Keith Lui's Blog

The National Hockey League was officially organized in 1917, making it almost a century old.  Originally founded in Montreal, it has penetrated into many American markets.  Now, only 6 of the 30 teams in the league are located in Canada.

During its 94 years of existence, many events have challenged the NHL’s position in the market.  Powerful substitutes have appeared in the professional sports scene (the NFL in 1920, and the NBA in 1946.)  Furthermore, hockey leagues such as the World Hockey Association (which featured stars like Wayne Gretzky, Gordie Howe, and Bobby Hull) have formed to compete for a share of the hockey fan base.

Yet the NHL, to this day, is still by far the most successful, as evidenced by two very important facts.

• The NHL has a team salary cap of approximately $60 million, while the next highest-salaried league, the KHL, has a cap of $17.4 million.  This indicates that the NHL generates much higher fan revenue.
• Many skilled European players prefer to play in the NHL.

Success starts with a very important aspect of marketing:  the product itself.  As the oldest hockey league, the NHL has been able to continue attracting some of the best hockey players, creating a chain effect.  Young hockey fans idolizing their hockey heroes on TV often create a lifelong dream of winning the Stanley Cup.  Some fortunate, hard-working individuals are able to realize this dream, and this in turn continues the chain effect.

But a good product that is poorly marketed will ultimately fail.  Needless to say, with the exception of franchises such as Phoenix and the New York Islanders, the NHL and its teams do a phenomenal job of marketing.

Furthermore, although essentially a separate entity, the NHL has been able to negotiate deals with the IIHF to host tournaments such as the World Junior Championships and of course the Olympic Games.  In these heavily-promoted tournaments, fans are able to show their patriotism and cheer for their national teams.  Many fans tend to follow certain players after the tournaments after watching them play on their national team, creating long-term fandom and ultimately revenue for the league.

Successful marketing initiatives from the NHL could fill an entire book.  To conclude this post, I would like to illustrate the effect the NHL has had on fans, by sharing this fan-made ad inspired by the NHL’s series of “History Will Be Made” advertisements: