SBJ/Oct. 21-27, 2013/Facilities

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  • Chiefs busy testing mobile concessions tech at Arrowhead

    Don Muret
    Some Kansas City Chiefs fans can now pay for beer with credit cards without leaving their seats at Arrowhead Stadium.

    The added convenience is one of several pieces of mobile concessions technology the Chiefs are testing this season on the club level to drive incremental revenue and collect more data from their season-ticket holders, said David Young, the team’s vice president of stadium operations.

    The Chiefs, in conjunction with Levy Restaurants, their premium food provider, and Bypass, a technology firm, have equipped beer vendors with Samsung Galaxy S3 handhelds that Bypass has programmed to take credit cards for payment. The vendors use the handhelds as they roam the stadium’s 10,200 club seats selling beer, bottled water and peanuts, Young said.

    Servers at one Arrowhead club are using customized tablets to take credit card payments.
    Photo by: KANSAS CITY CHIEFS
    Separately, Levy cocktail servers working the lounge in the Foolish Club in Section 213 are using larger Samsung tablets customized by Bypass to process orders, streamlining purchases by taking payment without making multiple trips to the bar.

    The third piece of the test was set to launch Sunday for the Chiefs’ home game against Houston, allowing about 500 fans in sections 212 through 216 to order food and drink through Chiefs Mobile, the team’s new mobile application.

    The in-app ordering is restricted to a BBQ stand at Section 215 equipped with a Bypass tablet as its point-of-sale system.

    The Chiefs are targeting the end of October to test mobile merchandise ordering through Aramark, their retail provider, Young said. The test will be done for club-seat holders in Section 209.

    Apart from concessions, Chiefs Mobile, developed by YinzCam, has live camera feeds during the game that enable fans to view streaming video on their smartphones and tablets from multiple angles. They also have access to the NFL’s RedZone channel, Young said.

    All these high-tech bells and whistles are supported through recent upgrades to wireless infrastructure, including a distributed antenna system shared by AT&T, Sprint and Verizon, and Cisco’s high-density Wi-Fi system covering 600 new access points in the stadium. The directive from the Hunt family, owner of the Chiefs, was to go beyond installing new technology at Arrowhead, a 41-year-old facility, and to develop it in a way to make for a better fan experience, Young said.

    For Bypass, the ability to customize tablets for sports food operations is the latest evolution for a firm that entered the space in 2010 by providing a Web-based service to order concessions from smartphones. The Denver Broncos, Detroit Lions, Green Bay Packers and New England Patriots are also using Bypass-programmed tablets at their facilities.

    Over the past three years, as mobile devices have become more sophisticated, they are serving as mobile payment systems as a flexible option to traditional point-of-sale vendors such as Micros and NCR-owned Quest, said Bypass President Brandon Lloyd.

    “It means the POS business is no longer a hardware investment you make once every seven years,” Lloyd said. “It now evolves with your venue to support CRM, loyalty, loaded tickets, data mining and other software functions.”

    > LEADING THE PACK: The Husky Stadium renovation was completed a few million dollars under budget, a function of the developer-led model the school used after failing to get tax dollars for the project.

    Local developer Wright Runstad & Co. took the lead, filling the role as the owner’s representative for the University of Washington. Its partners were two national sports firms, 360 Architecture, the stadium’s designer, and Turner Construction, the contractor responsible for building the renovation.

    Together, the Wright Runstad-led team streamlined the process for taking bids and delivered the project for $247.4 million after proposing it would cost $250 million when it was awarded the project in August 2010.

    “Basically, we had a private-public partnership,” said Chip Lydum, Washington’s associate athletic director of operations and capital projects.

    The total project cost was $280.6 million after the school’s board of regents approved add-ons later in the development, including the $11 million UW Sports Medicine Clinic below the stadium, $5.1 million for an IPTV system, $2.3 million for the Touchdown Terrace and other upgrades.

    The renovation is being paid for through $230.6 million in new revenue tied to the stadium, including premium seats and sponsorships, and $50 million in philanthropic donations. As of late September, the school had generated $52 million in donations, UW officials said.

    The developer-led model in the college space is not new but it is not the typical path schools take to pay for sports facility construction.

    Under more traditional models, builders such as Turner take on most financial risk to ensure a project is done on time and on budget. Washington struggled for several years to find a funding model. UW officials had asked state legislators to extend local sales taxes to pay for half the cost to renovate the stadium, including a food and drink tax used to pay construction debt for Safeco Field, home of the Mariners.

    After state leaders denied the requests, the school and the state agreed to use a private developer to manage the project.

    Mark Emmert, Washington’s president before becoming president of the NCAA in November 2010, saw the developer model used to build student housing during his tenure as chancellor at LSU, Lydum said.

    “We looked at a lot of places, but no one really had this kind of hybrid model that we have,” said Scott Woodward, Washington’s athletic director.

    The process starts publicly, Lydum said, with proposals issued to private developers, and after one is selected, it becomes the client’s construction agent managing the entire process from start to finish.

    “The university gave Scott Woodward authority over the project and he was able to make decisions without going back to the administrative labyrinth all the time,” Lydum said. “The university could be required to go through 28 approval steps on campus. We were only required to have three approvals. It liberated the process.”

    Don Muret can be reached at dmuret@sportsbusinessjournal.com. Follow him on Twitter @breakground.

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  • New company formed to resell tickets for teams on the secondary market

    A former Brooklyn Nets ticket sales executive has joined forces with a prominent ticket broker to form Dynasty Sports & Entertainment, a company that resells tickets for teams on the secondary market and provides consulting services to develop better pricing models.

    Dan Lefton, Dynasty’s president and co-founder, was most recently vice president of suite sales and premium seating at Barclays Center. His business partner, Dynasty co-founder and CEO Cole Rubin, is the owner of Charm City Tickets, a large ticket inventory house in the secondary market. On its own, Charm City, a company whose title will be phased out after the NFL season, generated more than $30 million in revenue in 2012, Rubin said. The broker has worked directly with 23 NBA teams and 22 NFL clubs and is one of StubHub’s biggest customers, he said.

    Since forming Dynasty two months ago, the 14-person company has bought thousands of tickets valued in the millions of dollars from eight major league teams, including the Brooklyn Nets, Dallas Cowboys and San Francisco 49ers, Rubin said.

    Dynasty’s inventory covers 450 tickets and a suite for every Nets home game at Barclays Center, including All-Access season tickets tied to three-year contracts that Charm City originally bought in 2012. In Arlington, Dynasty bought tickets for seats stretching from the lower bowl to the upper end zones at AT&T Stadium. The broker signed a 20-year, $5 million agreement for a field-level suite at the 20-yard-line that it resells for individual Cowboys games and uses on its own for hospitality, Rubin said.

    In the Bay Area, Dynasty bought $2.7 million in PSLs tied to 550 seats at Levi’s Stadium, the San Francisco 49ers’ new facility opening in 2014.

    It’s not an unusual situation, though most teams will not talk about it publicly. Charm City, for example, has become one of the Nets’ biggest accounts dating to their days playing in New Jersey, said Fred Mangione, the Nets’ executive vice president and chief marketing officer.

    As a broker, Dynasty is no different than StubHub, Vivid Seats and ScoreBig, three competitors operating in the secondary market. Dynasty, in fact, lists tickets on ScoreBig’s site, Lefton said.

    Teams have sold tickets to brokers for many years, said John Walker, president and CEO of Tickets.com and a former senior executive with the Phoenix Suns. But only recently have both parties sat down to talk about strengthening their relationship with some flexibility, he said.

    Those discussions revolve around brokers committing to long-term deals where they pay a premium to buy tickets when a team is hot and get a discount when things aren’t going well. That helps the resellers cut their losses and provides guaranteed revenue for teams.

    Dynasty did not get a discount for buying in bulk from the Nets, Cowboys and 49ers, but there are other instances where it does get a price break, Lefton said.

    The consulting piece is something Dynasty could hang its hat on if it can help teams effectively manage their ticket inventory, Walker said.

    Lefton, whom Mangione hired six years ago, met Rubin when Charm City resold tickets for the Nets at their former homes at Izod Center and the Prudential Center. Lefton oversaw the team’s temporary relocation to Newark as well as the All-Access ticket program in Brooklyn.

    “What they laid out to me is this is more of a full-service company, and their goal is to educate some of the teams on how analytics can help them,” Mangione said. “Dan knows the ins and outs of ticketing and which teams are struggling.”

    It’s something Dynasty officials say is a point of difference over other ticket brokers, through their ability to help teams bridge the gap between the primary and secondary markets using Rubin’s proprietary analytics program to build more effective pricing models.

    To date, though, Dynasty has generated 100 percent of its revenue reselling tickets. It is not now consulting for teams, a service it would provide in exchange for receiving more tickets to resell, Lefton said.

    Its competitors on the consulting side include The Aspire Group and IMG Learfield Ticket Solutions, two firms that do not resell tickets.

    Dynasty can customize resale programs for teams that prefer using league-approved ticket exchanges, Lefton said.


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