Once-decimated Hornets now one of NBA's most promising franchises
NEW ORLEANS -- The hurricane and the oil spill hit five years apart. At various times the team had neither a permanent home nor an owner. The best players wanted to leave, the league was locked out and the country was in recession.
No one was predicting the favorable outcome that today defines the New Orleans Hornets. This is the story of one of the more promising and inspiring franchises in basketball.
Over the next few weeks, the Hornets are expected to be sold by the NBA to an ownership group that will be obligated to keep the franchise in New Orleans until 2024. In May, the Hornets will attend the draft lottery with a chance at winning the No. 1 pick and the rights to center Anthony Davis, a potential franchise star who happens to be leading Kentucky into the Final Four this weekend in New Orleans. The Hornets will enter July with gobs of cap space to be used in free agency or trades, to go with a future All-Star in USA Basketball guard Eric Gordon, and two 21-year-old former lottery picks in Al-Farouq Aminu and Xavier Henry.
In years to come, there promises to be a new cable-TV partnership, the NBA All-Star Game will return to the city, the New Orleans Arena will undergo $50 million in improvements, and the franchise, in all likelihood, will be rebranded. The "Hornets" nickname, which followed the team to New Orleans during its 2002 relocation from Charlotte, will probably be replaced by an identity more fitting to the city to which the team is now married, for better and for worse. Though everyone involved hopes the worst is now far behind them.
"You can see in the building of the team, the redemption of the city," New Orleans mayor Mitch Landrieu said last week from his City Hall office, a short walk from the stadium area where the Hornets and Saints play virtually next door to each other. "It completely flat-lined and people thought we were gone. And we've kind of stood back up.
"You're seeing one of the great comeback stories, really, in American history. The Saints have been symbolic of that, and the Hornets are very much too. But the Hornets have positioned themselves a little bit differently. They want to [represent] not the city that we were; they want to be what the city of the future looks like."
The new incarnation of New Orleans is a city of 343,000, or roughly 20 percent smaller than the metropolitan area was before the flooding of Hurricane Katrina in 2005. The thousands gathering around the Superdome for the NCAA Final Four will be seeing for themselves that the downtown and French Quarter destinations have been restored. As a result of marketing funds supplied by BP following the oil spill, 8.8 million tourists spent a record $5.5 billion in New Orleans in 2011. The schools and other functions of the city are improving.
More hard work remains as large sections of the city must be reclaimed and restored as the city transitions away from the infusions of relief funding that followed the hurricane and the Gulf spill. The Hornets, in their own small way, have served as a metaphor to the future of the city: When the franchise was in danger of moving away or going under, its management and fans rallied together to redeem it, keep it in New Orleans and turn it into something new.
Over the NBA's last 12 difficult months, which have been defined by ugly labor negotiations, a four-month lockout and the ongoing season that has been abbreviated to 66 games, the most amazing achievement by far has been the Hornets' success in recruiting customers. Last summer, the franchise recruited fans to invest in more than 3,700 new season tickets, transforming the woebegone Hornets into a position of launching opening night with the support of more than 10,000 season-ticket holders overall.
The Hornets increased their fan base despite plenty of bad news. Since December 2010, the team has been owned by the NBA, which purchased the Hornets from George Shinn for $300 million when he was unable to find a buyer who would commit to keeping the franchise in New Orleans. The lockout began in July, which prevented team officials from naming any of the players -- whether they played for the Hornets or their opponents -- whom fans would be paying to see. At the same time, it was widely reported and accepted that the Hornets' franchise star, point guard Chris Paul, was unwilling to commit long term to New Orleans and was likely to be traded, and that his fellow All-Star, forward David West, was on his way out of town as well as a free agent.
It was in this toxic environment that the team launched a campaign of 100 events in 100 days to reach out to potential fans. The scope of these events, known as "influencers," was unique to New Orleans. In the daytime or after work, Hornets president Hugh Weber and other members of his front office and basketball operations staff would go to a local home, business, church or other meeting place to visit with prospective customers. Day after day they sold tickets face-to-face, handshake by handshake, by a means that is unusual in the big-money world of professional sports today. They grew to know their customers personally.
"I did a ton of them, and I got a chance to meet some of the fan base," said Monty Williams, who is finishing his second season as the Hornets' coach. "I was talking to them about my family and their families. They told me stories about Katrina and what the city was like before -- things I would never have imagined."
"It was people from all varieties of life," said general manager Dell Demps, also in his second year with the Hornets. "You might be with local fans and corporate sponsors. Sometimes you were with entrepreneurs and sometimes with school teachers. You're with nurses, ambulance drivers, city employees -- so many people we met during those times, and it was incredible.
"We would go there, everybody would socialize, and then I or Monty would say a few words about where the team is going and the direction we're headed. We did one with a medical group, and they had a lot of questions about injuries. Then we did another one with a law firm, and they had a bunch of questions about the CBA [the collective bargaining agreement that was being negotiated with the players]. But we couldn't talk about the players. I said, 'If you take me on retainer, then you can have attorney-client privilege and I can tell you everything you want to know and you guys can't tell anybody I told you.' "
In the two seasons after Katrina, the Hornets had played the majority of their games in Oklahoma City. Their return to New Orleans full time in 2007-08 forced the Hornets to reconsider their place in the community, which they could no longer take for granted.
"When we said we were coming back, the sentiment in the marketplace was, 'That's great! How many games are you playing here?' " Weber said. "We said, 'We're playing all of our games here.' They'd say, 'Really? Because you played three [in 2005-06] and six [in 2006-07], so we figured you'd play eight maybe this year.'
"We had the worst possible scenario. We were relaunching in the marketplace, trying to get momentum, and yet there was literally zero excitement. And rightfully so, because they were focused on getting the city back up. But at the same time, they were trained for two years that every month or so we would have a game."
When the Hornets had first arrived from Charlotte in 2002, they had sold themselves to New Orleans as the big-time NBA.
"It was that you were going to see Baron Davis and all these big NBA players every night -- and it never resonated," Weber said. "Because here, it had to become a New Orleans business that happened to be in the NBA. We had to immerse ourselves in the culture and who we are, and humble ourselves to say it's not about the NBA, that we're a New Orleans institution.
"We didn't have critical mass -- we didn't have all of these Fortune 500 companies, we didn't have all of these homes with over $600,000 in annual income. We didn't have any of that, but what we did have was intimacy, where I really could go out and get to know every fan. If we really opened ourselves up to it, we could literally put a name and face on every season-ticket holder. We had to say, This isn't about numbers. This is about people."
The team sold itself around a marketing campaign known simply as "I'm In." It was a creative way of tying the ambitions of the team to the larger ambitions of the city. The team wanted to stay in New Orleans, and the fans didn't want the Hornets to leave either -- and not just because of the Hornets' $300 million economic impact, the $10 million they contributed in taxes or the 2,000 jobs they claimed to generate. If the Hornets were to move to a more prosperous city, what kind of discouraging impact would that have made on New Orleans and the people left behind?
"We did them anywhere anybody would have us," said Weber, who attended all 100 of the influencers, which were actually held over a span of 107 days. "Sometimes they would be upscale cocktail parties in a mansion, and sometimes they would be in someone's living room with literally four crates of pizza and 15 guys who are bloggers 22 to 25 years old. We did every imaginable demographic across the board.
"The message was always the same. We asked them to come, and we told them why they were coming: We needed them to buy something. It was definitely an ask. But the pitch was very soft."
They weren't making threats about leaving. Instead, they were asking for their fans to help them stay, and they were able to make the sale sincerely, as if it were an investment in the city itself. They had been holding similar influencers since their return from Oklahoma City, but never so intensively as last summer, with so much at stake.
As a sign of the Hornets' importance in their relatively small NBA community, more than 40 percent of the metro area has watched, attended or listened to a Hornets game over the last 12 months, a rating that ranks among the highest in the league. An NBA marketing survey found that close to 98 percent of the Hornets' season-ticket holders could name their account representative. When customers choose to not renew their tickets, they are likely to receive a follow-up call from Weber asking why. When they meet to hold "draft parties" in which they divvy up their season tickets among a group of friends, Weber is likely to show up if he's invited via Twitter.
"We're a small city of families, and we're a city that enjoys being familiar with each other," Landrieu said. "So when I campaign, it's not unusual for us to go door to door and to get into retail politics in this age of mass-media buys -- we do both of them. They're both really important, because that kind of connection creates an emotional reality that doesn't necessarily exist, and it gives people a sense of ownership. It's just kind of the way we've always been.
"The good thing is the Hornets recognized how New Orleans was. It helped them become ingratiated to the citizens of New Orleans, and people showed that they liked it by buying tickets.
"It took an awful lot of work, and what we tell people here now is it's just elbow grease. Your grandma taught you that, right? You got to stay at it, get up every day, keep walking, don't take no for an answer, and you'll eventually get there. Clear the dust away, let all the noise be what it is and stay focused on the purpose, and you'll eventually get there. It might not look like what you thought it would look like when you first started, but you might find something wonderful at the end of it. And we have."
Why was NBA commissioner David Stern committed to keeping the Hornets in New Orleans? Like NFL commissioners Paul Tagliabue and Roger Goodell, who didn't want their franchise to abandon the city in distress, Stern believed he needed to make a stand on behalf of New Orleans.
But league sources say that Stern also wanted to use the Hornets to send a message to other owners and franchises. If the Hornets under interim NBA ownership could be run efficiently, despite all of the calamities around them, then what excuse did other teams have?
After the NBA took control of the Hornets, Stern installed sports attorney Jac Sperling as his representative in charge of the franchise. Sperling, a New Orleans native who is vice chairman of the NHL's Minnesota Wild, was charged with finding a new owner who would keep the team in New Orleans. He also served as Stern's representative in negotiations with state and local government to renegotiate the lease and make the team more hospitable to the next owner.
Stern also sent representatives of his team marketing and business operations division -- known as TMBO -- to help hire sales employees and oversee management of the team. Hornets officials say TMBO was invaluable in helping to guide the Hornets by using information from other clubs to inform Sperling and Weber of business practices that worked or failed elsewhere in the NBA.
The Hornets have become a franchise that, like its host city, "punches way above its weight," according to Landrieu. Parallel to the recent CBA negotiations, the NBA owners negotiated a new system of revenue sharing in which the richer clubs funnel profits to teams that are underperforming in the NBA market. Not so long ago, the imperiled Hornets would have seemed to be the franchise most likely to benefit from revenue sharing, but no longer. As it stands now, they will not be entitled to participate, and by as early as next year they are projected to achieve profitability.
In his meetings with owners and executives of the other 29 teams, league sources say that Stern has been able to point out -- bluntly and with no little pride -- the financial success of his Hornets. New Orleans is the smallest market to have two franchises from among the NFL, baseball and the NBA, and yet within the NBA the diminutive Hornets rank in the upper half of ticket sales, in the middle of the pack in sponsorships and No. 19 in overall revenue. As Stern prepares to leave office in the next few years, the Hornets have emerged as an example that he can use to compel other franchises to perform more efficiently, and thereby drive up league revenues overall.
The most controversial aspect of the Hornets' turnaround was their trade of Paul to the Clippers, which was consummated after Stern ended previous negotiations that would have sent the point guard to the Lakers.
In its original form, Paul would have gone to the Lakers in a three-team deal involving the Rockets, who would have received All-Star power forward Pau Gasol from Los Angeles. When teams were allowed to begin negotiations in December after the lockout resolution, the Hornets pursued a strategy to trade Paul for players who could keep the team in playoff contention. The original Lakers trade would have left the Hornets with a more expensive roster built around newcomers Luis Scola, Kevin Martin, Goran Dragic and an unhappy Lamar Odom; a league source says the Hornets had three adjunct deals lined up to move Odom onto another team.
Stern was widely accused of vetoing the Lakers' trade amid suspicions that he wanted no part of a deal that would help one of the NBA's richest teams become more dangerous and younger while saving money in the process. But league sources involved with the Hornets insist that the trade had not been consummated officially because it hadn't been reviewed and approved by Stern, in his role as the Hornets' de facto owner.
One highly placed source believes there was simply a breakdown in communications between the Hornets and Stern, as information about the potential trade never reached Stern until he decided to halt negotiations with the Lakers on Dec. 8, following the meeting with NBA owners to ratify the new CBA. It wasn't a matter of conspiracy but of priorities: The pressing demands of the CBA and revenue-sharing negotiations -- both highly contentious -- prevented Stern from receiving specific information about the developing trade until the Hornets, Rockets and Lakers had agreed in principle on the general terms, according to the source.
It is important to note that the proposed deal could not have been deemed official because the exchange of salaries involving the Lakers, Rockets and Hornets did not meet NBA rules. Another $2.5 million in salary still needed to be worked into the complicated trade before it could be finalized.
Six days later, Stern agreed to the trade that sent Paul to the Clippers in exchange for Gordon, the expiring contract of center Chris Kaman, second-year forward Aminu and the Timberwolves' unprotected No. 1 pick in June. This package of young talents, an expiring contract and a draft pick was the kind of deal sought routinely by teams that are up for sale, as a means of creating cheap, promising assets that would make the Hornets more attractive to a buyer.
The Hornets are expected to announce in the next month that they will be sold to either Los Angeles businessman Raj Bhathal or Gary Chouest, a former minority owner from New Orleans. This summer, the Hornets will attempt to sign Gordon to a long-term contract while maintaining maximum cap space to go with their two first-round picks in the draft.
There are no assurances that Weber, Demps and Williams will remain in their current roles. At the same time, there is no reason to replace three team leaders who have developed relationships with fans and sponsors that have helped transform the Hornets from victims into community partners.
The most interesting decision of the new owner may be whether to rebrand the franchise. Will the "Hornets" nickname be relinquished and enabled to return to Charlotte, where owner Michael Jordan could rebrand his own underperforming franchise?
If so, how would the basketball team of New Orleans rename itself? No suggestions will be made here, for the new name would have to represent the resilient spirit of New Orleans and its fans. It would be the finishing act of a franchise that has been reinvented, a team committed to the city that wouldn't let go.