Hockey Marketing Deal: Second Time Lucky?

North America's Detroit Vipers hockey club has signed a deal with Soviet Wings to bring a Western-style marketing blitz to the Russian hockey world.


If it sounds like d?j? vu all over again, that's because it is.


The Pittsburgh Penguins and CSKA entered into a similar deal in 1993 with resounding success, until infighting between the CSKA squad and its sponsors, the Russian Defense Ministry, split CSKA into two teams and for all intents gutted the Penguins' deal.


Now, the Detroit Vipers of the International Hockey League -- which is one step down from North America's premiere league, the National Hockey League -- is hoping to capitalize on the successes of the Pittsburgh Penguins' marketing deal with CSKA, while avoiding the pitfalls.


The mix of Russian hockey and Western marketing hype propelled the Russian Penguins to success unmatched in the Russian sports world: Scalpers were selling tickets to sold-out games, and CSKA players shared the rink with scantily clad dancers and a two-meter tall penguin mascot. More than $1 million worth of CSKA Penguins merchandise was sold.


"It was a pretty ingenious idea for Pittsburgh to do," said one hockey insider who wished to remain anonymous. "I don't think it can be duplicated."


But the Detroit Vipers are giving the U.S. sports-marketing connection a second shot here: In late February, the Detroit team's management signed an affiliation agreement with Krylya Sovietov, or the Soviet Wings. Although there are details left to be worked out and the specifics of the marketing agreement have not been released, the two sides say they expect to be working together when the season starts next fall.


"We felt, and they did too, that it would be beneficial to both teams," Rick Dudley, the general manager of the Vipers, said by telephone from Detroit. "It will bring exposure to a high level."


Cooperation with the Detroit Vipers would bring a top professional sports marketing team to Krylya Sovietov. The Detroit Vipers are owned by American Bill Davidson, who also owns the U.S. National Basketball Association's Detroit Pistons.


"Our marketing team is one of the best in the business," said Dudley, who helped negotiate the deal on behalf of the Vipers. For the Vipers, in return, the agreement means the Detroit side can gain exclusive access to Krylya Sovietov players.


But in the wake of the floundering Pittsburgh Penguins deal with CSKA, the sides say they are being careful to avoid the type of misunderstandings that derailed the earlier deal.


The Defense Ministry, the sponsors of the CSKA club, had distanced themselves in the early '90s from its team because it couldn't afford to pay the squad's expenses, said Viktor Gusev, formerly the vice president of media relations for the CSKA Russian Penguins.


"Then we signed the deal with the Penguins and the army eventually saw [how profitable] this was and wanted the team back," Gusev said.In the resulting high-tension fallout, the Defense Ministry formed a rival CSKA squad, while the original team remained with longtime CSKA coach Viktor Tikhonov.


The relationship between Tikhonov's squad and the Penguins is officially still alive; Pittsburgh continues to supply uniforms to Tikhonov's squad and Tikhonov recently traveled to New York for talks on extending the relationship with Pittsburgh.


"Had the situation with Pittsburgh and CSKA turned out different there could have been more teams interested in investing in Russian hockey," said Paul Sporn, the head of the Soviet Wings Trust, which currently markets the Soviet Wings.


"Our expectations are not small, but they are realistic," said Sporn, who was instrumental in bringing Soviet Wings together with the Detroit Vipers.


One of the sticking points of the Vipers deal could turn out to be the same that sank the CSKA Penguins: control of the stadium. The Defense Ministry controls the CSKA stadium, and the Penguins deal began to fall apart when the ministry began asking the American side for more money for utilities and other expenses. Similarly, in the Vipers deal, the stadium is controlled by the City of Moscow, rather than by the team.


The difference in the current deal, the Vipers said, is Soviet Wings coach Igor Dmitriyev. Dudley described Dmitriyev as a "visionary," and said he was the reason Detroit signed on.


"We understand we need image and advertising," Dmitriyev said, adding that despite current corporate marketing deals, the team is short of money.


Back when rumors were swirling around the Russian hockey world of a lucrative deal between the Penguins and CSKA, other Russian teams -- including Krylya Sovietov -- were seeing dollar signs.


Steve Warshaw, who was sent by Pittsburgh to head up marketing and public relations for the CSKA Russian Penguins, said that after the Penguins signed its deal with CSKA, Detroit's NHL team, the Red Wings, offered $1 million to form a similar partnership with Krylya Sovietov. Krylya turned it down, Warshaw said, hoping for something more.


"They heard we paid $1.2 million dollars but no one will know the real figures," Warshaw said from his office in New York City. "It was a typical Russian move. No one knows the value of anything."


Dmitriyev confirmed that the team had received an offer from the Red Wings. Issues such as money and control of the rink derailed the talks, sources said.


Dmitriyev said that under the deal with the Detroit Vipers, the Vipers are not bringing any money to the deal, but rather are offering marketing expertise.


Krylya Sovietov may turn out to be a jackpot for the Vipers: The Wings have developed more NHL draftees over the past three years than any other hockey club in Russia, Sporn said. Hockey experts agree that top Russian teams such as Krylya and CSKA continue to produce outstanding talent .


"CSKA did not have an agreement with the Penguins so they could use Red Army players," Sporn said. "Instead, they tried to focus on how to develop the team here and promote the team internationally."


Sporn, who a few years ago spearheaded an ultimately unfruitful deal with the NHL to merchandize seven Russian hockey squads in the West, has since turned his attention toward marketing the Soviet Wings, through the Soviet Wings Trust.


Sporn said the team has already attracted a number of sponsors, including Japanese electronics manufacturer TDK, Finnair and Phillip Morris, and attendance has increased 60 percent over the last three years.


"Now, a lot of people come to our games, so we're satisfied with their [the Soviet Wings Trust's] marketing," said Dmitriyev.


For those who worked on the CSKA Penguins project, the new Vipers-Wings deal elicited skepticism, and nostalgia.


"It's very limited as to what that joint venture can accomplish," said Warshaw, the marketing whiz behind the Russian Penguins.


"They're following our example," noted Gusev, who still works informally with the CSKA Penguins side. "Sometimes when I go to their games I have a nostalgic feeling of what it used to be like here."