I attended one game at PGE Park last season. The PGE Park experience just felt wrong.
Then he slid down the chimney.
A rather tight pinch, but if Santa could do it, then so could the Grinch.
He got stuck only once for a minute or two,
then he stuck his head out of the fireplace flue where the little Who stockings were hung all in a row. -Narrator
Merritt Paulson purchased the Beavers in 1997 from Abe Alizadeh. Paulson is a brilliant guy. He has a Masters of Business Administration from Harvard Business School. Yet, some have started to wonder if Paulson is failing to effectively promote the Beavers.
The Beavers are clearly behind the curve (or above it) in ticket prices. With attendance on the decline, the Beavers still have one of the highest general admission prices in the Pacific Coast League. You can sit in the center field bleachers at Safeco Field for $7. For $9.00 you could sit in the “fish tank” at a Florida Marlins game or watch the San Diego Padres Triple-A team in Portland.
The high ticket prices can easily be correlated to the high cost of maintaining a 16,000 seat stadium. The rent of PGE is also expensive. Paulson believes a new stadium could alleviate some of that high cost.
Food and beverage prices are similar to other markets across the country. PGE Park is catered by an outside company, Centerplate Catering, which makes it unlikely food and beverage prices will change anytime soon. Increased food and beverage prices happen. Expensive food and beverage products at the ball park have become a staple of the sports experience much like the movie theater experience. Amid the economic recession in 2009 the Beavers offered $1 menu items and 200 four dollar tickets on Fridays.
What did the Blazers do when fans stopped attending games and they were in need of an image boost? They lowered ticket prices and offered affordable family packages. For a discounted price you could take your family to an NBA game, food and beverages provided. When times were tough the Blazers reinvented their marketing strategy. They didn’t move to a new stadium.
When attendance dropped for the Beavers, Paulson decided to move the Beavers to a new stadium and pursue a Major League Soccer franchise in what seems like a classic example straight out of an economics/marketing textbook from the Harvard Business School.
It has worked before. In a 2009 article, Brad Schmidt of The Oregonian wrote:
“New stadiums have helped reinvigorate some minor league teams. This year, Ohio's Columbus Clippers moved to a new stadium near a National Hockey League franchise. Attendance shot up 22 percent. And when the 75-acre "Arena District" is complete, the city will have seen $750 million of investment, according to a consultant hired by Beaverton.” (1)
I also emailed a friend who graduated from McCombs School of Business if moving to a new stadium was common practice. The economist, who wished to remain anonymous because of work guidelines, told me:
“From an economics standpoint taxpayer financed stadiums rarely make sense. You reduce supply to match demand which in theory will raise the price as the supply/demand curve finds a new equilibrium. Because of the large fixed/sunk cost aspect of building a stadium this becomes more than a classic supply/demand problem. There is at the very least a substantial amount of friction, which is why I would look at it from a marketing perspective. The goal would be to create a more intimate fan experience and thus bring more people out to the park.”
As I walked out of PGE Park this past June I looked around. Nothing had dramatically changed. The streetlights hit the sidewalk at the same angle, Burnside was still busy and Fred Meyer was still a block away. Red Robin was gone but baseball remained at PGE Park. Yet, when I left the game I did not say 'I can't wait to come back here.'
The PGE Park experience wasn’t about baseball anymore. PGE Park lacked a viable atmosphere to watch a baseball game with friends and family. Paulson might just have the right long-term plan for marketing: a more intimate fan experience which PGE Park lacks.
Paulson has tried to promote the idea of a better ballpark but has been met with obstacles and widespread criticism from the Portland community. He's now found himself stuck in a rather tight pinch.
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"You're a foul one, Mr. Grinch
You're a nasty, wasty skunk
Your heart is full of unwashed socks, your soul is full of gunk
Mr. Gri-inch
The three words that best describe you are as follows, and I quote: Stink, stank, stunk!"
-Singer
Portland Rockies owners Jack and Mary Cain were successful promoting the team. They worked hard to sell tickets and merchandise. Paulson has yet to experience the same success with the Beavers that Cain had with a Single-A team.
The Portland Rockies were a success because of a strong marketing push by the Cains who consulted with S.R.O., a Lake Oswego-based consulting and training firm, specializing in ticket sales and sponsorships. In 1995, Dwight Jaynes at The Oregonian told The Sports Business Daily:
“those guys had lots of salesman on the streets selling tickets. People think that you can open the gates on opening night and fans either love you or hate you. But they worked hard… The Cain’s have proven that the off-season is when the work gets done, and tickets are sold.” (8)
The Cains also had a good reputation in the Portland community. Paulson has been the victim of harsh public criticism online and even been nicknamed "Little Lord Paulson" by a blogger.
Paulson has been criticized by users on OregonLive.com for failing to effectively promote the Beavers. In the comment section on a recent OregonLive.com article a user named mikeschr argued:
“if Paulson had given the baseball team one-tenth of the promotion he gave the soccer team, their attendance would have been much better. But he wanted to keep the baseball attendance down so that he could ram through the soccer deal.” (1)
Paulson has evolved into a cartoon character we have poked and prodded a la The Grinch. What has Paulson done to warrant the criticism he has received in online message boards and blogs?
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Cindy Lou Who: Santie Claus, why? Why are you taking our Christmas tree? Why?
Narrator: But do you know, that old Grinch was so smart and so slick, that he thought up a lie and he thought it up quick.
Grinch: Why my sweet little tot...
Narrator: The fake Santie Claus lied...
Grinch: ...there's a light on this tree that won't light on one side. So I'm taking it home to my workshop, my dear. I'll fix it up there, then I'll bring it back here
The Cains set the tone for baseball’s image in Portland. Jack Cain would often deliver hot chocolate to fans that sat in the rain and watched Rockies games. Would Paulson do that? The Harvard business grad might suggest Centerplate Catering increase the price of hot chocolate because it’s raining. Supply and demand, right?
They key to the Cain’s success in Portland was beyond baseball. After moving the Rockies from Bend, they acted quickly to gain public interest in the team and meticulously developed important contacts within the city. The Cains made an instant impression with then-Mayor Vera Katz.
After arriving in 2007, Paulson tried to quickly push a new stadium deal without developing the same infrastructure that had supported the Cain’s.
The Cains superseded the image of Portland baseball. Mary Cain taught ballet at Mt. Hood Community College. Both Mary and Jack were on the board of directors for the Salvation Army of Portland. Jack refereed high school football and basketball games around the Portland area. He was also a member of the Rotary Club of Portland, played Santa Claus for the Make-A-Wish Foundation and would visit children at Doernbecher Children’s Hospital and Emanuel Hospital. (8)
The Cains became local celebrities because of their involvement in the community, not because they borrowed millions of dollars from their father to purchase minor league sports franchises.
When Paulson wanted to establish his image within the Portland community he did what he had been taught to do his entire life, donate money. He established the Portland Beavers and Portland Timbers Community Fund and donated $10,000 to a local baseball little league team to help them construct a field (9).
Paulson has failed to develop the public image the Cains had in Portland but can you blame him? He hasn’t had the time.
He’s busy evicting the local baseball team.
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"Every Who down in Whoville liked Christmas a lot,
but the Grinch, who lived just north of Whoville - did not.
The Grinch hated Christmas - the whole Christmas season.
Now, please don't ask why; no one quite knows the reason."
-Narrator
Unfortunately for Portland baseball fans it’s pretty clear Paulson’s immediate priorities are with soccer. In July, Seth Prince at The Oregonian asked Paulson in an interview if he even realized he owned a baseball team (10).
Paulson’s response:
"Yeah, I do. (Its slow speed is) part of the fabric. But it's definitely a concern about baseball. It won't be with the 30-and-older crowd, but the generation past Generation X. The Generation Y and everybody younger than that. You still have baseball fans but I'm telling you, in some ways, if you take an extreme view, soccer's better positioned."
The question was asked in jest but isn’t there something wrong when the question is even being asked? How can Paulson fully appreciate the rich baseball history of Portland when he doesn’t even know he owns the team?
In America the MLS is still far behind the NFL, MLB, NBA and NHL. The NFL has the highest per-game attendance of any domestic professional sports league in the world. However, the NFL’s overall attendance is still only approximately 20% of Major League Baseball. MLS still lacks the recognizable stars that the NFL, MLB, NBA and even the NHL produce (11). Even Paulson admits it takes an "extreme view" to suggest soccer is better positioned than baseball (10).
MLS in Portland is an unfortunate setback for Portland baseball fans who once believed Major League Baseball might one day come to Portland. The loss of PGE Park would only add an even bigger obstacle to overcome.
Six years ago Portland officials traveled to New York to address baseball’s relocation committee but fell short of landing the Montreal Expos (12). The “Bring Major League Baseball to Portland” bumper stickers are now in the attic and those days seem long gone. (10)
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"Santa, don't forget the Grinch.
I know he's mean and hairy and smelly,
and his hands are cold and clammy,
but I think he's kinda... sweet."
-Cindy Lou Who
You can’t blame Paulson for being young and energetic. He wants to get things done.
John Canzano of The Oregonian writes:
“Paulson has it. Big time. And he’s maxing out his lines of credit and taking personal loans from family to make the MLS thing happen…The current deal has Paulson contributing about $80 million toward the project (including $22 million in rent to the city).” (13)
Here’s a guy who wants to gamble his own money on a stadium deal. Wouldn’t the public want to embrace him?
Paulson has made all the right moves too fast. He’s pushed too hard with too little time. He gained the rights to an MLS team without securing public funding and a concrete stadium deal. Paulson has failed to establish the right business relationships to succeed in Portland.
Paulson believes Portland could be a great soccer town. Yet, soccer still feels like a gamble when Paulson wants to reach into the city’s public money. It’s a gamble most citizens of Portland aren’t rushing to support considering there is still an unpaid balance from the last PGE Park remodel.
Paulson has also failed to address much of the economics that will be considered financially beneficial to Portland. Attendance is expected to increase only slightly according to “conservative” estimates from Paulson (1).
Paulson first explored moving the Beavers to the Rose Quarter. In April, Beth Slovic of the Willamette Week interviewed several key players involved in the decision:
Rick Williams, executive director of the Lloyd District Transportation Management Association: “This seems incredibly fast."
Doug Obletz, a developer with Shiels Obletz Johnsen: “We should take a deep breath and do what’s right long-term for the Rose Quarter.”
Commissioner Nick Fish called for a "time out": I would love for this not to be decided with a gun to our head." (14)
Paulson then went to Lents Park to pursue a stadium deal. Lents Park residents showed up to boo Merritt Paulson at a meeting on June 18, 2009. The next morning he abandoned the idea of a Lents ballpark. Margaret Haberman of The Oregonian wrote:
“Paulson’s move prompted his harshest criticism so far in the negotiations.” (15)
Portland City Commissioner Randy Leonard who had been one of Merritt Paulson’s biggest allies in the new stadium deal responded by saying:
"What Merritt has done is put me in a bad position. I told him I would vote for soccer if he kept the Beavers. He promised me, he shook my hand, he said he'd see this through. Merritt needs to very quickly calm down and take a deep breath.”
When Brian Schmidt of The Oregonian asked Paulson if Beaverton would have a Triple-A baseball team if a stadium is built he responded by saying: “It’s guaranteed.” (1)
To some Portlanders it may seem like Paulson is making false guarantees. It might even sound like Paulson has become the next big take-charge Portland politician, a la Erik Sten, who can’t seal the deal.
Randy Leonard is right. Paulson needs to slow down.
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"Those Whos are hard to frazzle, Max.
But, we did our worst, and that's all that matters."
-The Grinch
Paulson remains disconnected from many Portland residents who would vote for a stadium bill. Many of these residents were born long before the North American Soccer League awarded an expansion team to Portland in 1974. These residents know the Beavers have a tradition that reaches to 1903.
Paulson doesn’t get tradition. He was not a history major. He's a progressive economist. In 2007 he attempted to change the name of the Beavers to avoid confusion with Oregon State University. Fans voted and the name remained unchanged. Paulson responded:
“We said from the beginning this was a decision that couldn’t be made without the input of the community and our fans. There’s no question that there is a great deal of history with the Beavers’ name, and we are embracing that history. We were not going to change the name just for the sake of change. It’s clear that there are strong feelings about the Beavers’ name, and that’s a great thing. However, we still need to explore changes we can make to enhance the team’s identity.” (16)
It’s safe to say Paulson has successfully changed the team’s identity. For only the third time since 1866 Portland might be without a professional baseball team.
Embracing history? Nothing says “embracing history” like evicting the Beavers out of the stadium they have played in since 1956.
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"And the Grinch, with his Grinch-feet ice cold in the snow, stood puzzling and puzzling, how could it be so?
It came without ribbons.
It came without tags.
It came without packages, boxes or bags.
And he puzzled and puzzled ’till his puzzler was sore.
Then the Grinch thought of something he hadn’t before.
What if Christmas, he thought, doesn’t come from a store.
What if Christmas, perhaps, means a little bit more."
-Narrator
John Canzano wrote: “This soccer-baseball debate isn't a Paulson issue. It's a sports issue.” I agree. The real question is if Paulson has improved baseball in Portland. The answer is no. Not yet.
Paulson has become the face of the Beavers and Timbers. He’s become a politician. He rushed to the scene and didn’t develop the relationships within the city he needed to be successful. He has pursued his big ideas at the expense of an already existing fan base.
Hopefully he can make the Portland baseball experience better.
In the meantime, Paulson needs to step back and allow his ideas to come to the forefront. He needs to step outside the MAC Club and build his image in the Portland community. He needs to develop more important contacts from community leaders. He needs to focus on the resources he already has and focus on making PGE Park a better experience for families. He needs to show his doubters that he realizes he owns a baseball team and that he wants to make it better.
It’s time for Paulson to bring hot chocolate to fans next May.
It’s time for him to sit and enjoy the game with those fans and get to know them better. Maybe then he'll see that baseball, perhaps, means a little bit more.
If Paulson doesn’t ease up, Portlanders might wonder what’s next on Paulson’s agenda? Christmas?
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And what happened then?
Well, in Whoville they say that the Grinch's small heart grew three sizes that day.
And then - the true meaning of Christmas came through,
and the Grinch found the strength of *ten* Grinches, plus two!
-Narrator
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References
All quotes by Dr. Seuss from How the Grinch Stole Christmas
(11) http://www.youthimpactprogram.org/web/page/598/sectionid/559/pagelevel/2/parentid/559/interior.asp
