The Economic Impact of Mario
Lemieux's Effect Is Substantial And Quantifiable
By Bob Grove

On the ice, Mario Lemieux has always resonated skill and creativity. Even at 37, a rocky medical history and an almost fictional litany of comebacks behind him, the Penguins' captain is still the best player in the National Hockey League.

The local and national media that cover him regularly have just about exhausted their ability to describe in some new way the same old amazing story.

Where is the fresh adjective that invokes the quickness and accuracy of the head-man pass that led to an Alexei Kovalev breakaway goal earlier this month in Toronto? Can anyone explain how, back in October, his 40-foot pass from the left boards at Montreal's Bell Centre could possibly snake through a forest of skates, legs, pads and sticks to settle precisely on the blade of Aleksey Morozov for the tying goal with only seconds to play?

Lemieux is an offensive force the likes of which the game has never before seen. In the week before Christmas, his career points-per-game average was an NHL-record 1.97 despite the injuries, despite the WWE-like defensive tactics of opponents over the years, despite a mid-90's shift toward robotic approaches to preventing goals, despite playing the first four seasons with a team that couldn't even reach the playoffs.

Equally true, although less frequently discussed, is that off the ice Lemieux is a one-man economic force unequalled in Pittsburgh sports history. In the summer of 1999, when his ownership group dragged the Penguins out of bankruptcy and off a fast track to Portland, OR, Lemieux became one of the few former professional athletes to own a team. When he ditched his suit for his now-iconic No. 66 sweater in December 2001, he became the first player in modern pro sports to play for the team he owned.

In the 15 years before Lemieux took ownership of the team, he was merely a major factor in delivering to the city of Pittsburgh the economic benefits of having an NHL team. He was merely the primary generator of the revenues that flowed to the team and its business partners. He could score goals and he could sell tickets and, yes, he could win Stanley Cups, but he didn't have his fingerprints on every facet of the team's existence.

That changed one summer day in bankruptcy court. Now every cent that flows to the team or from the team is directly traceable to the 18-year-old kid who left Montreal in 1984 and grew into a Pittsburgh treasure. On the ice and off it.

A ticket-selling machine

A graph of the Penguins' average attendance since drafting Lemieux first overall in 1984 could easily double as a timeline for his career.

Average attendance jumped by a team-record 3,179 per game in his rookie season and more than doubled by his third season. There was a dip in 1990-91, when he missed 56 games after back surgery, and another in 1994-95, the season he did not play while recuperating from the cumulative effects of anemia and his treatment for Hodgkin's Disease. Another dip came in 1997-98, the team's first season after Lemieux's retirement, and there was a well-documented surge in 2000-01 when he returned from retirement.

"It was much easier to measure that the year he came back. We were in a certain place in season ticket equivalents and advance sales, and when he came back everything just blew out almost immediately," says Tom Rooney, president of Team Lemieux LLC and one of approximately 100 employees of the team. "That year we made it all the way to the conference finals, so that particular year his impact was several million dollars.

"We feel the ebb and flow all the time. It really did hurt us this off-season, not to be able to project Mario because he needed rest. We weren't in a position to say anything about whether he could play or not this year until training camp came. Then we saw another nice spurt. It's measurable, both in the positive and the negative."

Through the first 14 home games of their 36th season, the Penguins had sold out 334 regular-season games during 15 seasons with Lemieux as an active player. They've sold out 69 games in 21 seasons without him.

All those sellouts also generate money for the city. While Lemieux's ownership group benefits $3.2 million annually from the county-wide Regional Asset District tax to pay for recent Mellon Arena improvements, every fan buying a ticket (five percent amusement tax) or a parking space (31 percent parking tax) is putting revenue directly into the city's general operating fund.

With the team's average attendance this season fluctuating around 15,000, and given an average ticket price of $48 (according to Team Marketing Report) and a typical parking charge of $10 for each of 6,000 cars (2.5 occupants per car), the city would stand to receive approximately $2.2 million this season. The Penguins have also hosted 81 playoff games, for which ticket prices typically rise, since drafting Lemieux ­ many in years when the city's amusement tax was 10 percent.

Lemieux is also conscious of helping promote hockey for the Penguins' minor-league affiliates, the Wilkes-Barre/Scranton Penguins of the American Hockey League and the Wheeling Nailers of the East Coast Hockey League.

The Wilkes-Barre/Scranton Penguins, another asset he hauled from bankruptcy court, are owned by the Lemieux Hockey Development Group and have been a dependable source of revenue for the parent club. They have blazed their own path to success, leading the AHL in sellouts in each of their first three seasons, but it doesn't hurt that the parent club has spent parts of training camps there and played NHL preseason games at the First Union Arena at Casey Plaza.

A business asset

Lemieux's presence also benefits the Penguins by fostering lucrative partnerships in the corporate community. It was not long after his ownership group took control of the franchise that the Civic Arena became the Mellon Arena in a naming rights deal with Mellon Financial Corporation that pays the Penguins $1.8 million annually over 10 years.

"That was probably the most dramatic thing he did for us when he took over the team. In a very short period of time we were able to get a very good naming rights deal with Mellon," Rooney recalls. "We closed that deal around Thanksgiving of the first season. Those kinds of deals usually take a year to get together.

"What Mario can do is get you from A to Z without having to go through the rest of the alphabet very much. Talk about skipping grades ­ he skips a lot of letters. No one has ever turned us down on wanting to have a meeting where we might bring Mario along."

Mellon, certainly, was glad to schedule one.

"This sponsorship has proven to be an excellent fit for Mellon as we continue to expand our brand recognition globally," says Rose Cotton, senior vice president/Mellon Financial Corporation and head of Mellon Corporate Affairs. "Mellon and its subsidiaries have operations in many NHL cities, and since the NHL has become so popular in Europe, this enhances our marketing efforts of Mellon and Newton Investment Management, our UK-based asset management company."

The Penguins have also been able to negotiate increasingly attractive broadcast deals with Lemieux as an owner and player/owner, both with cable affiliate Fox Sports Pittsburgh and radio giant Clear Channel Communications. Both media outlets are able to reap quantifiable benefits from their association with the team, supplying programming content their audiences want and advertisers support.

This season, both outlets have begun new weekly programming fostered by their close working relationship with Lemieux's ownership group. Fox Sports Pittsburgh, with 2.2 million subscribers, has launched Inside Penguins Hockey, while Clear Channel airs Pens.Week, a magazine show that is also archived on the internet at PensNet.com.

"(The ratings) do show up during the season on (flagship) 3WS. I would tell you that it's a very positive impact," says John Rohm, Regional Vice-President/Market Manager for Clear Channel in Pittsburgh. "In this market, the Penguins' popularity probably surpasses that of the Pirates. You pretty much have the Steelers and the Penguins, and that's kind of an unusual situation.

"Does he add value? I definitely think so. Mario has turned out to be one of those exquisite-type athletes and personalities who really contribute to the community. People want that association. Our clients are very comfortable that they can make an investment and get a return ­ and not a tarnished image."

The Penguins' local television ratings have been among the highest in the NHL for many years, so it was no surprise when Lemieux's comeback game against Toronto on Dec. 27, 2000 drew a 15.9 rating ­ more than five times the average rating for a November 2000 game. By March of that season, Fox Sports Pittsburgh was averaging a 6.28 rating for Penguins games.

"Clearly, those kinds of increases you could trace directly to him coming back," says Fox Sports Pittsburgh general manager Larry Eldridge, who recalls with a smile drawing a 20 rating for the Penguins' Game 7 playoff victory at Buffalo in the spring of 2001.

"The value of a Penguins game to us, to be able to show that to our subscribers, is increased by having somebody who is such a magnet for attention. It's hard to calculate the value of someone who's been such a large presence in this market for so long. But our ad department sells ads on a variety of platforms, and ratings clearly are central to that effort."

From St. Louis to Sweden

The NHL, whose dismal national television ratings prevent it from assembling the astronomical rights deals cut by other major leagues, is well-known for its dependence on ticket revenue and developing other revenue streams. One of those is merchandise sales, which are split evenly among its 30 teams.

Here again Lemieux is a heavyweight. In the one-year period that concluded this past October ­ a year in which he missed 58 games with hip problems ­ only three jerseys sold better worldwide than Lemieux's: Detroit's Steve Yzerman, Toronto's Curtis Joseph and the New York Rangers' Eric Lindros. Penguins merchandise generated the fifth-highest sales among NHL teams, trailing only Detroit, Toronto, Colorado and Philadelphia.

"I don't think he's ever fallen out of the top 10 as long as his jersey has been available," says Brian Walker, Senior Manager, NHL Corporate Communications. "Clearly, he's the league's marquee player."

Lemieux is also the foundation for Nike, Inc.'s foray into the hockey equipment market, having landed an endorsement contract that pays him handsomely. ESPN always makes programming plans with one eye firmly on the Penguins' schedule, and earlier this month televised their game in San Jose to the entire country, not as one of two regional games as is typically done for its Thursday Night Hockey programming.

In a poll of 60 sports marketing, advertising and public relations executives last year, Sports Business Daily reported that 84 percent chose Lemieux as the NHL's most marketable player.

That's why opposing teams trumpet Lemieux's impending arrival. Of the Penguins' first 16 road games this season, 12 saw the crowd exceed the home team's season average coming into the game. Attendance jumped 44.8 percent in Atlanta, 30.3 percent in Carolina, 26.2 percent in Anaheim, 20.6 percent in New Jersey and 20.4 percent in Buffalo.

Impacting the active crowd

One of Lemieux's most remarkable influences on the Pittsburgh sports scene can be found by following any of the thousands of kids toting huge equipment bags into local rinks.

Nineteen of the 25 indoor ice sheets in the Pittsburgh area today were constructed after Lemieux's arrival, and almost everyone associated with youth hockey who's witnessed this transformation agrees the two developments are not coincidental.

"He got everybody excited about hockey, and when the Penguins became more successful, even more people wanted to be a part of it. That sparked everything," says Jim Koch, general manager of the Ice Castle in Castle Shannon, which employs approximately 30 people to manage two ice sheets. "Eventually people said, 'We've got to have more places to play.' "

Millions were spent on construction of these new rinks, including Blade Runners complexes in Bethel Park, Cranberry and Harmarville with two sheets each; the Airport Ice Arena (2); Center Ice Arena (2, with another planned) in Delmont; Golden Mile Ice Center (1); Iceoplex at Southpointe (1) in Cecil Township; Indiana Ice Center (1); Island Sports Center (2), home of the Junior A Pittsburgh Forge; a private rink at Shadyside Academy; and an Olympic-size rink in Connellsville.

The kids haven't stopped coming, either. In the 11 years from 1991 to 2002, USA Hockey registration in the Pennsylvania region has grown by 162 percent to 25,277 players ­ outstripping the organization's 155 percent growth nationally.

"It started with the 1980 Olympic champions, and increased again when Wayne Gretzky went to the Kings and once again when Mario and the Penguins won the Stanley Cup," says Rae Briggle, Director of Member Services for USA Hockey. "All of that brought the sport to the forefront for U.S. kids."

Given the game's national growth, it's impossible to attribute the fantastic rise of local youth hockey exclusively to Lemieux. But the consensus is that he deserves credit for most of it.

"The explosion started when Mario came to town," says Darcee Purvis, president of the Pittsburgh Amateur Hockey League, which includes more than 250 teams. "It's been pretty amazing. It was like a big wave, and it's just continued."

While that's been a boon to operators of local rinks, it's also created a rich market for hockey equipment. Today there are specialized hockey equipment stores throughout the region catering not only to ice hockey players but roller hockey and street hockey players, who also can find what they need at Dick's, the area's largest sporting goods retailer.

"I wouldn't be standing here right now if Lemieux wasn't playing in Pittsburgh," Dave Retone, general manager of the Penalty Box in Glenshaw, said from his store recently. "Lemieux has been the No. 1 reason. He's it. If he hadn't come to Pittsburgh, you wouldn't have all these kids playing, all these rinks, all these stores. He changed everything. Little kids see him and want to go out and try that."

Retone, a lifelong Pittsburgh area resident who has 14 employees at his two stores, said parents can spend anywhere from $400 to $800 to outfit their hockey player.

"We've got kids buying one-piece composite sticks for $150," he said. "Back when we started, I'd say the market was 20 percent of what it is now. And sales of Lemieux jerseys have been unbelievable. We sold about 16 in the past week alone, and we get requests all the time: 'Can you do an infant Lemieux jersey for us?' "

All of which makes Koch, who fought for ice time on just a handful of rinks while playing at Canevin High School in the late 1970s, shake his head. "The average person can't understand how different it is now," he said. "We used to have practice at 3 a.m. on Sunday mornings. It's come a long, long way."

Giving to the community

Not long after he concluded treatments for Hodgkin's Disease in 1993, Lemieux founded the Mario Lemieux Foundation, which has since raised millions of dollars to fund promising local projects being conducted in the areas of cancer and neo-natal research.

In 2001, the foundation pledged $5 million to UPMC Health System, one of the Penguins' major corporate partners, to establish the Mario Lemieux Centers for Patient Care and Research. The foundation has also established the Austin Lemieux Neo-natal Research Project at Magee-Womens Hospital in honor of Mario and Nathalie Lemieux's healthy son who was born prematurely.

Less than two years after making its pledge to UPMC, the foundation has already delivered $3 million. "He's been clear with his gifts: 90 percent of the money we want to be used in cancer and neo-natal research, and we want 90 percent of the money to stay local," says Tom Grealish, the foundation's executive director. "He's contributing to Pittsburgh and the Pittsburgh region."

The foundation's primary fund-raising vehicle is the Mellon Mario Lemieux Celebrity Invitational golf tournament at The Club at Nevillewood. The annual four-day event brings to Pittsburgh some of the biggest names in sports ­ Michael Jordan is a regular ­ and raises more than $1 million, making it the largest such charity golf event in the nation.

"We have 40,000-50,000 people over four days. The celebrities at the event are staying in local hotels, eating in local restaurants. We work with security companies, bus companies, scoreboard companies. . . that event is like a small business in and of itself," says Grealish. "The golf tournament has five full-time employees, and it takes over 1,000 volunteers to make it happen. It's a huge undertaking."

The Lemieux Foundation also supports the University of Pittsburgh Cancer Institute, the McGowan Institute for Regenerative Medicine, the Leukemia Society, the Lupus Foundation and Children's Hospital of Pittsburgh.

In addition, Lemieux and his teammates continue to draw people to the Penguins' At Your Service dinner, which since 1986 has raised more than $2.5 million for the Cystic Fibrosis Foundation of Western Pennsylvania.

And for an encore. . .

The next project squarely in Lemieux's business sights is no small one: fostering state and local support for a funding plan that will construct the new arena the Penguins so desperately need. Mellon Arena, which turns 42 next fall, is the NHL's oldest building.

"Mario's legacy, I believe, will be the new arena," says Rooney. Before that cornerstone is laid, Lemieux and his ownership group must navigate some very tricky economic, financial and political waters. Betting against him, however, might be unwise.

"I've said it before: there's nothing this guy can't do," says Grealish. "Nothing."