Flames and Rebuilding – Follow the Money

 

 

Feaster has been at the helm of the Calgary Flames for just over a year. And while some superficially significant moves have been made over that period (specifically, the trades involving Robyn Regehr and Daymond Langkow) the organizational path and mantra hasn’t changed much despite the switch in management. Calgary continues to market long beloved heroes like Jarome Iginla and Miikka Kiprusoff while battling to remain in the playoff picture in the Western Conference.

There has been a lot of discussion over the Flames apparent lack of a future direction since the off-season. While Calgary’s reluctance to engage in a  "full rebuild" has various origins, "revenue" is probably one of the prime reasons.

According a recent story in the Toronto Star, the Flames are currently fifth in the league in terms of per game ticket sales ($1.5 million). Only Montreal, Toronto, Vancouver and New York make more at the gate. Clubs like Chicago, Pittsburgh, Boston, San Jose and Detroit take in about $400,000 less than the Flames in terms of ticket revenue per contest.

As a result, the Flames are currently only one of five teams that gross more than $60M via ticket sales per year.

That’s big chunk of dough for an NHL club. It’s also a big disincentive to change. Whatever dissatisfaction the fans may feel about the Flames futility the last few seasons, it hasn’t shown up at the gate (at least, not yet). As a result, the signals Ken King and ownership are getting from the market are more "stay the course" than anything else. Veering off into uncharted waters in an attempt to push the club beyond the purgatory of mediocrity means potentially risking the strong, ongoing sales the Flames have established under King since the 2003-04 cup run.

Which isn’t to say the franchise’s motivation is necessarily venal. Calgary has spent at or near the cap for numerous years and the ownership has shown a willingness to bury various mistakes (be it of the coach or player variety) since sales improved in the early part of the new millennium. The franchise is also active in the community and with various charities. 

Nevertheless, $61.5M is a lot of cake to gamble with. There are obviously some aspects of the Alberta/Calgary market which make a rebuild gambit less risky for the Flames – the lack of other professional sports teams, the relative affluence of the city, a downtown dense with corporate headquarters and strong, grassroots support for the team (which is why Edmonton, despite being a weak sister for five years running, comes in sixth right behind Calgary).

But that’s theoretical. It’s easy to speculate from a distance that gate receipts would remain constant regardless of management’s successes or failures. The truth is the potential fall-out of trading a player like Iginla or suffering through an unsuccesful rebuild could have large ramifications for what is currently a very healthy bottom line.

Loss aversion is a strong cognitive bias. People generally prefer to avoid losses more than anything else. It’s a heuristic I once used to partially explain Darryl Sutter’s descent into madness. As such, folks tend to try to avoid losses even more than they look to maximize gains.

This isn’t my call for fans to boycott their tickets or refuse to pay for Flames merchandise until the team decides to fundamentally alter it’s team building philsophy. I’ll leave that up to the individual fan.

Just know that the Flames are probably at or near their regular season cap in terms of revenue; even with the team perpetually finishing 10th in the west. The club could therefore potentially risk a lot with an overtly aggressive rebuild, which is why we’re unlikely to see a more meaningful "switching of gears" by the Flames in the near future.

Until there are stronger signals from the market to change or literally no other choice left on the ice, expect the Flames to continue to more or less tinker around the edges. 

  • jakeryley

    The way the owners probably see it is if the buisness is working, don’t try and change it. Iggy and Kipper (especially Iggy) make the team a whole lot of money through jersey sales, and ticket sales because they are (were) some of the best in the league. So if you trade one or both of those players, where are you going to get all the money from? The Flames have no up and coming superstar player like the Oilers have in RNH, and it is very very difficult to market a team on a whole bunch of 3rd liners. I’m not saying that not doing a full scale rebuild is the right thing to do, but owners don’t want to chance it. Because if they’re making a big profit right now, why do something that might risk it?

  • jeremywilhelm

    @JeremyWilhelm

    Patience is the key? How long can we expect to wait? Has it not been a few years all ready? I don’t think Feaster has any more pull with the owners than Darryl did, so should we expect changes next year inregards to the direction of the team? The year after? Or do we expect changes when ticket sales start to slow down?

    • jeremywilhelm

      Well, I would be prepared to wait another 2-3 years at least. The team isn’t going to have any miracle solution unless they draft one. So the last couple drafts and the next couple coming up have to find the future.

      That is pretty much the only chance.

  • jakeryley

    @JeremyWilhelm

    I agree to a point, who are you going to market if Iginla and Kipprusoff aren’t here. But what happens next year when Iginla walks and wants to go to a contender after his deal is up in Calgary? You have nothing on the ice or in the pipleline waiting to come up and still have the same middling team without Iginla. Iginla will not, and is not now, going to be a first line player for the rest of his career. I don’t know what the answer is. There is solid points on both sides, I guess I’m on one side and everyone else is on the other. Usually when I make a decision it’s usually the wrong one so just maybe you’ll convince me yet.

    • jeremywilhelm

      You are assuming he will do that. Which I believe he definitely will not. He will leave if management asks him to for the good of the team, but he loves Calgary and will no leave of his own accord. As he has stated in the media and to people who know him outside of hockey as well.

      The team is in for a rough couple years, you can honestly not tell me nothing is in the pipeline. Baertschi and Reinhart are solid prospects, possibly even difference makers for the future, Irving is as good as I always praised, and I believe he sticks.

      It’s a start. This team will retool for another good 2-3 years with the draft if Feaster has his way. I don’t particularly like Feaster but I believe he is willing to make changes the right way, slowly and not from a position of weakness. Which is exactly what trading every name player on this team away for a hope of a quick turn around, because that is all it is, a hope and a prayer.

      Patience is key.

  • jakeryley

    If this team misses the playoffs again, significant moves are required – and if they aren’t done, then my apathy, which is by in large already present, will be solidified.

    Either win the free agency bidding war – which isn’t a very smart way to build a team as it’s never the wisest way to spend money, or rebuild – those are the only two real options facing this organization built upon two ageing and cracking foundations. However, with management’s reluctance to rebuild, something as dramatic as landing both Suter and Parise is needed for this team to become competitive again…I mean, we’re still close to being a good team right? We only need another franchise forward and #1 d-man….right?…sigh.

    The other option is of course to go into a full on rebuild. Those are really the only two options this organization has…IF they want to build a winner. Otherwise, as Ken so strongly points out…the Flames organization will continue to be perpetually irrelevant as far as the NHL standings are concerned.

    I don’t care how many times Jay Feaster, Brent Sutter, Ken King or Jarome Iginla tell me that they “think” they can be a good team. They can’t. They aren’t a good team, and certainly are nowhere near being a team GREAT enough to win anything of worth.

    • jeremywilhelm

      And yet there is absolutely no way for them to become relevant any time soon. So patience is required. You are gonna be pissed off either way, might as well relax and enjoy the ride.

      • jakeryley

        I disagree. I’m not advocating Iginla and Kipper be dealt, however this team needs to take advantage of what it can sell and still not set themselves back in the jersey selling category.

        Bourque, Jokinen, Sarich, Stempniak could and should be advertised at the trade deadline – and they should be traded. If we’re say…5 pts back from the 8th playoff spot come deadline time – would you be okay with them standing pat like last year only for them to miss again? Would you not advocate trading any and all players not named Iginla and Kipper?

        • jeremywilhelm

          I think if you can trade them for high picks or position players that we need, then yes, but to trade them for the sake of just trading them would be silly, you are essentially giving up, which is a terrible attitude for an organization to adopt. No winning organization/company just gives up, especially when the long term plan is success.

          That is like a company declaring bankruptcy and then in a year or two asking investors to give them money again with a new marketing scheme, there is no trust there anymore.

          I am not advocating having more of the same, I don’t like the head coach, and I think is a very very poorly built team, but changes can be made in the offseason without gutting the whole team.

  • jeremywilhelm

    Its the nature of the fan to be shortsighted and narrowminded with a what have you done for me lately attitude. If the owners weren’t making money, this team wouldn’t even be here for you to cheer for.

    It’s so easy for people to propose trades and say it is easy to rebuild, well truth is, you have no clue how difficult it is to get a good return for anyone.

    You trade Iginla and Kipper and who do you market in this team? Who’s jerseys are you selling?

    • jeremywilhelm

      This team has pieces that it can market without KIpper and Iggy. Giordano, Backlund, Sarich (just kidding), Irving, Bouwmeester, Glencross, and potentially Baertschi and Reinhart.

      • jeremywilhelm

        You could put all those guys you stated together and they wouldn’t sell the same amount of jerseys and paraphenalia that Jarome and Kipper sell by themselves.

  • Great article kent. I’ll ask you and everyone else again like I did last night.

    How do the Flames get out of this ever growing rut year after year? If you don’t want to overpay and go balls deep in free agency this summer, can’t trade many of your players because the 29 other GM’s know what you have, and are constantly drafting 10th-16th (?); what does Feaster do to make this team an upper tier team? I can’t figure out why they would not look into trading Iginla or Kiprusoff or anyone else for that matter that is over 30 years old. I get that without Iginla and Kiprusoff that the Flames will likely lose their share of games, but can it get much worse than it is now. There is no skill or speed in this lineup. They have shown over the last decade (minus 04) that they are a very inconsistent team with little heart. If the Flames could get quality picks and prospects for Iginla and Kiprusoff, at least the future would be bright. Right now the future looks like it did last year, and the year before that ect, ect.

    I went to a flames game about a month ago when they lost to Columbus in a shootout. I sat close to Ken King and asked the season ticket holders next to me who were the guys sitting with him.They said thatthey were the corporate head honchos (owners? sponsors? big spenders? I’m not sure). I found it funny they all had Flames jerseys on with #12 Iginla stiched on the back. In my mind the people who know nothing of hockey are making the decisions on which way this club is heading. Maybe that’s the way it is in other NHL cities too, I don’t know. But when I seen all those Iginla jersey I knew right away that those guys will determine if Iginla is traded or not, not Jay Feaster.

    I’m frustrated. I can’t imagine owning season tickets to this farce.

  • jeremywilhelm

    That really rubs me the wrong way. Continuing to have mediocre seasons in order to maintain the flow of money? I know it’s a business, but still…. It’s a game as well.

    If I may quote Albert Einstein–> Insanity: Doing the same things over and over again and expecting different results.

    This team will not make the playoffs for a third year in a row, because management continues to twiddle their thumbs while counting the stash of cash they continue to gather.

    My rant is now done… have a nice day

    • Id say the people in question don’t expect things to change – or least hope they don’t on the dollars side. It’s hard for me to overly indictment them over that either. I mean, they’re making good bank with the strategies they’ve employed over the last 7 years or so.

      And to be fair, the franchise has certainly shown a willingness to make some changes. They have fired a handful of coaches, a GM and made a lot of personnel moves. The last mile – to commit to a full rebuild – is long one given what they would be risking.

      This isn’t me necessarily condemning King and company. Just sketching out the lay of the land.

      • RexLibris

        Great article, Kent. Thank you for writing it. I have listened (read, actually) to several comments here over the past couple of years about the revenue generated by Iginla’s role on this team and it became clear fairly quickly that his impact on this franchise was seen by fans as not merely limited to on-ice performance and community work. I think that his importance, financially, to the Flames, and by extension their fans, is what drives a lot of the emotion that surfaces when fans are engaged in the “trade Iginla” debate and what the return ought to be.

        This is something that some people here may not want to hear, and it has been mentioned already, but I bring it up as some background reading regarding fans’ reactions to their team’s perpetual disappointment: check out Leafs Abomination by Dave Feschuk and Michael Grange. You can read about a beloved franchise that has been hijacked and abused at the fans’ expense for decades. I’ll save you some time in coming to the book’s general conclusion and one that speaks perfectly to the gist of this article, in the end the primary concern is about money, and if the fans want change then they need to stop feeding the dysfunctional system. In other words, if fans truly feel that the Flames organization doesn’t give a rat’s behind about winning and just wants to keep stringing you along ad nausuem for the money, then stop paying. Stop watching, stop buying and worst of all, stop talking about them.

        Yeah, I don’t see that happening, but it got that bad in Toronto, and the threat of it seemed to change the board’s minds a little bit. So maybe a threat is as far as fans in Calgary would need to go. The same discussion happened in Edmonton right before Katz took over, so I’m coming at this with some experience.

        With regards to the prospects and someone to take Iginla’s mantle, I just don’t see anyone stepping up in the next two years. I think Baertschi and Reinhart will excite, but not to the same degree. Likely the next Beloved of Fans will show up in some unexpected or at-this-time unforeseen way.

        On that note, Kent, once the WJs finish I’d be interested in reading your assessment of Baertschi and Granlund (Markus, of course). The former seemed to be fairly quiet, concussion aside, and the latter had a good game today. Just curious.

        Anyway, that post should put Vintage Flame a few cups of coffee over his daily limit. =)

      • jeremywilhelm

        The people in charge may not be expecting things to change, but some of the fans still hold hope for this team making the playoffs, or are otherwise hopeful for a full tool rebuild. Its high time the guys upstairs made up their mind on what their goal is. They are NOT making the playoffs with the team they have assembled, so either make changes in the lineup to give yourself a better shot at the playoffs, or trade some of your assets and get retooling. It makes me angry how money is such a driving factor in having a team continue to slide down into irrelevancy.