Thursday, July 07, 2005
It's not just that the Devil Rays have the most losses of any team in the majors. It's not that they trail the 29 other teams in numerous pitching and offensive categories.
Just to put the icing on the cake, as an organization, they have the worst tin ear for marketing of any profit-making organization since the Seattle Mariners in the late 70's allowed a schizophrenic 40-something man to have, during a scheduled game, a try-out for team mascot dressed in nothing more than a giant diaper held together with a giant safety pin and, ambulating on all fours for hundreds of yards until the artificial turf lacerated his hands and legs so badly he collapsed and almost bled out next to the first-base coach's box.
The Devil Rays' ownership (I gotta think this is the ownership, and not the marketing department) have instituted an innovation that gives innovation a bad name. If you read this weblog much, you know I'm militantly pro-experimentation. But Russian Roulette with five bullets, what the Devil Rays are doing, is not conventional thinking for a heck of a good reason...it's got a benefit/cost ratio so low, it's beyond not worth trying. It's destructive.
Take a cautionary lesson here for your own organization.
To appreciate fully the abject horror of Tampa Bay's devilry, here's some background:
- The team has the lowest payroll in the majors, 30th of 30 teams.
- The payroll is so low that they'd have to increase it 54% to tie with the next lowest payroll in their division.
- Their payroll is so low they'd have to increase it by 150% to be the median-payroll team in their division.
- They posted very healthy operating income last year, $27.2 million, 2nd among all the teams in the bigs.
- That operating income about covers their payroll.
- They get massive influxes of cash from MLB's revenue-sharing plan, $20 million from last season, for example.
This is not a team that's suffering financially, nor one, based on the minor league players in its system (and on its major league roster), suffering for a lack of future talent.
From a marketing perspective, they really do need to be focused, and build their positioning as an entertainment choice, build baseball awareness in young people, and be all about baseball. They don't need to beg poverty or diminish clarity among game attendees about why they're at the ballpark: the overarching theme is entertainment, fun and entertainment.
¿So why the frell are they hawking furniture in a primary stadium entrance?
According to a story from the South Florida Sun-Sentinel (thanks, Baseball Primer), it's this very chair-raising, sofa-the-little-children, just-say-yes-to-rugs madness that has gripped the Devil Rays, marketing household goods to people seeking out entertainment.
They're not the same thing. If they were, every Levitz would have a batting cage, every Ethan Allen (not him... him) really good sight lines, every Dania a video rental stand. People are not in hard-goods mindset at the ballgame, and if they are, they shouldn't be...the team has failed. Furniture retailing undermines the experience-as-fun, puts customers into a serious, nesting space.
There are probably lots of things you could sell at a stadium entrance that would be silly. But household furnishings are way beyond silly -- they simply run totally counter, 180 degrees from what you're trying to deliver.
It's really important to be flexible in taking on new products, to be open to ways you might manufacture or sell something seemingly different that adds to your capabilities or knowledge or customer goodwill or that slipstreams products you're already selling without having to add staff proportionally or a half-dozen other reasons.
Buckman Labs, for example, is in the chemicals business, but one of their main products is information about chemicals and their use. Their customers can tap into Buckman's expertise not only on Buckman's products, but competitors' as well. It's a different business, but it's related.
There are pizza delivery chains that sell and/or rent videos along with the food on the menu. Different, but makes use of the same distribution effort and the customer is the same. It doesn't confuse the customer -- the evening-at-home becomes a package deal.
There are counter examples, too, five-bullet Russian Roulette extensions that probably won't work.
A consultant in Texas who I used to work with had a client that was in the food processing business. When the price of oil flagged (yeah, that dates this one, doesn't it?) a lot of business and family spending contracted and the processor's customers were applying the old price squeeze on them. The owner, logically, hoped to expand into a higher-margin business. A wholesaler of golf equipment and accessories across town went under in the contraction and the owner of the food processor, a rabid golf enthusiast mortgaged his house and bought the distribution business. Different line of work, different customers, different field, different expertise required. It took the food processor's owner five months to go out of business, but he was able to live in his house for another four before he lost it.
There was the Northwest company that sold very high-end corporate computer equipment, ultra-high performance hardware for network storage. As margins in the category wilted, they decided to expand into new lines. The choice, office supplies. The rationale was "our customers buy computer hardware from us, and the same companies buy office supplies (true), so we can get them to buy their office supplies from us" (false). Bloodbath. They had no expertise in office supplies, nothing innovative to peel existing customers away from their existing suppliers, and the buyer/purchasing authority for one line is rarely the same human as for the other line in any organization big enough to make a difference to a seller.
I'm thinking the Devil Ray logic is the parallel to the computer equipment/office supply one (I'm holding on for dear life to the idea it wasn't completely random): The people who come to our ballpark to see baseball also buy furniture sometimes, therefore, we can get them to buy divans and futons from us.
This is really poor marketing. As I said earlier, blending ideas aren't bad in themselves, but a blending idea not thought-out is likely to stumble.
The Devil Rays aren't starved for money, they're starved for on-field success. The business of baseball comes down to the game and the entertainment/fun related to playing it and watching it played, and being in a place with other people who are being entertained. The Rays' customers (fans) are starved for on-field success. In the absence of on-field success, there is only fun to offer.
Instead, the Rays are offering their fans serious hard goods, major purchases, Divans of Doom, muddying the escapist fantasy of being at the ballpark with the domestic seriousness of furniture. Bad, irrevocably lousy, legendarily tone-deaf marketing.
If we're lucky, in his next dispute with an ump Lou Piniella will eschew pulling up first base and tossing it, instead grabbing a rasher of bar stools and spraying them around the infield, Extreme Makeover: Tropicana Edition-style.
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