now uses stock sales for capital improvements, including an in-progress $143 million project at Lambeau Field. I know some of you might think the Packers are taking advantage of fans who want to own stock. But from a national perspective, that beats the hard feelings associated with taxing an entire municipality made up of football and non-football fans alike. Consider it the lesser of evils.
As a midwest transplant, I'm not sure how important it is for the Packers' top executives to have been born or raised in Green Bay or attended school in Wisconsin. Relating with local citizenry requires an open mind, good listening skills and a sense of place -- not necessarily a birth certificate or in-state diploma.
It's true that president/CEO Mark Murphy was identified by a search firm and had no ties to Wisconsin when he was hired. But his arrival reflected a trend that brought the Packers inline with several other franchises. Local ownership/leadership is less prevalent these days. New Jersey native Zygi Wilf owns the Minnesota Vikings, Houston resident Bud Adams owns the Tennessee Titans, St. Louis-based Shahid Khan recently purchased the Jacksonville Jaguars, and New Orleans Saints owner Tom Benson is from San Antonio, Texas.
With that said, Packers executives have a complicated set of responsibilities that can't be replicated elsewhere. As revenue officers, they have an obligation to maximize local income. But they must also be careful about how they capitalize on local willingness to contribute, be it through stock sales or tax breaks or other local levies. Further, the Packers' outsized aura relative to the size of the city means every decision the Packers make has a larger local impact than any other NFL franchise.
I was interested to see the rise of Tim Connolly, the former Vikings general manager whom the Press-Gazette paints as the team's second-most powerful business-side executive after Murphy. Connolly is the vice president of sales and marketing, but appears to have wide latitude within the organization. Connolly is a hard-driving businessman who left his mark on the Vikings during a 15-month tenure. Many of the people he hired in 1999 remain with the organization, including vice president of football operations Rob Brzezinski and chief financial officer Steve Poppen. Connolly is the type of hard-charging revenue driver the Packers have probably never employed, but is not uncommon in today's NFL.
Long story short, I think the Press-Gazette project illustrates that the Packers are a uniquely big business in an uncommonly small market. There are no real parallels for them to follow in terms of operation or responsibilities toward two separate entities: Their 31 NFL business partners and their hundreds of thousands of citizen/stockholders.