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Turnaround Teams By Tripp Mickle, Staff Writer Published October 6, 2008

Rocky Wirtz had his welcome-to-the-NHL moment before he even took over as owner of the Chicago Blackhawks. With his father, Bill Wirtz, in the hospital and the 2007-08 hockey season about to begin, a memo from the Blackhawks finance department landed on his desk. The team needed an immediate infusion of $34 million to start the season, the memo said, or it wouldn't be able to make payroll. The eight-figure request stunned Wirtz. As president of Wirtz Corp., he oversaw a family-owned business with interests in liquor, wine and beer distribution, insurance, real estate, banking and co-ownership of the United Center. The enterprises generated more than $1.4 billion in annual revenue, and none ever came close to missing a payroll. Wirtz knew that managing a hockey team was different and many teams operated in the red, but the Blackhawks' financials were worse than he imagined. He made the money available, but he never forgot the memo. It became the catalyst for a dramatic reinvention of the team's business after his father's death weeks later. "I knew the Blackhawks brand had a pulse. I just didn't know how strong it was."

ROCKY WIRTZ, OWNER, CHICAGO BLACKHAWKS "I knew we had to do something," Wirtz said. "It had to be dramatic and it had to be now. Now meant I had nine months to continue to make a payroll, and to make a payroll I had to start selling (games) out. There was a lot of urgency to get things done." Since becoming chairman of the Blackhawks last October, William Rockwell "Rocky" Wirtz, 55, has used that urgency to enact a series of sweeping changes that have revolutionized the franchise's business model and reinvigorated its fan base. From putting home games on television and hiring Chicago Cubs President John McDonough, to repairing the franchise's relationship with Bobby Hull and more than doubling the size of the front office, he has revived a forgotten franchise. Before his death, Bill Wirtz said the Blackhawks had lost $31 million during the 2007-08 season and $191 million over the past 10 years. But over the last year, the franchise has cut its losses in half by increasing its season-ticket base from 3,400 to a franchise-record 13,425, improving its sponsorship revenue by 40 percent, and boosting TV revenue for home games. "I can't say enough about what Rocky and John have been able to accomplish in such a short period of time," NHL Deputy Commissioner Bill Daly wrote in an e-mail. "They certainly seem to have the pulse of the Chicago sports fan, and have made incredibly strong strides in reconnecting with the fan base." Challenges certainly remain. To ensure that the team remains relevant, it will have to win on the ice. But for the first time in years fans believe that's possible, in large part, because of an optimism rooted in the changes under the franchise's new leadership.

Captaining a new team

When Bill Wirtz died, outsiders expected his younger son, Peter Wirtz, to assume management of the team. Peter, 47, was vice president of the Blackhawks and worked for the franchise for 20 years. But two days after his father's funeral, Peter resigned from the team and took a position overseeing Bismarck Enterprises, one of the family's food service businesses. In his exit letter to Blackhawks employees and fans, Peter said he was stepping down so that his brother, Rocky, could "instill new and fresh leadership into the organization." Rocky, who had been chosen to take over Wirtz Corp. after his father's death, assumed control of the franchise and began making changes. Within a week, he reassigned Blackhawks senior vice president Bob Pulford, moving him from the United Center to the Wirtz Corp. as a liaison for NHL affairs. For years the team shunned televising many games for fear of losing ticket sales. Now expanded game broadcasts on Comcast and WGN have helped rekindle interest in the Blackhawks. Pulford was known to be staunchly loyal to Bill Wirtz and agreed with the former owner's notion that broadcasting home games would dampen ticket sales. That attitude had become divisive in Chicago, angering and estranging fans. Within weeks of Pulford's departure, Rocky Wirtz met with Comcast SportsNet about broadcasting home games. The season had already begun, but he believed that putting games on TV would help win back fans and generate new revenue.

Comcast agreed in principle and suggested the team, which owns a percentage of the network, could broadcast one or two games. "No," Wirtz said. "Tell me how many games we can broadcast." The network had already set much of its fall, winter and spring schedule, so dates were limited. They came back and said they could do 11. Wirtz settled on doing six. He also asked Diageo and Crown Imports, companies he knew through the liquor business, to sponsor the broadcasts. He helped Comcast convince Chevrolet to sign on as the broadcast's presenting partner. "It was really a combination of Rocky Wirtz being a great guy and a great opportunity," said Mike Hillstrom, president of Select Marketing Group, which made the buy for local Chevrolet dealers. "It gave us an opportunity with fans to have them say, 'Wow,' and have a perception that we helped bring home games live on TV." The news of the Comcast broadcasts received dozens of positive comments on the Blackhawks message board. "That's a darn good start. Thank you, Rocky!!!" wrote Odium at the time of the announcement. "Now, with enough time between now and the start of the 08-09 season, let's see if we can't just get them all on the tube."

Recruiting a new leader

Though Wirtz initially dove into the Blackhawks business, he preferred to focus on the Wirtz Corp.'s wine and spirits business. He wanted to relinquish management of the team to a new president and already had a candidate in mind McDonough, president of the Chicago Cubs. Wirtz had a mutual friend reach out to McDonough in early November. "In all due respect," McDonough told the friend, "I have a pretty good job right now, but tell Rocky when I get back from these baseball (winter) meetings (in Orlando) that I'll give him a call just to say hello." McDonough hung up, but the friend called back five minutes later. "We know you leave Sunday," the mutual friend said. "Can you meet with him Saturday?" McDonough agreed. He'd never met Wirtz before and the two rendezvoused midmorning at Champps Restaurant & Bar. What was supposed to be coffee turned

into lunch as the two talked about the Blackhawks, the Cubs and the Illinois-Ohio State basketball game being played on TV. As the meeting ended, McDonough told Wirtz he was happy with the Cubs and had no intention of leaving his job, but he offered one piece of advice. "Whoever you have come in to run your business operation, they have to come in with the mind-set that they're going to be 0 and 82," McDonough said. "Anybody that comes and tells you that you're not drawing because the team's bad, you let that person go the day they tell you that." The advice made Wirtz want to hire McDonough more. On Monday, he asked McDonough for permission to speak to the Tribune Co., which owns the Cubs. McDonough said OK, and Wirtz extended an offer later that day. Between panels at MLB winter meetings in Orlando, McDonough wrestled with the idea of leaving the Cubs. Four days later, he woke up, called home, spoke to his wife, and then called Wirtz and said, "I'm in." "I think you only have one shot in your life at reinventing yourself one legitimate one," McDonough said, explaining his decision. "I think the potential here is the sun, the moon, the stars."

Changing the culture

On the Friday of McDonough's first week with the Blackhawks, he walked into his office, closed his door and let it all wash over him. The situation was worse than he expected. The team has often tested the patience of its fans; now it takes time to salute them. "We didn't have a receptionist," he said. "We didn't have a full-time person to run the business operation. We didn't have anything." The staff was microscopic by modern sports standards. Twelve people worked at the United Center and another eight worked at a separate office. McDonough's first act as president was to hire a human relations manager. "I told her, just bring me great here," McDonough said. Within weeks the staff doubled to 25 people, and after a few months, Jay Blunk joined the club from the Cubs as senior vice president of business operations. McDonough let employees know that from that point on they needed to care about the organization as much as he did. "If you don't," he said, "you're not going to be here."

When people expressed satisfaction because a crowd of 14,000 attended a game, 68 percent of capacity, he told them it was awful. He also used the media as a vehicle. In a December interview with USA Today, he said that he wasn't used to empty seats and he didn't like it. McDonough also looked for ways to win back fans. Many Chicagoans were so angry with the franchise that they vowed never to return to a game. The team made peace with hockey great Bobby Hull (left), who now serves as a team ambassador. Here he joins currentplayers to promote the NHL Winter Classic. To overcome that, McDonough thought the team should bring back its old stars, Hull, Stan Mikita and Tony Esposito. He asked Wirtz for permission to reach out to Hull, whose rift with the Hawks stretched back to the 1970s. That's when Hull had left the team for the Winnipeg Jets and the World Hockey Association, prompting the Blackhawks to sue him for breach of contract. Hull traveled to Chicago for a meeting with Wirtz and McDonough last December. The hockey hall of famer spent 45 minutes airing grievances from the past. He was angry and left without promising to work with the franchise, but he saw something different in the new ownership and management. A week later, Hull accepted McDonough's offer to be an ambassador for the team. He and Mikita returned last March for a special night honoring their history with the team. Later that month, the team honored Esposito at a similar event. The Esposito night gave the team its ninth sellout of the season, which was more than the previous five seasons combined.

Reaching the goals

Before the season ended, the team announced that it would broadcast every home game in 2008-09 through a deal with WGN and Comcast SportsNet. The announcement gave the franchise additional momentum that it looked to build on in the offseason. The Blackhawks also increased their marketing budget by 300 percent to more than $1 million to help drive ticket and sponsorship sales for the 2008-09 season. The team signed deals with the Cubs and White Sox, becoming the first professional sports team to sponsor two other pro teams in its marketplace. The deals gave the Blackhawks signage and benefits, including the chance to pass out a Blackhawks

pocket schedule at a Cubs game and the chance to air a commercial during the sixth inning of every White Sox game. "We need a voice in this offseason to relaunch this franchise," Blunk said. "We felt that reached a targeted audience that got us back in." The team got an additional boost when the NHL named Chicago as the host city for its annual outdoor game, the Winter Classic. On New Year's Day, the Blackhawks will play the Detroit Red Wings at Wrigley Field in the first NHL game ever played at a baseball stadium. "In Chicago, with what is going on with the Blackhawks, it was pretty clear to us that this thing would be embraced," the NHL's Daly wrote in an e-mail. "And, by all indications, it has been." The combination of the TV announcement, marketing campaign and the NHL Winter Classic energized fans. Season-ticket orders rose from 3,400 the previous season to 13,425 for the coming season. Sponsors also became interested. The team signed its first presenting sponsorship deal with the Chicago Board Options Exchange a three-year, seven-figure deal that gives the company branding in arena and media. Another 19 new sponsors signed on, boosting sponsorship revenue by 40 percent. The combination of ticket sales and sponsorship sales has helped the team generate $14 million in additional revenue this season, easing the payroll burden for Wirtz. And all of it comes as a complete surprise. "Quite frankly, I didn't know if we could do it," Wirtz said. "I knew the Blackhawks brand had a pulse. I just didn't know how strong it was."