Toronto Maple Leafs Captain George Armstrong took a backhand pass from winger Bob Pulford, skated three strides to cross the red line, then gently wristed the puck into an empty Montreal Canadiens net. The goal, with 47 seconds left in the third period, clinched a 3-1 win and a 1967 Stanley Cup victory over the Canadiens, sending 16,000 fans at Maple Leaf Gardens into delirium. \nThe Leafs victory, its 11th Stanley Cup since 1932, ruined the heavily favoured Canadiens’ plans to display the cup in the Quebec Pavilion at Expo ’67, the world’s fair held in Montreal during Canada’s centennial year. A half-century later, as Canada celebrates its sesquicentennial, no Leafs team since has won the Stanley Cup or even reached another final series. Over the past 50 years, the Leafs missed the playoffs 21 times, including 10 of the past 12 seasons.\nDespite these dismal results, the Leafs are consistently ranked at or very near the top of financially successful National Hockey League (NHL) franchises. In Forbes magazine’s 2016 listings of estimated franchise values, for instance, the Maple Leafs ranked third in value at $1.1 billion (all figures are US dollars). Only the New York Rangers, at $1.25 billion, and Montreal Canadiens, at $1.12 billion, topped the Leafs. \nThis strange situation — where a team that has not won a trophy in years continues to rake in dollars and fans — does not just happen in hockey: it is found around the world in such sports as soccer, basketball and football. In soccer, for instance, Arsenal Football Club of London, UK, was valued in a 2015 study at £1.11 billion ($1.44 billion), second only to the storied Manchester United FC, despite failing to win the English Premier League title for more than a decade. And in football, according to Forbes 2016 valuations, the Dallas Cowboys were the richest team in all of sports at $4 billion, but had not appeared in a Super Bowl in two decades. \nNO INCENTIVE TO WIN?\nSo what is it that makes it possible for a team like the Leafs that has not won a Stanley Cup since 1967 to continue to be a money spinner with a large die-hard fan base? The answer is complex and is not always the same in the various sports. Factors such as location, or closeness to major markets, sales of luxury seats and ticket pricing, and branding are all in play, making it difficult for the simple winning of titles to be the key factor in financial valuation. \n“The Maple Leafs have almost no incentive to win,” says Brian Mills, an assistant professor in the tourism, recreation and sport management department at the University of Florida in Gainesville. “They have a huge waiting list for their tickets. They can charge really high prices and they haven’t been very good, at least in recent history. Even not making the playoffs, they can [still] make plenty of money.” \nBob Stellick, president and CEO of Stellick Marketing Communications in Toronto, worked with the Leafs between 1985 and 1997 in various senior capacities, including director of business operations and communications, and director of public relations. \n“I think a huge component of the Leafs’ success has been geographic. They’re fortunate to be in [what is] really the economic engine of the largest hockey-caring market in the world,” Stellick says. \nJeff Moorad holds a similar view. “Individual team valuations primarily track market size and significance of brand,” says the Newport Beach, Calif.-based chairman of PrimeSport Holdings Inc., a global sports travel and events-management company. Speaking of the NBA’s New York Knicks, he continues, “[They play in] the largest market in the US. They’re a premier team, irrespective of success or the lack thereof on the court in recent years.” \nForbes publishes an annual estimate of sport franchise value, and in 2016 it top-ranked the New York Knicks at $3 billion, a team that has not won a title since 1973. The Knicks nevertheless have a long NBA history as a charter member of the league since 1946. The second-ranked Los Angeles Lakers, which have won five NBA championships since 2000, are valued 10% lower at $2.7 billion, and the third-ranked Chicago Bulls are worth $2.3 billion, despite having won six titles in the 1990s with Michael Jordan, considered by many to be the best basketball player ever. Moorad, former CEO and part-owner of the San Diego Padres and Arizona Diamondbacks major league baseball teams, notes that the Los Angeles Clippers, despite never having won an NBA championship, sold for a healthy $2-billion price tag in 2014. \nThe Leafs’ move from historic Maple Leaf Gardens, which had a seating capacity of about 16,000, into the Air Canada Centre in 1999, with almost 20,000 seats and more than 100 luxury suites, has also been a financial bonanza for the team. In the late 1980s, Stellick explains, the top seats in the gold section closest to the ice were priced roughly in the low $30 range and affordable to the average fan. Today those seats sell in the $300 range and are snapped up by corporations. \n“Tickets have gone from probably 80% personally held three decades ago to about 80% corporate-held today. Corporations cheer for what their customers want to go to, and certainly hockey has been important, even when the Leafs weren’t competitive,” says Stellick. \nTHE RICH ORIGINAL SIX\nThe Leafs’ rich 100-year history also contributes to the team’s enduring brand popularity and financial success. Until the NHL began to expand in 1967, it consisted exclusively of a small number of teams known today as the Original Six franchises. The Leafs (established in 1917), Canadiens (1909), Boston Bruins (1924), New York Rangers (1926), Chicago Blackhawks (1926) and Detroit Red Wings (1926) all managed to establish rich histories, traditions and rivalries before expansion. \nThe financial benefits of being an Original Six franchise still resonate today. An independent research paper submitted by MBA students Robert Antolin and Pras Kayilasanathan illustrates the extent to which Original Six franchises continue to enjoy a wide premium in value over their peers. \nUsing NHL team valuations from Financial World from 1992-’93 to 1996-’97 and Forbes’ valuations from 1997-’98 to 2014-’15, Antolin and Kayilasanathan found that in the 1992-’93 season when there were 24 teams, the average aggregated value of the 18 teams admitted into the league since 1967 was only 77% of the average aggregate value of the Original Six teams. \nBy the 2014-’15 season, with 30 NHL teams, the average aggregate value of the 24 post-1967 teams had dropped to only 52% of that for the Original Six teams. \nOne reason is “you’ve got a much deeper fan base for Original Six teams than you do for the expansion teams,” says Glenn Rowe, professor at the University of Western Ontario’s Richard Ivey School of Business in London, Ont.; Antolin and Kayilasanathan were his students. \nDEVILS AND COWBOYS\nEven post-1967 teams that won multiple Stanley Cups couldn’t break through into top valuations. The study contrasted the value of the New Jersey Devils — which was ranked 17th during the 1995 season when it won its first Stanley Cup, 10th when it won its second cup in 2000, and 14th in its third cup-winning season of 2003 — with the Leafs, which fared much better, ranking seventh in NHL valuation rankings in 1995, fifth in 2000, and third in 2003. \nThe NFL’s Dallas Cowboys topped Forbes’ 2016 worldwide list at $4 billion, yet they haven’t won or appeared in a Super Bowl since 1996. \n“Typically, the question that is posed to me is, ‘How in the world are the Cowboys the most valuable when they haven’t won in 20 years?’ ” says Michael Lysko, director and professor of the practice sport management program at Southern Methodist University in Dallas. \n“The Cowboys’ brand here is a little bit like the Maple Leafs are in Toronto,” says Lysko, a native of Ontario and former Canadian Football League commissioner. “Their brand, their value, their equity is clearly far and away better than anybody else’s in the league,” he says. \nThe Cowboys, branded as America’s Team since its on-field success in the 1970s (it won Super Bowls in 1972 and 1978, and again in 1993, 1994 and 1996), are the only NFL team to opt out of the league’s merchandise revenue-sharing arrangement. \nOwner Jerry Jones chose to control that aspect of the Cowboys’ business, says Kurt Badenhausen, a New York-based senior editor with Forbes, and author of a 2016 article profiling the top franchises. \n“He’s gone out and built this merchandise business. He’s out there selling more aggressively than any other team. He has to share a portion of those proceeds with the NFL as part of the agreement to opt out of the league’s merchandise agreement. But it’s still a huge net benefit to Jones in terms of his bottom line,” Badenhausen says. \nJust like the Leafs and the Air Canada Centre, another reason for the Cowboys’ success is its state-of-the-art, 80,000-seat AT&T Stadium (expandable to about 100,000 for events such as the Super Bowl), which replaced the 65,675-seat Texas Stadium in 2009. AT&T Stadium features 342 executive suites, more than at any other NFL stadium. These are all sold, and ticket prices are “extraordinarily higher in the new stadium,” says Lysko. \n“They have a naming rights deal that is the standard in the world. That number is not public, but it’s a number that is generally agreed to be much higher than anybody else has ever paid [for] a stadium,” he says. \nJones even had the press box, which doesn’t generate revenue, moved from the 50-yard line (midfield) to the corner of AT&T Stadium so he could replace it with seats and command higher prices from fans sitting in a prime location. “The way they designed the stadium was to maximize the revenue they were getting,” Lysko says. \nIn 2014, the Cowboys generated $620 million, an NFL record at the time, says Forbes. The Cowboys generate both football and non-football related revenue at AT&T Stadium. In recent years, high-profile non-football events have included WWE wrestling, boxing and musical concerts, among others. \nSTRONG BRANDS ACROSS THE POND\nThe financial valuation of soccer teams in the UK’s Premier League bears certain similarities to franchises in North America. \nFor example, Liverpool FC’s financial success exceeds its on-field performance in recent years, says Dan Haddad, the London-based director of commercial consulting with Octagon, a sports and entertainment marketing agency. \n“Liverpool has always been a big historic club and a massive brand within football. But that really was based around success that the club had in the 1970s and 1980s before media rights kind of ballooned. They were able to build an incredibly strong brand and an incredibly loyal and large fan base, both within and outside the UK,” Haddad says. \nThe brand value of Liverpool has allowed the club to command strong revenues in spite of not having won the Premier League since the league debuted in the 1992-’93 season, although Haddad notes that Liverpool has won various other cup competitions, including the FA Cup in 2001 and 2006. \nThe largest stadium in the Premier League is Manchester United’s Old Trafford, with more than 75,000 seats. Like Dallas’ AT&T Stadium, a larger stadium affords teams the opportunity to sell more hospitality seats, which are akin to luxury suites in North America. \nTeams like Arsenal, Manchester United and Liverpool, with larger stadiums, are probably making about £1 million more per match than the smaller teams in the league, says Haddad. But the biggest differentiator for soccer, the sport with the largest global following, is commercial, which primarily involves sponsorships, he says. \nDeloitte’s Football Money League 2017, featuring the Big Four accounting firms’ annual profile of the finances of the top 20 soccer teams in the world, shows that Manchester United placed first in both the English Premier League and worldwide, with 689 million euros ($749 million) of revenue earned during the 2015-’16 season. The club earned 53% of its revenue (363.8 million euros) from commercial enterprises, 27% from broad- casts (187.7 million euros) and 20% from match, or game day revenue (137.5 million euros). Arsenal placed third among English clubs and seventh worldwide, with 468.5 million euros. Liverpool was fifth among English clubs and ninth worldwide. \nUnlike the Dallas Cowboys, Manchester United has won several championships in recent years. But like the Cowboys, it is an innovative marketer. \n“What Manchester United very cleverly did is they created a new type of sponsorship, which they called regional sponsorship. Rather than sell one sponsorship deal globally, which gives one company global rights, [they would say], ‘We’re going to sell this sponsorship deal in 50 countries around the world,’” Haddad says. \nManchester United pioneered this strategy in about 2009, gaining a massive head start on other large European competitors who started replicating that model about four or five years later, says Haddad. \nThe Deloitte figures for 2015-’16 illustrate how this strategy has paid off for Manchester United, which was No. 1 in the world in commercial revenues earned, with 363.8 million euros. Bayern Munich’s 342.6 million euros from commercial activities was second worldwide, but the next Premier League team, Manchester City, was well back, with only 238.9 million euros earned from commercial endeavours. \nManchester United and the Dallas Cowboys underscore a common theme among professional sporting franchises on both sides of the Atlantic, which is that marketing innovation can often contribute to tremendous financial success, regardless of the number of championship trophies won in recent years.\nBut formulas for financial success are also malleable, as illustrated by the rare cases of teams such as the Toronto Maple Leafs and New York Knicks that have long, distinguished histories as charter members of their leagues — albeit minus championships in many decades — in the largest metropolitan markets populated by fans who love the game.