Rugby: Desperately seeking hearts and minds of NZ

Fans are turning away from rugby as more games are added to the schedule. Photo / Dean Purcell

Brendon O'Connor, CEO of North Harbour Stadium, was NZRU Commercial and Marketing Director when Super Rugby was conceived. He details the crisis that led to the birth, how that context has been forgotten and recommends changes that might save the game here.

Where have all the people gone? Crowds in New Zealand have been down significantly in Super 14 rugby from last year - with almost 55,000 fans not attending New Zealand games during the first eight rounds compared to the same time last year (down from approximately 296,000 fans to 242,000).

It's not new, either. Between 2002 and 2008, the average round robin crowd attendance at New Zealand-based Super 14 games decreased by 32 per cent - from 22,862 to 15,602.

Midway through the 2009 season, we have seen some remarkable drops in attendance. For example, the 2009 opening game Highlanders vs Brumbies saw only 4670; Chiefs vs Sharks (round three) 6100; Hurricanes vs Cheetahs (round four) 6294, Blues vs Cheetahs 7140 (round five) and NZ marquee games such as Highlanders vs Crusaders only 11,800 (round four).

These results are across all franchises. I believe the odd exception - such as the 23,908 attendance at Blues vs Sharks - will not prevent the final crowd attendance average for 2009 falling significantly; maybe even below the lowest ever average of 15,243, recorded in the 1996 launch season.

Not only are gate crowds down, across the five Super franchises, memberships and season ticket sales are in sharp decline. Some sources say memberships and ticket sales are also down by as much as a third.

It would be easy to trot out excuses for low crowd numbers - economic recession, early season apathy, competition from other events, especially in Auckland.

These do have some relevance. However, if your business was showing such an alarming downward trend, you would be searching for more than the standard 'blip' in sales' excuses. You would want to know the exact problems so you could retain and attract custom; you'd want to be bold, to try new things.

LET'S START at the beginning, at least of Super Rugby. Super 12 was designed and established when the game was in crisis.

The majority of All Blacks and elite players in the top rugby nations had signed contracts with a new organisation called WRC which promised them a new international professional competition with money and all the bells and whistles that came with being an international professional athlete.

While it would be easy to judge the players of the time as greedy mercenaries, it is equally easy to blame rugby administrators. The signs had been there since the early 1980s, that the game could not cling to amateur idealism forever.

But the amateur ethos was embedded and generations of rugby administrators were conservative and defensive on the topic of pay for play.

In 1995, WRC secured the players initially but not the revenue and rugby. The establishment, through the leadership of the NZRU, played a clever game under pressure. They sold the broadcast rights to News Ltd for a new professional rugby competition that did not exist.

This meant they had the money - so the players reviewed their position and signed with the establishment. The three Sanzar unions then designed the Rugby Super 12 and successfully launched it in 1996.

NZRU responded to the crisis with tactical astuteness - but let's be clear. The transition to professionalism was not part of a grand master plan. It was a reaction to an explicit and obvious crisis.

The NZRU had a moment in time, a period of maybe six months, where it had to be innovative, to make decisions and, crucially, to drive implementation with pace. Provincial unions were supportive because
they had no choice. The mindset was 'save the game'.

Rugby is again in crisis but at this time it is more covert, more subtle. The quick movement of 1995 contrasts sharply with today where the NZRU undertakes highly expensive reviews, pays consultants to tell them what they should already know, announces changes, the provincial unions say 'we don't think so' and progress is stalled.

In this respect, the NZRU is in a difficult situation. It is trying to prosper in a competitive commercial marketplace on several levels, yet is constrained by what is essentially a cumbersome political structure. The tail can wag the dog, or at least get in the way of progress as minor unions have constitutional voting power.

So what were the innovations the NZRU established when it designed the Rugby Super 12 and Tri Nations Series? A few of the non-negotiables for New Zealand were:

WRC had the players (cost); the NZRU would get the broadcast deal (revenue); give News Ltd what they needed or valued - for example, night rugby.

The All Blacks brand was sacrosanct.

For the new competition with Australia and South Africa, it was imperative to All Black success and values our players could live anywhere in New Zealand, play professional rugby and aspire to be All Blacks from their home towns - so they didn't have to live in the three big cities.

Players chosen for the All Blacks must be playing in New Zealand.

The competition (then the Super 12) would be the game's entertainment brand while the NPC would be the parochial local representative brand.

New regional teams would create new intellectual property and thereby new revenue. It meant the NZRU could not be bound by current sponsor contracts at provincial level and could control the brands and players for the greater good of the game and the All Blacks.

Not only were key decisions made, and innovations such as regional brands launched, the implementation in the face of extreme pressure due to time constraints and the expectations of News Ltd was successful.

Yes, there were bumps but it is reasonable to say the first years of Super Rugby were successful on nearly every level - excitement at launch, significant new revenue streams, entertaining rugby, big crowds, winning New Zealand teams, strong TV following and so forth.

BUT THAT was then and this is now and if there was, upon objective reflection, one major lesson NZRU rugby administrators should have written in large letters on every wall of their Wellington offices, it would be 'do not wait for the next crisis'.

There are two major issues which hail from 1995. Firstly, while we did all we could to protect and enhance the All Black legacy, the harsh reality is the All Blacks have not made a Rugby World Cup final in the three opportunities since 1995.

Forget all the talk about the All Blacks' winning percentage - Rugby World Cup is the ultimate measure of success and New Zealand has failed.

Secondly, we continue to lose elite and valuable players in significant numbers. It was the threat of losing Sean Fitzpatrick, Zinzan Brooke, Mike Brewer, Jeff Wilson, Christian Cullen and Jonah Lomu at their peak or soon after their peak that prompted the transition to professional rugby.

So we created Tri Nations and Super 12 to gain large revenue streams. On reflection, maybe we should have said to those signed with WRC, 'away you go, do you want a lift to the airport?' - because we still lose players every year perpetually weakening the All Blacks as well as the Super and provincial teams and competitions.

Newcomers do not have to oust a senior player because the latter takes off overseas while he can still run, pass and tackle.

Another factor in the decline is that rugby has kept adding fixtures and has been indecisive about clearly defining the line between professional and amateur rugby.

The consequences are huge. Many non-Super rugby provinces have unaffordable player wage bills and no hope of this being balanced by income.

We have a 10-month commercial rugby schedule. In a small population the outcome is that fans do not have the time or money to attend most games.

An immutable rule of economics and business is the more of something there is, the less value it has. Or the more of something we have, the less we appreciate or desire it. Rugby has moved from the position of a meaningful representative sport to that of a commoditised and compromised entertainment product.

Live rugby is on TV from Thursday to Sunday for most of the year. This creates two problems:

1) why go to a stadium when you can watch it on your 42-inch plasma, with commentary and replays?

2) Sky, the main marketer of Super 14, promotes the game with an 'eyeballs on screen' objective. Other professional sports such as the NRL, AFL, NFL in the USA and Premier League have regulations to ensure widespread electronic coverage does not come at the expense of fans at games. Delayed or live coverage is not confirmed until a venue sales threshold is achieved.

When the issue is raised in New Zealand rugby circles, it is dumped in the 'impossible, never happen here' basket with the same defensiveness that officials back in the day displayed in relation to preserving the game's amateur status.

One high-ranking NZRU executive suggested we need bouncy castles at games to attract families. Should we be worried? Hell, yes.

All the commotion about All Black unavailability, epitomised by rotation, rehabilitation et al, is a direct result of too much rugby, too many teams, competitions, coaches and way too many paid players who contribute little or nothing to revenue.

Consequently, key products such as Air NZ Cup and now Super 14 have been damaged to the point that rugby is losing, or has lost, the hearts and minds of its fans.

So Sanzar is reviewing the structure and normal currency applies: It will be driven not by smart commercial thinking with the objective of retaining and attracting customers.

Rather it will be driven by a combination of local rugby politics, international rugby politics and a self-destructive bent allowing News Ltd and Sky to devalue the game further by agreeing to even more live TV coverage more often.

The only hope is that the power players in New Zealand rugby realise the game is in crisis. In 1995, it was the players we were losing. In 2009, it is the fans.