In a December post, I expressed concern that the Yankees under the leadership of Hank and Hal Steinbrenner did not understand the importance of the franchise as a Global Sports Brand committed to winning. This is an update to that post. Over the past three months, the Yankees situation has gone from bad to worse. They have experienced a rash of injuries to aging stars, free agents have departed, questionable players have been signed and Mariano Rivera, one of their true icons announced his retirement. The Yankees growth as a sport brand is tied to their ability to continually engage their demanding fan base with a winning team. The baseball landscape has changed in the post steroid era and the Steinbrenner Brothers and Brian Cashman have been slow to respond the changing model.
The Yankees did get some good news yesterday. For the sixteenth straight year, the Yankees are baseball’s most valuable team and brand, worth $2.3 billion according to Forbes. An article last year on forbes.com also named the New York Yankees as the most valuable sports team brand in the world. However, I believe that their brand value is at risk because the new leadership team does not understand the essence of the brand.
This brand equity was built on a single-minded focus on winning. The brand’s core purpose has been to win the World Championship every year. Anything less was viewed as a failure. With 27 World Series Championships, the Yankees are the most successful professional sports franchise in history. Under George Steinbrenner’s leadership, the Yankees aggressively pursued championships and built a powerful brand. He spent whatever it took to put a winning team on the field and business and sports success followed. The Yankees global fan base has become accustomed to winning while generating huge revenues for the brand.
However under the leadership of Hank and Hal Steinbrenner, the Yankees new fiscally responsible approach to business is putting the brand equity that their father built at risk. Their core purpose has shifted from winning world championships to running the team as a business first. While improving the short-term bottom line, they risk long-term revenue growth and brand equity by fielding a good enough team. They are expecting that their long time loyal fans will accept this approach. It has been suggested to me that the Steinbrenner brothers plan to sell the team in the near future. If this is their approach, I hope they do. If George Steinbrenner were alive today the actions of the team’s leadership would not be tolerated.
I am a long time Yankees fan who has great memories and stories from watching games at old and new Yankees Stadium. I have witnessed two World Championship Games live, countless Yankees-Red Sox battles and Aaron Boone’s famous home run. 2012 was the first year in memory that I did not attend a Yankee game at the stadium. I felt the 2012 team was flawed, built to be competitive, but not win a championship. Unlike previous years, I am not excited for the baseball season to start on Monday. I fear a return to the mediocrity of the late 80’s.
This off-season the Yankees have sat back and watched the Blue Jays, Giants, Angels, Pirates and Red Sox all invest to improve their brands and teams. This has been hard to watch. The Yankees have been outbid for players they would have never lost in the past. A team with a great history of catchers that includes names like Dickey, Berra, Howard, Munson and Posada is going to battle with Francisco Cervelli and Chris Stewart as their catchers. The San Francisco Giants have passed the Yankees and become the model franchise in Major League Baseball winning two world championships in the past three years.
What do you think of the New York Yankees short and long-term prospects for winning a championship?