Sunday, February 28, 2010

Brand Premium of Team Canada & Why the Olympics Matter


So here we are- less than an hour away from what will likely be the most watched hockey game in North American history: Canada vs. the USA Olympic gold medal. The game will also likely be the most watched program in Canadian history. (Incidentally the record is held by Salt Lake City’s Olympic gold medal game between Canada and the USA). But this game has game some extras that make it special. First, and most obviously, Canada is gunning for gold of “the nation’s sport” right at home. Second, at the time that I am writing this, the USA has already won the most winter Olympic medal in winter Olympic history (granted there are more events than ever before but still…) and Canadian athletes have already done its $118 million “Own the Podium” program proud by delivering more gold medals to the host country than ever before in Olympic history. So this game- with the most profile event at the Olympics is a battle of the Olympic champions. Here are a couple musing on the game and the Olympics.

The Brand Premium of Canada’s hockey players.
In marketing there’s something called “price premium” measure of brands. Basically, you compare 2 equivalent brands’ pricing. The difference between the two prices is the perceived “brand premium”. For example, if you compare “Kellogg’s Corn Flakes” 575g ($4.99) to “President’s Choice Flakes of Corn” 575g ($3.99), you get a brand premium of $1 for Kellogg’s. The theory is that the Kellogg brand is worth $1 more. How does this relate to today’s game? I cranked out a few numbers, and the average Team Canada player makes around $3million more per season than the average player on Team USA. On a per game basis (assuming a player plays 84 games a year), that amounts to about $35,000 per player per game. If ice time is 18 minutes, that’s $2200 per minute. Remember, that’s not what the shift is worth- that’s the “brand premium”.

Why the Olympics Matter.

Olympics are so wonderful for a bunch of reasons: Olympics generate excitement about sport which in turn inspires kids (and kids at heart) to pick up healthy activities; Olympians are role models (most of the time) for gracious winning and defeat; and the Olympics give nations a healthy way express nationalism. By watching the Olympics, citizens of a nation root for their home country while at the same time are forced to realize the diversity of talent around the world. And for these reasons, I will always be a fan of the Olympics.

7 comments:

  1. Great posts Bob! All of which make me realize how much I miss talking to you about marketing, or anything in general!
    Good thing you are a frequent blogger;)
    cheers,
    ceren

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  2. Great posts Bob! All of which make me realize how much I miss talking to you about Marketing, or about anything in general!
    Good thing you're a frequent blogger;)
    cheers,
    ceren

    ReplyDelete
  3. Nice post Bob, and what I think is most interesting there, is that even though Canada's hockey team brand premium is 2200$ a minute compared to Team USA, these players are playing for nearly free at these Olympic Games. Nice win by the way!

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  4. Love the post Bob. By the way, I did a little investigation as to why we changed sweaters. It turns out the Olympics won't let another brand be displayed on a uniform. Hockey teams have to use nation flags. I prefer this one anyway.

    Stefan

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  5. Hey Bob- I took a loook at your brand mojo site - and Hockey Canada is the 2nd highest sports rank (tied with the NHL). I wonder how that will change after the win today.

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  6. I LOVE your posts. I use some of your ideas in my class and hope that you don't mind!

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  7. So the games aren't fixed ;p

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