League to bring U.S. back to velodrome AutoTrader.com renews with NBA Breaking Ground: NHRA looks to Paciolan Nike’s Converse sues 31 companies PowerBar narrows sponsorship focus From the Field of Information Management Roc Nation in acquisition mode End the one-size-fits-all approach How brands can reach the two Brazils Pete D’Alessandro
SBJ/October 8-14, 2012/OpinionPrint All
■ BIGGEST STORY: LOS ANGELES DODGERS. This is easily one of the top stories of the year, not only in baseball. Just look at what’s happened in six months. A group headed by Guggenheim Partners and Mark Walter, Stan Kasten and Magic Johnson buys the Dodgers from Frank McCourt for more than $2 billion. The details of that deal alone were fascinating, but there’s much more. The bankrupt team under McCourt started the season with an Opening Day payroll of about $91 million and no public support. But under new ownership, the Dodgers have become one of the most unpredictable and fun teams in sports. Their late August trade with the Red Sox shocked baseball and showcased a rare franchise willing and able to take on large amounts of payroll. The money spent by the new owners since they took over the team totals a reported $432 million. One of my favorite quotes of the summer is when Walter, the Dodgers’ chairman, was asked whether the Dodgers have a spending ceiling. “Somewhere, I suppose,” he said. They’ve tried to be active in the community to heal the wounds left by McCourt, they’ve brought in the talented Janet Marie Smith to look at renovations to Dodger Stadium, and they still have yet to complete their massive new TV agreement, which could hit $4 billion over 20 years.
■ BIGGEST TURNAROUND: WASHINGTON NATIONALS. There was a lot to like about what this franchise did, much of it off the field. It conducted a number of smart initiatives with Fortress GB, specifically with RFID technology and a test of paperless ticketing that enabled the team to track customers’ spending in real time from the moment they enter the ballpark. The business side’s focus on “taking back” Nationals Park from waves of visiting fans worked, and the team’s strong play on the field helped across the board, with attendance up 20.3 percent over last year. Merchandise sales were up a whopping 80 percent over last year, and the team was the first in MLB to create a New Era walk-in store on the main concourse. The Nats have among the biggest gains in social media followers and with stars Stephen Strasburg and Bryce Harper, they have quickly become one of the hottest sports brands in the nation’s capital.
■ BIGGEST QUANDARY: CHICAGO WHITE SOX/TAMPA BAY ATTENDANCE. I don’t envy Brooks Boyer and the White Sox staff. The team played strong baseball the entire year, and while its quest for the playoffs came up short, the team was in the mix all year. But the White Sox drew fewer than 2 million fans this season, the sixth consecutive year attendance has dropped. The team’s average of 24,271 is 24th best in the league. This has left executives and even players, who have been extraordinarily vocal about the lack of local support, all perplexed. In St. Pete, something has to come to a head soon. The Rays are going to finish with the worst attendance in the league and why? Well, it’s not because of the play on the field. The team has been to the playoffs three of the last five years and fielded a winning team for five straight seasons. There is obviously a building issue here, but even that can’t seem to get any traction with the infighting between St. Pete and Tampa. I think Stuart Sternberg is quietly one of the best owners in sports, but I’d understand if he is starting to lose patience.
■ BIGGEST LET-DOWN: MIAMI MARLINS. The season started with great hope: moving into their new $515 million vibrant ballpark that was years in the making and a testament to the relentless work of owner Jeffrey Loria and President David Samson. The Marlins also received prime-time billing as the star of Showtime’s “The Franchise.” But from the start, nothing clicked. From an Ozzie Guillen/Fidel Castro controversy to poor play, to another payroll dump, it was a familiar story in South Florida. As Samson himself said, “It was good on April 4, when the first pitch was Strike 1. I think from that moment on, on the field, it’s been downhill.” But give them credit, last week’s move to sign feel-good story Adam Greenberg to a one-day deal got them national exposure, announced on the “Today” show, and industry plaudits.
■ LEAGUE MVP: TIM BROSNAN. The biggest business story for MLB during the season was the league’s media rights agreements, and Brosnan and his team delivered for ownership, completing massive eight-year deals with ESPN, Fox and Turner worth an estimated $12.4 billion. Seeing the bullish market, Brosnan was able to double the league’s previous deal. He had other interested bidders, but the three incumbents have done right by baseball, value the tonnage of the property and stepped up financially. But it isn’t just the media deals that gets Brosnan the hardware here. He and his team secured a renewal with new inventory for Anheuser-Busch (remember when those two were in a legal dispute?), had a successful All-Star Weekend in smaller-market Kansas City and saw more pop culture tie-ins with the Fan Cave. Ownership should feel good about the work done by Brosnan and his team.
Media, fans took the Red Sox and their owners to task.
A few areas still strike me as miscalculations by the franchise. One, end this sellout “streak.” No one cares and everyone in Boston calls it bogus. They could easily make that story disappear, and I don’t know why they haven’t done it by now. Second, get some clear lines of authority — and accountability. The organization seems to be stepping all over each other. Third, move away from all the Fenway Sports Group branding. As a native Bostonian told me the other day, Fenway Sports Group just reminds fans of all the time and energy that is not spent on the Red Sox.
“Get some separation,” he said. “No one ever accused George Steinbrenner of spending too much time on shipbuilding. Liverpool and NASCAR doesn’t matter in New England and there is no crossover as far as Boston fans are concerned. Force-feeding Liverpool to Boston fans on NESN and expecting that they will adopt them because John Henry owns them is insulting. When it comes to foreign sports teams, Red Sox Nation is isolationist.”
This ownership group has done a lot right in its tenure, and lived a good life up until last September. But something cracked under the stress of a brutal Boston media and the team can’t spin its way out of this. It’s going to take work. I asked my friend what he’d do. “They know what works,” he said. “They did it. Now be humble. Admit they lost their way, but return to the recipe that worked. If the product isn’t selling, then fix the product. And right now the product has to be the team. Not Fenway. Not ‘Sweet Caroline’. Hard play and wins will cure a lot.” Yes, things can get better very quickly just by winning games.
Abraham D. Madkour can be reached at email@example.com.
Loyalty programs in professional sports have seen varied degrees of success over the past 20 years. They have failed usually because of the lack of quality incentives, or because of the level of spending or attendance necessary to accumulate enough points to earn a meaningful reward. For the most part, these programs have been free and thus the enrollment numbers large, but the actual participation and involvement has been much smaller.
The Padres’ membership program focuses on season-ticket holders.
Photo by:SAN DIEGO PADRES
The Padres have launched a new membership program, the first phase of which focuses on season-ticket holders whose purchase of a ticket plan qualifies them as a member. The second phase will focus on general ticket sales prior to the 2013 season. For these prospective new members, signing up to become a member is free, and then they can move into blue-, gold-, and platinum-level memberships that include 21-game, 41-game, and full-season plans, respectively. (Consider the ticket purchase as the membership fee or dues.)
Blue, gold and platinum members select which type of membership that best fits them (fanatic, social, business or family). As the members’ status increases, so do their benefits. It isn’t a loyalty program based upon points, but a membership program designed to give fans a greater sense of belonging with the team, and benefits and opportunities reflecting their interests and type of relationship with the team and the organization.
Memberships can be tailored to family, business, social or fanatic, depending on a buyer’s interest.
Photo by:SAN DIEGO PADRES
“The membership program is something we’ve been working on for a long time, and we’re excited to finally roll [it] out for 2013,” said Padres President Tom Garfinkel. “It started with a few core themes. First, the idea that we needed to tap into fan psychology more and create a sense of belonging. Being a fan is emotional, not rational, yet somehow we keep going to market trying to rationalize with people. Secondly, we needed to create benefits that can’t be transferred on a secondary market and create more reasons to be a season-ticket holder than ever before. Finally, we needed to have more of a direct relationship year-round with our fans and have more information about what is important to them so we can deliver on it.”
Jeremy Walls, senior director of ticket sales and membership services, believes the program has been a huge success thus far and points to the statistics:
• 75 percent increase in “membership revenue” year over year (with that “membership revenue” being the club’s designated season-ticket revenue).
• Membership renewals running 44 percent ahead of last year at the same time.
• 110 percent more full (platinum) plans and 100 percent more half (gold) plans than the previous year, and 36 percent less 21-game (blue) plans — which suggests that membership benefits are driving customers to upgrade their memberships.
At a time when fans are spending heavily in the secondary ticket market, the season ticket, or any ticket plan, needs to be much more meaningful than just a place to sit and watch a baseball game. This membership concept being touted by the Padres, and under development by some NBA and MLS clubs, offers a meaningful attempt at creating a relationship through a membership that seeks to form a 12-month bond with the member much like a country club, or perhaps a civic club, or even a church. The most intriguing part is that this is only the beginning.
“This is just Membership 1.0,” Walls said. “It’s a foundation that we can build on, and layer new ideas and benefits using technology. In the future, it could include benefits from corporate partners, community initiatives, in-park gaming, instant seat upgrades, concessions, merchandise, fan-to-fan communication, non-baseball events like concerts … the possibilities are endless.”
Membership has its privileges and also its rewards, but maybe because it is in a sports context, the best thing might be belonging to a community of fans.
Bill Sutton (firstname.lastname@example.org) is the founding director of the sport and entertainment business management MBA at the University of South Florida, and principal of Bill Sutton & Associates. Follow him on Twitter @Sutton_Impact.