From a BusinessWeek article this week:
The Green Bay Packers are a historical, cultural, and geographical anomaly, a publicly traded corporation in a league that doesn’t allow them, an immensely profitable company whose shareholders are forbidden by the corporate bylaws to receive a penny of that profit…
When you talk to Packer management, you start to realize that success is a tribute to the careful, constant maintenance of two things: the product on the field and the community’s warm feelings about that product. “It starts with football,” says Murphy. “We structure the organization in a way that we can be successful on the field. But a big part of it is also remembering that this team has a special place in this community. We’re owned by this community. We can’t be perceived as gouging the fans.”
I’m in the middle of thinking through a lot of the non-profit/for-profit issues in the education space, and I wish I understood the football industry, because Green Bay seems like a fascinating case study.
My first thought is that the Packers have “done well by doing good.” By prioritizing fans and the community, they created a brand and a customer relationship that has become extremely lucrative. It doesn’t seem like there’s anything stopping heads of for-profit teams from doing the same.
But then you get a chicken-and-egg issue: if the team doesn’t already have great fans and a great brand, where to start? By winning games? But you really have to take a long view to cultivate a whole talent system over time, which is tough, especially when ownership changes and neither fans nor shareholders are necessarily willing to give new owners a long time to get results.
I see this as two interconnected cycles: long-term performance and branding/loyalty. When you can get both cycles going together positively, they are mutually reinforcing. When fans are engaged with their teams and expect results, there is additional pressure for teams to deliver; when teams deliver, fans become more engaged.
Loyalty and performance don’t always go together — in baseball, the Cubs have high loyalty/poor performance, the Florida Marlins have high performance/low loyalty. But those are exceptional cases — Cubs have a beloved stadium, Marlins don’t really have a hometown (just a home state). But it seems like in most cases, you have to work on both at the same time.
So to get back to Green Bay — given fan ownership, they have a tremendous, ingrained traditions of loyalty and long-term focus, so they really don’t need the profit motive to incent management to cultivate them.