Pushing The Envelope: Marketing in Red Sox Nation

When Sam Kennedy spoke at the MIT Sloan CMO Summit in Cambridge, MA recently, he realized quickly that he was preaching to the choir.

Not only were his comments received warmly, but his organization’s name — the Boston Red Sox — was the only one mentioned that day to receive spontaneous applause.

“See how hard it is to market the Red Sox,” joked Kennedy, the ball club’s vice president of sales and corporate partnerships.

But while the team has a deeply loyal fan base, Kennedy said the club does realize it needs to work “to sustain the phenomenon that is Red Sox Nation.”

Toward that end, a flurry of promotional activities led up to opening day. Several members of the team were made over for an episode of “Queer Eye for the Straight Guy” that will air in June; the players are in demand for interviews; numerous books about the once-cursed franchise are hitting shelves; and a movie about the team, “Fever Pitch,” opened last month.

“The business is indeed cyclical,” said Kennedy, a Brookline, MA native who joined the Red Sox’s office in 2002 after a stint with the San Diego Padres.

He remembers a time when average attendance at a home game was around 20,000. “That’s not acceptable in our business,” he said, especially considering that half the club’s revenue comes from tickets.

Fenway Park’s current seating capacity is 33,871, the smallest in Major League Baseball. The team has sold out the last 145 home games since May 2003, and is on target to sell out the 2005 season.

“[Ticket] pricing probably gets more attention internally than whether to re-sign Pedro Martinez,” said Kennedy, noting that the team holds a three-week pricing summit, getting input from sales, marketing, IT, fans and employees.

The team has boosted its revenue 54% since new ownership took over in 2002. That year the team was sold for $660 million, with $40 million in assumed debt. Today, Forbes values the Red Sox at over $1 billion, he said.

Because of the ballpark’s size, tickets are in insanely high demand. Kennedy estimated there were approximately eight to nine buyers for every ticket, even though the team’s prices are the highest in the major leagues — nearly double that of the second highest, the team’s arch-rivals, the New York Yankees.

The Red Sox’s annual advertising budget is “easy to track,” he said. “It’s $0.”

Instead, the team chooses to promote the brand through corporate sponsors like Dunkin’ Donuts, The Sports Authority and Budweiser. Kennedy did joke that sometimes the team may be better off saving a dollar than earning one, as 34 cents of every dollar earned goes back to Major League Baseball.

The team holds quarterly focus groups to get feedback from fans. Baseball lovers of all stripes are invited, from season ticket holders to fans who only attend one game annually to those who have vowed never to set foot in Fenway Park again because the team traded Nomar Garciaparra to the Chicago Cubs.

The team’s fan base extends well beyond the New England borders. Many loyalists travel to see the team play, and pockets of fans are all over the nation. A panelist who presented with Kennedy at the MIT event — Homayoun Hatami, associate principal at McKinsey & Co. — suggested the Red Sox could go even further. The U.K. football team Manchester United has a worldwide fan base 2 to 3 million strong, he said, noting the Sox could easily duplicate their success.

It’s an interesting thought, especially since the Sox movie “Fever Pitch” is based on author Nick Hornby’s obsession with another U.K. football club, Arsenal. A new loyalty program for Red Sox Nation already has attracted 35,000 members, and a Red Sox Kid Nation club also is doing well.

And yes, I do realize that I’ve managed to work into two recent columns that the Boston Red Sox won the World Series last year. But since there were 86 years between victories, I think as a native New Englander I’m entitled. And I promise I won’t do it again.

Well, I’ll try.