One of the toughest things in a start-up is to figure out when to invest in initiatives that take a longer term to payoff (e.g. channel partnerships, brand building) vs. those with immediate revenue generating opportunities. On the one hand you feel that optimizing for immediate revenue always trumps anything else; however, on the other hand, if you don’t invest in longer term market development initiatives, you can starve the customer pipeline.
But, sometimes it’s obvious…case in point the NHL
On the heels of one of the greatest hockey games ever played (yeah, I went there), with record ratings of 27.6 million US viewers, and probably every single Canadian viewer, NHL commissioner Gary Bettman foolishly undermined this success in an interview the day after. Bettman, takes an evasive and cowardly stance by not committing the NHL players to attend the 2014 Winter Olympics in Sochi. Rather than commit to the greatest marketing platform available to the league, pressure from some owners over the two-week suspension of play and “jacked up” travel schedules [Note: Can you believe Bloomberg’s Michelle Steele would use this term?] value the short-term revenue & logistical implications over attending. Who knows, maybe they prefer to rely on their “blockbuster” TV deal with Versus?
Maybe he’s not stupid…just spineless
While there is likely a lot of gamesmanship on the part of Bettman to gain leverage with the IOC to set the terms of the NHL players participation, it’s plain stupid for him not to seize the opportunity to promote the game…especially since the NHL is in financial trouble. Saying things like the impact on season to great “balancing act”, and blaming “foreign Olympics” maybe coy; however, by not taking a stand Bettman comes across as a a weak commissioner, and calls into question whether he’s committed to delivering a great product for fans.
In situations like this it’s better to take a strong stance to say “the Olympics are great for our game and we’ll do what we can to be there” engenders more confidence than Bettman’s tip toeing. Fans (or customers), and the legions of prospective customers who were activated by Sunday’s game, won’t commit their attention unless their is a strong stance and identity….and Bettman blows the opportunity.
Follow the data
When faced with the decision to balance long and short term priorities, if you have data you must consider it. For instance can you model out the net financial impact of each option? In Bettman’s case there is a lot of precedent to draw from, using previous Olympics or even events like the Canada Cup and World Cup of Hockey…and if that doesn’t work, you can always look at yesterday’s SportsNation poll.
When the choice is clear, take a stand and move on
While making these trade-offs can be a difficult challenge for most start-ups, as life doesn’t often give you black and white decisions, here it’s pretty clear. So when you’re handed a decision like this on a silver platter make the right call and move on.