On Saturday night, I hosted a live sports business chat during NBA All-Star Saturday with two special guests joining us to take your questions. Darren Heitner, CEO of Dynasty Athlete Representation was with us for the first hour and Drew Cloud, Vice President of Sales and Service for the New York Knicks took questions during the 2nd hour. You can see a full replay of the chat below.

This Sunday, the Dallas Mavericks will host the 2010 NBA All-Star game at Cowboys Stadium in Arlington, Texas. Admittedly, I’m not a huge NBA fan. I hear a lot about the Phoenix Suns on sports talk radio because of where I live, and I follow the Denver Nuggets because they have my favorite player, Carmelo Anthony. So normally, the All-Star Game might slip by me relatively unnoticed, especially since I’m running a half-marathon that day, and it’s every woman’s favorite holiday - Valentine’s Day!

But today I received a press release from a large PR firm. It’s not clear who exactly commissioned the press release, but I’m guessing it is a group called ‘the Coalition to Advance the Protection of Sports logos.’ After reading the press release, it really made me wonder if sports fans care about this age-old question: Are they real, or are they fake? (Merchandise, that is).

The press release attempts to ’separate facts from fiction.’ Some of the fictions include statements like ‘counterfeiting isn’t that big of a problem’ and ‘people don’t sell counterfeits in North Texas.’ The facts given are that businesses lose $600-700 billion (yes, billion) annually due to counterfeiting and that innocent buyers get scammed by this inaccurate and often poorly made merchandise.

So my questions for all of you are:

• If you went to an event like the All-Star Game, are you concerned with whether the merchandise is official or not?
• Do you look for the hologram on the tag?
• Do you double-check the spelling of all the names and logos?
• Are you concerned with the exact colors of the logos?
• Or does the lure of 2 shirts for $15 override any of those issues?

At times I’ve been worried only about getting a good deal. Other times, the event or team involved has been important enough to me to make sure I have the official merchandise. What do you think?

I saw a great story the other day about a failed promotion by the NBADL Utah Flash. Back in September, team owner Brandt Anderson had talked about hosting a game of 1-on-1 between Michael Jordan and Byron Russell at halftime of a Utah Flash game. The match would be flashback to their famous confrontation at the end of Game 6 of the 1998 NBA Finals, where Jordan hit the series-clinching shot over Russell. Anderson was going to offer $100,000 that the winner could donate to a charity of their choosing, and Russell was on board. However, Jordan declined the challenge so that seemed to be the end of it…at least temporarily.

Anderson ultimately decided to continue with this event.  He still promoted that the 1-on-1 match would occur at halftime of Monday’s game and there were “Jordan sightings” around town that day. This led to over 7,500 fans attending that night’s game, expecting to see this halftime match, but instead they ended up seeing Russell take on a Jordan lookalike. The crowd was outraged, and the team experienced a very vocal backlash. Anderson now regrets his decision to move forward with this stunt, and is trying to repair the damage with refunds and free tickets to future Flash games.

So what do we learn from an incident like this?

• Viral and word-of-mouth marketing is very powerful! Anderson had all the makings of a great viral campaign, even “leaking” a video of “Jordan” eating at a local restaurant. However, his campaign came with a very specific expectation that he could not meet. If you build up that much buzz, you have to deliver on customer expectations.
• Teams need to be more transparent when using publicity stunts to sell tickets. For example, last year the Philadelphia Phantoms hosted a game where David Akers and Andy Reid were going to do the ceremonial puck drop and sign autographs. However, through the language of the press release and marketing materials, it was pretty clear that instead of the Eagles’ player and coach, it was going to be a fake Akers and Reid in attendance. The team ended up with the desired effect of generating buzz, but they also managed the fans’ expectations and still had a successful promotion with a boost in attendance.
• When customer expectations are not met, immediate action must be taken to try and resolve the problem. Anderson is doing just that through his immediate apology and offer of refunds and free tickets. The only question will be whether fans feel that this service recovery is enough to compensate them for their failed promise. There may be some lingering skepticism for casual fans that were in attendance to purchase tickets to a future game.

The New Jersey Nets are currently suffering through a historically bad start to their season. Seventeen games, seventeen losses and a fired head coach is a tough stretch to say the least. While the goal of the business side of the franchise is to generate a profit regardless of the product on the court, there is no doubt that this type of situation can be very damaging to the organization. In particular, the Nets have several factors they must overcome:

1. A very poor product on the court, arguably the worst in the league
2. Operating in a very crowded market with many sports and entertainment alternatives
3. A weak mass transit system that doesn’t let them tap into the New York audience
4. The fact that the team is moving to a new building in a new city in the near future
5. A complete shift in management as Bruce Ratner sells the team to Mikhail Prokhorov

With these hurdles standing in their way, what can the Nets do to keep the business moving forward while the team performance does not cooperate?  Here are a few ideas, some of which the team has already implemented.

• Market basketball and the NBA without focusing on the Nets – The team has already done this with one of their earlier ticket package incentives that gave buyers reversible jerseys featuring players on the other teams. They can take this further by openly promoting the best opponents that are coming in to town over the coming weeks.
• Focus on specific games instead of the entire season – If you think about trying to sell all of the remaining games, it can be quite an overwhelming tasks. So focus on specific games and opponents that give you the best chance to succeed and concentrate your sales efforts on those dates.
• Discounted pricing – While cutting prices doesn’t fix the underlying problems, it does open the product up to a wider audience. Since the team isn’t a draw, the buying decision for consumers comes down to what form of entertainment they want to see. In order to compete with options like going to the movies, the price need to be comparable. This approach can also be achieved through special “family packs” that combine tickets with food and merchandise for a fixed low price.
• Connect with season ticket holders – The worst potential impact of the team performance is the eventual loss of season ticket holders. Every effort needs to be made to maintain relationships with these customers through this tough time, as they are still the biggest source of ticket revenue. Give them additional free tickets to share with friends, reward them for referrals and let them take part in game experiences so that they still get the most value and enjoyment out of their season tickets.

If you were in charge of sales and marketing for the Nets, what would you do right now?

It looks like Mikhail Prokhorov, the richest man in Russia, is going to buy an 80% stake in the New Jersey Nets from current owner Bruce Ratner.  He will be the first team owner from outside North America for the NBA, and the first “Russian billionaire” to take hold of a team in a big-four U.S. league. So what does this actually mean for the Nets? Here are three of my takeaways:

1. Any doubts about this team moving to Brooklyn should probably end. Yes, the team has continued to run into multiple roadblocks, but Prokhorov is also purchasing a large percentage of the Barclays Center and the Atlantic Yards project as part of the team purchase. The potential value of this team is really based on their ability to get into the new facility in the better NY market, and he would not be spending the money without being confident in that future value. You’re going to see this project move quickly now, especially with a three month deadline to break ground (otherwise they’d lose their tax-exempt bond financing arrangement with New York and Barclays could back out of the naming rights deal).

2.  The previously thrifty Nets will probably start spending more on players, and I doubt they will care about the luxury tax threshold. I’m saying this based on the behavior of other Russian team owners from other sports, particular European soccer and Russian women’s basketball. Roman Abramovich owns the Chelsea soccer club and Alisher Usmanov has a large stake in Arsenal F.C., and both have shown a willingness to spend money on players, particularly Abramovich. Owners from Russian women’s basketball teams have been willing to spend a lot of money to bring over the best players from the U.S. and other countries. The common trend is spending money on top talent to do everything they can to win. I’d expect the same strategy from Prokhorov.

3.  Prokhorov believes that this will increase the popularity of the NBA in Russia, and I agree with him. The game has been growing there over the past few years, and now the fans in one of the largest international markets will have a team they may identify with more. U.S. teams have gains popularity in foreign markets via foreign players (Seattle Mariners, Houston Texans, etc), so maybe an owner can have a similar effect.

By now, everyone knows the story, but let’s do a quick recap anyway.

• Jordan Crawford, a college basketball player from Xavier, attended a Nike basketball camp that LeBron James was at.
• During a game at this camp, Crawford dunked over LeBron.
• Employees from Nike confiscated all video footage of said dunk, possibly at the request of LeBron.

I know that I’m skipping over the details of the story, but that’s a nice quick summary.  The news of this generated a lotof buzz in the sports media, both traditional outlets like television and radio, as well as new media outlets like blogs and social networking sites.  The big questions were:

1. Did LeBron and Nike make the right or wrong decision in confiscating the footage?
2. Will we ever get to see this dunk?

Well today, the 2nd question was answered, as two different video clips of said dunk have been released on TMZ.com and eBaumNation.com.  Here’s some of the footage (Note – I am operating under the assumption that this is legitimate. There is always the chance this is fake.)

So now we all must return to the first question – was the original decision to confiscate the video of the dunk a good or bad move by Nike and LeBron?  I heard a lot of people saying that in the age of YouTube, it was a good thing to take the video, otherwise the “embarrassing” footage would be out there for the world to see for years to come.  By taking the video away, you’d get a short-term negative reaction, but ultimately the story would fade and LeBron’s reputation wouldn’t take a hit.

However, I completely disagree, and I think that so far, the evidence is in my favor.  By taking away the video, Nike turned this into a much bigger story, unintentionally creating a viral conversation that most companies would pay big money to generate. Everyone wanted to see this dunk, and taking the footage away only intensified our collective desire.  When the clips leaking out today, Twitter was buzzing with people sharing the link and talking about the dunk. If the video made its way around naturally the day or so after it happened, people would have reacted and then the story would end.  Instead, the story has lasted for several days and will probably continue for several more.

So back to the question one more time – was confiscating the video the right decision?  If they wanted to “protect” LeBron and try to make this a non-story, then no.  However, in an odd way, Nike has generated a lot of buzz and publicity, so maybe it ended up being the right decision but for the wrong reasons!

UPDATE – 7/24/09: News came out today that Nike will now return the confiscated video footage. Of course, this was decided only after other video footage had already leaked.  And according to their statement, their decision to take the video “…was never about the play or the player, it was always about our media policy.” If it was really about policy, why did it occur after the dunk, and why decide to release it now? I don’t know how these decisions have been made throughout this story, but they did either strategically or accidentally manage to sustain quite a buzz surrounding all of this, regardless of what their actual intentions might have been.

Today’s post is courtesy of guest blogger Joshua Duboff of The Sports Business Exchange.

The day after the NBA Draft is usually devoted to commentaries on which teams end up as winners and losers from the night before. This Draft offered plenty of opportunities for discussions. However, what rarely gets discussed is the Draft’s sponsors. I attended last night’s draft as a mere spectator, but as many in the sports business encounter, I could not stop myself from looking around for sponsors and analyzing their activation. From what I could gather, there were four sponsors: EA Sports, Adidas, Kia, and Hewlett Packard. Here are last night’s sponsor winner and losers for on-site activation.

Winner – EA Sports:  EA Sports had the best sponsorship package of the evening. Not only was their logo everywhere, including the back side of some of the tickets, but they had an activation kiosk in the main lobby of WaMu Theater as well. At the station, fans could pose with a basketball and have their picture superimposed onto the cover of NBA Live ‘10. The photo printed out and was a great take away from the evening. There were also gaming stations where fans were playing Playstation. While I couldn’t get confirmation, I assume the fans were playing NBA Live ‘09, since the 2010 version doesn’t come out until October 6th (I only know the release date because of last night’s sponsorship). According to a Sports Business Journal article from June 22, EA Sports also gave away branded Dwight Howard Fathead Tradeables to fans as they left the event. I stayed until the very end of the Draft and was then ushered out a side door so I did not get a promo. If this promo is true, that’s a good take away item, although I’m not sure how a Dwight Howard Fathead was embraced in the New York market. At my desk, I still have my green Sprite cup from the 2007 NBA Draft.

Losers – Kia & Hewlett Packard:  Kia and HP took different routes. Kia handed out reusable bags with car information pamphlets inside. Many fans grabbed a bag, but many bags eventually found their way to the ground as well. The color of the bags (redish brown) left something to be desired and lacked distinguishable marks to recognize the 2009 Draft. Inside the theater, the video boards rotated between sponsor logos (EA Sports, Kia, HP). This was the only sponsorship I could see for Hewlett Packard. There was no activation, simply signage (note: most of HP’s sponsorship was behind the scenes with printers and scanners).

Undecided – Adidas:  I had to be reminded that Adidas was a sponsor because there was no activation outside of selling NBA Draft merchandise. Had I been in the market for a new hat, I probably would have more easily identified Adidas as a sponsor. That being said, there was a long line at the merchandise table all night. With both local teams only having on relevant pick and assuming most fans are from the Tri-State Area (in other words, few people should be there buying Clippers or Grizzlies gear), I suspect Adidas was pretty happy with the crowds at their table.

Like I mentioned earlier, I may have missed some activation points. However, if I as a sports business professional couldn’t find these points, I can’t imagine the rest of the fans could either. EA Sports wins.

Here are three quick thoughts on sports business storylines for the 2009 NBA Finals.

• What happens to the Kobe/LeBron ads?  Whether it’s Vitamin Water, Nike or the NBA itself, there was a lot of hype focused on Kobe vs. LeBron.  Now that the Magic have eliminated the Cavaliers, will these ads disappear?  Maybe Nike can add a puppet for Dwight Howard, since those commercials had done so well.
• Speaking of Mr. Howard, how will he be used in the NBA’s marketing efforts, or in the marketing from league partners?  Off the top of my head, I’ve only seen him in the T-Mobile ads where he plays second fiddle to Wade and Barkley.  Howard is a funny, charismatic athlete and should be easy to promote.  When I asked people on Twitter what stories they were following, this was definitely the most common response.
• The ratings for both conference finals were excellent, but will any disappointment about the match-up impact the rating for the finals?  I think there will be a small hit, but they still have the power of the L.A. market.  I think one early win from the Magic would reassure people that it will be a good series and keep the viewers tuned in

And of course, I cannot forget the NHL Stanley Cup Finals, even if I’m two games late!

• How will the declining auto industry and specifically the recent bankruptcy filing by GM affect ticket sales for the games in Detroit.  The Red Wings do a great job drawing fans in, especially in the playoffs, but the fans still need money to buy the tickets.
• Is the rematch from last year’s finals a good thing or a bad thing for the league? Since we’re two games in, we already know some of this answer.  The ratings are upfrom games 1 and 2 last year (which were on Versus) and from NBC’s first two games last year (games 3 and 4).  I would think the league is happy to see the Penguins come out of the East, but it might have been a great opportunity to strengthen the NHL’s presence in Chicago (top 5 media market) if they had advanced over Detroit.
• Does the NHL need to worry about over-marketing Crosby?  Clearly he’s one of the most talented players in the game (arguably #1), but his team is already down 2-0.  Is there a risk to pushing Crosby if his team fails to win again this year?  Maybe there is too much pressure on him to succeed.

Finally, here are the results of the poll that I’ve been running the past two weeks:

While more readers said they were paying closer attention to the NBA playoffs, the numbers are pretty close!  

So what other stories are you following?  Leave your thoughts in the comments!

UPDATE:  Well, it didn’t take Vitamin Water long to get their Dwight Howard ad together! Check out this post from Darren Rovell of CNBC, complete with the commercial video clip.

Vitamin Water has recently come out with a new advertising campaign, based around the argument of “Who is better -- Kobe or LeBron?” I’ve seen these ads both on TV and online (ESPN.com had this campaign on their frontpage yesterday). You can view the most recent television commercial below:

Now, if you’re going to pick a couple of NBA players to promote your product, you really can’t go wrong with Kobe and LeBron.  However, I wonder if they planned this campaign weeks or months ago, based on the thought that the Lakers and Cavaliers would face each other in the NBA Finals.  Both teams were considered almost locks to make the finals when the playoffs started, but now some people believe that the Lakers (and maybe even the Cavaliers) could be upset in the conference finals. 

My question now is, looking at this campaign as an example, is it too risky to focus on certain players during the playoffs since their visibility will drop if their team is eliminated?  Will Vitamin Water continue to use the campaign during the finals if either team is eliminated?  Or maybe, are Kobe and LeBron such powerful icons that it doesn’t matter if one of them loses before the finals?  I have to believe that an early elimination of the Lakers or Cavaliers would have some negative impact on this campaign.  What are your thoughts?

Remember to check out TheBusinessOfSports YouTube Video Library for more sports commercials, viral videos, and other valuable content.

Everyone here has most likely seen this classic sports commercial, featuring a very intense game of HORSE between Michael Jordan and Larry Bird:

Why doesn’t the NHL (or one of the NHL’s top sponsors) create a similar commercial featuring Sidney Crosby and Alex Ovechkin?  These two are clearly the most marketable players in the league, and on top of that, they have quite the individual rivalry brewing.  How hard would it be to put the two of them together in a hockey-style HORSE match? 

If I was creating this commercial, I’d even try to make it as close to the commercial above as possible.  In fact, isn’t McDonald’s a league sponsor?  They should be the company to recreate it.  Combining the nostalgia of the original commercial with the top two emerging stars of the NHL would be an instant hit!  Someone get McDonald’s and the NHL on the line!