March 22, 2012 06:06 PM
In this world of evolving markets and media, marketers from bankers to carmakers to hoteliers are navigating myriad platforms to get the message out.
The most daunting challenge, said Hyundai Motor America VP Marketing Steven Shannon, “is the explosion in media channels and distribution channels. In the car business, TV is still important, print is hanging in there, but the explosion in social and digital and optimizing all of those and trying to measure all of those is probably the biggest overall challenge that we face.”
“Part of the challenge of running a marketing organization is getting everybody to actually be on point, to be focused across the vision you set out as to how you’re going to reach your target segments of customers and not be distracted by a hundred different ways that you can reach out to them,” said Jeff Diskin, Senior VP, Global Consumer Marketing, Hilton Worldwide. “But at the same time, also being a listening post and finding the new points of innovation that you should be part of.”
Another challenge that the marketers face, Diskin said, is that customers are more engaged and more in charge.“We’re used to an environment where you could direct the conversation,” he said. “You could indicate what was important. You could control it. We have to embrace the horror that the customer is in charge.”
The financial world has had its own challenges in the last few years, and Citi and
Capitol One are addressing those concerns in their marketing efforts.
Citi Chief Brand Officer Dermot Boden said, “One of the challenges I face in an industry that’s been fairly beaten up, perhaps more than many others, is how do I convince the organization to invest behind our brand, to invest in a way that’s building the brand and not just sort of coldly selling product but building an emotional connection.”
“The whole thing with consumers is that they shifted to trusting each other instead of trusting us as marketers,” said Marc Mentry, Capitol One Senior VP, Brand Marketing. “How do we harness that? It’s a big, big challenge for us. If you look at any survey, you’ll see that they will trust a stranger to tell them about a brand rather than real facts that we’re putting out there for them. It’s a tough challenge.”
On what the Olympics means to a company:
Boden: “We’re new to the Olympic family. We’re proud that we’re joining this family. We’ve done a lot of research to understand how we can bring this to life in the U.S. I think it’s important that we don’t artificially insinuate ourselves into the conversation. We haven’t earned that right. Other brands have. It is ultimately about establishing ourselves back as a brand that people can trust.”
Diskin: “I like the Olympics sponsorship and it’s my favorite for activation because it’s not singular. As a marketer, you have different objectives, but mostly you’re looking for engagement, and the Olympics works with what our values are.”
March 22, 2012 05:17 PM
When AEG announced its naming rights deal with Farmers Insurance in August 2011, the public perception was that a stadium and a team arriving in Los Angeles – be it a team moving from another market or an expansion franchise – was imminent.
“I remember when the NFL first left, the Raiders and the Rams left LA, and I was asked routinely, ‘How long do you think it will be before they’ll come back?’” said David Simon, the president of the Los Angeles Sports Council. “My stock answer in 1995 was ‘At least five years and maybe 10,’ and the routine response when I said that was, ‘It will never take that long, the NFL will never stay away for five years – are you kidding me?’ Now it’s 17, 18 years later and we’re still waiting. I think in those first few years after Georgia Frontiere and Al Davis picked up stakes, both the NFL and Los Angeles found that they could live without each other.”
The hold-ups have been countless, from the location of the stadium, to which team would occupy it, to what potential owner would be willing to undertake the multi-billion dollar project that it would require to return the NFL to the second biggest market in the United States.
“One of the questions that has gone on, back and forth, is does LA need the NFL more or does the NFL need LA more? And I think the real question is does either side really need the other?” said Sam Farmer, an NFL columnist for the Los Angeles Times and a National Football columnist.“Obviously, both have thrived without each other, and now the landscape has changed so dramatically with the NFL, Los Angeles is really the Ellis Island of NFL fans, we have every fan represented. And now you have the ability through Direct TV, Sunday Ticket, through the web to follow your favorite team. So where is the urgency to put a team back in Los Angeles?
“I don’t think there’s a terrific urgency on the part of the league, which has signed an unprecedented 10-year labor deal [and] set records with its TV deals,” Farmer continued, “and all those teams that are in ‘struggling markets,’ now the rising tide has lifted all boats so they’re not in the sort of desperate situation they were in before. And the NFL, if it’s shown us anything, has shown a willingness to wait for the best situation and I don’t think the league sees that deal on the horizon right now.”
Beyond how and when the stadium deal actually goes through, or when a team pushes for relocation, there’s also the belief that there’s a new factor that will determine the fate of the NFL’s return to Los Angeles.
“This derby that’s going on, this auction that’s going on, with respect to who buys the Dodgers, could have a huge effect because it’s going to be a super-billionaire, there’s no question about it, and that person undoubtedly is going to have a lot of credibility,” said Alan Rothenberg, chairman of Premier Partnerships. “I cannot imagine that anybody buys the Dodgers and lets (Frank) McCourt own the surrounding parking lot real estate, so that’s got to be thrown into the negotiation. Whether they even want to develop it for a football stadium or other use is unknown, but knowing the NFL and that they’ve always loved that site, and always loved competition, that that’s out there, we’ll know within 60 days. Now suddenly it’s not just (Ed) Roski, it’s not just AEG, but it’s Mr. X, the new owner of the Dodgers, and it stirs the pot even more.”
“We’ve just had a myriad of proposals, and two reasons, I would say, it’s taken so long [to bring a team to Los Angeles], one is Los Angeles, and the LA area, has antipathy to using tax dollars for sports projects. That antipathy does not exist in most other major markets. The other is we’ve had, by my count, seven different cities in this area that have been the subject of serious proposals for a new stadium or renovation of an existing stadium: Anaheim, Inglewood, City of Industry, Irwindale, Pasadena, Carson. So when you add all these up, each of these cities is small compared to the city of Los Angeles, but each has had its own financial issues, own city councils, made its own case to the NFL to be the place for the NFL in LA.” – David Simon, president, Los Angeles Sports Council
“Over the last 17 years it’s been a Rubik’s Cube, we’ve said what’s the stadium, who’s the team, who’s the owner. It’s very difficult to solve that, and it’s becoming increasingly difficult when you consider that stadiums that just less than eight years ago we were talking about teams spending $400 million on a stadium, now everything is north of a billion dollars. It’s getting more difficult, not less difficult.” – Sam Farmer, NFL Columnist, Los Angeles Times; National Football Columnist, Tribune Newspapers
“The revenue is not dependent on those fans, the revenue that matters is the sponsorships, the suites, and the club seats. I think clearly because of the market and the importance of the market, the sponsorships are probably a slam dunk. The suites and the club seats should be okay but they’re very expensive. If it happened right now, we’re just barely coming out of a recession and LA’s a strange market, is the home of very, very few Fortune 500 companies, it’s the market of a lot of small- and medium-sized businesses, for whom the purchase of a suite on a 10-year contract, which is what you need in order to do the financing, may be too much of a reach. I’m not saying it can’t be done, but it’s not going to be easy.” – Alan Rothenberg, chairman, Premier Partnerships
“You threw out a very scary number at the start of this: $300 billion. Well, how are they going to make it up? The television revenue is fixed, ticket sales, how much can you charge? So the money is going to be made up on the corporate suites and sponsorship sales and those are going to be very, very expensive to make those numbers work, and the corporate community is going to look at how much that’s really going to cost, especially when there’s such a competitive market, there’s two baseball teams, two hockey teams, two basketball teams, college sports, the PAC-12, there’s a lot going on here. And will the entertainment community step up and buy a lot of that corporate stuff that’s going to need to be sold to make those numbers work?” – Michael Lynch, head of global sponsorship management, Visa
“LA currently sells more paid tickets to sporting events (professional and college) annually then any other city in the country, maybe in the world, 25 million last time we chartered this maybe two years ago. To me, going up by 3 percent, which is what an NFL team would take for eight or ten games sold out, to me, that’s not hard.” – David Simon, president, Los Angeles Sports Council
March 22, 2012 05:06 PM
Pac-12 Enterprises president Gary Stevenson talks about why the college marketplace is "hot as a firecracker."
March 22, 2012 04:48 PM
With USA Today on the doorstep of every attendee, the subject of the paper’s top story, on NFL Commissioner Roger Goodell’s unprecedented suspension of Saints’ coach Sean Payton, was all the buzz during the morning’s first session.
Steve Bornstein, president and CEO, NFL Network; executive vice president, media, NFL: The commissioner is saying “that this kind of behavior is not going to be tolerated, but the more interesting point to me is that it really is on the cover of every newspaper in the country today, and that, to me, speaks more to the impact of sports in our society today, and that people really care. They want it to be honest, they want it to be straight, they want it to be fair. And I think that’s what Roger was trying to communicate.”
Brian Bedol, founder and CEO, Bedrocket Media Ventures: “I think clearly they were sending a message, but I don’t think it’s the first time that it’s gone on. I think the fact that, number one, they were caught, and it was such a high-profile event that they were caught, they had to send a strong message.”Gary Stevenson, president, Pac-12 Enterprises: “I admire the commissioner because he recognizes the role models these players are, and you have to send a message to a high school football player that this kind of behavior is not acceptable. Whether the penalty was the right penalty or the wrong penalty – I don’t know the facts of the case – but I think recognizing that these athletes are role models and sending a message to young players, I admire him for that.”
Mark Shapiro, CEO, Dick Clark Productions: “Anybody who didn’t see this coming is living in a cave somewhere. From Day 1, Roger has been messages. Clearly. He’s been very tough on penalties. He’s been very tough on enforcement. He’s been very tough on discipline. So this was going to come down. And, you know what, he has to do it. It’s not just about sending the message to the players and the fans at home, but let’s be candid here, the NFL is under the microscope. They’re in the spotlight when it comes to the physicality of the sport, the, quote unquote, brutality of the sport. So sending this message that we’re not going to tolerate that, we’re going to play inside the rules, was the right thing to do and it was warranted.”
With the breaking news out of the way, the discussion turned to the evolving relationship between the media and fans and how the in-home experience is cutting into attendance.
“I do think the product is great and some people make a choice to watch it at home,” Stevenson said. “In some cases, attendance is down, but I happen to think it has more to do with the in-game experience when you go to the stadium. If you go into a college dorm room today and you watch a group of students watch an NFL Sunday or a Pac-12 Saturday, they’re not just watching it on one screen, they’re watching it on a number of screens, and they want to interact with friends and they want to share the experience. If you go to a stadium and you can’t have that experience you get frustrated. So our view is that some of the stadium infrastructure needs to change a little bit so that the fan experience, when you go to the stadium, is better.”
“There is no price you can put on being there,” Shapiro said. “There’s nothing like being there. On the flip side, yes, the game is great, but at the same time, ticket prices are high. So now you’re at home as a sports fan, you’ve got these high-ticket prices, you’ve got a tough economy and you have a great in-home experience. Now being there has to take a back seat.”
“I think we actually blew it as an industry,” Bornstein said. “We make the experience so good, so clean, that we shot ourselves in the foot.”
“I don’t think the answer to improving attendance is increasing the price of the out-of-stadium experience,” Stevenson said. “It’s incumbent upon the teams to increase the experience within the stadium and to give people something that’s worth paying for that $30, $40, $50 ticket, that they can’t get at home.”
“We’ve got to enhance the fan experience,” said Ben Sutton, President, IMG College. “When they come in the gate, they’ve got to feel like they’ve gotten real value. We’re not doing enough, in my estimation, that when people come through the gate we’re depending on tradition too much. I think you’ll see, at least in college sports, over the next 10 years some really radical changes in that regard.”
On the big story people are watching over the next year:
Bedol: “Will one of these new platforms write a big check and use sports as Fox and DirecTV did to really break into the mass audience business.”
Bornstein: “Are these virtual competitors out there real? Is Google or Yahoo! going to make the leap and try to be entertainment to the consumer and into the home?”
Shapiro: “They’re coming, there’s no question about that and they’ve got the pockets to do it. They’ve got to get the technology, and at the end of the day they’ve got to get the content.”
Stevenson: “I’ll echo that. Will the big technology companies make the investment and really want to be a player in this industry? I think they do.”
Sutton: “Just to pick something different, Will there be a national championship in college football?”
On what’s going to happen next in the 3-D world:
Bornstein: “I think that experience is going to happen. I don’t think it’s going to happen nearly as quickly as people thought 18 months ago. I think it will actually make it theatrically first, and when that experience is refined it will ultimately end up in the home. But I think the horizon line is pretty far.”
“You have to get past the glasses,” Shapiro said. “The technology is there and it’s going to come out, but it’s never going to catch on as long as you have to wear glasses in your own home.”
On the importance of paying attention to consumers:
Stevenson: “It’s a mistake to think that we’re going to be able to dictate to consumers how they consume our product with the way technology is today. For the longest time, we could dictate who was getting what and when. It’s not our choice any more. We have to meet the consumers where they want to be.”
March 22, 2012 03:40 PM
Citi's chief brand officer, Dermot Boden, talks about restoring luster to the brand and why the Olympics is the right property for building an emotional connection with U.S. consumers.
March 22, 2012 01:31 PM
One of the biggest social media challenges for companies is integrating campaigns through both social and traditional outlets, says Skechers Fitness Group president Leonard Armato. Bonus: His rules for social media.
March 22, 2012 12:27 PM
Mark Cuban recently blogged about how adamantly opposed he was to fans at Dallas Mavericks games taking time away from the live game experience to look down at their mobile devices. Not everyone in the sports business shares that thinking.
“That’s what we’re trying to solve with the 49ers: allow your consumer to decide,” said Jed York, president and CEO of the San Francisco-based franchise. “If you want to use a smartphone, if you want to use a tablet to enhance your game experience and share your game experience, you can do that. You want to give them the opportunity. If you want to come and leave your smartphone at home or turn it off and just watch a football game, you can do that, too. I think trying to dictate for your consumers and trying to give them a kind of one size fits all, that’s over.”
Not only does a fan need to be able to connect to his or her mobile device, according to the five panelists, there should be maximization of the devices’ features, from paperless ticketing, to reading Tweets from athletes during games, to finding the shortest line to buy a beer.
“What we think has happened in the last few years is people have tried to create apps and services for venues, but when [fans] show up at the venue they don’t work, so it’s been a frustrating process for a lot of these app developers, but we believe we have solved now the connectivity issue,” said David Holland, senior vice president and general manager for the Sports and Entertainment Solutions Group, Cisco.“What will happen now is you’ll see an explosion of app development around how you bring the experience, be it the Niners or the Nets, to the fan in a very cohesive, seamless way without getting in the way of the event itself.”
“It’s incumbent upon us to let people live the life that they have outside and bring it in, and that’s a life that relies on information, and it’s very mobile,” said Brett Yormark, president and CEO of Brooklyn Sports & Entertainment, and CEO of Nets Basketball. “[That lifestyle is] something that we’re really, really focused on, and we’ve built the infrastructure of our staff and our building in order to meet those needs.”
The Nets are scheduled to open their brand-new, state-of-the-art facility, the Barclays Center on Sept. 28.
“I think fan expectations are different now. Fans expect to follow athletes on Twitter, fans expect to get real-time breaking news from athletes on Twitter, so I think fan expectations are different now, and team stadiums definitely have to keep up with that because otherwise we’re going to lose them.” – Priya Narasimhan, founder and CEO, YinzCam
“About four years ago we had a conversation about the telepresence idea. If you want to actually be there to ask Coach Harbaugh a question at the end of the game, and see what it feels like to be in the locker room, you can do that. And now with IPTV, you can put that throughout the game, throughout the stadium, throughout the arena, and those are ways to get people connected. It’s easy to be able to do that even during the game, where you might not do something that’s going to tip your hand on what your strategy is so the other team can see it, but you can find a way to get people to connect: What’s Coach Harbaugh saying on the bench? What’s going on in the locker room? Those types of things … so that you can send it out where it’s consumed in a way that it’s not going to hurt your competitive advantage.” – Jed York, president and CEO, San Francisco 49ers
“Another thing we focused on when we started looking at this space was this competition with the couch, trying to get people from the home into the venue, because I think that battle is enjoined right now. We still see teams that struggle to fill their venues. I believe when we get these stadiums differentiated in terms of the experience they offer, and it’s possible to do today … really raise that experience, then it turns from being a competition with the couch to how do you connect with the couch?” – David Holland, senior vice president and general manager, Sports and Entertainment Solutions Group, Cisco
March 22, 2012 11:50 AM
Two senior NFL team executives at the World Congress of Sports strongly supported NFL Commissioner Roger Goodell’s decision to levy punitive fines and suspensions on the New Orleans Saints.
Green Bay Packers President and CEO Mark Murphy said he was not surprised by Goodell’s decision. “Roger is very sincere that he’s not going to tolerate anything that puts at risk player health and safety,” Murphy said. “I know it was a difficult decision for him. But I knew he would act quickly.”
Murphy said the severity of the penalties came not only from the bounties, but also from how the team acted afterwards. “Part of it, as well, was not just the bounties but I think their lack of openness in terms of the investigation,“ he said.Murphy expressed sympathy for Saints owner Tom Benson, but reinforced his opinion that the punishment was justified. “I know Tom Benson is very disappointed,” Murphy said, “but it was a very serious violation. Probably the biggest issue we face as a league now is what can we do to make the game safer. With the concussion lawsuits and issues with retired players, I think we really had to come down strong.”
Houston Texans President Jamey Rootes agreed. “You have to step up when things like this happen,” he said, “regardless of the circumstance and to protect player safety.”
March 22, 2012 11:29 AM
Five legends of the industry were honored at a luncheon and during a panel discussion as champions of sports business. The stories they told about the lives and careers will be featured in the March 26 issue of SportsBusiness Journal.
Our final question to them, though, was what advice they would give to young people who want to break into the sports business. Here are their answers:
Judy Sweet, co-director, Alliance of Women Coaches:
“I think it’s really important for young people to understand that they need persistence, they need patience, and they shouldn’t hesitate to ask for help. Too often, young people, or old people, feel that if they ask for help it’s a sign of weakness. I don’t know anybody who, when asked for help, says no. So don’t be afraid to ask for help.”
Bill Battle, founder and chairman, The Collegiate Licensing Company:
“One of the things that I’ve advised people is that if they can get a job in sports, and they know what they want to do, it’s great if they can get one. If you can’t get one don’t be afraid to work for free.Don’t be afraid to go do an internship, a graduate assistantship, to learn, A, the business, but to let people learn about you and the contacts you make doing that. There are a lot of people who do that. We’ve hired a lot of interns who’ve come through our shop. I was a graduate assistant and it did wonders for me in my career. That’s what I’d tell them.”
Ed Snider, chairman, Comcast-Spectacor:
“I was going to say exactly what Bill just said. I can’t tell you how many interns have come to work for us, impressed us and that we’ve hired. And many have gone on to work for other companies. I’ve met some here today that started with us as interns, so it’s a good way to get started and get your foot in the door.”
Don Ohlmeyer, former President, NBC, West Coast:
“Kids always ask me what the most important course was that I took to prepare myself to be in the television business, the sports business, and I tell them child psychology, because nobody I’ve ever worked with in this business, including myself, has an emotional age of over 13. And Howard (Cosell) proved that to me. Also, it’s all about what you put on the screen in the end. It’s about servicing the audience. You respect the audience, you serve the audience and you listen to the audience. No matter what you do, if you don’t do that you have no chance to succeed. If you do that and you do it well, you have a chance to succeed.”
Humpy Wheeler, CEO, The Wheeler Company:
“I tell people to think like they’re a 12-year-old boy, because when you’re a 12-year-old boy, that’s the last year that boy’s going to have any fun -- all the time -- ‘cause his hormones haven’t hit yet and he’s into fun. And if you can keep that in the back of your mind you can come up with some pretty creative ideas on how to entertain people. Also, I like to try to get kids to start out at small venues. Like I would never try to get somebody to start out at a place like Charlotte Motor Speedway or Daytona, but start off at some dirt track out in the middle of Ohio, or whereever, because that’s where you learn to do everything, because there’s not enough people around. You learn plumbing. Very important. You learn tickets. I’ve always said there are three things you’ve gotta do. The three Ts. Tickets, you’ve gotta sell them. Traffic, you’ve gotta get people in and out. And, back to my favorite subject, toilets, ‘cause they’ve gotta work. And when you get all those three things together, the kids, they’re gonna be good. But you need to go to a small place to learn to do all of that stuff.”
March 22, 2012 11:24 AM
Green Bay Packers president and CEO Mark Murphy and MSG Sports President
Scott O’Neil showed an interesting contrast in their thoughts about ticket prices during a panel session at World Congress of Sports.
Murphy gasped when O’Neill mentioned that courtside seats for Knicks games cost more than $3,000. “Not to pick on [the Knicks], but $3,000 for a courtside seat?” Murphy said. “All fans and crowds have become more corporate. We’re getting away from really having family events.”
O’Neill responded with a barb: “Our market is different from being in Wisconsin. We don’t have such fierce competition as the Brewers and the Bucks.”
O’Neill went on to say that the Garden has tickets at all price points. “We like to have something for everyone. In our market, if someone wants to sit on the front row, there’s a premium. If someone wants to get in the building, we have $10 seats. If somebody wants to have the food and beverage inclusive…we’ve got you to, buddy.”