- NHL team broke e-commerce and in-venue merchandise records after first title in franchise history
- TV ratings and digital streaming minutes on NBC Sports Washington up significantly year-on-year
- Franchise to host viewing parties at Capital One Arena for all away post-season games this season
The Washington Capitals’ historic Stanley Cup success in 2018 has had a profound effect on the franchise’s commercial fortunes, impacting almost every revenue stream.
Last June, the National Hockey League team – which is owned by Monumental Sports & Entertainment – defeated the Vegas Golden Knights to win the first Stanley Cup in the franchise’s then 44-year history.
It was also Washington DC’s first title in the major four professional US sports since 1992, when the Redskins won the Super Bowl.
The play-off run to the Stanley Cup finals and the Capitals’ efforts since to capitalise on the team’s glory has impacted the business “across the board”.
“Every metric that we look at – whether it’s ticketing, sponsorship, corporate hospitality and suites, merchandise and even our gameday [per capita sales] with food and beverage – are significantly higher than they’ve ever been,” Jim Van Stone, Washington Capitals president of business operations and chief commercial officer, tells SportBusiness.
According to Forbes, the Capitals earned a record $194m (€172m) in revenue last year – aided by an additional 11 play-off games at Capital One Arena – while the franchise rose in value by 16 per cent year-on-year to $725m.
“It was the most special time that the organisation has experienced,” adds Van Stone. “It was something that captured the marketplace’s attention for the better part of two-and-a-half months so it was an amazing opportunity for us.
“We had a lot of success from a brand development stage, both on the consumer and corporate side. It was really a rallying cry for the greater Washington region.”
Rises in merchandise sales, TV ratings and sponsorship revenue
According to league and team merchandise partner Fanatics, the Capitals broke the record for both e-commerce and in-venue retail sales for a Stanley Cup champion since it began tracking such data in the mid-2000s, while the victory was in the company’s top-10 championship merchandise sales across all major sports.
The growth in merchandise sales was aided by the popularity of star player Alex Ovechkin, who had the NHL’s best-selling jersey in the 2018-19 season. According to the Wall Street Journal, the Capitals’ championship merchandise sales rose 276 per cent in Ovechkin’s native Russia year-on-year during the post-Finals period. Sales of Capitals merchandise in Sweden were also up 60 per cent over 2017, largely due to the presence of Nicklas Bäckström in the squad.
“The biggest area where we saw an unbelievable growth was on the merchandise side,” Van Stone says. “Certainly, you had the lead into the Stanley Cup and the post-events but the demand really carried through into the following season in terms of the demand for our merchandise products.
“Our portfolio of products was enhanced; we added a lot more products into the mix. We saw increases in both online and in-store sales. We were prepared to take advantage of that opportunity, so we had a really good game plan in place.”
Linear TV ratings on regional sports network NBC Sports Washington – which Monumental part owns – have also risen year-on-year. The average audience during the 2018-19 regular season was up 30 per cent and 124 per cent in the Washington DC and Baltimore markets respectively. For live streaming on MyTeams and the NBC Sports app, the average minute audience increased 149 per cent in this time frame.
According to Van Stone, the Capitals had already sold 90 per cent of season tickets for the 2018-19 season by the time the play-offs started but there have been increases in individual ticket and new business sales. “Our season-ticket numbers have always been high,” he adds. “I wish we had another 2,500-3,000 seats in the building to be able to build on it.
“We’ve seen some solid numbers, but it’s been really consistent with the way it’s been. But the demand on the secondary market for individual tickets has been higher than we’ve ever experienced in franchise history.”
The Capitals have also enjoyed a growth in sponsorship revenues. The NHL added four new in-ice advertising positions at all games, in each of the rink corners, from the 2018-19 season. These partnerships were taken up by Capital One – which also has the stadium naming rights – and LiUNA!, the Laborers’ International Union of North America.
Following the Stanley Cup victory, the Capitals held a victory parade in the city, which was attended by an estimated 700,000 people. Seven corporate partners were bought in as Presenting Partners: Capital One, Giant, Budweiser, Ford, M&Ms, the Washington Post and Red River.
Van Stone adds that the Capitals have engaged in talks with European companies over potential long-term partnerships and that the franchise are in a stronger position to gain new partners following the Stanley Cup success.
“Our partnership revenues are up pretty significantly from a percentage standpoint so that’s been a really great growth opportunity,” he says. “[Winning the Stanley Cup] puts you in a better situation…the demand when you are reaching your accomplishments certainly gives you a lot more runway.”
Expansion of viewing parties for away games
One successful initiative from last year’s play-off run, which the Capitals are continuing and expanding, is holding viewing parties at Capital One Arena for away games in the post-season.
Last year, the Capitals held these viewing parties for the deciding Game 7 of the Eastern Conference Finals against the Tampa Bay Lightning and for Games 1, 2 and 5 of the Stanley Cup finals against the Golden Knights.
Entrance to these events – which were held in partnership with Capital One – was free but the merchandise store and concessions stands were open, leading to healthy sales in both departments. The team’s mascot Slapshot, cheerleaders the Red Rockers and additional Capitals personalities were also in attendance to help build the atmosphere.
From this year, the Capitals are hosting these viewing parties for all away games in every play-off round.
“We have a great foundation of what we learned from winning the cup,” Van Stone adds. “A lot of what we’ve learned, and where it’s helped prepare us, is fan development and engagement and keeping people very excited about the brand and property itself.”