Baseball is one of Taiwan’s most popular leisure activities. It provides a welcome break from political disputes and has long been the most effective recipe for giving people a sense of well-being.
The Chinese Professional Baseball League (CPBL) has been in existence for 30 years, but in the past several years it has hit a bottleneck in terms of business scale, with only four teams. This year has produced a glimmer of hope with the return of the Wei Chuan Dragons after a 20-year absence.
However, on July 3 the managers of the Lamigo Monkeys said that the club would be sold after years of operating at a loss. This decision comes despite the team’s popularity and their success on the field.
The announcement has caused quite an uproar, with people wondering who will take ownership of the club. At the moment there is no answer to this question, but it provides an opportunity to examine how Taiwan’s professional baseball can swing back up from its current low point, as well as finding businesses that can have a positive impact on the development of the national sport and persuade them to take part in the CPBL.
Here are a couple of suggestions from the angle of operational management.
The first suggestion would be to assess the compatibility between baseball consumers and the target markets of companies that are potential buyers for the Lamigo club.
Looking at a few companies that have pulled out of professional baseball over the years, apart from not having sufficient financial strength, another aspect that is often overlooked is the market positioning of the company.
For a well-known company to take over the club and run it sustainably in the long term, the key requirements are that the target market of the company must have a similar profile and characteristics to the majority of consumers of the sport of professional baseball, and offer competitive products or services that directly correspond to the demands of this kind of consumer.
For example, in the cases of the several baseball backers that have quit running their teams, the target customer segments of their core businesses were not very similar to the kinds of people who are fans of professional baseball.
By sponsoring professional baseball, these companies turned into charities that showered hefty amounts of money on their clubs just to fulfill their corporate social responsibilities, while failing to simultaneously look after their own business benefits, with the unfortunate result that they eventually pulled out with tears in their eyes.
A contrasting case is that of the grand old man of Taiwanese professional baseball — the Uni-President Lions. In the 30 years since they joined the CPBL, their performance has varied between good and bad, but there has never been any talk of the company’s top management wanting to stop running the team because they were not performing very well.
The main reason for this difference is that the target market of the company concerned — food and retail giant Uni-President Enterprises Corp — is similar to Taiwanese baseball fans. This means that by continuing to operate a professional baseball team, it can create a synergistic marketing effect for its corporate brand and products.
If a company with this kind of mindset wishes to take over a baseball team and run it in the long term, of course it will recognize that running a professional baseball team is both a business activity and an investment activity. Thus, even if the club is run at a loss for a long time, the people in charge will be able to see it in a positive light, regarding it as an advertising investment and counting it as part of the company’s annual marketing costs.
If all baseball teams were run in this way, they would not keep changing hands every few years.
The second suggestion is to analyze the emotional connections between the corporate buyer and localism. It is not enough for a professional baseball team to have a “rich dad.”
By deepening the connections between a baseball team and local fans, a club can win the support of local businesses in the form of sponsorship. It could also win over and recruit fans who live in the vicinity of the host stadium who would be willing to buy tickets and go to the stadium to support the home team.
This is why baseball teams all over the world stress localism in their operational strategy, along with promoting the sport of baseball in their respective localities.
The Taoyuan City Government and the Lamigo Monkeys hope that whoever takes over the club will go on deepening its roots in the city.
If what happens next is that a big corporation that is interested in taking over the team has no affinity with the location — Taoyuan — or even has no long-term strategic plan, or cannot find an emotional connection that it can make use of, it might find that there are not enough benefits to be gained from long-term operation. Then, if there is any hint of trouble in the market, there is no guarantee that its affiliated baseball team would not once again become a sacrificial lamb.
If, on the other hand, the company that takes over the club can be a local, Taoyuan-based business or one that plans to open a factory in a nearby area, those would be very good local connections. Such a company could have a strategy of using sport marketing’s fresh and healthy image, along with tangible and intangible brand associations, to establish emotional connections with the brand among local residents and deepen its integration with the locality.
The professional baseball business has run into a bottleneck. The CPBL could collaborate with the central and local governments and — after discussing, researching and weighing up the various aforementioned conditions — search for a suitable business group to take over the baseball team, create a win-win situation and turn this crisis into an opportunity.
That is the only way to ensure the sustained development of Taiwan’s national sport and make the public feel happy about business.
Charles Yu is an associate professor at National Chung Hsing University’s Graduate Institute of Sports Health and Management.
Translated by Julian Clegg
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