Saturday, April 11, 2009

For the Good of the Game

This is a continuation of the Paintball Sucks! post on PBIndustry sponsors of tournaments and the naive notions some ballers have. The original post decried the ignorance or self-absorption of ballers who blame the tournaments for failing to line up enough sponsors/vendors when most of those same ballers have little or no intention of buying anything anyway.
The Big Picture point was that the model of sponsors/vendors paying the league in order to sell their products at an event is a model that is no longer working. (And, in fact, hasn't been working for longer than the current economic malaise.)

In that post's comments I was apparently being mean and dictatorial (see for yourself) for suggesting a more useful dialogue would result if commenters didn't ignore the original position and cherry-pick their objections. Anyway, this post is my effort to try a new tack--and respond to the self-appointed PSP flack, raehl faction, on my terms instead of his.

Around this point in comments the raehl faction jumped in to insist the new PSP policy is intended to protect local stores and fields from the predations of the swarm-of-locusts traditional trade show & camp followers. Does he address, even in passing, the idea that the sponsor/league model is in trouble? Does he think the premise is mistaken? Why or why not? Does he think players are as actively purchasing paintball stuff at events as was once plainly the case? Or soon will again? Does he put the PSP policy into any context other than to make patently absurd claims about it? Well, no, he doesn't. (This is approximately where I began suggesting the comments might be more productive if they actually, you know, had at least something to do with the point of the original post.)

On the subject of sponsor protectionism I've previously posted some thoughts here, here, here and here.

The raehl faction claim: the new restrictive sponsorship policy of the PSP is intended to protect local stores and fields. It's frankly an outrageous claim on its face because it doesn't do anything of the sort except perhaps incidentally at the margins.
Imagine a town with two or three lemonade stands. Once a year when the circus comes to town a few mobile lemonade stands follow along and park beside the circus, by the entry. Most of them offer extra large cups at regular prices while a couple of others sell more expensive premium lemonade. This arrangement worked as long as the circus attracted all sorts of people. All the traveling lemonade stands were happy but after a while it seemed more and more people bought the cheap lemonade and ignored the premium lemonade. The purveyors of premium lemonade were unhappy because it was more expensive for them to provide premium lemonade. Now the circus charged the traveling lemonade vendors for the opportunity to use the circus's popularity to sell lemonade and the premium vendors had bigger trucks and paid the circus more so when the premium vendors became unhappy the circus told all the small vendors of cheap lemonade they were no longer welcome.
The raehl faction version insists the circus did it to spare the local lemonade stands when the circus came to town--but aren't the premium lemonade vendors still trying to sell their lemonade? And if the locals suffer less harm is it because the circus gave a rodent's posterior about the locals' lemonade sales or is it because they were trying to satisfy the premium lemonade vendors who pay the big money to follow the circus?
Odd too that this new policy was only conceived after the big industry players started complaining about losing sales to the smaller retailers. I'm just saying the timing is oddly coincidental.
The reality is it's a policy intended to protect manufacturers from themselves and prop up an operating model that is no longer working--and keep some of that sponsor money coming in. (There is, of course, a rational explanation to be made for following this course of action but the raehl faction fantasy sounds so much more altruistic and nobody seems to believe you, the tournament consumer, can handle the truth. Except me. And I'm an oppressive hatemonger. Go figure.)


raehl said...
This comment has been removed by the author.
raehl said...

Your analogy stinks. You've replaced equipment used over years someplace and some time other than where it's purchased with lemonade consumed immediately at the point of purchase. You've replaced manufacturers and their dealer network with producers not at the circus against producers at the circus. And you've replaced different people selling the EXACT SAME product with different people selling different versions of the product.

Let's see what happens when we apply an analogy that doesn't suck.

Replace lemonade with cars, and the circus with an automotive trade show where anyone can buy a vendor booth and the public is invited to attend. Now imagine that GM and Chrysler and Ford go to these trade shows and sell their cars directly to the public at 20-40% less than the local GM/Chrysler/Ford dealer is able to sell the SAME car. After a while, GM/Chrysler/Ford realize that their dealers are getting increasingly pissy about this, and decide that they are going to end the discount car sales at trade show practice, and along with their other changes to protect dealer pricing, decide that they are only going to sell cars at trade shows at MSRP, or a bit more than the local dealer can sell the same thing. While the dealers still may not be entirely happy with this, at least things are fair, and while the manufacturers know they're not going to sell nearly as much at the shows, they have finally realized that the change is worth it to help the dealers the sport needs to survive.

But then a discounter buys a vendor booth at the event and starts selling the same product the dealer is at 75-80% less than the dealer is selling it for. Now the dealer is really getting screwed, and on top of that, the manufacturers who were each paying big money to bring out their show trailers and be at the shows partially because they got some sales but partially because they got promotional value out of it are now having their sales killed by a discounter in a tent who is undercutting the dealers, undercutting the manufacturers, and not providing a retail location in the area or a show trailer at the event.

So the trade show promoter changes policy to only let manufacturer-appointed reps have product at the show, thus preserving the manufacturer's first attempt to do right by the dealers.

I don't understand why this is so hard for you to understand - in virtually every other industry, there are no retail sales at trade shows at all, let alone DISCOUNT sales! This isn't paintball doing something wrong, this is paintball finally starting to do something right!

Also, there is another big area where your circus analogy fails - the circus doesn't have players and teams. It costs a whole bunch of money to run tournaments, and entry fees don't come close to covering the costs. If the league trades 5 or 6 major platinum sponsors for the guy renting a tent, that's a whole bunch of money that is no longer available to pay for running the event, which means either entry fees go up or the league ceases operating at all. And also don't forget that along with those manufacturer show trailers come manufacturer techs.

maldon007 said...

Just so I understand, are smaller manufacturers cut out now?... Like last time I was at cup, there was some new loader debuting, small company... owner right there. The price was probably below retail, but it was the company itself selling. I hope stuff like that is not gone, I have seen so many cool new things thru the years at wc.

Anonymous said...

You know its funny..10 years ago the PSP advertised its tradeshows as a flee market of sorts, where manufactures sold products at a discount to players in order to draw higher attendance (and sales) at major events. and it worked. i went with UNIQUE sporting and WGP several years in a row and we would clean out our product at the events.

without the deals, what is the reason i as a paintball player (rec or tournament) would want to buy any gear (beyond that of whats required; gloves, elbow pads and lenses) at an event?

sdawg said...

mmm lemonade!

Reiner Schafer said...

"without the deals, what is the reason i as a paintball player (rec or tournament) would want to buy any gear (beyond that of whats required; gloves, elbow pads and lenses) at an event?"

Probably none. It seems the manufacturers have decided that it's wiser to protect and pacify their bread and butter customers (paintball fields and stores) over flogging their wares to attract higher numbers at a few events. If the PSP changed the ruling, you can bet the manufacturers played a big part in mandating that change. There would be no reason for the PSP to not want to attract higher attendance. The only reason that the PSP would make a change like this is if they were given no choice by the people that provide a big chunk of the funding for the league.

It's just like the drop in ROF in the past two seasons. The PSP may never have made the change in ROF if the manufacturers had not forced the issue.

anonachris said...

You're not being mean and dictatorial. I was suggesting in more of a post-modern argument, if you control the definition and the terms of the argument you pretty much control the argument.

You may not be telling people what to think, but by telling people what to "think about" you are exerting some control over the nature of the outcome.

Beyond that I didn't finish reading the new post so I'll go back and read it now...

raehl said...

maldon007: No. The only thing that matters is that you manufacture the product you are representing or are designated by that products manufacturer to do so. Nothing about "small" or "large" at all.

anonachris said...

"The reality is it's a policy intended to protect manufacturers from themselves"

No disagreement there, but your lemonade bit was not your finest moment...

The policy is to protect the stores and the only reason the manufacturer cares about the store is because the store buys from the manufacturer.

So yes, naturally rule number one is: first do no harm to yourself. If they harm the stores they harm themselves in the long run.

This without a doubt costs the player at the league something. They get to see even less vendors and they get to probably pay higher prices for things they buy at the tournament. If they want to pay lower prices, wheel and deal at your favorite shop before coming out to the show and then everyone wins.

I think the PSP/USPL could implement this policy in a better way that might encourage more vendors to show. But then again when it was an open door policy before and the the leagues even offered space for free they still didn't get people as you pointed out.

So the real issue is obviously economics of showing up at the show. One the players don't buy, two we're not even completely sure if it's good in the long run that the players buy (robbing Peter to pay Paul).

This might relate to the fact that the PSP(uspl) has no agenda with its tradeshow. Is it just there right now to add some gravy to the manufacturers who own and put on the league? Is it a chance to promote their products to the public? Is it a chance to meet regional dealers? I'd be open to an industry only tradeshow for at least part of the event where the league tries to involve more of the industry.

Perhaps (perhaps!) in an ideal world it would be nice to have an industry only show (attached or separate from the league, haven't considered) and then have a retail show that is run by 1 large retailer who heavily sponsors the league to "own" that leg of the event: the Bad Boyz Toyz Chicago Open.

Next the league would dramatically raise sponsorship rates, and sponsorship would have nothing to do with showing up and selling stuff. You'd pay a ton of money to have a banner hanging up like Rockstar has done or when you go to Xgames and see Sobe banners everywhere.

Gear would still be available for players and spectators through the large regional store that pays to sponsor that leg of the event.

This would cause manufacturers to lose a lot of direct contact with their customers (good and bad). Maybe you allow your big manufacturing sponsors to demo products, but not sell them.

Does anyone remember people buying Intel chips from Intel when they showed up at a few events?

So in short, with the tradeshow, separate the marketing and advertising opportunity from the direct sales opportunity and charge for both of them.

The problem is the people doing the "charging" are also the ones who would have to make the decision to make life more expensive for themselves and the benefit would not be so obvious.

And who knows if this hair brained idea thought up at the speed of typing would even work.

ps - I have no idea if I focused on the content of your post, whether or not you care because when I answer a question I always answer the question "that should have been asked". ;)

Baca Loco said...

Post modern thought is largely reductio ad absurdum.
The policy aced the retailers out in order to try and justify the sponsor costs to the manufacturers because if they can't find some way to defray that cost (by selling stuff) they will stop paying it regardless of whatever claims are made about the value of marketing, branding etc. And if the big sponsors stop giving the league(s) money the leagues are very likely to stop being...period. All the rest is simply window dressing.

raehl faction
Build those strawmen and keep knocking them down. A) I don't care about discount deals or retailers at the trade shows. I simply observed how the model has always worked and what the customers have come to expect--and that even then the model was showing weaknesses. B)I don't care if the "trade shows" are restricted to displays of bubble gum art. Doesn't matter to me. Just like I'm not terribly interested in what the manufacturers do or don't do to their retailers except as it has the potential to impact competitive paintball. It is their business, after all, and if they want to screw themselves over it's not really my concern.
C) You are welcome to make whatever claims you wish for the policy switch but as a practical matter whatever it may or may not do for local retailers it eliminates a whole prior class of league sponsors and makes it much harder for the remaining potential sponsors to justify spending the money to go to events and that in turn puts the league's survivial at risk.
D) hypothetical arguments about future benefits are swell but rather irrelevant if there are no future events to go to.

anonachris said...

If you think the concepts of post modern dialogue as applied to debate do not work you do not understand why we have the people we do in charge of us -- from politics to tournament leagues.

If you frame the debate you are 80% of the way to winning it. This really isn't debatable. (see!...)

raehl said...

OK, so, A, B, and D is basically you saying you don't care. In C) you allege that

1) a whole prior class of league sponsors is eliminated


2) It makes it much harder to the remaining potential sponsors to justify spending the money to go to events.


1) WHO exactly has been eliminated, and

2) HOW is it now HARDER for trade show attendees to get value out of their attendance?

You're all over the place here Baca - is this protecting the manufacturers by getting rid of the vendors who were undercutting their pricing, or is it making it harder for them to justify attending the events?

Here's the short version: Some sponsors pay $40,000, $60,000, $80,000 a year to support the league, on top of bringing the nice show trailers, and on top of bringing out their techs and fixing player guns for free. And some sponsors rented a tent for a couple grand and sold stuff as cheap as they could. Which kind of sponsor do you think is important to the league's survival? I hope the answer to that question is obvious to you. How does this policy hurt those sponsors? It doesn't.

This policy is good for *EVERYONE* except the small handful of vendors chipping in a couple thousand bucks to unload piles of super-discounted stuff to an audience that only exists because everybody else was paying in the big bucks to make the league happen and thus get thousands of paintball consumers in the same spot on a weekend.

The old way was clearly not a good idea. The new way is an improvement. Anyone who thinks the old way was better, to use my favorite phrase, is just being stupid.

Chris said...

I'm with Baca.. I don't really care how well they do or who does well or what they do..

What I do care about is finding equipment I need at an event.

The fact that no one was selling pods in Phoenix was REALLY shitty.

Bright back First Call, bring back TMG. If you honestly believe your car analogy then these guys are the "Used" cars..


raehl said...

Been seeing a lot of used equipment vendors at trade shows?

If the only problem with this is that there were not any pods at Phoenix, maybe the solution is vendors start selling pods?

Baca Loco said...

This is getting surreal now but in a fun way. faction puts words in my mouth and then disputes my positions and now -X- is agreeing with positions I haven't taken. I confess I didn't see that one coming.
In one last (desperate but almost certainly futile) attempt at clarity let me reiterate.
1) most players don't care why, they just want more vendors at the big events in large part because that is precisely what the big leagues have promised in the past.
2) it seems a fair assumption from available samples that many players are also clueless as to the bigger picture of sponsor/league
relations and its importance.
3) the motive of the league in making the change wasn't aimed at helping retailers, it was aimed at helping the league preserve sponsor income.

I never suggested the old model of vendor sponsorship should be reinstated. In fact I repeatedly said it was broken. I never suggested the league change the new policy. All I said was that it was almost certainly going to prove counterproductive and that it was undertaken at the behest of the big industry sponsors, including league owners, primarily to satisfy them. And I will add that change was then rationalized as the only way to preserve the bulk of the sponsor dollars coming to the league. And the jury is out if it will, in fact, actually end up doing that or not.

anonachris said...

Let me re-write number 3.

3. Helping retailers preserves mid and long term sponsor income, while having the added effect of increasing event sales for sponsors.

A slow dime being better than a fast nickel and all that.

If you want to keep talking passed everyone and around in circles while you cling to your point that the only thing the PSP owners cared about is increasing their event sales, things can continue.

I would agree that the added bonus was to control/limit the success of trademygun. I'm certain every gun manufacturer in the industry took notice of that. But I don't think this rule was specifically crafted to contain trademygun, it was just a positive externality (from the gun company perspective).

anonachris said...

Or rather... if you prefer:

Yes, you're right the sponsors have enacted yet another barrier to entry as we all knew they would in their self-serving protectionist racket and are once again trying to pass off the actions of their cartel as legitimately doing "what's best for the sport".

Not that I agree with it, but I understand how it could be interpreted that way. And functionally/operationally there may not be much difference between the what you are saying and what I and others are saying anywya.

You could have just used that paragraph as the entire content of your post and had a bunch of people nodding heads and waving torches and pitchforks around :)

Reiner Schafer said...

I've said many times in my writing over the years that almost always, change comes about by either economic forces or it is mandated (usually by a governing body). It would seem theat the changes in ruling the PSP put in place may have had both play a part.

Baca Loco said...

Riddle me this, anonachris, how does the new sponsorship policy benefit the league?
Or even how does the old policy harm the league?

anonachris said...

The new policy benefits the league to the extent that the manufacturers, who fund the league, think it benefits them.

Some long term argument can be made that it benefits the league by making the industry more viable for new players to enter. This is a 3-4 year benefit, but arguably if paintball at the local level is healthy, people can play at fields, shop in stores, look up to tournament players and aspire to play in tournaments. I imagine this is exactly how most of us ended up involved with tournaments.

If you harm the local industry, you undermine that concept.

Switching gears into the trademygun/flea market sale. It does not directly benefit the league. It loses quite a bit more than a couple grand in vending fees as I can't possibly believe First Call only paid 2-3 grand for its world cup booth. It probably paid quite a bit.

But assuming the league and the owners are separable, which they are not, you could make a claim that Lane recognized the 10+ grand (made up) he got out of First Call at World Cup is not worth causing 300K worth of loses to retail stores and by extension manufacturers.

In reality, I'm guessing Lane works very closely with the manufacturers, both on a personal and a business level. He's not their lacky, he's actively seeking to do the right thing that will both serve the manufacturers interest and the interests of the industry.

Perversely, it is in the players interest to pay more for their products. If you only plan on playing paintball for 1 year, it's not, but if you want to play for several years and make this sport your home it is.

Baca Loco said...

Your imagination, or should I say, explanation doesn't feed the bear, anonachris.

What does the league require to continue to operate? The easy answer is enough income to cover its debts.

If the new policy is universally hailed by PBIndustry as beneficial and enlightened then please tell me where they are because most of them sure as hell ain't sponsoring the PSP.

All the claims are about how it long term serves the industry and meshes with policies in other industries but none of the claims (or arguments) have dealt with the question of what's actually in the league's best interest, now, today or tomorrow that ensures there will be a league in the long term.

And, to be honest, all the rest isn't really that interesting to me because it pretends to be knowing and insightful but never gets down to brass tacks.

Alright, this dead horse has been more than sufficiently beaten. So much so even I'm tired of it.

Reiner Schafer said...

"All the claims are about how it long term serves the industry and meshes with policies in other industries but none of the claims (or arguments) have dealt with the question of what's actually in the league's best interest, now, today or tomorrow that ensures there will be a league in the long term."

I don't think many of us have all the data available to provide you with the information you are looking for.

I remember Lane (Mr. Wright) saying in one of his posts about the drop in ROF how people involved in the industry laid the charts and graphs out in fromt of him and basically said (and I paraphrase), "this is what's happening, and if we don't do something to change it, there will be no leagues in the future, at all".

There has been almost complete about-face from manufacturers and wholesalers in the past year or so in how they are treating stores and fields. It seemed at one time, there was very little interest in doing right by retail paintball outlets, but now manufacturers/wholesalers (at least the bigger ones) are very interested in doing what they can to make sure fields and stores survive and thrive.

Maybe they were peeking in on discussions field and storeowners were havng on PBNation, or maybe they just finally figured it out for thenmselves that without financially healthy fields and stores, the paintball industry would basically die a slow death. Maybe, just maybe, the change in policy is to do nothing more but appease field and store owners. Maybe it's just part of all the other changes like giving away less free/cheap products ot sponsored teams to flog below wholesale costs and setting and enforcing MAP's, especially when it comes to internet dealers.

Maybe the long term health of the industry, and thereby the possiblity of leagues to continue existance, is the only reason these vendor changes have been introduced.

anonachris said...

"industry laid the charts and graphs out in fromt of him and basically said (and I paraphrase), "this is what's happening, and if we don't do something to change it, there will be no leagues in the future, at all"."

Boy if that's how it worked the people in the industry aren't half as smart as I used to think they considered themselves... (huh?)
Correlation not being causation isn't just a cute saying.

Anyway, I never said I had all the answer Baca, and neither did you. I'd just disagree to some extent about the motivations behind the recent policy moves, but as I pointed out, the net impact on the player may not be much different.

So you have a right to complain that the player could be forced to pay more if they want to buy at an event (or pay elsewhere).

At the same time, when the policy was open no one was jumping to sponsor the league. It's a losing proposition for anyone that can't consistently break even at events.

Reiner Schafer said...

"Correlation not being causation"

Correlation does not imply causation, but correlation and causation are indeed linked.

If you are in business, and you have data that is showing market trends, and if those market trends are going in a direction that is detrimental to your business, then you better try to figure out what's causing the trend.

In the end, there is usually some guesswork or "best etimate" involved, but ignoring the data is not really an option if your business is on the line.

One would think that with the formation of the PSTA, that there are numerous business people getting their heads together and looking at data from various sources from within the industry. It's not just one person's guess. Are they right in their guesses? I don't know. I do know that the way the industry was run for a while (a long while), was not working very well, otherwise why the big drops in participation and sales during times of economic stability and growth?

Obviously people don't like change if it affects them personally in a negative way. But sometimes change is necessary for the greater good. I'm sure the fact that paintball players are whining because they can no longer buy deep discount items at tournament events should surprise no one.

anonachris said...

WTF are you talking about? If you are in business and you see a trend you spend at most 2 weeks before launching a new program you think will solve your problems but may do nothing at all.

Here's what you do...

Randomly pick 25 fields across the country.
Randomly call 15 people that have played at each of those fields (remember the waivers)
Ask them some questions.
First timer?
Played again?
Questions to determine why not (price, difficulty, distance, dirtiness, unfair, poor experience, etc)

If you find out that its statistically significant that people haven't played again because they got shot to pieces, then you have a case.

And if you're actually a smart businessman these results would not only tell you what wasn't the problem, it would tell you what is the real problem and how you can fix it. If player re-participation is declining for some reason not connected to rate of fire, maybe you need to do something else.

I'm not saying I know what the answer is, but to imply correlation and causation are related is so ignorant of reality. Sometimes its related, sometimes it has absolutely nothing to do with anything. You could find the exact same correlation no doubt with the spread of HPA systems. Or maybe the number of hoppers on the market. Or maybe the decline in sales of All American barrels by Smart Parts. That's it guys! If only we can bet more Smart Parts Barrels on the market our problems will be solved!

I actually don't care one way or another about the rate of fire change. But to suggest that it will solve our industry's problems is so foolish its, well foolish.

Maybe, just maybe, the decline in paintball participation is also linked to the decline in discretionary income. Maybe, just maybe, a well known fact of "business", that high end, niche consumer goods and services, are the first items to be "cut" from a persons budget, long before a recession appears. There is even some debate about correlation/causation here. Does the decline in purchasing of luxury goods and services correlate with a recession or cause the recession to deepen.

But you don't come up with some hair brained scheme and pass it off as statistical fact that will help turn around play participation.

Hoping for a lucky guess isn't the wisest course of action.

raehl said...

You can't make business decisions by asking he customer what they want any more than you can run the country based on polling data. If you're not smarter than the customer, you shouldn't be in business.

The customer doesn't know exactly why they didn't choose to play again, because the customer makes emotional decisions. Somewhere their brain decided that paintball was not so enjoyable that they want to spend money to do it again. You can call all the customer you want, and none of them are going to say "I didn't play again, but I would have if fewer paintballs were shot at me" because the customer has no idea that they would have had more fun if fewer paintballs were shot at them. To them, paintball is what they got, and all they know is what they got wasn't fun.

And actually, when discretionary income goes down, people trade down expenses. So while some paintball folks may no longer do paintball, people who were doing even MORE expensive activities than paintball trade down to paintball. That's why most rec fields are actually seeing an INCREASE in business with the economic downturn. Instead of spending $5,000 a family going on family vacation, families spend $500 going to the amusement park - or paintball field. Not to mention, the participation decline was already started back when the economy was at its peak.

Regardless, the end conclusion is simple: shooting more paintballs is bad for business. Period.