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SBJ/April 23-29, 2012/Colleges
Cal gives ticketing the old college try
Published April 23, 2012, Page 3
|The university will keep ticketing in-house instead of outsourcing to a third party.
Schools have notoriously taken a passive approach to ticket sales — essentially mailing out order forms and waiting for the phone to ring — but Cal, Oklahoma State and several others are moving to a more proactive method of sales and marketing that resembles a pro team model. Many schools have looked to outside agencies such as IMG/Learfield and The Aspire Group for help, while others are examining ways to advance their ticket business in-house.
“We think we can do this ourselves,” said Terwilliger, Cal’s associate athletic director for business. “We know that everybody is looking at the outsource model and it’s the trend that everybody is jumping on, but we wanted to keep it in-house and truly integrate ticket sales and service through the rest of the department.”
For the last two months, Cal has been hiring staff, remodeling rooms and installing computer and phone equipment to create a ticket call and customer service center in Haas Pavilion, the school’s basketball arena. The Golden Bears essentially are doing what companies like Aspire or IMG/Learfield would do if the school outsourced the business, Terwilliger said.
Those companies have seen significant growth in their ticketing business ever since Aspire did the first deal with Georgia Tech in 2010. Aspire now has close to 20 universities. IMG, which recently formed a partnership with Learfield in ticketing, has a roster of a dozen schools.
Both companies see ticketing as fertile ground for outsourcing because a third party takes the risk of investing in infrastructure and staff, paying guarantees and percentages on revenue-share deals, and structuring a pay scale with commissions and incentives.
They hire staffs ranging from six to 20 full-timers to prospect and sell, and collect a percentage, anywhere from 10 percent to 20 percent or more, depending on how deals are structured.
Terwilliger’s pro forma estimated that Cal could net 10 to 15 percent more revenue if it kept ticketing in-house rather than outsourcing.
Ticketing has drawn others as well, such as Legends Sales and Marketing, the joint venture between the Dallas Cowboys, New York Yankees and private equity groups, and smaller companies like Indianapolis-based Get Real Sports, which recently signed a deal with Butler University.
Mark Dyer, who oversaw IMG College’s entry into ticketing 16 months ago, described it as a “very undeveloped space. It’s almost like the multimedia rights space 30 years ago.”
While nearly every major school outsources its multimedia rights now, the biggest competition in ticketing could turn out to be the schools themselves.
Cal shifted into overdrive earlier this year, hiring the San Diego Padres for a three-month consulting job to set up the ticketing center, recruit sales and account executives, and train them, all in time for the start of football season-ticket sales this month for the newly remodeled Memorial Stadium.
The athletic department also received approval from the school’s human resources department to offer sales executives the kind of incentives and pay-for-performance packages that the pros give, Terwilliger said. In all, 12 people have been hired and more positions could be approved by the end of the year.
The investment of about $400,000 was covered by a private donation, so Cal hasn’t incurred any startup costs this year. The school uses Paciolan software for its operations.
Terwilliger’s team even sold a sponsorship to Pepsi, whose marks will appear on all ticket-related collateral. The soft drink already had campuswide pouring rights.
The pro ticketing model represents the kind of aggressive play that most schools have shied away from or outsourced because they don’t have the expertise in sales and customer service and don’t have the money to invest in personnel and infrastructure.
“When you see that Cal looked at outsourcing and decided it was something they could do in-house, you start to understand that schools are the biggest competition to the Aspires and IMGs,” said Adam Haukap, assistant AD for sales and marketing at Oklahoma State, which employs students to sell tickets. “A school doing it in-house is going to keep 100 percent of what they reap and not give away that 15 percent or whatever the commission might be to a third party. More and more schools feel like they have a model that can work.”
Just as the schools have vastly different personalities from campus to campus, each of them are working on ticketing models that have their own nuances.
At Oklahoma State, Haukap is using a staff of 18 students to proactively sell tickets and seek renewals. But he’s discovered that while students can be effective at sales, their part-time nature makes it difficult for them to develop longer-lasting relationships with ticket buyers. So Haukap is in the process of hiring four full-timers who will focus on retention and customer service.
“We’ve found that the alums really enjoy talking to students and comparing old classes and old professors,” Haukap said. “We’ve even had students who developed relationships with season-ticket holders that led to jobs after they graduated. But we also want to develop those long-term relationships.”
Haukap, who worked in ticketing for the Indiana Pacers, is part of a growing number of school officials who have a background in the pros.
When Cal decided to develop its own in-house model, it hired Ashwin Puri as associate AD for sales, marketing and service.
Puri, who worked for the NBA’s team marketing and business operations division and the New York Jets, was skeptical that he’d ever be able to work in colleges. Schools just couldn’t be competitive salary-wise, and they weren’t sophisticated enough in their ticketing practices to attract top talent from the pro ranks, Puri thought. But he was drawn to Cal by the athletic department’s desire to establish a ticketing operation that mirrored the pro teams.
“I didn’t think I’d ever find a situation that was set up like the revenue-generation department of a pro team,” Puri said. “I didn’t think it was out there. But this is really an opportunity to be a trailblazer in college sports.”