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Volume 21 No. 1

Leagues and Governing Bodies

Strong walk-up and single-game advance ticket sales have driven MLB’s unexpected surge in attendance this season, helped further by strong pennant races, improved analytics and best-practices sharing among teams.

MLB’s attendance was up 7.4 percent, to 31,011 a game, through last Wednesday, about twice the increase projected for 2012 by league executives before Opening Day. Baseball is on pace to post its largest attendance since 2008 and perhaps challenge the league record of 79.5 million set in 2007.

“There are a lot of powerful factors at play, and this summer thus far seems to be the summer of baseball,” said Bob Bowman, MLB Advanced Media president and chief executive. “Teams have grown very adept at selling tickets. They’re really good, and only getting better.”

Online ticket sales are up 24 percent so far this year, according to MLBAM. Many teams also are reporting double-digit percentage boosts in offline walk-up and advance ticket sales, and several clubs have posted single-game facility records for walk-up ticket sales.

MLB just ended its 2012 interleague schedule with an attendance of 8.74 million for the 252 AL-NL games, third-highest total in the 16-year history of the format.

Some credit for the gains can be traced to late 2010, when MLB formed the Commissioner’s Ticket Review Committee as a means to formalize and expand best-practices sharing as well as address a key league issue from a more holistic perspective. Several efforts have emerged out of the panel, including the new FanPass brand for the sport’s efforts in digital ticketing, as well as continued study of MLB’s future role in secondary ticketing.

For many clubs, however, the 2012 season represents the first full opportunity to see significant returns on what they have learned from the committee, as well as from the fast-growing field of ticketing analytics.

“We’re all doing a better job in the industry of yield management. And for us, it’s only really just now that we’re at 100 percent of the capabilities of our [customer relations management] system that we’ve installed,” said Derek Schiller, Atlanta Braves executive vice president of sales and marketing and a member of the MLB ticketing committee. “The result is we’re doing more direct marketing and direct sales than we ever have been.”

Among the factors helping MLB attendance: The re-emergence of long-struggling teams like Baltimore.
Several other factors have been credited for MLB’s surge at the turnstiles, including the new postseason format that creates two additional wild-card berths, and surprising pennant races that have seen long-struggling teams such as Washington, Baltimore and Pittsburgh in the thick in the playoff hunt.

Dynamic ticket pricing, now employed by more than half of MLB clubs, has given team executives expansive new views into day-by-day consumer demand. Even a team such as the Minnesota Twins, losers of 99 games last year and in the AL Central cellar again this year, has seen a marked increase in walk-up ticket sales — in part because of its work with Indianapolis-based Digonex to monitor and adjust single-game prices.

“Our walk-up has been strong, particularly since school let out,” said Twins President Dave St. Peter. “We had a bit of an issue in the first year of Target Field [in 2010] where people thought there weren’t tickets available. We now have tickets available, there’s a greater understanding of that in our market, and we’re doing better getting to fans with the right kinds of offers.”

The new Marlins Park in Miami also has been a driver of the league’s overall attendance boost, but the Marlins’ increase of about 450,000 still represents less than 20 percent of the league’s overall jump so far.

The PGA Tour’s decision last week to bring its digital rights in-house was more than the culmination of a nine-month analysis. It’s also the beginning of a phase that will completely overhaul and enhance the PGA Tour’s presence online and on mobile devices over the next 18 months.

By the end of 2013:

Every PGA Tour telecast will be available on multiple websites and smartphones. will have a new look and feel, including a Spanish-language version, supported by a larger team of editors, writers and operations experts.

A new PGA Tour Latinoamérica website in Spanish will provide full coverage of the tour’s new property in Latin America.

All of the tour’s content will be adaptable to any digital platform, whether it’s the iPhone, iPad, Android, Hulu or a laptop.

The tour will keep all of its digital revenue.
“More and more, people are surfing the Internet on their tablet, their smartphones or through other applications,” said Luis Goicouria, the tour’s vice president of digital operations and business development. “We’ve got to be multiplatform. Ideally when we relaunch the new site, it will work on any platform and react to whatever device you’re using.”

Goicouria was hired by the tour nine months ago, just as the evaluation of its digital strategy was beginning. He came to the tour’s Ponte Vedra Beach, Fla., headquarters from MTV, where he ran the digital operations for MTV’s Latin American business in Miami, and provided the tour with a fresh perspective from someone not in the golf industry, or even sports.

He will continue to oversee the operations side of the business, including content, while vice president Lee Bushkell, a tour veteran since 2005, will oversee media sales. Both report to Paul Johnson, senior vice president for strategic development, digital media and entertainment.

That leadership team will guide the digital business into the next era, now that the tour has decided to bring it in-house. Turner Sports had been the tour’s digital partner since 2006, but that relationship will end at the close of 2012.

The tour also considered CBS and NBC, its two broadcast partners, as potential digital partners, but Johnson ultimately recommended to Commissioner Tim Finchem that the ability to keep all of its revenue, while maintaining flexibility and control, was the best direction.

Turner had been paying the tour an undisclosed rights fee for the digital business and the two sides shared revenue. Now the tour will keep the revenue it creates from its digital rights but it will lose the annual rights fee.

“There might be times that we want to develop a new product and it won’t be profitable right away, even if it’s the right thing for the tour,” Goicouria said. “Having complete control gives us the flexibility to do that.”

The tour’s most clearly stated goal for 2013 is to make all of its tournaments available via online or mobile. That was going to be the case with or without Turner. Johnson said the tour is working with NBC and CBS to determine the technology required to do that, how many different websites and apps will have access to it, and what new advertising inventory will emerge, among other issues.

“The target is to have the telecast available on the Internet and mobile for all of our events in 2013,” Johnson said. “It might not start right away at the beginning of the year, but we’re working toward that. Having this [in-house] model in place will make it easier — maybe a little less complicated — to work across all of the TV partners.”

The tour said it will bring on Omnigon to provide the technical resources it will now need to bring this business in-house. More hires will be needed from an operational and editorial standpoint, and sales executives will be added to a small existing staff.

There also will be an emphasis for the digital team to work more closely with the corporate sales team, headed by Chief Marketing Officer Tom Wade and Jay Monahan, the tour’s senior vice president for business development.

“Digital is now so intertwined with our core business. It’s part of everything we do,” Goicouria said. “Every partner wants to have a digital extension.”

A substantial amount of work is necessary between now and Jan. 1 for the tour to move its content off of Turner’s system and onto its own. The extensions off the main tour website include pages for more than 80 tournaments, 250 players, stats, live scoring and Shot Tracker. The tour also is working to digitize all of its archived footage so that it’s fully adaptable to any digital platform.

“We’re certainly going to look at all the ways we can monetize this content,” Goicouria said. “With ad sales, highlights, archives, there are many different ways to do that. We haven’t gone to a subscription model, but it is something that we’ll look into.”