Seth Godin wrote in We Are All Weird about how the Portuguese government forbid the creation of maps of the new world about 500 years ago so that people wouldn’t know what was out there.
Which came to mind as I was reading about the news that ESPN is going to need to cut hundreds of millions of dollars in annual expenses in the next year or so…(don’t believe the reported numbers, its always going to have to be higher.)
Along with following the continued battles between the San Jose Sharks and many of their disgruntled season ticket holders.
If you put the 3 things together, you come to a quick realization that we have hit a patch in the road where the world of sports business is trying to triple down on the era of mass in a business environment where mass doesn’t sell nearly as well as it used to.
Let’s look at a few of the challenges first:
Moving to try and push for one homogenized market:
There is a lot to unpack in this one, but one word that sums up everything is mass.
As we have seen new TV contracts signed, we see that the contracts are so large in most instances that for the networks to profit or find value from these deals, it is a necessity that they work towards trying to hit the lowest common denominator.
Unfortunately, as sports business has been doubling down on LCD marketing and brand building, the consumer has changed.
And, changed in a way that isn’t helpful to this idea of mass.
Here’s how that example plays out:
In Michael Jordan’s final season with the Chicago Bulls, his nationally televised games were 71% higher than anyone else’s. Which meant that MJ was a cultural icon and someone that was recognized around the world. While the current era’s biggest star, LeBron James, moves the needle, it isn’t moved nearly as much as the time of MJ. Even if LeBron James has been part of teams and storylines that are just as compelling, if not mores than MJ’s.
While much of this shift has been alleviated by the rise of Regional Sports Networks, it actually reinforces the idea that the idea of mass isn’t as powerful as it used to be.
As a practical matter, this means that at the same time that networks and leagues are doubling down on mass, the consumer is moving back towards the local and the personal connection.
Pushing revenue at all costs:
In the south where I grew up, we have this saying, “cutting off your nose to spite your face.”
For many of our leagues and sports teams, they seem to have definitely rolled into that category over the last few years.
There seems to be this epidemic in the world of sports business that if we keep raising prices at all costs, that nothing adverse will happen except we will make more money.
That’s actually not correct as the Twitter feed of Empty Seats Galore can show you on most nights.
What is partially responsible for this phenomenon is the rise of the secondary market with sites like StubHub, TicketsNow, and Vivid Seats becoming more and more common places for fans to buy tickets to games, concerts, and events.
While the websites alone should be agnostic at this point, nothing more than a simple transaction portal.
What seems to be driving teams and leagues nuts is the idea that brokers are making windfall profits on the backs of their products and events.
Or, as I like to call it…”the theory of the $2,500 Yankee ticket.”
You see back in 2004, the Yankees and Red Sox played an epic American League Championship game. At the time, I was the most influential broker in the world, having built a partnership between the secondary market and American Express that was the envy of everyone in the industry.
Which means that I was all about going to whatever I wanted to.
Going to Game 6, the bloody sock game, was a thrill. But being confronted with how awesome the experience of attending that game was, I ended up sitting on a single ticket for the Game 7 matchup that would determine who was going to the World Series.
I decided that if someone was willing to pay me a ridiculous amount of money, I would sell my single ticket behind the Red Sox dugout for Game 7. That’s when I said, “If someone will give me $2,500 for the ticket, I’ll be happy to watch the game on TV at Mugs.”
I don’t remember what happened really, but I do remember selling the ticket for about $600 and the face value was probably around $225-$250. But much less than the $2,500 that it was listed on StubHub and TicketsNow at for most of the day.
What drives people crazy is that they see these incredibly high listings, but they never see the fact that the sale actually occurs for far less than what the listed price is.
With reporters happy to trumpet out the average listing or some other average, it drives the perception that teams and leagues are being robbed blind by brokers and the secondary market.
Which has the impact of causing pricing decisions to be driven by false data.
Or, pimping out revenue at all costs, even when it is keeping fans away and making the experience of going to a game less like a party and more like a wake.
Let’s flip this over and look at some of the opportunities that are present:
Fans want an experience:
This should actually be one of the most exciting things that comes out of the changing desires of fans and consumers, people want an experience.
The challenge is that our stadiums and our games have to keep up with this.
Which is a real challenge because many of our venues were designed at a time when the game was the centerpiece of attendance.
In many venues, strides have been made to make the experience a highlight.
Visit Cleveland’s Progressive Field and go up to the right field corner to visit The Corner. Where you can pour your own craft beer, hang out, and watch the game.
This same thing has played out in Detroit at Comerica Park. It has played out in Fenway Park with The Bleacher Bar.
Wherever you look, more and more experience is being emphasized.
Without the expense and risk of building a new bar or remodeling your venue, there are plenty of things that can be done to enhance the experience right away.
Here’s a few ideas:
- How about a pregame Happy Hour? If you have a nice beer selection and some decent food selections, would it be impossible to open the gates in one specific area and have a Happy Hour before the game, so that fans can be in the venue early, hang out, and not have to go spend money at a competitor? I can remember vividly the scene that played out a Safeco Field in Seattle during Thursday afternoon games in the early 2000’s. Think about how much of an improvement it would be to be able to hang out for Happy Hour and not have to rush in at the last minute or chug your last beer at the bar down the street.
- Have you ever shopped your own venue? In hotels, team members will go stay at other hotels to see what the service is like and what they can learn from other competitors. In sports, we often rely on staff that is outsourced and/or we are removed from the experience of the average customer. Have you actually shopped your own product lately? What’s the ticket buying process like? What’s the ingress and egress? How is the customer service if you are just going to go sit in the upper deck? Standing in line for a beer? Would you pay for the experience? Yes! Great! No? Let’s do some stuff to fix it.
- Create experiences and connections within the experience of going to a game. Do you have a large business base? Lots of singles? Whatever? Can you throw events, parties, and experiences for them? Why aren’t you doing it already?
Fans know what you are doing, so don’t try and pull the wool over their eyes:
I’m pretty sure that anyone that visits this site or reads any of my stuff knows pretty well how I feel about discounts…(refresher: they destroy your brand.)
What I see a lot of is something that needs to be addressed pretty directly:
Teams and leagues are concerned about the challenge of selling tickets and season tickets…as they should be.
They push the season tickets with talk of “discounts,” “vouchers,” and other add-ons that maybe aren’t all that valuable when there is no pricing integrity of the product.
Because in many cases, fans that commit to a full season are embarrassed by their team because when there are lots of unsold tickets, the knee jerk reaction to discount kicks in and it destroys the respect between fans and team.
Unfortunately, there isn’t a way to hide this either.
Fans know what is going on.
They see the discounts and they are insulted by them.
Which means that the season tickets that are being offered up have less and less value because the “member benefits” aren’t very strong and the ability for a STH to resell or offload any of their tickets is greatly reduced.
And, due to the fact that discounts are being thrown around so readily, this drives down the perceived value of the games and even the sacred playoff ticket isn’t as valuable as it used to be.
All of this combines to a need to revisit the entire ticket sales process and the value proposition around tickets and the relationship between fans and team.
Here are a few ideas that can help repair and rebuild the connection between the ticket buyers and the team:
- How about stronger fan club that encourages fans to attend, to use their tickets, to act in a manner that the team wants them to?
- How about creating stronger ownership incentives? When I owned Sonics tickets in Seattle from 1999-2002, the Sonics had a strong incentive program for STHs including pickup games on the practice court, opportunities to hang out with players, cheerleaders, and team executives. Plus giveaways for STHs and other benefits that created a community around the team, not just a transaction.
- Use social media as a bridge from casual fan to buyer to advocate. One of the missed opportunities of social media is that teams haven’t been able to effectively translate social media engagement into actual attendance. But I think this is an area that could be ripe for disruption and advancement.
The thing is, in sports business, we can’t afford to be like the Portuguese with their maps. Because that’s like the ostrich sticking its head in the sand. Just because you pretend that the environment is the same, doesn’t mean that it really is.