Friday, August 1, 2014

Shedding Layers


With the announcement that they are interested in selling Velo Magazine, VeloNews.com, VeloPress and the TriRock Triathlon Series, Competitor Group Inc. has taken the second step in shedding everything not having to do with running and the cash cow that is the Rock 'n' Roll Marathon Series.

[The first step in this process was the closing of the Inside Triathlon brand and forcing triathlon icon Bob Babbitt into retirement earlier this year.]


Questions that arise are:
Why not sell Triathlete Magazine and Triathlete.com with the shedding of the TriRock Triathlon Series?
What happens to Endurance Live? Does it become a running awards show or just dies on the vine?

One hypothesis could be; if CGI completely divests its interest in the triathlon vertical it would alienate the triathlon community of Southern California where they depend on workforce and industry relationships.

A second could be; if they had added these three brands to the shedding, it would have caused great alarm and concern that the entire company was in trouble, thus devaluing the business and making it more difficult for Calera Capital to elevate the value of the company to investors and a future sale.

Triathlete Magazine and Triathlete.com are minor contributors to EBITDA and are not additive to the running vertical in any way; one has to guess that if pressed, Triathlete Magazine and Triathlete.com are in the mix to be sold as well.

It is unfortunate to see an organization that was built to serve all athletes in the endurance sports industry turn its back on the sports of triathlon and cycling. Clearly, they could not sustain a platform that engaged consumers throughout their endurance sports life and create crossover value from RnR runners getting into triathlon and/or cycling.

Now, the "one and done" mentality of participants in the half and full marathon industry will have greater impact on the CGI business, as there will be no other event product offings to capitalize on the already earned consumer engagement.

At one point, CGI's portfolio was a robust and complementary collection of endurance brands & events that was able to offer consumers multiple outlets to discover and engage with as their lives and interest in different activities changed.
Now, the "refocus on the running market" will put the company in direct competition with Rodale's Runner's World, Running Times and their events; an arena CGI can only compete in with events and an area where media buyers with significant budgets show little interest.

Here is a new version of the CGI boilerplate:
About Competitor Group
Headquartered in San Diego, Calif., Competitor Group, Inc. (CGI) is a the active lifestyle industry’s leading media and event entertainment company. CGI’s portfolio of media brands span the full range of the expanding endurance industry include ing Velo, Inside Triathlon, Triathlete, Women’s Running and Competitor with a combined monthly controlled circulation of over 700,000 500,000.  CGI owns and operates 53 events around the world, including the flagship Rock ‘n’ Roll Marathon Series, the TriRock Triathlon Series and Women’s Running Series, collectively delivering more than 600,000 professional and amateur participants in 2014. Additionally, Raceit.com, a leading digital registration platform, is the catalyst for the company’s race services offering that looks to meet the needs not only for the company’s owned and operated events, but also for endurance events of all sizes on behalf of the entire industry. Further information about CGI and its digital, publishing and event entertainment properties can be found atCompetitorMediaKit.com.

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