Jim: Video games will be in the next Olympics. I know it’s mind boggling. The money that some of these players make and the how rapidly Madison Square Garden or Staples Center sells out for people to come and watch a bunch of guys play video games. That’s a big fact. The arenas sell out faster than some of the biggest name artists on their concert tours to go and watch these guys I mean play video games.
Narrator: Welcome to Endless Coffee Cup, a regular discussion of marketing news, culture and media for our complex digital lifestyle. Join Matt Bailey as he engages in conversation to find insights beyond the latest headlines in deeper understanding for those involved in marketing. Grab a Cup of coffee. Have a seat. Thanks for joining.
Matt: Welcome to Endless Coffee Cup. I am your host Matt Bailey. Glad you can make it for another conversation with some coffee. Glad to have a returning guest here. Jim Kadlecek is back to talk about sport marketing. I don’t know if you know but the original episode that we did so out of about almost thirty episodes, your episode on sport marketing is in the top five. This is definitely a subject that people are interested in. So, I have got back with me Jim Kadlecek. He is the sport business faculty at the University of Mount Union. He is also executive director of the Sport Marketing Association which I don’t think you told me that last time or I didn’t look on LinkedIn to see the title. So, when you invited me to speak at the conference and you told me that you are the director, I learnt something. Thanks for joining. Good to have you back.
Jim: Well, thanks for having me back. It was fun last time. I’m looking forward to today.
Matt: Very good. Well, the first thing is, since we last talked, I went to the sport marketing association conference in Boston last fall and I enjoy learning about new industries. Usually as a speaker I get invited to different industries, but the sport marketing industry was just so unique, and we talked about that a little bit in the last episode. One of the things that surprised me was the amount of facilities and I guess I never really thought about that that these facilities, they have offseason events that they have to attract and market and sell. So, it was very interesting hearing the facilities talk about how they use social media, how they market themselves and really the facility becomes a personality to reflect almost the team but also itself. That was a surprise.
Jim: I think that there’s no question. As you see the millions of dollars now being spent in facility upgrades or building new facilities or the billions of dollars being spent on building facilities. For instance, in southern California you’ve got the Rams, Chargers, developers that’s going to be a multibillion dollar project when it’s all said and done and yet football only has counting preseason, ten home games a year.
Matt: That’s right.
Jim: To spend that kind of money on a venue that’s only going to have ten scheduled events or the fact that they’re going to have two teams playing there twenty, that still leaves it by my math about three hundred and fifty-six days.
Jim: So, you have got the over three hundred days that are dark. There’s nothing going on there. So, they’ve got to look at how to generate revenue in those venues when they’ve spent so much to build them. That goes into it. That goes into how the venues are designed to be able to maximize use in non-game days and then a whole marketing strategy on how to drive traffic to the venues. The Dallas Cowboys have been masters of that with AT&T stadium where they put together a tour business of the stadium. But unlike any others, most the time if we think about touring a stadium we think about you show up here at the entrance and you have a tour guide who takes you around and it’s set time, and no you can’t go in there. Very kind of locked down. Well, what they did with the tour, the Cowboys, is you pay money and you can get there at nine o’clock and stay until five o’clock.
And, you can be out on the field. You can bring your friends and bring a football and play some games there. You are all the way up to the very top in the press box. They have different types of tours that give you different kinds of access. There are kids who would have their birthday parties there. They’ll rent one of the suites to be able to sort of have the cake and that stuff but then they’re out playing on the field and doing stuff. So, they generate more money off of tours than what a lot of professional teams generate off of their ticket sales for the games.
Jim: Yeah. They’ve been very innovative. I think you’re seeing more organizations looking at how we can maximize this venue that we have and even just up the road in Cleveland where they’re going through the queue transformation. A multimillion dollar update. Part of that is going to go to allow them to do more things on non-game days. Although the queue gets quite a bit used between concerts and the Cleveland Monsters Minor League Jockey and the cars, and then once the transformation is done the Gladiators Arena football team will be back. They have a lot of days played out there but there are still a lot of other days that are available for you.
Matt: What sounds like even with the cowboys are doing it, it is that fan experience which all kind of comes back to the even though it’s the facility they were able to offer. You know here’s an afternoon on the Cowboys field and I can’t imagine any fan that wouldn’t enjoy something like that. You get your pictures; you have your friends and have a pickup game. What a great experience that is.
Jim: I know. They’ve done a great job too. It is leveraging the Dallas Cowboys brand, which is one of the most valuable brands in all of sports. I don’t know that the Tampa Bay Buck would be able to do the same type of thing, but yeah when you’ve got fans were loyal from coast to coast and they are coming to Dallas, they want to see the stadium. They can go beyond just seeing it. They can go and play on the field. It’s a pretty cool thing. It is pretty innovative on their part and it’s generated a lot of money for.
Matt: That seems to be the theme of a lot of the conferences and then also our conversations is change, innovation and looking at how to monetize in different ways. Things are changing. With more electronic access, people are demanding more, but also new opportunities are rising and one of the things we ended with in the last episode was that I’ve learned more about it and you have brought even some information about that is the e-sports. How e-sports is taking away but it’s almost like a new industry has just created itself. Especially the NBA has really latched on to that to take control of it. This is going to happen, lets own it. They’re really forward thinking in that respect.
Jim: No question about it Matt. The e-sports phenomena is one that I think a lot of us are still trying to figure out because they’ll have these e-sport events and that will sell out in minutes at Madison Square Garden or Staples Center. People are selling out to go watch six people play video games. I kind of don’t get it but there’s a whole bunch of people who do and it’s this sort of whole niche of folks that are just really into lifestyle. And it’s in communities because when you’re playing games, you have got a gaming community and you can be interacting with them as you’re playing your game and you know different remote locations. But yes, to the NBA, they are all in on it. Adam Silver has referred to the new NBA 2K e-sports league as part of the family of leagues of the NBA with the NBA, the WNBA, G League and their E-sports League. It’s just as important to them as the other three. They had an e-sports combine where they brought in gamers to play so people could evaluate them because I think it’s seventeen of the current NBA franchises have an e-sports team. There was a draft. The commissioner was there to announce the first player drafted.
The players are paid. There’s a season long competition and then at the end of the season, there is a big payoff for the team that wins the final term. The other aspect when you talk about its impact with NBA 2K or Madden or a couple of the more popular sports, e-sport games have really done a lot for making the youth familiar with players. NBA 2K does a great job of how quickly they update. When the Cavs made that big trade this spring where they cleared out a whole bunch of players, you got the revised version of the updated version of 2K right away.
Matt: Are they doing an electronic update of the games?
Jim: Yeah. So, it’s not like by this year’s version and it’s going to have all the guys that they just traded wouldn’t next time you go to play the game you got the new players on the team.
Jim: So, you can see that the NBA’s definitely all in but probably the greatest signal of the impact of the e-sports and how it has really infiltrated or penetrated the sport landscape is the fact that in the next Olympics, e-sports will be in the Olympics. It’s a little bit mind boggling to me.
Matt: People tend to hear what sports are going to be in the next Olympics and you kind of roll your eyes. But that is amazing. It is also holding true for the European, the football leagues like FIFA. Are those organizations seeing that? Are they embracing it?
Jim: I’m not aware that they have anything to the degree of what the NBA has done and even in the U. S., the other of four major professional leagues – Major League Soccer, the NHL, Major League Baseball and the NFL, have not yet gone all in the way that the NBA has. But, I was recently at a conference where there is discussion and I think they’re all looking at this is a space that we probably need to get into and figure out a way of how to capitalize on the fact that people are playing these games. Anyway, we’ll see what happens and with that, you have how you monetize it in right. So, the ability to incorporate sponsor brands into the game so you’ve got branding opportunities but also that’s a space that you have to be really sensitive to because players are not necessarily people who want to be in a loaded up with sponsors. But they get a lot of players that have their own sponsorship deals. So, you can look at what they’re wearing when they play or whatever. But, as far as incorporating it into the game, when you look at the digital court you know that there is a brand on it or the uniforms that the players are wearing in the two 2K League. It’s one of those things that everybody is trying to figure out, sort of like ten years ago when social media was kind of the new thing that everybody is doing. I think to this day people are still trying to figure out how to monetize digital and social, but they are a little further along than they were ten years ago. I think that’s kind of where e-sports is right now. People are trying to figure out how we capitalize on this.
Matt: Well, the branding thing just seems like a big playground at this point because you’ve got the teams in the branding that those agreements have been in place. Then you’re also bringing in the gaming part of it where you’ve got the brand of the game but then if individual gamers are being sponsored. That’s not necessarily a sports sponsor. It’s a whole different product realm or brand realm that you’re bringing in and so it increases but also makes it a bit more complicated as well.
Jim: Right. I would compare maybe who they’re thinking about. More towards like the action sports audience, and so when you look at some of the different action sports events that go on, who are the sponsors that are involved with that?
And, maybe like a Red Bull and some of the other kind of cool and a more youth-oriented product lines are what I think you’re seeing a little bit more of.
Matt: Wow. It’s like you said they’re getting to know the players at a deeper level. They’re becoming more kind of like with fantasy football; you’re watching players you never would watch before but now you’re familiar with them and you’re getting to know them. I don’t see it is really taking away any revenue or appreciation for the sport. It’s actually enhancing it.
Jim: To add to your point, fantasy has become a multibillion dollar industry but one of the things that you’re seeing venues do a better job now is giving fantasy updates. So, you’re there at the live game watching your team play but they’ll give fantasy updates on who’s the top wide receiver today and how many points they have on top running back and how many points they haven’t. It’s that people are busy playing fantasy sports and you don’t want them to stay away from coming to game because they’re so into their fantasy. You don’t want them frustrated that they are at the game and want some fancy updates on sold the stadiums themselves now or are incorporating into their game presentation of fancy updates for the fans who are playing.
Matt: That’s amazing. I remember the days when everything was done on a spreadsheet and it was late Tuesday afternoon or Wednesday that you would get the final scores. Now its real time and I think that has what has transformed it from ‘the back-office activity’ to now ‘it’s just right on the forefront’. You immediately know what’s going on. Which again transformed it and now you’re seeing so much more integration with the Leagues to enable that and to make it happen.
Jim: Well, now the level that it is taking when you have a DraftKings and people can make money doing this. You also have the other like ESPN where you can put your league and just have fun playing with other people. But there’s the opportunity when people are looking like, ‘hey, I’m good at this and I want to make money off of it.’ Daily Fantasy, weekly, leagues or whatever, that’s with DraftKings and Vandals have provided which has made it a multibillion dollar industry.
Matt: I’m a nerd fan of figuring out or observing how people figure out how to make money. I mean it’s a product they don’t have, they don’t own but they have figured out how to make money off of it by just simply offering people the opportunity to do something.
Matt: It just fascinates me. The amount of ways people come up with to create money, it is just absolutely amazing. Related to that, we kind of talked about this earlier is the NBA. You were talking about Adam Silver saying that we are looking to get into gambling which is revolutionary in the field of professional sports. That’s amazing.
Jim: Yes, it is amazing and Adam Silver has been pretty progressive. The NBA is I think the most progressive league when it comes to sales marketing, just sort of being visionaries. You look at what they’re doing with the e-sports and creating their own e-sports league. It was probably five years ago when I first heard Adam say that they are supporting legalized sports betting and his point was that it’s going on. There are billions of dollars that are being exchanged and why shouldn’t the NBA have a piece of that?
Jim: And, make it more legit. So, right now that’s actually in process through different legal entities of opening up legalized sports betting besides New Jersey and Las Vegas. Most of it has been off shore. So, to bring it in, the sports bet where we want to, and that the NBA would be able to get a piece of anything that’s bet on NBA games.
Of course, the NBA is always concerned but I think that the reason leagues have been opposed is they don’t want anybody to be able to say that the games are fixed. They’re looking at betting lines or anything else. That’s the concern but I think that Adam Silver’s point is that this is going on anyway so why don’t we make it more above board instead of the off shore etch, while it gets us part of the action? So, we’ll see what happens.
Matt: Yeah, that’s amazing because gambling is so connected to professional sports.
Jim: Yeah, like it or not.
Matt: When Mike and Mike used to be on, that was sort of my go to show in the mornings just to have in the background, and they would always talk about the upcoming games and they give you the line. The betting line on it. How do you separate the two when even your sports entertainment talks about the betting line when they talk about the upcoming game? It is so intrinsically tied together even though they would say they don’t advocate it. Yet, that’s how they would discuss it. Who’s favored by how much? Do you agree? That’s always the first thing that comes out as soon as they know who’s going to the Super bowl. Here’s the line and it’s just amazing how it’s always been tied together, like it or not, by the leagues.
Jim: Yeah that’s an interesting point and often in our newspapers when you’re looking at the upcoming games, you will have a list of games and show the line right next to the games in the sports section. So, yeah that’s a good point. One of the areas where Royal Leagues have got a little more flexible as it used to be, you could not have a casino as a sponsor or really involved with the team. With more states having legalized gambling and having casinos, so leagues at different times, I think now all the leagues, there’s no barrier to being able to if you’ve got a corporate sponsor who’s a casino, there’s nothing now that, there are some stipulations on what you can and can’t do but there’s not any stipulation about you can’t have a sponsor who is a casino.
Matt: Okay I have got to ask this as a fan but also, is that why no one’s going to Vegas yet as a professional sports franchise?
Jim: I think you’ve got two that go there now. You’ve got the Golden Knights NHL team that just finished their first season record setting and then The Raiders are going to be moving there in two years.
Matt: That’s official then?
Jim: Yeah. But there had been trepidation about gambling and is it okay for us to live in the heart of gambling and have teams? I think they have finally realized that there are very few States in the country now where there isn’t legalized gambling. The lottery is gambling. There is no skill involved. You’re just hoping that your numbers come up. I think that’s where the combination of it made sense in terms of could that market support. I think that was one of the things that were not sure, because of the transient nature of Las Vegas. Could a team actually survive or is there enough of a fan base to be able to support team? But this year with what the Las Vegas Gold Knights have done, I think they’ve proved clearly that you can have a major league team in Las Vegas and can be successful for a fan attendance standpoint. Their performances been history making. There’s never been a first-year exhibition or a new team that has had the success that they’ve had.
Matt: That’s great. That’s very unusual. I always thought that if someone goes to Vegas it’s going to still be a very tourist driven enterprise that while you’re there, you can go record the team.
Jim: Because you already have a two degree in Miami and Phoenix where a lot of the fans who go to the games.
They may be now re located there but they’re fans of the other team. As well as the travel, like Miami is a nice place to go for the weekend and watch my team play or Phoenix is a nice area to go to for the weekend to watch my team play. So, you’re seeing a little bit of that have already happened in those markets and Las Vegas. I think you’ll see the same thing where opposing teams will probably attract well because a lot of people like to go to Las Vegas and it seems like many of the major airport hubs around the country have low fares to get there. The hotels pretty affordable. It runs around the affordability standpoint. It is a way to go see your team play that you would have got to see them otherwise.
Matt: Mix it together with a vacation especially to a warm weather destination. Well that’s one of the things and one of the words that you brought up was the disruption is hitting the sports industry as well. How is disruption entering into sport besides what we’ve already talked about a few? But, what are some other ways?
Jim: That seems to be the buzz right now, the disruption. When I hear that word, to me it means that the industry’s being challenged to deal with new opportunities or to do things differently than how they’ve been done before. So, I suppose some other examples would be, besides the e-sports, little bit more about the digital aspect in terms of providing more opportunities for fans to get closer to their team from a digital standpoint. The consumer behavior aspect of that is of want do they want, how are they looking at the distribution of content and what content do fans want? When we talk about distribution of content even the aspect of the streaming of games comes in. Now I can watch my game on my phone, my tablet or my laptop. I don’t have to be there, or I can get bits and pieces of it because I don’t have time to watch the whole thing. I can get it when I’m in faraway places. I think that’s something that the NFL this past year had to deal with. The year before with Twitter, where they screen one of their games or Thursday night broadcast. They’ve got to deal with Amazon now as well and so on. I think they are constantly looking at different ways on how fans can consume the product. The use of analytics from a standpoint of more on the business and strategy side, I mean you have seen the analytics on the player evaluation side but you’re seeing analytics used even more with that. And, now the sideline NFL game, it used to be all the pictures that they would take to show the previous series. Now, everything is on a tablet and you have the breakdown of what they did here. They’ve got real time analytics for plays that have just been run or what people did in that. So, all those are ways where sports are being disrupted. Ticketing, you know, there is far more use of digital tickets. That’s been going on for a while but higher adoption rates now of the digital ticket, I mean here in Cleveland we’re pretty familiar with flash seats in the caves and so it’s been a long time since we’ve used paper tickets to attend the caves game, but The US open this year I think there is a seventy percent adoption rate for digital. College football playoff was I think seventy eight percent. The NHL All Star game this year had eighty five percent adoption rate of the digital ticket. I think people are recognizing that it’s easy. I don’t have to worry about losing it. I just bring my phone, I scan it and then the flip side is now as a sport organization, I’m getting fan data that I was never able to get before. Matt Bailey might have bought fifteen tickets and handed them out to fourteen friends and then kept one for him and all I knew was a little bit about Matt Bailey. Now, with digital ticketing I have got data on all fourteen of those people that Matt gave tickets to. So, it allows them to get a better idea of who is coming to the games, maybe what are some of behaviors they are exhibiting at the games?
Matt: Right. That gets into the beacon technology. If I have got my app on your phone and it was opened in order to skim the ticket, now there is a whole bunch of data.
Knowing your seat, what concessions you visited, that’s an amazing part of the data. Triangles just figuring out what are people doing. I love the behavioral aspect because when you’ve got that high of an adoption rated digital, you now all of a sudden have a lot of data you need to deal with. So, I suppose right now people to crunch that data are in very high demand within the industry.
Jim: That really true. I’d say that’s probably the fastest growing area on the business side is people who can help with the analytics. We’ve got all this data that we have got to deal with. Also, one of the things that has been disrupting is that it’s not just about compiling data. So, now we’ve got this data warehouse which has got all this stuff in it but it’s like what am I going to do with it? How do I make sense of it? So, having analytics of your analytics, you must be able to find some meaningful trends in the data that helps make decisions and that are going to let you do things smarter, better, more efficiently and more profitably.
Matt: That’s the trick about analytics. My brother is also deep into the analytics world and he’s constantly bringing stories because he’s working with a lot of big brands. He tells me that they’ve got this massive cloud storage and it’s all about, ‘I need the data. I need the data.’ And then he’ll sit and say, ‘Well what problem do you want to solve?’ And that’s not something they’ve addressed. They are in love with getting all the data and now we’ve got people to analyze the data but what problem or scenario can you come up with that you want to solve? That’s the hardest thing. They can find people to crunch it but to ask the right question is one of the most difficult parts in finding someone who can even look at the situation and say that’s the problem or that’s the opportunity we want to explore. Now, what data do we need to address that? In the industry we call them the unicorns because having someone who understands how to crunch the data but then ask the right question to get the right answer out of the data, they are one in a million. You’ve got to find that kind of skill set to get to that place because I can imagine just even a ballpark, you have got that state of where do you even start? What question do we have and how do we then monetize and optimize it? Create a better experience?
Jim: I think that’s where teams have tried to do a better job of building profiles of their fans, so they have a better understanding of who their fans are and then getting into what their behaviors are. What is it that they want? So, when teams or sport properties consider a digital strategy to be able to look at what’s the consumer behavior of our fans and what is it that they’re indicating that they want from us and how quickly can we deliver that content to them and to overall give them a better experience, a better relationship with the organization to enhance their fandom and their loyalty to the organization that they‘ll continue to spend money and keep the organization profitable.
Matt: I think the last time I took my kids to see The Ducks up in Akron, I did not expect to spend that much. You take kids to a ball park; they’re going to get hungry which I plan for. I just didn’t realize how hungry. It’s just so funny when you just see the vendors going around; to fourteen-year old kids everything looks good.
Jim: Yeah, exactly.
Matt: So that’s amazing. What other types of disruption are the industry talking about or they have to deal with?
Jim: I think we have talked about a lot of it. We have talked about e-sports. I guess we have to say something about AR and VR. That’s another big piece. The virtual reality or augmented reality where the question is, what’s being provided for fans? I would say that was that’s an area that is still kind of being figured out but you’re seeing more organizations. The main thing is that I think people recognize the limitations of virtual reality.
Is someone really going to sit for two hours with the head set on for this virtual experience? Probably not. But are there things that you can do to enhance the fan experience with virtual reality? Absolutely. So, I think that’s another area that is really growing and continues to be looked at. How do we incorporate this into our overall marketing strategy to give fans what it is that they want?
Matt: One of the things I I’d seen here is that YouTubers reporting in the past year, the number of searches for highlight videos has grown ninety percent. Anything with the term highlights or short small bites of highlights. One of the things I noticed is that not just your typical new sports news organizations are providing more content in one to three-minute clips but also the teams themselves seem to be also publishing via Twitter or Facebook or whatever. During games they’re much more active. They are packaging together highlight reels as they happen and pushing them out. Just the other night, with some of the Cavs highlights, the amount the Cavaliers were pushing out during the game was just amazing. That was a great shot. Thirty seconds later it’s on Twitter and the with the video it seems like the teams themselves have become much more aggressive in pushing the highlights out and not just waiting for your typical ESPN bleacher report’s. What I find bleacher report doing now is republishing what the teams have pushed out into a stream.
Jim: I think that is one of the areas where teams are looking at. What’s going to drive people to our app or to our Twitter account? What do we need to do to give value of following us on Twitter or of having the app open during the game or whatever? That’s it. People want content and that kind of goes back to what I said earlier about the challenge with digital. It is finding out what do our cut, what’s the consumer behavior telling us that our consumers want from a content standpoint and then being able to provide it. So, you know when you look across leagues and teams at their different Twitter accounts, there are some that do great stuff with it and keep you engaged even on non-game days. There are others who are not so much. I’ve got the Caves app and I get push notifications all the time about different opportunities or ‘Hey, its two hours till tip off or whatever.’ They are to keep me engaged. If I’m not able to sit down and watch the game, I just open up the app. It’s got real time score updates and what’s happening. If I want to seek some plays, it’s got that there. So, I think that absolutely beds the critical part of that aspect of content development, content delivery and providing the content that fans are looking for. Then the YouTube highlight aspect, I’m sure there were lots and lots of hits this past weekend with the NFL draft. People hit nine. I want to see highlights for this player or who’s this writer that our team just drafted? What highlights can I find on them? So, definitely YouTube has seen a big boost with that and then you have the providers that are coming from all different sides of the equation when they’re providing the highlights.
Matt: Yeah. With the individual players during the draft, that’s what this article was going into from Google. It is just that it’s on demand and news organizations, sports organizations or even players themselves as a personal brand, you need to be ready to provide this content and you can’t wait a week to do it. You can’t wait a day to do it. It’s got to be ready now because one thing I thought was interesting here is that eighty-percent of sports viewers say they use a computer or smart phone while watching live sports on TV. So, they are messaging, looking at scores stats and looking at other data while they’re watching the game.
So, now it’s become a multi-screen experience and for the vast majority of fans.
Jim: That term disruption that is one of the things that sport properties are well aware of is the amount of multi-screen consumption. I’m watching the game, I’m on my phone checking Fantasy updates, I’ve got my laptop over here where I’m doing other stuff, So, a three–screen experience is not uncommon. Back to the days of pre–remote control, you watch TV and you sat through the commercials as well because of a hassle to get up and change the channel and then it goes back to the game. Now, you know you’ve got your remote and you’re flipping channels when a commercial comes on and you are checking your other screens. The amount of distraction that goes on during games or the amount of stimulation, the amount of content the people are consuming is very different than it was twenty years ago and so supporters are having to find ways of dealing with that and keeping fans captivated.
Matt: Absolutely. I remember the first time that I watched the NFL’s red zone. I honestly think I sat there for almost six hours and all of a sudden realized how much time had gone by because it was just highly after-highlight, after-highlight you know. All the score and you wouldn’t think that there would be that much content to show on every touchdown or every score. But, it was almost too intense because in a normal game there’s lulls you can take breaks you get up and walk around the commercials come on. This was non-stop. It was almost too much. Too much activity you just got lost in it but really it was an innovative way just to please the fantasy owners and those that just want more action. Then you try watching a game where it’s just play after play and I think it’s a forty-minute game. In reality I think they’re doing the same with baseball where they show the replay without the breaks and pauses. But, it’s interesting, the delivery aspect. You want highlights, here is it? You want second screen. It’s just cutting it up in different ways and presenting it different ways. It’s almost like you can’t lose because people just want somewhat thirty-second clips, somewhat the five-minute, somewhat the sixty-minute and by offering all of it you’re still winning.
Jim: You’re still winning as long as you’re still providing fans compelling reasons to go to the game. That’s the other concern that sports organizations have. It’s that the at-home online multi-screen experience can be so good, why would I ever want to spend money to go to the game? So, that continues to be one of the reasons why organizations are so focused on wanting to know as much as they can about the fans that are coming into the building so that they’re able to provide them a great fan experience. It’s going to want them to continue to come back in to invest in season tickets. Because when you have nobody in your building but all of sudden these other things aren’t nearly as valuable, you need people coming to games and so on.
Matt: So, what are things that teams do? If the team is not doing well, we don’t have any super stars. How do we get people to come to the games?
Jim: Well, I think that one of the areas that I look at a lot is the aspect of ticket sales and first saw it’s a cop out when teams say we have a really lousy team and so nobody’s going to come to our games. The Cleveland Browns which can be defined as lousy. One wins in two years. When you look at what they’ve done in ticket sales, sponsorships sales, premium sales, they are at the top of the NFL because they have an amazing culture. They have great leadership in those positions and they are people who work really hard in taking care of their fans and providing value to them.
If you ask anybody that would you rather that your team is good or bad? They’re all going to say we’d rather. I mean the people at the Browns are saying cash. I’m hoping for another sixteen years. But the flip side is it makes you better and from a selling standpoint that makes you better as an organization even. They’re definitely not coming because we are successful. They’re not bandwagon. They are coming because we’ve got to do something right, that’s going to make them want to come. One of the challenges sometimes is the ushers. Most of the times, ushers don’t work for the teams. They work for union or stadiums. When you go to the games, you associate the ushers to your team. The usher treats you rudely, you are mad at your team. Even if you are over charged for the parking. The team has nothing to do with these things. A lot of times the team doesn’t have a whole lot of input on that, but you see teams recognizing. These are all really important parts of a fan experience. Where they park, how they get into the stadium, how they’re greeted, how they’re treated, what kind of food they get, how much you’re spending, those are all things that are really important to the fan experience in the team. Team doesn’t have as much control over that as they would like but you’re seeing them being a little bit more aggressive as far as once you’re in the stadium of working more with the security companies to give them proper training. So, fans are going to be treated in the way that they want them to as guests, sort of the Disney approach. Atlanta Falcons build a brand-new stadium, Mercedes Benz stadium. One of the things that they did that was looked at from the entire industry and was viewed as somewhat controversy but Arthur Blank, the owner of the falcon said, ‘We are going to provide our fans with value based concessions and so we’re going to have concessions that are affordable to our fans.’ So, I think it was a two-dollar soft drink but had unlimited refills. Everything was going to be in that. People were like what are you doing? This is crazy. But, when you go back they just have their first season of it and in doing it what they found was they had way more hits in their concessions this year. Now were the margins as high? I don’t know. They’re talking about how much more they generated overall in terms of reconciliations and revenue. I don’t know what their margins were like but none the less the point was, people will buy it when you make it more affordable.
Jim: And, they have a better sense about their experience. Like, they had a lot of different options for me. They didn’t break the bank. So, you might see more of that type of thing being done as well but at the end of the day, the ability to communicate the value of spending discretionary income to come out to a game, of the memories with your kids or the opportunity to entertain a business client, or to show your employees that you appreciate them, those are all things that sort of move the needle on why people buy tickets.
Matt: Everything comes down to the fan experience and teams understanding that, it’s much more than the game play.
Matt: It’s everything that involves getting their parking, getting to the stadium, getting in and you know I’m doing a lot of experience mapping with companies, where we look at the full customer experience. And typically, there something outside of the realm of the immediate thought of what they think is a customer experience is. This is a prime example of everything around but yet it’s associated with the team even though they have nothing to do with it.
Matt: But, I love the examples. People post pictures constantly of the ten-dollar cup of beer that at any other place is two-dollar. But slap a logo and sit here and this is how much it costs and it’s a joke how much. I think that the margin would be very interesting to see if they made up for volume.
I’m wondering, do you see more teams trying to get into those intangibles of ‘do we want to broaden what we control about the fan experience’?
Jim: Yeah, I think when it comes to concessions and what Atlanta did this year, concessions undertaking is a huge undertaking. You have third party vendors who are a couple out there. The teams don’t really want to take that on. There are some teams that do their concessions internally and got somebody who maybe came from one of those places and have great expertise. But, it’s big because you’re also dealing with a lot of part-time employees, who are just working game days. Coordinating all that is a big undertaking. So, some team say we don’t want the hassle of that but also, we don’t like it when people complain about it. So, that is a challenge. I think as more organizations adopt something like what happened in Atlanta, a lot of us can’t do with the relationship with their third–party vendor. Who is their concessioner? What can they negotiate with them? A lot of the complaints that fans have regarding their customer’s experience has to do with ingress and egress. It’s such a hassle to get in the long traffic lines. It’s hard to get out of here, not a lot of times teams are having control over that. But, trying to work with your local authorities to see what we can do locally, to make that better so you control the things that you can’t control and then you maybe try to influence the things that you don’t have control over, but maybe have some input on to get them to align more with what fans are looking for.
Matt: Well, this has been fascinating Jim and one of the things that I keep learning about sport marketing is that the marketing aspect is there but the growth of the industry in analytics, in communication, in even video editing, what are the hot jobs or opportunities that are available in sports marketing.
Jim: I guess I will always say that sales are always going to be first and foremost because ticket sales are what drive the sports machine. Tickets and sponsorships are worth anything. Media rights aren’t going to be as much worth because if nobody is going to the games, why should we pay you a bunch to broadcast games that nobody is going to. So, that is always going to be the first and the foremost. Having a strong relationship with marketing to communicate messages that need to be communicated to help support the sales of the organization is going to be the key. I guess other growth areas are certainly going to be the social digital and how to better utilize that. How to take advantage of all the things that are out there? The analytics are what organizations are needing more and more. That’s where there is growth. More people are entering the analytics side. As far as some of the traditional marketing positions are concerned, those are reinventing themselves but aren’t necessarily growth areas. Where people are getting hired, its ticket sales, analytics side and commitment to the digital side.
Matt: Good. If someone is interested to learn more about sports marketing or get involved in the industry, where would you point them?
Jim: As far as they are looking for job opportunities, the best place is www.teamworkonline.com. That is where they put their positions. It’s free service. You can upload resume and cover letters.
You can be notified when different organizations have opening. It is the place to go for jobs. When you see jobs on other sports job portals, most of the times they are by team work online. One of the main trade publications, Sports Business Journal, that’s what the industry reads. It’s a great way to learn what is going on. They also have a sister publication, Sports Business Daily, which is distributing digitally what’s happening, what are the news makers and what are the trends. Those are two excellent resources.
Matt: Great. Jim, thank you for coming in for another discussion. It’s funny how sports seem to rise on the top of the topics. People are always interested in what goes on behind the scenes of sports. It’s always a treat to have you here.
Jim: It has been fun.
Matt: Thanks for sitting through this. Hope you enjoyed the conversation. Thank you again for listening to Endless Coffee Cup. Be sure to go to iTunes and give us a rating, say something nice or just shoot me an email. Talk to you next time.