SBJ/20100823/This Week's News

New tools help NBA build season-ticket sales

The Charlotte Bobcats can credit their first playoff appearance and new owner Michael Jordan for helping generate more than 1,500 new season tickets this summer. But the franchise can also point to NASCAR for influencing the substantial uptick, given that the team uses one of the region’s pastimes as part of an aggressive mix of tools to push offseason ticket sales.

“We have found that going outside our building can be valuable,” said Pete Guelli, executive vice president and chief marketing and sales officer for the Bobcats. “It gets the client into a completely different environment. It feels much more casual and I think the customers respond to it. It is more like we are attending the event together and less like they are attending and we are working.”

But it’s not just the Bobcats. Sales tools that are increasingly being used across the league have helped drive new, full-season-ticket sales near the 40,000 mark, a record level that is up at least 30 percent over the same date last offseason.

Outside the arena

Some NBA teams increasingly are looking outside their own facilities and into other local sports franchises to drum up business. It’s a tool that NBA teams in the past tended to avoid.

“It is relatively new and it is rapidly spreading,” said Chris Granger, senior vice president of team marketing and business operations for the NBA. “You want to be at events where premium buyers are. It is about getting face-to-face contact.”

The Golden State Warriors this year rented a suite at the Oakland A’s ballpark when the New Yankees came to town. The Bobcats had Jordan drop the green flag at a race at Charlotte Motor Speedway while, at the same time, team officials wined and dined potential premium customers at a trackside suite. The team also had a continuing presence at this spring’s PGA Tour Quail Hollow Championship stop in Charlotte.

Left: Charlotte Bobcats owner Michael Jordan drops the green
flag at a race at Charlotte Motor Speedway, an offsite venue
where Bobcats officials entertain potential premium customers.
Right: The Houston Rockets are getting additional data on
what their fans buy once they’re inside Toyota Center’s doors
using Veritix’s Flash Seats system.

“It is becoming more common,” Guelli said. He would not say exactly how much revenue was generated, but the team already is planning to follow the same strategy next summer. “Both events were highly successful for us,” he said.

But some teams that have experimented with using outside events to market themselves now prefer to focus on their own assets. The Phoenix Suns in the past bought a suite at the PGA Tour’s Waste Management Phoenix Open, but this year did not return.

“While we have used those type of outside events, we found that we have a lot more to offer inside the US Airways Center,” said Jay Parry, senior vice president of brand and business development for the Suns.

Depth of data

All NBA teams use data from their ticket vendors to glean information on potential buyers. While companies like Ticketmaster and even secondary ticket sellers like StubHub have long been resources for teams in collecting customer data, Veritix’s Flash Seats paperless ticket system is also emerging as a tool in gathering data. The company, owned by Cleveland Cavaliers owner Dan Gilbert, uses a system is which ticket holders swipe their credit cards to enter an arena. The process allows teams to track all activity from its ticket buyers and use that data to better target their sales efforts.

“They have very rich data in terms of who is buying, but also who has bid on the tickets, what they are willing to pay and the types of games they are interested in,” Granger said. “It allows for a greater depth of understanding the data.”

Four teams this season — the Cavaliers, the Denver Nuggets, the Utah Jazz and the Houston Rockets — are using the Veritix system.

“It creates the opportunity to follow the ticket everywhere it goes,” said Jim Olson, senior vice president of sales and marketing for the Jazz. “We see who is getting the ticket and who is using it, where with other systems, once the ticket is resold, you lose track of it.”

So why aren’t more teams using the Veritix system? Mainly because competing ticket vendors like Ticketmaster are more established and are willing to pay teams more lucrative upfront fees for the ticketing rights. To some teams, the upfront cash from competitors trumps the Veritix system.

Another drawback is that teams must spend time and money to educate fans how to use the paperlesss ticketing system.

“For all these years, fans are used to having tickets in hand and now it is loaded on your credit card,” Olson said. “We have to get people comfortable with the new.”

Niche nights

Not all of the hottest ticket sales tools are based on the increasingly sophisticated use of data. Consider the Suns, who are using niche marketing events to drive new business.

In the past, teams would hold meet-and-greet events with a wide variety of potential season-ticket buyers, trying to draw as many of them together as possible and offer the chance to meet the team’s coach, general manager or other top front office executives. Now, the approach has become far more industry specific. The Suns this year are hosting at least five industry-specific events expecting to top last year’s event-based marketing, which generated $1.4 million in ticket revenue.

The team has worked with local auto dealers to bring in buyers of luxury cars and will hold a youth coaching clinic that brings in local coaches for a session with the Suns staff, with the goal of selling more group tickets.

“It allows us to get a targeted audience together and get out a specific message about our upcoming season,” Parry said.The Rockets are also aggressive in niche marketing events, holding three events that brought in  attorneys, physicians and oil-and-gas executives to mingle with team executives, while the Indiana Pacers this summer also held an event for youth basketball coaches.

Leaguewide, the niche marketing events are resulting in a 10-to-1 return in sales compared with the event expense, Granger said.

“These sales events are becoming far more specific and allow teams to talk with a singular message to like-minded people,” Granger said. “In the past, there were town-hall-type of events. But now, teams are getting people in specific industries talking to each other about how they use season tickets. It is far more targeted and effective.”

Lead time

Among the new sales tools making their way through the NBA are lead scoring systems from companies such as Vienna, Va.-based Eloqua and New Jersey-based Turnkey Sports.

Turnkey rolled out a product last fall and has deals with the Atlanta Hawks, Oklahoma City Thunder, Miami Heat, Philadelphia 76ers and Washington Wizards. Eloqua counts the Suns, Warriors, Portland Trail Blazers and Sacramento Kings as clients.

Teams pay for technology that scores potential ticket buyers based on personal demographic information, ranging from the type of car a potential customer drives to the square footage of their house.

“Turnkey uses each prospect’s historical purchase history, coupled with consumer data appends such as lifestyle cluster, discretionary spend score, net worth, presence of children, and mixes it up in their algorithm to calculate the lead score,” said Lara Price, senior vice president of business operations for the Philadelphia 76ers. “In our preliminary analysis, we’re finding that the leads with the better scores have a higher conversion rate than average and the sales cycles are shorter.”

Eloqua also uses similar data.

“We use explicit [demographic, purchase data, etc.] and implicit [Web visits, e-mail opens, etc.] data to score leads within our system,” Parry said. “The more activity you have for each, the higher your score for each. In reviewing the option, we felt Eloqua offered more integration opportunities regarding what’s driving the score.”

But not all NBA teams are convinced the lead evaluation systems are worth the investment.

“We have our own raw data that we use and we have some consultants that we brought in-house,” said Chris Dacey, vice president and chief strategy officer for the Rockets.

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