Indians sales staff faced down big-time pressure

March 4, 2010
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Late last September, the Indianapolis Indians stared down the barrel of financial disaster.

Following the 2009 season, three-fourths of the team’s sponsorship deals expired, and in this economic climate that’s enough to make just about any sports business administrator hit the panic button.

But Indians officials stood in the batter’s box, dug in their cleats and didn’t blink. Instead, the team’s front office rolled up their sleeves and went to work.

They re-signed the vast majority of those sponsors and enough new ones to see a 5 percent sponsorship sales increase this year. Ticket sales also look positive a little more than a month before the season opens.

Among the Indians, there was never any doubt. In fact, the team kept with its philosophy of investing in Victory Field.

Since it opened in 1996, the Indians have poured $4 million in improvements to the ball park sitting on the west edge of downtown. Anyone in baseball will tell you no minor league team spends more on keeping its ballpark pristine than the Indians.

Despite the rocky economy and an uncertain future, the Indians stuck with that strategy. Instead of being detrimentally tight-fisted, the minor league affiliate of MLB's Pittsburgh Pirates dropped $600,000 into a new video board on the left field wall and $125,000 into much-needed front office renovations, including a re-vamped conference room and trophy display area. Indians officials also initiated a host of game promotions and specials to enhance the experience for fans during Indians home games.

Remember, the Indians are no major league franchise. The team’s financial performance has been steady, but their margins are thin. It takes solid management to churn out a profit near or slightly above $1 million year-after-year. Indians' total operating revenue for 2009 was only $8.5 million, less than one-fourth the operating budget for the Indianapolis Colts or Indiana Pacers.

It would be oh so easy to miscalculate by $10,000 here and $100,000 there and miss the mark and end up in the red. But for decades, the Indians never have. That’s probably why Indians stock trades as high as $25,000 per share.

So, even when times looked tough, like during this off-season, Indians management led by Chairman Max Schumacher and General Manger Cal Burleson never waivered.

And come the end of the team’s fiscal year Sept. 30, I’m sure they’ll register a solid score.

To read more on the Indians’ off-season initiatives and ramp-up for the 2010 season, see the March 8 IBJ print edition.
 

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  • That's a lot of selling
    As someone in sales, I can tell you that's a dang lot of selling. No matter what economy or under what conditions and no matter what business sector in. Renegotiating 3/4ths of your deals and coming up 5% ahead of last year is pretty darn good.
  • Odd
    It's odd in sports business practices to set up your sponsorships to have so many expire during the same year. A number of NBA franchises have been bitten by this. The Pacers for one, had bunches of suite leases expire the same year (2008) and had to really scramble to get those filled. The Pacers didn't have nearly the success ratio the Indians did. Anyway, you have to hand it to the Tribe staff for pulling this off at a less than ideal time. I bet they're trying to better stagger their deals now.
  • Odd?
    My take on contract expiration is that most of it depends on the clients wants/needs. I'm sure every business would like to stagger renewals but that's not always easily done, especially in the economy. Getting any multi-year deal in this climate is a win. Good timing Anthony on a Tribe post, best weather day around here in a long while.
  • Not so odd, Conseco opened in 1999 or 10 years ago. it might be smart to stagger contracts to expire in multi year groups.

    But in the Pacers defense, who would have seen the perfect storm of the Artest situation, the recession and the emergence of the Colts. All have taken their toll on the interest in the Pacers. They need to get a high draft pick and try to build a team around him.

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