SBJ/20090928/Up Next

Sports can reconnect by becoming part of the community

Unless you are playing in the game, involvement with sports is most often centered on gathering with friends. How then can 65 percent of Americans say they are “not at all likely” to spend on sports while 45 percent say they are “very likely” to spend on gathering with family and friends? Something is wrong with this picture.

86% of Americans are sports fans.
Sports interest increased from 2001-07 after 9/11.
Sports interest has declined since June 2008.
67% of Americans say they have less spending money than last year.
40% say they have much less than last year.
65% of Americans say they are “not at all likely” to spend money on sports because of the economy.
45% of Americans say they are “very likely” to spend money on gathering with family and friends.
Sources: The ESPN Sports Poll — Product of TNS Sport; Luker on Trends with ICR’s Social Science

The ESPN Sports Poll (see chart at right) shows American interest in sports declining since July 2008. Two August national studies of American adults by ICR and the ESPN Sports Poll found nearly 40 percent are enjoying sports less because of the economy and about 15 percent said they were enjoying sports more. At the same time sports television viewing numbers are up. Recently completed research from Leo Burnett found roughly 40 percent of their respondents were saying they need to eliminate discretionary spending and high-end out of home entertainment and are more focused on in-home entertainment. Ben Kline, chief strategy officer for Leo Burnett, sees both the practical and emotional implications in the findings. Americans are doing more of the things that are free, but that doesn’t mean their heart is in it.

Sports should be a leading alternative for investment in gathering in this rough economy, but it isn’t. Americans are increasingly of two minds: They are less likely to favor sports than they once did but more likely to turn to sports as a free option now that they are not spending as much on entertainment.

I believe what is wrong with this picture is that our industry is focusing on the business of sports and not the love of sports. Fan appreciation and development is an afterthought. The financial success of sports in recent years may be blinding us to the consequences of focusing too much on our success.

Forward Thinking with...
John A. Walsh
Executive vice president, executive editor
ESPN
What is the most important challenge facing the sports industry today?
“The American sports business is cashing in on the adult American love of sports that was built on $5 tickets to major league games 30 years ago.”
Pat O’Conner
President
Minor League Baseball
With record attendance five years in a row and the lowest losses in 2009, what is the secret of MiLB’s recent success and what can other sports learn from it?
“Americans came to our games in record numbers because we are a part of their community. They came to us FOR community. We get it. The key to the future is doing more every day to make the minor league baseball experience a bigger part of the community context where families and friends gather. And we are doing just that.”

For example, Nike and Starbucks worked hard to understand the American personality, earn the respect of customers, and provide products and services to match the identity of Americans. Wearing Nike was a badge. Starbucks became a second living room. What happened?

Success happened. Nike and Starbucks shifted focus from people to harvesting profits, which both companies did to their short-term success, but potential future loss. Neither has lost out to competitors,  and neither will go out of business any time soon. And it may simply be the magnitude of their success that makes it more difficult for them to maintain a personal relevance with their brands. Based on what we are seeing with both, making the difficult investments to stay close and personal may be the only way they regain the hearts of those who once identified more closely with them.

American sports face similar challenges as they have entered a similar harvest mode. What remains of the feelings we got as fans that we were part of the team? What part of a $500 ticket feels like a focus on everyday Americans gathering for the love of sports?

As American interest in sports declines, particularly among youth, the cost of sporting events is seen as unreasonably out of reach for most families. We still get time with fans because they are watching more on TV. But what is at risk is their hearts.

The industry needs to get out of harvest mode, remember why we love the games, and reinvest in sports as America’s greatest context for the gathering of family and friends. Companies that focus on how their brands can enhance the joy and relief of gathering around sports will win big for a long time.

According to the latest ESPN Sports Poll, 60 percent of all NFL television game viewing is done by people who plan to get together with others to watch. It’s social gathering, but we only think of it as watching TV, as a ratings number. Americans are willing to invest in gathering and they are asking sponsors to invest, too. We, as an industry, need to re-engage with our hearts so that, by our actions, our fans see sports as the ultimate context for gathering and re-engage at the heart level, too.

Rich Luker (rich@lukerco.com) is a consultant with The Luker Co.

FUTURE FIVE
What will be the most important issue of the fourth quarter?
RANK
(PREVIOUS RANK)
ISSUE TOTAL POINTS (% OF 1ST-PLACE VOTES)
1 (2) Amount of discretionary income available to middle-income American families 236 (48.1%)
2 (1) Impact of pressure companies feel to reduce costs and improve bottom line 209 (22.2%)
3 (3) Investments in sports sponsorships by companies 206 (11.1%)
4 (5) Attendance at professional and major college sporting events 169 (3.7%)
5 (7) Changes in the industry signaled by the nature of long-term deals finalized this quarter 148 (7.4%)
Note: Results from a panel of 27 industry leaders. Participants ranked each of 10 issues, with 10 points being assigned for a 1st-place vote, nine points for a 2nd-place vote, down to one point for a 10th-place vote. Percentages have been rounded. Only the top five are listed.
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