The Future of the Canadian Football League

Bill Laidlaw, President, Parkelaw Inc. and Past President, The Empire Club of Canada; The Reverend Stephen Peake, Rector, St. Thomas Anglican Church, Shanty Bay; Brian Etherington, Chairman, Special Olympics Canada Foundation; Derek Martin, Director, Vanier Cup; John Johnson, Chairman, Delta Hotels; Tim Reid, President, Strategic Investor Relations and Director, The Empire Club of Canada; Bob Johnson, President and CEO, Purolator Canada; Bill Moir, Executive Vice-President, Marketing, Tim Hortons; and Randy Gillies, President, Sun Microsystems Inc.

Introduction by John Koopman

It is a great irony of history that having won their independence in the name of liberty, the American colonists went on to perpetuate slavery for almost another century. At the same time in history the British Empire turned toward abolition. Within decades of the revolution, the slave trade within the empire was abolished.

The empire also did its utmost to disrupt continuing African slave traffic by other powers. The British bullied the Spanish,Portuguese and French into accepting the prohibition. By 1840, still 23 years before Gettysburg, the Royal Navy had 30 warships engaged off the West African coast and 425 slave ships had been intercepted and liberated. Only ships flying the United States' flag still defied the Imperial edict.

Slavery ended in the United States with the collapse of the confederate rebellion in 1865. However 100 years later African-Americans could not play quarterback in the National Football League.

Consider the story of Sandy Stephens.

Sandy Stephens was a great athlete. When he finished high school in the late '50s he was offered 59 university scholarships. He quarterbacked the University of Minnesota to the Rose Bowl in 1960 and 1961. The University of Minnesota never reached the Rose Bowl before Sandy Stephens nor has it reached the Rose Bowl since.

Stephens was drafted by the Cleveland Browns in the NFL draft and by the upstart New York Titans in the AFL draft. He never played a down for either team however. Neither team wanted him as a quarterback. They wanted him to play a grunt position.

Canada profited from the United Empire Loyalists who fled the anarchy of the revolution and formed the bedrock of our national consciousness. Canada profited from the underground railway that brought productive citizens to our nation. We also profited when the CFL welcomed Sandy Stephens to Canada and he led the Alouettes to the 1962 Grey Cup.

Stephens still dreamed of playing quarterback in the NFL and eventually returned to the United States and joined the Kansas City Chiefs. The Chiefs however used him as a fullback and he never realized his dream of playing quarterback in the NFL.

Stephens is no exception. J.C. Watts led his college team to two successive Orange Bowl victories and got lots of offers for NFL jobs, but he had to come to Canada to play quarterback. In 1981 he led the Ottawa Rough Riders to a Grey Cup game.

In that 1981 Grey Cup game J.C. Watts faced another black quarterback who had been denied an NFL opportunity. Only after winning five consecutive Grey Cups did Warren Moon get a chance to play quarterback in the NFL.

Contemporary attitudes have of course changed. There are a lot of good black quarterbacks in the NFL. Canadians should be proud of the CFL's leadership role in changing these mores.

As for Sandy Stephens, in his memoirs he relates to the tragedy of Moses--able to see the promised land, but unable to enter.

The CFL is an honourable and quintessentially Canadian institution. Mr. Tom Wright is the leader and 11th commissioner of the CFL. Prior to becoming commissioner, he spent more than 20 years in sports marketing as president respectively of Salomon North America, Adidas Canada and Spalding Canada.

Ladies and gentlemen, please join me in welcoming Mr. Tom Wright to the podium of the Empire Club of Canada.

Tom Wright

Mr. Chairman, head table guests, ladies and gentlemen, let me start my remarks by thanking the Empire Club President, John Koopman, for allowing me to address the Empire Club in Toronto.

For any individual in government, business or even sport, it is an honour to speak to this club and its membership particularly in this 100th anniversary year. Yours is an organization that is deep in a history that is linked with our country. It is here that world and domestic leaders have shared their perspectives on the very events that have shaped our nation and indeed our world.

While my comments today should not be construed as being earth shattering from a world perspective, the organization I represent, the Canadian Football League, has and continues to play a role in the shaping of our country. The CFL shares a special relationship with Canada--a relationship that travels back to 1909 and the first Grey Cup.

Just a handful of blocks north of here, the game was played at Rosedale Park at which the University of Toronto defeated Toronto Parkdale by a score of 26 to 6. Since that day in December 1909, Canadians have embraced, celebrated and rewarded the CFL in its moments of triumph and heaped scorn and derision on the league when it went astray.

But through it all the Canadian Football League has continued as a national beacon on the sports landscape for all Canadians: Westerners and Easterners, French and English, young and old. It is about this great country and what it means to be a Canadian sports fan that will be the focus of the thoughts I will share with you today.

It is about the role of the CFL, not in the past, but its future as a vibrant, vital, and connected sports institution that will be at the heart of my message.

I am a Canadian and a very proud one. This probably more than any factor attracted me to the Canadian Football League and to the role of commissioner. Like most Canadians of my generation, I grew up with the CFL; the great games, the great rivalries and the truly great Grey Cups.

I have vivid memories of the Calgary Stampeders' horse right here at the Fairmont Royal York in Toronto, the Grey Cup parties my Dad would host in our family room and the Grey Cup parties I would later attend as an underage, and most likely over-served teenager. I understood, albeit from a dated perspective, the special place that this all-Canadian league held in the minds, and more importantly, the hearts of sports fans across the nation.

Like all of you, I watched this league with all its good intentions and with its heart firmly in the right place stumble, and stumble badly. It was in the late '80s and early to mid-90s. The league made a strategic error as it attempted to find its place in a brand-new landscape.

Here was a league with deep Canadian roots trying to come to grip with a new sports environment--an environment dominated by the explosive expansion of sports television, the consumer-mandated marriage of sports and entertainment, the blurring of borders between our country and the one south of here and the melding of electronic cultures that confused, for a short-period, our sense of what it meant to be Canadian.

It was the same period where the pervasive "thought du jour" was that "big equates to better" and where "internationalism" was deemed a key ingredient for all enterprises in Canada, including major league sports. This period and this thinking led the Canadian Football League down a path--a somewhat slippery path--which was almost its undoing.

The Canadian Football League abandoned the core essence of its brand, the true reason for its being. It abandoned what it stood for because its leaders did not understand at the time why Canadians supported this brand of football, this brand of sport. The league headed down a path that it thought was what football fans wanted.

It turned its focus to the U.S. and leaped into expansion south of the 49th with both "fully spatted" feet but without any articulated desire on the part of its fans, or any business plans to adequately support the move. The CFL turned its full attention to its American "experiment" while its Canadian position was left untended.

All of us in this room know the results from that period. Enter the Las Vegas Posse, Shreveport Pirates, Birmingham Barracudas, Memphis Mad Dogs, Sacramento Goldminers, and the Baltimore Stallions. Exit the Las Vegas Posse, Shreveport Pirates, Birmingham Barracudas, Memphis Mad Dogs, Sacramento Goldminers, and the Baltimore Stallions.

And so life continued in these American cities, but the damage from the U.S. project was felt in Canada. The league confused its core fan base in this nation with what the CFL stood for. Somehow in becoming "less Canadian" it became less relevant. It moved from being a major league Canadian property to something less because it attempted to be that which it was--and is--not. It attempted to be something that its fans never wanted it to be in the first place.

So why give the history lesson? Well fortunately the CFL's flirtation with disaster has a happy ending. It led this league to understand that its place on the sports map is determined by its fans, with only directional cues from the league to reinforce and in some instances shift perceptions.

It led the league to understand the CFL was really "Brand CFL" and that as a brand it would require careful management like any other consumer product from beer, to soap to cars. And it would require significant investment to ensure that its share of voice on this complex sports map was not only heard, but was also competitive.

Fortunately, at the same time the league was experiencing its epiphany, Canadians, particularly young Canadians, were going through a change of national identity--a change that fed the strength of the CFL through the late '90s and now into this decade.

Companies like Molson with their "I AM Canadian" strategy were first to recognize this change in national mindset and moved swiftly to embrace it. After 130 years Canada was becoming a country of Canadians.

We stopped identifying ourselves by what we are not and began, in the late '90s, to celebrate what we are. We achieved, again led by our youngest citizens, cultural independence. Canadians embraced community. Canadians trumpeted the right for individual thought and set our own agenda for our place in the world.

Canadians moved forward with positions that were sometimes in conflict with our traditional allies; be it in environmental reform or even the right of the country to participate in war, when and only when Canadians deemed it right to do so.

Whether or not we agree with the expression of this new-found confidence, and I suspect there are a number in this room who do not, the fact is that it is happening and it is having a dramatic impact on how we live, what we buy, what we watch, and what we subscribe to.

With respect to this brand of sport, sports fans that had left it during the '80s and early '90s began to come back as they re-discovered Canadian values and embraced their communities. Without market manipulation by the league, we found ourselves in sync with changing consumer needs. The shift was evident first through broadcast with CFL audiences more than doubling from 1997 to 2002 to where we are today as the second-most-watched sport next only to the National Hockey League. Concurrently with our broadcast growth, fans began to spin our turnstiles at an average growth rate of 12 per cent per year over that same five-year period, with younger Canadians leading the way.

The goal of the league now was to harness what was leading its growth and to do that we had to understand what was at the root of it. We needed to operate from a fact base.

While this need is obvious to most in this room, it is a difficult transition for an organization that had operated from the "gut" for most of its 90 years. It is a radical cultural change for a collection of Canadian football purists, who had lived and died through when-I-was-a-boy thinking, to allow its fans to climb into the driver's seat and to be more than just your traditional "arm-chair quarter-back."

In 2002 we undertook the broadest and most comprehensive research ever undertaken by this league and I suspect by any league operating in these 10 provinces and three territories. We began a journey of open dialogue and open minds with CFL fans and not-so-CFL fans in every region and both languages.

The nine-month project taxed our organization from top to bottom, but the effort was more than worth the investment. We came away from the project with a clear understanding of what was driving the growth of the CFL and what would be required to maintain and accelerate this performance.

We understood the role of heritage of the game in this country. We began to grasp the importance of 90 years of shared experiences with a country itself continually evolving. We began to understand the magnitude of the importance of the absolutely unique Canadian identity that this sport alone holds with Canada, and the role our Canadianism would play in carrying our businesses forward.

The role of community, the sense of regional rivalries, the understated nature of our collective personality, even the role of the natural elements, "the cold wind in the air and cold beer in the hand," contributed to the fit between the game and its fans.

Perhaps a lesson to all sports operators, certainly in Canada and likely well beyond, the CFL draws its strength from its athletes. In a sports' environment regrettably dominated by salary news, labour disruptions and athletes distant from their fan base, CFL players stand apart as professional athletes, viewed as accessible "working-class heroes" and involved members of the community who play for the love of the game and not for the million-dollar paycheques.

We listened to fans speak passionately about the Grey Cup--the venerable Canadian sports icon that has more that stood the test of time. The strength of the Grey Cup was demonstrated in hard numbers in 2002 as the most-watched championship in professional sports with over 5.4 million viewers tuning in.

All that being said, I would like to stand before you and report that the news from our work was all positive, but it was not. We discovered that the national brand, the CFL, was under-developed. We also came to realize that in the absence of a strong CFL brand and a strong and consistent voice of leadership from the CFL office many teams ventured off in their own directions. This was understandable but equally incompatible with the necessary fundamentals of a Canadian league charged with building a Canadian brand.

The strategy that emerged from our homework and diligence detailed a new, aggressive and exciting role for the Canadian Football League. We have taken charge of our symbols introducing a brand new look for the CFL. It is loud. It is proud. It is bold and it is truly Canadian.

We have strengthened our rituals reinforcing the marriage between entertainment and sports with the bottom-to-top reformatting of the Grey Cup and the East and West Division championships. We have introduced new properties to create identifiable signposts adding depth to the season. The Canada Day Bash, Labour Day Classic and Gridiron Thanksgiving all address the further development of our brand. Most importantly, our re-engagement with consumers and sports fans has to be national in scope.

Our businesses are healthy in the West. We have seen a dramatic resurgence in CFL fortunes in B.C. as the new Lions management team has made all the right moves to reconnect with its market. Our strength in Edmonton, Calgary, Saskatchewan and Winnipeg is well known and well founded, and certainly the game rivals hockey for fan attention in these markets.

In the East, the Montreal Alouettes have developed a very special relationship with their fans. They are the pride of the city and have just completed four straight years of fully sold-out games. The reintroduction of the Ottawa Renegades has been described as a text-book launch. Averaging more than 24,000 fans a game, the team has embraced the fan as the hub of its business. As well, CFL prospects for expansion in the East in Halifax or perhaps Quebec City are very strong with well-developed amateur football programs in both centres.

Our challenge markets of Toronto and Hamilton are the absolute clear focus of our attention. Sometimes we need to remind ourselves that not so many years ago we considered Montreal a "special market." In Toronto and Hamilton, the prescription required direct action. In late July, the league took over management control of the Toronto Argonauts. A little more than two weeks later we did the same in Hamilton. We know factually that the fundamentals of our brand in Southern Ontario are alive. Are they alive and well? No. Are they alive and ripe with potential? Absolutely.

Overall, the region continues to contribute between 35 per cent and 40 per cent of our television audience. In fact, the Argonauts remain our number-one television product. However, these two teams suffered from crucial issues that have caused the erosion of our presence in these excessively important markets.

Issues such as:

• Proper capitalization;

• Committed, connected, and local ownership; • Disciplined business planning; and

• Effective, long-term and consistent brand marketing.

We had a choice this past summer to again whitewash our issues in Toronto and Hamilton and avoid the untidy public debate, or for once and for all to make the tough decisions necessary to ensure that our performance in the Golden Horseshoe would keep track with our experience in the rest of Canada.

We chose the latter because we are healthy enough as a league to do so. We chose the latter because our national growth could not be sustained without building a relevant connected business in Toronto and Hamilton. We chose the latter because it was the right thing to do. And the rest is history.

Since the middle of August, we have subsequently moved forward with the announcement of the sale of the Ti-Cats to Mr. Bob Young, an individual with the right mix of passion for the game, outstanding business experience and credentials, and a deep love for city and country. In Toronto, I am confident we will be able to move forward with a similar announcement of ownership with proven entrepreneurial success, long-term business opportunity thinking, strong Toronto community ties, and passion for both the CFL and the Argonauts.

So as a league we will arrive in Regina, Saskatchewan, for the Grey Cup with a solid position in all nine markets and prospects for near-term expansion in our sights. We will arrive knowing that we have an enviable business model rooted in labour peace on the strength of a workable salary cap and players who share in the goal of building their brand. We will arrive with a well,architected brand under the careful stewardship of a league office that knows and understands marketing. We will arrive knowing that we will have just completed year one of a new landmark broadcast agreement that delivers the deepest broadcast footprint in Canadian football history with 72 of 81 games on-air, a full appointment television schedule with TSN's successful Friday night package now reinforced by CBC Prime Time Football on Saturday nights, and the best production quality ever put forth for this game. All of this is to suggest that we are moving forward on our plan.

We understand our brand and have charted its course on a footing of sound fact. We are in sync with the mood of the country and reflect its nature in our product. We are ensuring that our message is communicated broadly and consistently whether the source of that message is the league, the teams, our sponsors or our broadcasters. We are building new businesses and monetizing assets through the Internet, through secondary broadcast products, and in balance through electronic market expansion to the U.S.

If there is one piece of critical learning from our brand exploration, it is that the market is dynamic and constantly changing. We understand the ever-shorter life cycles of trends and consumer interests. We are cognizant of the need to continually monitor the market and adapt our product as required.

We are aware and will invest in creating the market by feeding the development of amateur football across the country. We are not oblivious to the advancement of world sports but, providing we stay fully in sync with Canadian values, we do believe the sense of community that emanates across our nation will ensure CFL football not only lives but thrives within Canada.

This game, the Grey Cup, has been, is and always will be a fundamental part of the fabric of Canada. While for many this game is rooted in great memories, it is our challenge to ensure that we continue to create memorable moments for new generations of fans.

It is our responsibility to ensure that this great game continues to reside in a special place in the mindset of Canadian sports' fans, and that we demonstrate the CFL is a major league entry at all points of contact in a manner or with a positioning that fully reflects the ideals of Canadians.

Ladies and gentlemen, I thank you for your kind invitation to join you here today. I hope I have been able to convey our enthusiasm for this game and our confidence that it will continue to be an important part of our sports landscape for generations to come.

I would also like to thank our partners at Rogers AT&T, sponsors of today's event, who earlier this year joined the CFL as its Premiere Business Partner, and who have demonstrated their support day in and day out through the support of our Heroes Program in our broadcasts.

I hope each of you will find the opportunity to reconnect with Canadian football. I encourage all of you to support this great Canadian game and to share the experience with your families and friends.

Again, I thank you for your attention.

The appreciation of the meeting was expressed by Tim Reid, President, Strategic Investor Relations and Director, The Empire Club of Canada.