Is the Orioles’ “Free” Kids’ Tickets Program Crazy?

Earlier this week I wrote about the $16 beer at Nats’ Park and another story in the DMV is starting to capture a little bit of attention: the Orioles’ Kids Cheer Free program.

Yahoo’s Jeff Passan wrote a nice piece about the program and the Orioles hope that this leads to cultivating a new generation of fans.

Being around sports business, I was asked yesterday for my thoughts on LinkedIn.

In my reply there, I said I applaud the Orioles for trying something new and that getting kids to the ballpark is one thing, but actually getting kids to care about the game is another one entirely.

Having long been an advocate of finding ways to get people into the ballpark, I was pretty amazed to see John Angelos speak so eloquently on value, pricing, and the idea that fans don’t just come to games in a vacuum.

And, I am in love with the concept of being “the anti-airport.”

That out of the way, do I really think the Orioles’ “Kids Cheer Free” program is crazy?

I don’t think it is that simple, but here are some ideas I do have about it.

Free is way superior to a discount: 

One of the big discussions that happens in sports business is whether or not teams should paper the house, discount, or some other strategy to make sure that there aren’t so many empty seats.

On the surface, this is one of those instances where you’d be wondering if free isn’t devaluing the product or whether this just acts in a manner consistent with discounting.

It goes without saying, “discounts destroy brands.”

You have evidence that you can see with your own eyes by looking at retailers that can’t get consumers to come into their stores in many cases because they’ve gone over the top trying to outcompete Amazon on price.

You have scientific evidence that shows that once you start discounting, you are a discount brand in your consumers’ mind for around 7 years before you have a chance to reclaim your full value that can be read about extensively in Martin Lindstrom’s fascinating book, Buy-Ology.

You have evidence that you can collect just by looking around the internet on Facebook or Twitter, where brands that discount aren’t likely in the conversation in a meaningful way.

In many cases, free isn’t always used much better in sports.

From my conversations with executives, VPs, and junior staffers at teams at all levels of sports business, I know with almost 100% certainty that the experience of just papering the house is a poor one.

The list of challenges that come up are numerous but include:

• Free ticket holders still don’t come.
• Free ticket holders sell the comps outside of the venue, leaving the buyer with a bad taste.
• Free ticket holders don’t spend money on food, beverage, or merch, which is one of the outcomes hoped for by comping.

These are just 3 examples, but you can fill in the blanks with your own case.

Back to the “Kids Cheer Free” program at Camden Yards…what about it?

In my opinion, it is incredibly wise.

As a parent, you have limited time and money to spend with your family in almost every instance.

So taking a flyer on a new activity can be a challenge.

Knowing how fickle children are, paying full price for a ticket to a ballgame that a 3-year-old might not be able to last more than an inning or two is a tough sell.

The Orioles have removed that barrier.

Besides removing that barrier, a program like this does several really valuable things:

• It enables more kids to be able to come to the ballpark. Think about it, a father or mother can bring themselves and two kids for as little as $5 each. Or, if they splurge, and if you splurge, maybe $15 each. Which if you’ve seen some of the kids’ movies that I have seen lately, an infinitely better value than going to the movies.
• They expose kids to the game early. Seth Godin wrote about first impressions in his book, All Marketers Tell Stories. He says that first impressions matter more than ever, but the funny thing is that the first impression might not be on the first visit. This helps the Orioles ensure that they have the chance to make a huge first impression on kids.
• Strengthens the brand across demographics. It often feels like baseball has lost the narrative of what the game is and why it mattered so much to previous generations. One of the key points was that the game was something that had the hint of a family heirloom. Your dad might pass down his love of the game and a team to you and you to your child…or your mom or your grandparents. By doing something like this, the Orioles likely reopen that door.

There are more reasons, but the core is that by opening up a more value-based opportunity, the Orioles are taking a risk, but one that is likely to pay off since they aren’t discounting, but they are offering up a chance to make bringing your children to the ballpark more manageable.

If you get people into the building, you should be able to generate revenue: 

A quick internet search for costs associated with attending an MLB game show you what can only feel like a “hidden tax” to the average consumer.

For years now, baseball has tooted about their growing revenue.

Making more money should be the sign of a healthier business, but all you have to do is watch a handful of games to notice that there are less and less people attending games and that if MLB is saying that they have attendance of 73 million fans, your eyes can likely tell you that they are being quite generous with that number.

Realizing that revenue comes through at a game from many different places, the slippery slope of lower attendance becomes pretty clear.

Less fans in the stadium mean:

• Less money from parking
• Less beer sales
• Less hot dog sales
• Less merchandise sold

When all of these numbers are falling, this likely leads to having to elevate the prices to keep the revenue coming in and the profits at a place where they need to be to justify many of the spending lines that are required to run a stadium or sports business.

But this comes back to what John Angelos said about value because, at a certain point, the declining attendance numbers become a self-fulfilling prophecy.

Lower attendance means you raise prices.

Higher prices mean fans start to feel squeezed.

Because fans start to feel squeezed, they start making a different value judgment about the benefit of attending a game.

Then the cycle starts all over again.

Incremental revenue has been at the core of my work over the course of my career.

I learned the lesson pretty early on when I was helping open a national chain of nightclubs and we needed to bring our check average up from $13 to $13.25.

The simplest way would have obviously been to just raise prices.

Of course, if you raise the prices $.25, that opens a whole new set of challenges like:

• Slowing bartenders because they have to make change
• Changing the value proposition in your consumers’ minds
• Potentially lowering the value of the tips your bartenders receive which could impact your customer service

Those are really just the most basic forms of impact that you might encounter.

Needless to say, raising prices has a number of unintended consequences.

We decided to take a different approach that actually paid dividends much more than simply raising our check average $.25.

We decided to ask a simple question: “What kind of liquor do you prefer?”

A simple question, but one that created impact in a bunch of different ways:

• We made more money. In fact, the 6 months after we started asking that question, we made $500,000 in additional profit with basically no increase in overhead because the incremental costs of premium spirits were very low at the volume we were selling.
• We created a better experience for our guests. Which led more people to want to come to our club. Making us busier and increasing our revenues even more.
• We were able to open up even more lines of revenue because our customers enjoyed the experience, were treated well, and wanted even more from their night out.

The same thing can apply to any entertainment option now.

Take a baseball game as an example:

• If you are getting charged $16 for a craft beer at a game. Your spreadsheet might even show that the revenue is “maximized” in that purchase, but if that person only attends one or two games a year…what have you really accomplished?
• Same goes for t-shirts, hats, or other purchases. If you are charging excessively high prices, are you maximizing your revenue or are you training your fans that your product is only a once a year treat?

That’s why John Angelos’s observation of the “anti-airport” is so important.

Because if you treat your customers like you want them to come back and spend time with you, they might just take you up on your offer.

And, if you price things in a way that you can make money off of and encourages people to come back, you are likely to make more money as the Falcons found out at their new stadium.

Playing an infinite game with your fans would mean that you don’t have to take all of their money at one game, that you both win by having them come out many times a year.

More importantly, if you are playing the infinite game with your fans, it is likely that over time you are going to grow their lifetime customer value because they are going to feel appreciated, they will enjoy the atmosphere, and they will want to come more.

Getting kids into the ballpark is only the first step:

I’ve felt like baseball has a marketing problem for a long time now.

We’ve all bought into the line of reasoning that if a New York team is in the playoffs or finals, that drives attention.

That has been proven in ratings a number of times and I would point to that as a function of marketing and market.

But you can’t just hope that the right team is going to make it to the playoffs or the finals or to come to town to fill your stadium or nurture your customers, you have to do that yourself.

That means that demand generation has to be an ongoing process and one that is put at the forefront of any organization’s planning and thinking.

As values have inflated from TV contracts, too many organizations seem to have taken the idea that demand is someone else’s job because the value of the asset has been increasing at exponential rates.

But more and more, this thinking seems to be faulty.

We see it in declining rates of participation in team sports.

We see it in declining attendance numbers and declining ratings.

This points to two things:

1. Demand generation for the future needs to start today.
2. Demand generation is likely the not a one-time event but an ongoing process.

How do we all make sure that demand generation is an ongoing process?

I think there are a few ways that we should be looking at:

• Get more kids involved at the earliest ages:
  • Soccer has gained a lot of traction in the US, I’d point directly to the success of youth soccer programs. When I was a kid, my sports idols were Dale Murphy, Bob Horner, and John Smoltz. For my son, I’m not sure he can name any player in baseball outside of Bryce Harper. I’m pretty certain that has everything to do with the fact that he hasn’t really played baseball in an organized way. His sports heroes are Harry Kane, Steph Curry, and Kevin Durant because he plays those sports.
• Do a better job of storytelling and mythologizing:
  • Stories are our most powerful way of sharing what is important. We have fallen away from putting sports and sports history into a context that allows one generation to another.
• Market year round:
  • Sure, there is in-season and off-season, but the nature of the relationship between sport and fans should be a year-round endeavor.

How can we do that?

• Get kids involved earlier:
  • Can you do something with school kids?
    • Would there be room for sponsors and partners to work with your team to introduce the sports to kids at an age when they are impressionable and willing to learn?
  • Can you help make access to your sport easier for kids, especially ones that wouldn’t have access normally?
    • I used to like to see reports of RBI programs, but I think that this is only a jumping off point. What would happen if we worked to get everyone to play catch 20 minutes a day? Or something that got kids of all ages and economic areas involved in some part of the game?
• Storytelling:
  • Make your history more apart from the experience of your game and your brand.
    • Look at the Orioles, they’ve had a pretty exciting team the last few years, but you never miss that Ripken was there for his career and that Earl Weaver was important. You also never forget Eddie Murray and Frank Robinson either. The key being that you want to connect one generation to the other and by doing so you create an opportunity for connection, not just with the team but with the reasons that the team or the game are important.
• Market year round:
  • There are so many ways that you could expand the form and nature of year-round marketing:
    • Email and digital marketing need to become better. Everything is around the game or the season, but what would change if you were to consider how to make your connection more consistent.
    • How could you reach people in the different ways that are going to be meaningful?
    • How can you create action items or ways to connect that will drive fans to your site, your platforms, and cultivate their fandom year round?

I think that this Orioles program opens the door to some interesting new ideas and I am hopeful that it will spur on some new ideas and some new thinking.

I’ll be watching eagerly.

What say you?