A Cana­dian sports ex­ec­u­tive tries to take the world’s rich­est fran­chise to the next level

Calgary Herald - - FINANCIAL POST - JOE O’CON­NOR jo­con­[email protected]­tion­al­

Dave Hop­kin­son re­mem­bers Nov. 1, 1994, quite well: it was his 24th birth­day and his first day hawk­ing sea­son tick­ets for the Toronto Rap­tors, then a pro­fes­sional bas­ket­ball ex­pan­sion fran­chise in a diehard hockey town.

Hop­kin­son and 23 com­mis­sion­hun­gry re­cruits sat in a room on the 14th floor of a build­ing over­look­ing an arena con­struc­tion site. Each was armed with a phone, desk and chair, and all com­peted to make a sale and ring the six-inch brass ship bell that their boss, Rap­tors founder John Bi­tove, had mounted on the wall as a mo­ti­va­tional tool.

The top four sell­ers were promised full-time jobs. The rest would be let go.

“Dave was de­ter­mined, fear­less and fun,” Bi­tove re­cently re­called. “And he was just a kid, in his early 20s, but he would never give up, which is one of the things I loved about him. He would cold call any­one. He would work the phone. He would work his per­son­al­ity.”

Hop­kin­son would keep ring­ing the bell and look over at Bi­tove’s desk af­ter­wards with a big, aw­shucks-boss-I-did-it-again grin on his face, which drove ev­ery­body else in the room half­way nuts, but earned him a full-time sales po­si­tion.

The en­try level job was a toe­hold on the sports busi­ness lad­der that he has kept climb­ing: from sell­ing the Rap­tors to sell­ing just about ev­ery­thing for Maple Leaf Sports & En­ter­tain­ment Ltd. — own­ers of the Toronto Maple Leafs, Rap­tors, FC, Arg­onauts and more — in­clud­ing a 20-year, $800 mil­lion deal with the Bank of Nova Sco­tia to re­name the rink for­merly known as the Air Canada Cen­tre.

The deal — the largest of its kind in North Amer­i­can ma­jor pro­fes­sional sports his­tory — re­ver­ber­ated in­ter­na­tion­ally. Hop­kin­son, long sought after by NHL and NBA teams but never sold on a move, be­came a hot in­ter­na­tional com­mod­ity.

An ex­ec­u­tive re­cruiter in Los An­ge­les called and, this past June, Hop­kin­son left MLSE to be­come the global head of part­ner­ships at soc­cer gi­ant Real Madrid, the third most valu­able sports fran­chise on the planet, be­hind only the Dal­las Cow­boys and Manch­ester United (the Maple Leafs are not among the top 50).

The move to Europe means Hop­kin­son has to ap­ply the skills he honed at MLSE over two decades to a new con­ti­nent, while also bring­ing some of the Old World back home. One of his chief man­dates: sell­ing an iconic Span­ish club, not just to the true be­liev­ers, but to the soc­cer hold­outs in North Amer­ica and China.

“With Real Madrid, Hoppy has stepped up to a whole new level that we sim­ply don’t play at in this coun­try,” said Brian Burke, a friend and for­mer col­league at MLSE. “He is in the pent­house suite in terms of work­ing for a pro­fes­sional sports team. Hoppy is a heavy­weight.”

Hop­kin­son, known as Hoppy since Grade 7, was raised in Toronto, had only ever worked in Toronto and cer­tainly wasn’t ex­pect­ing a call from Real Madrid. He didn’t even speak a lick of Span­ish. But Real Madrid was “Real Madrid,” he said, ” a mag­i­cal op­por­tu­nity,” a pro­fes­sional roll of the dice too good to pass up.

The new hire was in the bath­room of his new home in Madrid on a re­cent Novem­ber evening, fill­ing the tub after pick­ing up his el­dest of two daugh­ters from dance class — a mun­dane, dad-at-home mo­ment in what has been a whirl­wind few months.

“I’ve al­ready bumped into a cou­ple of pointy ob­jects around the of­fice and stepped on some land­mines, but I’ve also had some small wins,” Hop­kin­son, 48, said. “I sort of sym­pa­thize with what it is go­ing to take to be suc­cess­ful here, and how to be suc­cess­ful around here.”

Real Madrid is val­ued at more than US$4 bil­lion by Forbes mag­a­zine and gen­er­ated over $1 bil­lion in rev­enue in 2017, ac­cord­ing to Deloitte UK’s an­nual Foot­ball Money League re­port. Al­most 50 per cent of rev­enues came from mer­chan­dis­ing and spon­sor­ship deals. (By com­par­i­son, the Leafs, hockey’s sec­ond most valu­able team next to the New York Rangers, are worth US$1.4 bil­lion and had $211 mil­lion in rev­enue dur­ing the 2016-17 sea­son, ac­cord­ing to

Money, though, isn’t nec­es­sar­ily the most ap­peal­ing busi­ness as­pect of Real Madrid. Part of what sold Hop­kin­son on the move was the team’s own­er­ship struc­ture. In­stead of be­ing lorded over by an ego­ma­niac bil­lion­aire or some soul­less profit-driven-cor­po­rate en­tity, the 116-year-old club, much like the NFL’s Green Bay Packers, is owned by its fans, about 93,000 com­mu­nity mem­bers known as “so­cios,” who each pay an $185 an­nual fee.

Many so­cios have been mem­bers for more than 50 years. Col­lec­tively, they wield a cor­po­rate ham­mer, elect­ing the team pres­i­dent and board of di­rec­tors, ap­prov­ing an­nual bud­gets and dis­ci­plin­ing way­ward bosses who stray from the com­mu­nity’s wishes.

Steven Man­dis, who spent parts of two years in­ter­view­ing Real Madrid ex­ec­u­tives, play­ers past and present and front line em­ploy­ees for his 2016 book, the Real Madrid Way, be­lieves “com­mu­nity val­ues” and cul­ture, two airy-fairy and hard to de­fine things, are what un­der­pin the fran­chise’s en­vi­able suc­cess, on and off the field.

“It starts with Real Madrid get­ting the world’s best play­ers that match the com­mu­nity ’s val­ues — to play an at­tack­ing beau­ti­ful style of soc­cer with class, to win cham­pi­onships and cap­ture the imag­i­na­tion and in­spire the cur­rent and po­ten­tial global au­di­ence,” the for­mer Gold­man Sachs Group Inc. banker tuned busi­ness au­thor/aca­demic wrote in his book. “Since Real Madrid’s val­ues are in­clu­sive and uni­ver­sal, ap­peal­ing to a global au­di­ence of all ages, the com­mu­nity grows glob­ally.”

Man­dis’ be­lief is both el­e­men­tary and rev­o­lu­tion­ary. Sports fans are in­her­ently tribal, soc­cer fans per­haps the most ra­bidly so, which oc­ca­sion­ally re­sults in hooli­gan­ism and pitched street bat­tles be­tween ri­val sup­port­ers. But Real Madrid’s tribe isn’t just shelling out for tick­ets and mer­chan­dise, or throw­ing the odd knuckle or two, it guides the club’s di­rec­tion.

The re­sults are telling: Real Madrid wins — a lot. It is the three­time de­fend­ing UEFA Cham­pi­ons League win­ners and has cap­tured a record 33 Span­ish do­mes­tic league ti­tles since 1932. Its ex­cel­lence and fan in­volve­ment boosts an­nual rev­enues, en­abling it to cherry-pick global stars, such as Cris­tiano Ron­aldo (re­cently de­camped for Ju­ven­tus in Italy), which begets more win­ning, fur­ther ac­cel­er­at­ing the growth of the in­ter­na­tional fan base and the crush of spon­sors world­wide clam­our­ing to get a piece of the ac­tion.

Which is where the guy from Toronto comes in.

Hop­kin­son un­der­stands how flaky talk of “val­ues” sounds, es­pe­cially to a North Amer­i­can sports au­di­ence, and es­pe­cially around his home­town, where the greed of for­mer Leafs owner Harold Bal­lard scarred a gen­er­a­tion of hockey fans, and a pint at Sco­tia­bank Arena sells for $12 a pop. But after three months in Madrid in a job he parachuted into in part to walk the tightrope be­tween tak­ing a sto­ried fran­chise in some new busi­ness di­rec­tions and ob­serv­ing its old tra­di­tions, he has bought in.

He is tak­ing Span­ish lessons, work­ing with a lan­guage app and sees Real Madrid’s val­ues re­flected in ev­ery­thing from the ten­ure of its em­ploy­ees — peo­ple get hired and they don’t leave — to the tini­est of per­sonal touches. For ex­am­ple, send­ing out com­pany wide emails to an­nounce an em­ployee cel­e­brat­ing a birth or mourn­ing a fam­ily death, re­gard­less of cor­po­rate rank.

“I don’t see these val­ues ar­tic­u­lated any­where — there is not some plaque in the lobby say­ing, “This is our way,” he said. “But it is some­thing that is un­der­stood around here; it’s pal­pa­ble.”

Of course, as a sales guy, Hop­kin­son wakes up ev­ery day think­ing about the value of money and how he can squeeze more rev­enue for Real Madrid out of a glob­al­ized sports in­dus­try.

“Dave has no prob­lem putting a big num­ber on the ta­ble and jus­ti­fy­ing it,” said Brian Cooper, chief ex­ec­u­tive of MKTG, a Toronto-based mar­ket­ing/spon­sor­ship com­pany that rep­re­sented Sco­tia­bank in the MLSE nam­ing rights deal.

A life­time ago, Cooper was a Rap­tors ex­ec­u­tive when Hoppy was a “ticket sales grunt.” In many ways, Cooper said, Hop­kin­son has grown by bounds, but in oth­ers he is the same kid with the easy smile that he was from the start: smart, well-pre­pared, re­lent­less, quick to re­mem­ber a name or a fact, keen to net­work and able to make ev­ery­body feel as though they are part of the team.

“Dave’s team at MLSE would do a tremen­dous amount of work up front on who you are and what your needs are — and who your tar­get au­di­ence is,” he said. “And he is go­ing to bring that so­phis­ti­ca­tion to the Real Madrid brand.”

Hop­kin­son, like al­most ev­ery ex­ec­u­tive in ev­ery in­dus­try ev­ery­where, sees Real Madrid’s great­est po­ten­tial for growth in China and the United States.

“De­spite the fact that foot­ball is the world’s most pop­u­lar game, it is un­der­de­vel­oped in the two big­gest mar­kets,” he said.

Real Madrid al­ready has an of­fice in Bei­jing, and will open one in the U.S. some­time be­fore U.S.-CanadaMex­ico host the 2026 World Cup.

Hop­kin­son gives a purely imag­ined ex­am­ple of how Real Madrid might crack into China’s cor­po­rate cof­fers.

Take a hy­po­thet­i­cal Chi­nese do­mes­tic brand — a toque, an elec­tronic gizmo, a you-name-it — that is man­u­fac­tured in China and, as with many such brands, no­body in the West has ever heard of.

En­ter Real Madrid, sports be­he­moth, with more than 200 mil­lion fol­low­ers on so­cial me­dia (Face­book, Twit­ter, In­sta­gram), only about three per cent of whom ac­tu­ally re­side in Spain, plus a Cham­pi­ons League fi­nal tele­vi­sion au­di­ence of around 165 mil­lion view­ers an­nu­ally. (The av­er­age Su­per Bowl draws about 100 mil­lion view­ers; the Cow­boys count around 13 mil­lion fol­low­ers across so­cial me­dia plat­forms.)

Marry all those eye­balls, tweets and likes to a Chi­nese toque on an imag­ined Real Madrid player’s nog­gin and that brand sud­denly goes from hav­ing zero in­ter­na­tional pro­file to the big leagues. The big leagues, in the­ory, give a com­pany li­cence to charge a premium for its goods as­so­ci­ated with Real Madrid’s su­per­stars and, nat­u­rally, give Real Madrid li­cence to charge the com­pany a for­tune to be as­so­ci­ated with its trusted, win­ning nar­ra­tive.

“If you look at the statis­tics of the value of Real Madrid, plus their num­bers in terms of fan­dom and fan be­hav­iours, then you start to re­al­ize the mag­ni­tude of what they are talk­ing about,” said Cheri Bradish, a sports mar­ket­ing pro­fes­sor at Ry­er­son Univer­sity.

Although con­sumers have never been more adept at ig­nor­ing ad­ver­tis­ing mes­sages — the av­er­age hu­man’s ca­pac­ity to delete or ig­nore pop-up ads, videos, tele­vi­sion com­mer­cials and email-mar­ket­ing blasts is by now well honed — get­ting at­ten­tion from ex­ist­ing fans isn’t a prob­lem for Real Madrid.

But get­ting at­ten­tion in the U.S. is dif­fer­ent. Foot­ball — soc­cer on this con­ti­nent — has been try­ing to con­quer the U.S. ever since Pelé and the New York Cos­mos burst onto the scene in the 1970s. Ma­jor League Soc­cer has 23 teams, in­clud­ing three in Canada, and its fans are en­thu­si­as­tic, but the sports peck­ing or­der list still reads: NFL, MLB, NBA, NHL … MLS.

Dan Ma­son, a sports pro­fes­sor at the Univer­sity of Al­berta, ar­gues peck­ing or­der isn’t what it is im­por­tant. Real Madrid doesn’t need to con­vert Joe NFL Fan. It sim­ply has to con­vince U.S. multi­na­tion­als in­ter­ested in boost­ing their pro­file over­seas to har­ness the Real Madrid brand power to do it for them.

Real Madrid isn’t ex­actly a nonen­tity in the U.S. mar­ket. Fox’s English and Span­ish broad­casts of Real Madrid’s 4-1 vic­tory over Ju­ven­tus in the 2017 UEFA ti­tle game drew a com­bined three mil­lion view­ers, or about a mil­lion more than the av­er­age MLS cham­pi­onship game.

“Just be­cause Ma­jor League Soc­cer isn’t as suc­cess­ful as the other ma­jor sports leagues in North Amer­ica, it doesn’t mean that Real Madrid isn’t a valu­able brand in North Amer­ica,” Ma­son said.

Hop­kin­son de­clined to dis­close any Real Madrid state se­crets, but one imag­ines the likes of Gen­eral Elec­tric Co., Ver­i­zon Wire­less, Coca-Cola Co. and more should ex­pect a call from Spain soon.

De­spite the fact that foot­ball is the world’s most pop­u­lar game, it is un­der­de­vel­oped in the two big­gest mar­kets.

DAVE HOP­KIN­SON, Global head of part­ner­ships, Real Madrid


Cana­dian sports mar­ket­ing ex­ec­u­tive Dave “Hoppy” Hop­kin­son is tak­ing his sales and pro­mo­tional skills to Real Madrid, a world soc­cer jug­ger­naut con­trolled by its 93,000 mem­ber “so­cios.” The club, a peren­nial win­ner of the UEFA Cham­pi­ons League, is val­ued at US$1 bil­lion and gen­er­ated an es­ti­mated $1 bil­lion in rev­enue in 2017.

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