SBJ/Sept. 16-22, 2013/Opinion

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  • Virtual season tickets could produce real revenue for teams

    Professional sports leagues and many collegiate athletic departments are running out of new revenue sources. Premium seating, suites and season tickets are increasingly more difficult to sell and renew. No-show rates at games are increasing. Teams are struggling to monetize the growth in social networking and many forms of new media. Stadium and arena naming rights are unsponsored in some markets. Team owners are asking their business operations executives where the new revenue will be coming from. There are no easy answers.

    But one could be appearing virtually before our eyes.

    The next significant new revenue source for pro sports could be virtual season tickets. Teams have the ability to package significant pieces of inventory and benefits into virtual yet tangible off-site season tickets on a platform constructed to generate untapped revenue without cannibalizing existing team profit centers.

    Consider this: There are tens of millions of fans devoted to 122 North American professional teams who will never set foot in their favorite team’s home venue. According to Navigate Research, the market of fans who are very interested or somewhat interested in the big four U.S. team sports are as follows: 83 million NFL fans, 59 million for MLB, 41 million for the NBA and 21 million for the NHL. That’s more than 200 million fans interested in following their favorite teams, yet only 3.2 million have season tickets.

    The reasons that keep fans from attending home games of their favorite teams are varied and range from geography to affordability to the availability of other entertainment options.

    The answer?

    A virtual season ticket could be built on everything that happens in and around the game. The virtual season-ticket holder would experience the live environment of the venue through a virtual platform. Advances in technology, interactivity, 3-D TV, video games, social gaming, mobile applications, video streaming and virtual spectatorship could bring virtual season-ticket holders into the stadium environment without actually being there or spending thousands of dollars on tickets.

    Think of the current market of season-ticket holder benefits as hundreds of pick-up sticks. The virtual season ticket could bring order to this chaos. Fans could buy from a matrix of inventory as part of virtual season-ticket packages that could open a significant new revenue stream.

    How will it work?

    Let me describe what a Green Bay Packers game day could be like for virtual season-ticket holders.

    On the computer, tablet or smartphone, weekly customized matchups for that day’s game and a customized, downloadable sports stat package would be available.

    Virtual access to premium tailgate parties would be available and the opportunity to interact with top grillers.

    A member of the Packers would offer a real-time customized virtual tour through the team’s offices and training facility, followed by a virtual walk over to the Packers Hall of Fame where a hall of famer acts as tour guide.
    At halftime, they could take a virtual walk around Lambeau Field and virtually tour the locker room.

    When the team is on the road, fans would have virtual access to a bus and plane cam so they could feel like they are with the traveling party.

    Inside the virtual VIP suite, they could discuss the game action with Packers alumni players.

    Fantasy play-by-play: Virtual season-ticket holders and a friend could broadcast the game in a virtual broadcast booth.

    Using Cisco’s TelePrescence live video conferencing technology, virtual season-ticket holders could chat with Packers players, coaches and team executives before every game and at other times during the season.

    Packerville: Similar to the Farmville concept created by Zynga, fans could build their own stadiums, compete and purchase virtual goods as they build their teams.

    Market size

    The four major professional sports attracted a combined audience of 140 million fans to their venues in 2011. That number includes season-ticket holders, partial season-ticket holders, groups, single-game purchasers and suite holders.

    Teams keep their real number of full-season-ticket equivalents under lock and key. The total number of account holders is less than the gross number of season tickets. There is a duplication factor inherent in fans attending multiple times and being season-ticket holders of multiple teams in a market. An estimate of the number of season-ticket holders for each of the four major sports are listed above:

    There is a multibillion-dollar market of spending from pro sports team fans that isn’t being effectively marketed. By creating a unique proprietary service/product offering through one-stop shopping, teams and leagues would create a new revenue pool that could break the stagnating revenue trend in pro sports.

    The future

    Virtual season-ticket packages will be scalable so that significant new revenue can flow to the rights holders.

    Teams, leagues, schools and event promoters will have to invest creatively, technically and financially in implementing their customized programs. Since they own the rights, the costs should be minimal and the payoffs profitable.

    I have sat on the other side of the table from vendors and entrepreneurs pitching various unconnected components of this virtual puzzle. No single entity is effectively addressing the matrix concept of the virtual season ticket. Companies are trying to get teams to buy their product with promises of additional revenue or greater insight into existing fan behavior. The market activation has many spokes but no hub.

    The day of the little piece of cardboard known as a ticket is slowly disappearing. As we peer around the corner the virtual season ticket could become just the ticket.

    Andy Dolich (andy.dolich@gmail.com) is managing director of U.S. sports practice for Odgers Berndtson and has held team executive posts in the NFL, NBA, MLB and NASL.

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  • How a team injects fun, games into sales culture to good result

    The majority of tickets sold for sporting events and teams are probably sold by men and women under 30 years old. That said, it made me think about pop culture and “gamification” and the importance of those two areas for people in that age group.

    The number of people that play fantasy football and “World of Warcraft,” and even McDonald’s Monopoly, is staggering. People like the fun that games provide, along with the social interaction and opportunity to be recognized and rewarded as the winner.

    My interpretation of the term gamification is a way to engage people and motivate them to change behaviors, develop skills, communicate more effectively, break down barriers and solve problems through adapting existing game formats or creating a customized game to fit a particular situation. According to Brian Burke of advisory Gartner Inc., gamification is currently being applied to customer engagement, employee performance, training and education, innovation management, personal development, sustainability, and a variety of other settings.

    The marriage of pop culture and gamification has been integrated in the sales culture of a professional sports franchise in the form of the Tampa Bay Lightning’s “Shark Tank” competition. Adapted from the television show, the Lightning’s version of “Shark Tank” was developed by Tampa Bay’s sales management team and led by Ryan Cook, Lightning director of inside sales. According to Cook, the “Shark Tank” competition was designed to:

    Measure a combination of strength of ideas and presentation skills.

    Strive to bring new business teams together in preparation for the 2013-14 season.

    Operate as three contests: designing mini-plan concepts, creating programs to improve organizational culture, and developing capital improvement concepts for the Lightning’s home, the Tampa Bay Times Forum.

    Allow sales reps to exercise creativity.

    Give everyone a chance to make a difference in the way the team does business and provide them with a voice and an opportunity to be heard.

    Be fun first, but also competitive.

    It was the hope of the Lightning sales management leadership team that the contest would be a fun and engaging way to improve presentation skills essential for a successful career in sales, with the underlying hope that three big ideas capable of generating incremental revenue would be produced through the efforts of the contestants.

    The game lasted six weeks and consisted of three rounds in which various senior leaders from the Lightning participated as “sharks,” challenging the validity of the ideas and identifying factors that teams may not have considered. The teams were a combination of veterans and rookie sellers as well as retention/service personnel. Teams were not permitted to seek expertise outside of their own groups for the first two rounds. Once their idea had been approved for the finals, they were allowed to seek out one source, inside or outside the organization, for expert guidance.

    Tampa Bay Lightning “Shark Tank” participants are questioned about their business concept by a group of “sharks” during the competition.
    Photo by: TAMPA BAY LIGHTNING
    I had the opportunity to provide guidance to the finalists competing in the organizational culture competition. The groups had worked hard on their concepts, and while it was clear that they wanted to win, it was important to them to have the opportunity to be heard as potential young leaders by Lightning senior management.

    I was then selected to be one of five “sharks” in the final round to determine the winning team in each of the three categories. In the finals, the ability to take the concept, explain it so that all of the “sharks” could understand the premise and the potential impact, as well as the logic as to why this plan was conceived, was the absolute key to success. The three winning concepts were all simple ideas that were easily understood, could be implemented without great difficulty and had the potential to generate significant incremental revenue. Concepts that failed to win were complex and difficult to implement. Those sales presentations often left the “sharks” with more questions than answers.

    The winners were recognized at a company lunch and awarded their prizes: an ultimate sporting experience on a Sunday, followed by a day off.

    This is one of those rare instances in which everyone won and enjoyed the game. The organization received some great ideas to present to ownership for funding consideration and hopefully implementation; the sales managers identified some emerging stars; the summer sales period prior to the season was filled with excitement and enthusiasm; and a young staff experienced the opportunity to present themselves and their ideas in a forum to senior leadership and to describe revenue opportunities that they had identified and were excited to pursue.

    Participant Tony Econ summed up the experience: “It’s encouraging to have your ideas heard, even when you are not at the top of the chain. Future executives want to feel empowered, and ‘Shark Tank’ was the perfect way to give us that opportunity.”

    But “Shark Tank” was also designed to be a developmental tool for young sellers, providing them with an engaging competition to let them develop presentation skills that will be key to their professional success in the future.

    “I don’t think I’ve ever taken such pride in a group project before, and being on one of the winning teams was extremely validating,” participant Alison Goodman said. “It is also a nice bonus that my public speaking skills got a little boost because I know this is a personal area of weakness.”

    Sales as a profession has an extremely high turnover of young people. Taking some of the stress out of the job, injecting some popular culture and gamification can help alleviate that turnover by creating an environment that emphasizes development while also providing the entry-level worker a better understanding of organizational goals, objectives and workings. It also connects them to their co-workers in something that is more than the daily routine.

    Bill Sutton (wsutton1@usf.edu) 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.

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