Day One Highlights From Facilities & Franchises Conference

Street & Smith’s Conference Group’s 8th Annual Sports Facilities & Franchises conference began today in DC with a panel of team and facility presidents discussing key business challenges. Panelists included the Pirates' Frank Coonelly, Cavaliers' Leonard Komoroski, Marlins' David Samson and Auto Club Speedway’s Gillian Zucker. 

Samson Says Promotions Are Part Of Job For Major League Player

The issue: Are players and managers becoming more open to promotions?
The skinny: Coonelly: "This is why we keep our roster young. You have to set the expectation level. We do have it in player contracts that players must go to reasonable promotions as part of their job. They cannot just show up for BP and the game. If you allow your athletes to think they are not required, you are setting yourself up for a no answer."
Zucker: "I disagree that promotions are inherently part of players’ jobs. We see a difference when we get to know the athletes and what they enjoy to better tailor what promotions they can help within the community."
Samson: "We don’t ask. I would never ask a player. What players want to do on their free time is play video games and buy cars. They are not my friends. I don’t care about my relationship with them in any way. My job is to sign them, trade them, discipline them. They have enough people around them to treat them like gods, I don’t want to add our people to the list. I don’t want to imply that I don’t treat them like human beings, but they are human beings who are under contract to me. They are to do exactly what we tell them to do, exactly when we tell them to do it. We treat our players with kid gloves with the union so strong. The way they travel, the way they check into hotels. I’m not a monster. Our players have responsibilities in the community. We don’t wait for them to tell us what they are interested in. If they want to give money to our foundation, we will support them. We will help with their own charitable organizations." 
Komoroski: "There needs to be a happy medium. We put players in the community trying to have them doing things they may like and things that will help them succeed." 

The Issue: Why are promotions like all-you-can-eat sections and loaded tickets doing well? 
Coonelly: "Well, in Pittsburgh, we just like to eat. But really, you see things like college kids who like to come out and see if they can eat 20 hot dogs. But we really sold it to families who know they can come to the ballpark and get their meal and entertainment at a set price. Loaded tickets are another way to maximize on sections of the stadium that haven’t sold really well." 
Samson: "We’re often criticized by media for having too big a marketing budget, maybe even by your own publication. There is such a high supply of tickets at Dolphin stadium, and it is hot, so people don’t need to come to the ballpark to be uncomfortable. The all-you-can-eat section helps bring them in." 
Greatest hit: "We thought the all-you-can-eat section would be a money maker for us, and it could be economy-related, but we’re selling the section out to people like Randy Quaid from Vegas Vacation, who I think may be stuffing their tins with food" -- Samson.

The Issue: Looking forward three years to 2011, what will the ticketing experience look like? 
Komoroski: "We’ve got our sister company, Veritix/FlashSeats, which has 65% of our season ticket base using e-tickets. So we’re moving away from hard tickets. The new system will make it easier to transfer tickets among fans. It helps us to better understand who is sitting in our building during games. No counterfeit tickets, no scalped tickets. We now have an incredible amount of data and we can tell things like if fans come 15 minutes early. That can then translate into perhaps issuing that fan a coupon for a free drink pass redeemable before the game." 
Zucker: "We also have an incredible amount of data, so much so now that we need more people to just sit and analyze the data, and we don’t have the manpower for that right now. Going forward, particularly for the Pepsi race in July, we’re installing kiosks which will capture your info and give you an agenda for the day. There will be certain rewards associated with it, like perhaps going to Victory Lane, but you can only get it if you are an Auto Club member." 

Kasten Discusses Integration Of Team Sponsors At Nationals Park

NATS BALLPARK: The second panel of the day, titled "Working With Corporate Partners on Seamless Brand Integration," featured PNC Financial Services Group VP/External Affairs Brian Goerke, Nationals President Stan Kasten, Coca-Cola North America Associate VP/Bottle Sales & Marketing Dori Silverman and Sony Electronics Sports & Solutions Group Dir of Sales & Marketing Steve Stubelt. The panel highlighted how sponsors have collaborated with the Nationals to integrate their brands into the new Nationals Park. Kasten said, "I need to entertain you for four hours, and that’s why providing other spaces in the ballpark that have other things that interest you is so important. It used to be that when the Yankees sold their one millionth ticket, they were very excited because that meant they had a great year, because that paid the freight. That doesn’t pay the freight anymore. To pay the freight, I need to do a lot more than attract just hardcore fans. So if you are one of the 99% of people that don’t just want to sit in your seat for 9 innings, then we’re the place for you." Kasten also said '08 sponsor revenue will exceed the team’s projections. Kasten: "Everything started new this year. All our existing contracts expired after last season, by design. Usually about one-third of the deals are carried over. That made for a difficult off season for the sales staff."

ONE-ON-ONE: Following a luncheon hosted by Int'l Micro Systems, Inc., Redskins Exec VP/Football Operations Vinny Cerrato sat for a one-on-one interview. Cerrato listed suspended Falcons QB Michael Vick’s signing bonus -- which he gets to keep even though he’s in jail -- and Falcons QB Matt Ryan’s 6-year, $72M rookie contract -- which is higher than most veterans -- as two reasons why NFL owners felt they needed to opt out of the current CBA contract. He used both examples to demonstrate a rising cost structure in the sport that owners want to control. Cerrato: “If [Ryan is] a bust, you throw the franchise back 10 years. Nowadays you don’t want a top pick because it costs so much money. … At least the NBA’s got a system in place where rookies get paid at a certain level.” Cerrato also praised NFL Commissioner Roger Goodell for his handling of Spygate. Cerrato: “It’s something that gives you a black eye … (but) now it’s time to move on.” 

FAN EXPERIENCE: In a panel titled "Game-Day Innovations: Offering the Ultimate Fan Experience," Aramark Sports & Entertainment Group President Liza Cartmell, Comcast-Spectacor Dir of Event & Video Production Matt Coppola, SMG-Reliant Park Assistant GM Juan Rodriguez and Braves Exec VP/Sales & Marketing Derek Schiller discussed the programs that they have implemented to create and enhance fans’ game-day experiences.

The issue: How has the economy affected fan and team spending?
The skinny: Schiller: "We’re not being reactionary and we have not discounted anything."
Rodriguez: "We are not expecting people to stop coming out. We have a responsibility to give people what they expect and what they are paying for."
Coppola: "When things get difficult, sports do give people an opportunity to escape. If fans are in the building, that means they are not home watching TV, and its on us to give them a good time."
Cartmell: "I would make the argument that now is the best time to invest in the business. I’d say now is the best time to build fan loyalty." 

The issue: All-you-can-eat ticketing.
The Skinny: Schiller: "I am completely surprised by all the attention the media has given to this. Obviously, for fans who want and need cost certainty, this really appeals to them. If all we were doing was taking fans that were already coming to the ballpark, it doesn’t make financial sense. But if you are really trying to get new fans to the ballpark, because of the value added offer you are creating, that’s the strategy we are using.
We have three different types of food and beverage opportunities available. The most expensive one is the one we are selling the most of. It also happens to include beer."
Cartmell: "In reality, this offering has a fairly limited scope. In a baseball stadium, 600, maybe 700, people take advantage of this. It tends to work well in a group setting. It is definitely attractive to the cost-conscious group. One of the biggest groups are the social networkers. Which, to us, means that the much bigger story here is the creation of destination zones -- locations where you can bring people in."
Schiller: "What we’ve done is taken a $48 season ticket from last year, and made it a $60 season ticket that includes $10 of built in food and beverage. We did it for our highest-demand seats -- the 1,700 seats behind home plate. These spaces have terrific ROI."
Rodriguez: "We took the upper level endzone seats -- the seats that were usually sold last -- put new carpet, nicer furniture, plasma TVs and added all inclusive food, and now it has become a popular area.

COMMUNITY RELATIONS: One of the best ways for teams to get the most out of their community relations programs is to focus on three or four causes that are most closely aligned with your market. That was the consensus from a panel of four community relations executives participating in a panel titled "Community Relations Initiatives That Support Your Franchise Business Model." For example, the MLB Giants focus on education, health, violence prevention and youth. “If a group wants to come in and save the rainforest, it doesn’t fit within our four areas and gives us a respectable way to say no,” said Exec Dir of the Giants Community Fund Sue Petersen. The executives also spoke about the best way to get players to buy-into their teams’ charity drives. They all meet with players before the season and map out which ones will attend which functions. “Player appearances are a whole different animal,” said Wizards Senior VP/Community Relations Judy Holland. “Organizers of a $5,000-a-plate dinner don’t want the rookie tat has no name recognition. But that rookie is the one that has the time to do it.”