Net Gains

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In a professional sports world where attendance has declined across the board and player lockouts have become dinner-table discussion topics, the Seattle Storm has experienced an increase in attendance and season-ticketholder retention. According to the organization, gross revenues have risen 76 percent in three years. Corporate sponsorship of the team has similarly increased, and the organization touts strong community partnerships. But the real thrill and challenge in the niche-market Women’s National Basketball Association—since its teams already play the best women’s basketball in the country—is to make the league a viable, respected, enduring business.

The women-owned Storm franchise is pulling its share of the load. And, says co-owner Dawn Trudeau of the organization’s business model, “It’s working.”

Having recently completed its 15th season, the WNBA, for better or worse, is stepping from the shadow of its fostering organization, the NBA. Even with big brother’s backing, the story of the league has been one of indigence and impermanence. Six WNBA teams have folded and three others have relocated as the league expanded from eight teams to 16 and then contracted to the current 12. Franchises shift regularly, often resulting in diluted talent and weak footholds in the cities where the teams play. Only three franchises—the New York Liberty, Los Angeles Sparks and Phoenix Mercury—remain in their original cities from the eight-team league that began play in 1997.

According to Jim Copacino, the Seattle-based ad wizard whose firm Copacino + Fujikado is behind much of the Seattle Mariners’ popular television advertising, the biggest challenge to the Storm’s future is the financial stability of the WNBA as a whole. “If every team were in Seattle’s position,” Copacino says, “I think you’d have a healthy and viable league. But we know that isn’t the case.” The WNBA’s new president, Laurel Richie, is optimistic, however. “When we have teams that are strong and steady and stable and growing,” she says, “then, by definition, so goes the league.”

The Storm’s business leadership understands and embraces this mandate. “Our goal is to play our part, however small or big that may be, in securing the financial viability of the WNBA,” says Storm president and CEO Karen Bryant, who was named Executive of the Year by the Seattle Sports Commission at the group’s annual Sports Star of the Year event last January. “And we think the most compelling way for us to do that is to build the model and make it happen.”

From the beginning, Force 10 Hoops, which bought the Storm from Clay Bennett in 2008 for $10 million, has strived to operate in the black. While it also measures success through ticket sales, sponsorships and fan engagement, its ultimate goal has always been profitability. “In order for our team to survive long term,” says co-owner Ginny Gilder, “it needs to be an operable, viable business.”

Still, while the Storm is seeing increases in almost all of its major metrics, Bryant says the team is two to three years away from profitability. This, she adds, puts the company slightly “ahead of schedule” for operating in the black by 2014, which the ownership group had been told was a reasonable expectation when it bought the team from Bennett.

One way Bryant and Force 10 hope to grow revenue is by generating income in the off-season. Because the WNBA season runs from June through September (and into October if the team is in the playoffs), the Storm’s revenue flow fluctuates greatly. Bryant, confident in the Storm’s popularity on and off the court, is trying to figure out ways to market the team year round.

The recent history of that team is familiar to many Seattleites and fans of Washington basketball. In 2008, as the Seattle SuperSonics picked up and moved to Oklahoma under new owner Bennett, four women calling themselves Force 10 Hoops stepped in to assume ownership of the local WNBA franchise—and keep it in Seattle. Dawn Trudeau, Lisa Brummel, Ginny Gilder and Anne Levinson—Levinson is no longer with Force 10—bought what was then an 8-year-old team.

When Force 10 acquired the Storm, it avoided the bare-bones, cost-cutting model typical of many WNBA franchises. It also made Bryant the CEO. Bryant had been with the Storm since its inception in 1999 in advance of the 2000 season, first as vice president of business operations and then as chief operating officer. Before joining the Storm, she had been assistant general manager of the Seattle Reign in the now-defunct women’s American Basketball League.

From the beginning, Bryant and the owners agreed that hiring talented staff was the key to success. “You have to execute,” notes Trudeau. Bryant says that in three years, she and Force 10 have effectively doubled the staff of the organization from its original complement of 16.

Next, the Storm amped up television coverage by negotiating deals with local broadcasters in 2010. While WNBA games don’t generate NBA-type dollars, the Storm benefits from dial position when its games are on KONG-TV and from the ability to control content by producing its own broadcasts. Seeing the Storm on TV allows someone to sample the team and decide whether to attend a game, says Bryant, who believes TV coverage is “the single biggest thing in terms of the long-term success of women’s basketball.”

“Once people see us, they like us and they want to come back,” adds Trudeau. Season ticket figures don’t lie: The Storm’s season ticket retention for 2011 approached 90 percent, having exceeded 80 percent in each of the previous two seasons. (The NBA pushes for retention rates of 85 percent with its franchises.)

Of course, it helps that the Storm captured its second WNBA championship in 2010, winning every game it played at home and generating the sort of community buzz most sports-team owners only dream about. The Storm caters to a primarily female and family-oriented demographic, but it hopes to expand its fan base through continued marketing. “The fact that we’ve really built this business from the fan’s point of view, I think, is extremely noticeable,” says Bryant. Copacino and Gilder agree, pointing to a widespread sense that Storm players are not that far removed from the general public, and that there’s a feeling of intimacy and excitement generated inside KeyArena, the team’s home court.

The enthusiasm of the fans is what drove the Storm’s latest ad campaign and website redesign, developed by Wunderman Seattle. The ads feature photos of players and fans caught up in the fervor of a game. Each photo is labeled with words like “Pride,” “Drive” and “Yours.” “The biggest business challenge is simply getting new people to come in and experience a game,” says Sean Howard, Wunderman’s global client services director. “Once you go to a game, most people are really kind of hooked.”

Howard believes that attracting fans to KeyArena goes beyond ticket sales. He says Force 10 and Bryant have a “level of sophistication of how they think about their particular brand and what they are trying to do with it, [and] what they are trying to inspire in the community.” Promoting those ideals, he says, shows “a level of thinking and leadership that is league leading within the WNBA.”

This level of thinking includes early decisions made with long-term goals in mind. “Our goal is eventually to make money,” says Brummel, “but our goal [was] to get the team here [in Seattle] and sustain for the long term, more than anything else.”

Bryant shares the belief. “The Storm will live on long past us,” she says, “and we have the pleasure and privilege of being stewards here and now. But long after that, the relationships that we have are really what’s priceless.”

The real drivers of success, Bryant believes, are quality basketball and an enjoyable fan experience. “We’re all just working on packaging,” she says.

The product is exceptional in all 12 WNBA markets, she adds. The Storm is merely one of the first franchises to invest so heavily in it and to be “nimble” enough to take advantage of its independent ownership.

“When the owners bought the team,” Bryant says, “they said, ‘We want to be a model franchise to illustrate to other teams that if you invest in this business, the return [on investment] is there.’”

Having won a WNBA championship in the third year of Force 10’s ownership, the Storm clearly demonstrated the sort of ROI that not only builds balance sheets, but also fan engagement. And having weathered a much more diffcult year this past season—at press time, the Storm was battling just to make the playoffs—Bryant and company know full well that true success in bringing women’s sports into the mainstream is as much about winning converts as it is about winning games.

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Sponsorship and success

The Seattle Storm has seen a 32 percent growth in sponsorship dollars year over year. Its sponsors include such local icons as Alaska Airlines, Virginia Mason, Seattle Children’s, Group Health, PCC and Ivar’s.

The Storm is one of five teams in the WNBA with a “marquee partnership,” something common in professional soccer but unusual in other American professional sports. Under the team’s agreement with Microsoft, the jerseys that Sue Bird, Swin Cash, Lauren Jackson and their teammates wear sport the logo of Microsoft’s Bing search engine. Ad executive Jim Copacino sees the brand association as particularly fitting. “The league and the Storm’s brand fit well with the Bing brand,” he noted. “It says, ‘We’re an alternative. We’re not the biggest. We’re scrappy and you should pay attention to us.’”

The Storm’s corporate sponsorships are steeped in community building. Storm players, coaches and staff make more than 100 appearances each year. Many players partner with nonprofit organizations in Saettle. The team carries out its multiple annual community programs under the banner of the Seattle Storm Foundation. —S.D.

Seattle Storm point guard Sue Bird is a fan favorite. Photo by Neil Enns/Seattle Storm

WNBA BY THE NUMBERS

12: teams

6: teams owned independent of NBA teams

3: teams with predominantly female ownership groups

3: teams operating in cities without an NBA franchise (Seattle, Connecticut, Tulsa)

1: team that has turned a profit (Connecticut, 2010)

$852,000: Team salary cap (NBA cap: $58 million)

$35,880: Starting Salary

$103,500: Maximum salary

Executive Q&A: Toward a More Perfect Union

Executive Q&A: Toward a More Perfect Union

As president of Seattle-based SEIU 775, David Rolf represents more than 40,000 long-term-care workers in Washington and Montana.
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David Rolf expanded the number of home-care and nursing-home workers in his Service Employees International Union (SEIU) chapter twentyfold — to 44,000 — in the past decade. He was a leader in Seattle’s push for a $15-an-hour minimum wage and has received national attention by calling for labor unions to innovate.

FAMILY: I grew up in a middle-class family in Cincinnati. My great-grandfather on my dad’s side was the president of a distillers’ union. My grandfather on my mom’s side was born into poverty in Appalachia and worked on farms and at timber mills. It was joining General Motors and becoming part of the UAW that moved him into the middle class. 
 
INJUSTICE: I was brought up believing that people were fundamentally good and that if you worked hard, you would be treated fairly — which is either the most naïve or most dishonest thing you can teach a child. 
 
EDUCATION: At college [Bard College in New York], I spent as much time on picket lines as I did in class. As a student government leader, I supported all the progressive causes, but the place I felt I could make an 
authentic contribution was in the labor movement. I supported the janitors when they organized into the SEIU in 1989. Later, I did an internship at an SEIU local, and they ended up offering me a job.
 
ORGANIZING: I worked for a scrappy, heavily African-American local union in Atlanta, organizing public-sector employees like hospital orderlies and bus drivers. I always thought of unions not as talent agencies or negotiators but as social movement organizations that help ordinary people share in prosperity. I spent 20 years organizing some of the biggest union campaigns since the 1930s.
 
EPIPHANY: For decades, I thought that by being smarter and more strategic we could reverse the decades-long course of labor decline. But by early 2012, we had seen a generation of right-wing governors take office and repeal union rights. I began this quest to figure out how we could replace the model that we have with something that is stronger and more effective.
 
CHANGE: Unions grew because of the Great Depression, the large proportion of workers in factories, the unpleasant work conditions, and mobsters who were looking for new profit centers and promoted unions to loot their treasuries and extort employers. Factory owners decided that dealing with a union was better than waking up and not knowing if their factory was going to produce anything that day. But today, capital can be moved around the globe with a few keystrokes. You can source labor almost anywhere. The power of the industrial strike has been crushed. There is no Communist Party cranking out anti-capitalist organizers, and there is 
no Mafia. Good riddance, but still. People today take more jobs before they are 25 than those in my grandfather’s generation had in their entire lives.
 
WAGE STAGNATION: Now we’ve suffered 40 years of wage stagnation. Who would have imagined in the 1970s that if women doubled their workforce participation, the take-home pay of the bottom 90 percent of households would not increase at all? Who would have imagined that we would create more wealth in 30 years than humans had created in their entire history and none of that wealth would go to the bottom 90 percent? 
 
COMPETITION: If the unionization system is opt-in site by site, you create an incentive for employers to bust unions. Even a highly moral employer will say, “If I’m the only one with a union, I’m at a disadvantage.” If you employ janitors in Seattle, you’re fine because it’s 95 percent union here. [Landlords] aren’t competing based on the price of labor. But in the hotel sector in Seattle, only a tiny percentage is unionized. That tends to force wages down. 
 
ALTERNATIVES: Germany has the world’s largest middle class by percentage of population. Its automobile workers make twice what ours do and they still produce twice as many autos as we do. Their unions set minimum standards by sector and by region. We could do the same for the fast-food sector or the maritime sector. 
 
ORGANIZING BY TECHNOLOGY: In the old days, there were hiring halls where you would go to find construction workers. Now, you just get a message on your smartphone that tells you where to show up. One can imagine an app that helps workers engage in collaborative price setting and cut out the middleman, such as all these VC-backed platforms like Uber. Alternatively, Uber workers could meet and form an organization and collectively decide to turn off their apps until prices reached a certain point.
 
WIN-WIN: People characterize unions as “members first, pale, male, stale and possibly in jail.” But whether it’s protecting the bad teacher or the drunken guy on the assembly line, those were designed features of our collective-bargaining system. If you were going to design something for the 21st century, you would want a system that scales to touch millions of people so it doesn’t put individual firms at a disadvantage. Things like work councils and co-ownership also tend to promote efficiency and a win-win strategy.
 
DONALD TRUMP: American workers have been taking it on the chin for 40 years, so it’s not surprising that people are angry. Every time that happens, someone will offer a scapegoat to blame. The simplistic, populist appeal of someone like Trump doesn’t gain traction when people feel as if they’ve bought into the system in which they are working and voting. 
 
$15 MINIMUM WAGE: The cities with the most restaurants per capita — Seattle and San Francisco — are the cities with the highest minimum wages. Phased-in increases, even relatively steep ones, give businesses time to change and adapt. I met with labor leaders in Europe and among them were McDonald’s workers making $20 an hour under their union contracts.
 
GLOBALIZATION: It explains why we only sew 5 percent of our clothes in this country — down from 95 percent in the 1960s. It doesn’t explain why the guy who puts fuel in jet aircraft makes a minimum wage today versus $60,000 and benefits in the 1970s. 
 
EXECUTIVE Q+A RESPONSES HAVE BEEN EDITED AND CONDENSED.