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Volume 21 No. 1


Seth Waugh thinks schools are cool.

“I love being around schools,” he tells me with a smile. “I grew up at a school, basically, and I think school is one of the coolest places on earth. That energy, that passion, people expanding themselves, growing. I like high school the best because I think there is a purity to it that’s really cool.”

That’s how my conversation starts with the longtime financial executive who led Deutsche Bank’s swift rise in the U.S. as its CEO for more than 12 years. I met him recently on a sunny, breezy Thursday morning in Florida, as he greeted me at the door of his beautiful home, looking healthy and lean in a tan sweater, khakis and loafers with no socks. He guides me through the kitchen out to the glorious beach front, where he talks up the quality of life and business opportunities in Florida. “Geography will matter more in the future than it has. I’m really bullish on Florida, in particular, and the Southeast, in general.”

Waugh, at his Florida home, says “The opportunity to reinvent yourself is pretty cool.”

The setting is a long way from The Lawrenceville School in New Jersey, where his father taught English and all five Waugh boys attended. “Five boys, we all went there, grew up and played sports there. It’s basically our home,” he said. Now Waugh is spending far more time at home after stepping down from Deutsche Bank in February 2012 to spend time with his family: wife Sheila and son Clancy. He grabs a few bottled waters, and we head into a sitting room followed by his two Cavalier King Charles Spaniels, Deacon and Gus, who are our companions during a two-hour conversation on life, learning, leading and, of course, sports. His sandy hair slicked back, Waugh has a soft-spoken, easy style, and we talk of him leaving the frenzied world of finance and his newfound free time.

“I’d been doing this for a long time,” he said. “We have one son who is now a freshman at Wake Forest playing golf, and frankly, I just ran out of time. I’d been commuting for seven years to New York, and I’d never really lived at home while he was at home. It had been 30-odd years of traveling 60 or 70 percent of the time. I really wanted to be at home.”
Last summer, Waugh hit the road and served as Clancy’s caddie as he played in three top amateur tournaments. He wrote about the experience in a fantastic piece for Golf Digest that I encourage everyone to read. “It was probably the best time of my life,” he said. “Just hanging around with him and my wife, Sheila. Being in the ropes and competing with him was fantastic, but so was all the other stuff around it. That was July and August, and then we dropped him off at school, and it was sort of ‘OK, now what do we do?’”
Waugh admitted it took a while to adjust, but he’s started the process of figuring out what’s next. “The opportunity to reinvent yourself is pretty cool,” he said.

As he says that, I hear a loud snore from Gus, whose head is propped on Waugh’s lower leg. I get a cup of coffee and we transition to his start in the financial world, where he had to decide to either follow a passion or a business career at 21.

“I went to Amherst College. When I was graduating, I had three job offers: two were in coaching/teaching, and the other was trade and commodities in Minneapolis,” he said. “I couldn’t decide what I was going to do. My then-girlfriend — now wife of 30 years — listened as I walked her through the options, and she goes, ‘You’re going to teach and coach at some point, so go do business because you don’t really know what it’s like and it’s probably easier to go from business to teaching than from teaching to business.’ I said, ‘Well that makes sense’ and I took the job.”

His rise was quick. He went from Merrill Lynch to hedge fund Quantitative Financial Strategies and then was named CEO of Deutsche Bank Americas in 2000. Leading a global operation in finance is surely intense and likely cutthroat, but for Waugh, it all came back to being happy. “I’m just a big believer that if you’re having fun and you’re happy, then you’re really good at what you do,” he said. “If you’re not, eventually, you’re playing in traffic, and it’s not going to work out. You ask any parent on earth what they’d want for their kid, and they’d say you’d like them to be healthy and happy. If that’s the case, then why aren’t we allowed to be happy? If you’re going to be banking 12 hours a day, almost seven days a week, you’re spending more time doing that than with your family. You’ve got to like it. You’ve got to have fun. Not every second; that’s unrealistic.”
Gus snores louder; clearly he’s happy. “There is a feeling that if you’re happy, you’re not working hard enough,” Waugh laughs. “There is a feeling in the corporate world that you have to be miserable. You have to be a jerk because people are expected to be a jerk. I just never believed it. I always try to make meetings fun and interesting. People felt free to talk and free to ask any question to understand what was going on. At the end of the day, we had a mission that was worthwhile. We were going somewhere and we were doing it in a way that we’d be proud of.”

So outside of being happy, how did he manage and lead?

Waugh at one time was mentioned as a possible successor to PGA Tour Commissioner Tim Finchem.

“To the extent I had a style, it was very team-oriented,” he said. “It was very collaborative. At Lawrenceville, we learned around a Harkness table. They’re oval tables that sit 12 people, and the idea of Harkness teaching is that it’s a discussion-based technique. Everybody around the table is supposed to make the other person better. I sort of have Harkness table management, where you have a lot of discussion, lead it where you want it to go, and create a consensus. I knew what I wanted to get done when I got to the table, but I wanted everybody to feel a part of what that was.”
And if they disagreed with you? “Even if they disagreed with what I was doing, I’d try to have them feel good about why I did it and the fact that they were a part of getting there,” he said. “Part of leading is making decisions, particularly hard ones, and you realize that people do want to be led. They want to be on a team, they want to have a voice, but ultimately, they want to be led.”

What about the lessons of learning to lead at a young age? He shook his head slightly, and said, “You have to be willing to fail, you have to be willing to listen, you have to be willing to live with what you did wrong and learn from it and try to repair it. The hardest part for me was, and probably still is, to not take each decision personally. You have to take it seriously and think about it in a personal way, but you have got to live with the results in a way that is not personal and not emotional. You’re going to win hopefully more than you lose, but you’re going to lose some, and you’ve got to let go of that.”

Waugh seems so kind and mild-mannered that I ask how much harder consensus-building is this way rather than being a dictator. “I never wanted to be ruled imperially and I never wanted to rule imperially,” he said. “I never wanted to come from above. It’s easier to be a dictator. It’s harder to do it the other way: It’s more time-consuming, more frustrating. You end up having a lot of conversations about ‘stuff.’ But ultimately, you have to make decisions, and you still have to explain it to everybody. People want to be part of a team, want to be proud, want to be an insider and feel good about where they are. I tried to create a culture and abide by the culture at all times and always do the right thing. Part of that culture was, No assholes allowed. Everybody knew that. Ultimately, we were going to have a big discussion, but we were going to leave the room as a team and support that decision even if you didn’t think it was 100 percent right.”
I had to press him on his “No assholes” rule. He pauses and isn’t sure he wants to use the term, but I insist it’s fine. “If you ask anybody that worked for me, my golden rule was publicly ‘No jerks,’ and privately ‘No assholes,’” he said. Could he tell an asshole during hiring? “You try to hire talent but also hire culture,” he stressed. “At the end of the day, we’ve had to wash a few out. Oftentimes, the better the producer, the bigger the jerk. If you actually take one of them out, particularly if they’re a big producer, people start going, ‘Wow, they’re actually serious about this.’ As much production as somebody does, there is an enormous amount of damage that they do because they bring down the happy factor, bring down the fun, bring down the culture, and zap energy in a way that is divisive, as well as cheat on management time. You should leave places if you think the bad guys are ruining them.”

I get a second cup of coffee and Seth gets another water. He shoots me a quizzical look and says, “This is probably boring. Don’t you want to talk about sports?”

So we shift to his thinking about when Deutsche Bank made a big and surprising move into sports by landing title sponsorship of new PGA Tour Labor Day event in Boston in 2003. “We started to look at sports after we had built something at Deutsche Bank that I was becoming proud of,” he said. “We had the right momentum, and I thought it was time to advertise that — not literally advertise, but celebrate where we were and where we were going. We needed a platform to do that. We were trying to figure out something in the U.S., specifically, that could kind of turbo-charge everything we were doing.”
Sports was his focus. “We looked at tennis, football. We looked at sponsoring people, but … we came to golf for a couple of reasons. The values are there, it hits our demographic very well in terms of our clients who are high-earners and tend to play golf. You can entertain with golf: You can’t put somebody on the field at the Super Bowl, but you can put them on the course at TPC with Tiger Woods. That’s pretty unique.”

Waugh also sought to own something the bank could brand. “Owning something for one week seemed to me more powerful than just putting your name on something repetitively over the course of a year,” he said. “It seemed to me that if we could own a town, own an event, and put that energy into that, that would be the best way to do it. I didn’t want to be just another week. I didn’t want to just take over somebody else’s event. I wanted it to be ‘the Deutsche Bank’ because that’s what we’re about and it’s about branding yourself. I wanted it to be ‘the Deutsche Bank of Boston.’ I wanted to brand it around Boston, but I didn’t want it to be Boston.”

Waugh said that golf’s hospitality opportunities, including playing with Tiger Woods, can make for “a really cool day.” 
Photo by: AP IMAGES

The event quickly became unique with its rare Monday finish on Labor Day and connection with the Tiger Woods Foundation, which resulted in Woods appearing for the first five years. It also was very successful for the brand in Waugh’s eyes.

“The sponsorship worked out better than I ever imagined. I thought it would be good, but I didn’t realize how good,” he said. When I asked what a CEO looks for besides business results in a deal, he pointed to company pride. “It really had an enormous effect on our brand in the U.S. and our culture in the U.S.,” he said proudly. “Our people took a lot of pride in it. It worked internally because people saw we’re investing in the U.S. We have pride in the event, and we could see our brand on television. You feel great about the charitable element. You feel great about the economic engine part. You feel great about the client entertainment, especially as it’s becoming increasingly hard to spend time with people. You’re spending countless hours by the time you have dinner, play, have a beer afterwards, and you’re putting them with Tiger Woods, Adam Scott or Rory McIlroy. That’s a really cool day, and that client is going to bring their kid to caddie and their wife to walk along and they’re going to have a great day in Boston and they’re going to feel really good about us. It had a bigger and wider impact than I ever imagined.”

I asked what advice he’d give to a CEO interested in this type of investment, and his answer was simple: involvement. “I felt I had to be really involved,” he said. “The only way I thought I could make sure we got a return on it was if I personally owned it. I spent a lot of time, especially the first few years, figuring out how it worked. I’d talk to players, to caddies, to wives, to volunteers. ‘How’s it going? How are we feeling? What can we do better?’ Caddies just wanted good food and parking. Back to the happy thing: I wanted anybody who came through that gate to say, ‘These guys are good guys and this is really a happy place and I want to come back here.’”

With his love of schools, learning and teaching, I close by asking his advice to young people.

He paused for a long time, gazing out toward the ocean, and spoke cautiously in saying, “What I’ve seen a lot of, particularly around New York, is dominated by Wall Street. Everybody’s parent was in the business, and every kid figures that is what they need to do. Maybe it is, but maybe it isn’t. Why not think about what else is out there and where else you could do it rather than just get on a train and go to New York and go to Wall Street. Because that’s what you think you’re supposed to do? Back to being happy and having fun — and that may not be fun. If you’re getting a 6:15 a.m. train every day and getting home at 8 at night and you don’t like what you’re doing, that’s not good. You should feel good and be good at what you do. Maybe rather than be happy, it’s to feel good about it. Everybody has got to work hard and do what they need to do, but if you’re somebody full of promise and trying to figure out what to do, then you should explore a bit.”

“I’m a big believer in liberal arts — learning about the ‘why’ early in life.”

“I’ve always been better when I went an inch deep and a mile wide,” he said. “When I have 50 things going on, I’m really efficient. Meeting after meeting after meeting, and dinner and then travel tomorrow? I’m good. You give me an empty room and no agenda, I don’t know what I’m doing. I tell kids there are two ways to do well in life. One is to go an inch wide and a mile deep and become an expert in something, and the other one is to be able to connect dots and go wide. There are times in your career where you need to go deep, you need to become an expert and get really good at it. The unique people are the ones that can connect those dots. The real game-changers are people that are taking those verticals and connecting them horizontally.

“I’m a big believer in liberal arts — learning about the ‘why’ early in life. Eventually, you’re going to have to get really narrow, but you can’t forget the ‘why.’ We get kids in high school doing internships on Wall Street. I get it: That’s a filter to get you to where you want to get to. But go mow lawns, go to Europe, experience life — because eventually if all you know is one thing, you’re not going to ever be able to connect the dots across things that are unique and see what’s wrong and what’s right. That ‘why’ part is really important.

“In your career, you’re going to get narrow, then get wide. The only way to be good at the wide is to understand the narrows. You need to have the ability to go deep, because that gives you credibility and gives you knowledge, but you don’t want to get stuck deep. Certain people just like to go deep and stay deep, and that’s fine. We all need those, but I think the unique ones are the ones that go wide.”

It’s been more than two hours, and I’ve invaded Waugh’s personal time long enough. Deacon and Gus are up and running around the house, and Waugh has a full day ahead. He offers me a water for the road, walks me out to my car, and I ask him what’s next on his schedule.

“The beauty of Wall Street for me was that every day, there were younger, smarter people than me that made me better,” he said. “I loved that part of it. I try to spend a fair amount of time in Silicon Valley now just because there is this passion and energy in what is going on out there that makes you better.” His daily schedule now is still filled, but less intense.

“I’m addicted to activity and being involved in things,” he laughs. “I’m not very good at ‘no’ and so when people ask me, I tend to want to help. I’m not good at doing things halfway, so I get fairly involved. If I’m on a board, I want to really be on the board. If somebody asks me to help their kid get a job, then I really try to help get their kid a job. As a result, I tend to get overextended. Somebody once asked me, ‘Why do you do this?’ and this is going to sound so self-serving and romantic, but I like making people’s lives better. That’s what gives me a charge. That’s my perspective running a business or being a friend. It just makes me feel good.”

With that, Waugh offers a smile and an easy shake of the hand, heading back toward the beach on the way to reinventing himself.

Abraham D. Madkour can be reached at

“Sports marketing by objectives” is the phrase we use to describe a sports marketing program that is driven by accountability to a finite set of goals that advance the overall corporate strategy in a meaningful way.

Let’s break that down a bit. Accountability means identifying desired outcomes, setting specific realistic targets, tracking performance against relevant metrics, and honestly evaluating the relative success.

Without this degree of specificity, even a successful program won’t be replicable, and worse, corporate decision-makers won’t trust the outcome because any internal evaluation will seem subjective or, worse, biased.

From the top executives’ standpoint, marketing’s only job is to advance the corporate agenda, and it is ultimately the standard to which marketing decision-makers will be held accountable. Establish this accountability up front while you are designing sponsorship programs, report robust metrics that show progress against tangible corporate goals, and you will become a valued contributor in achieving the corporate agenda. Once you earn this level of trust, it’s a much smaller step toward earning a voice in helping to help set that agenda.

Where to begin?

Each sports marketing program’s goals and objectives should be derived from those of the corporation as a whole, placed in a sports marketing context. For each broad goal, such as revenue, there are many possible sub-goals, such as customer acquisition or retention, which may contribute to success.

For the specific sports marketing program, identify the sub-goals that could be targeted. Using the example of customer acquisition, key questions include:

How does your company acquire customers? This will help you to identify the consumer demographics and the factors in their purchase decisions, and determine which sponsorship opportunities are relevant.

How can this specific sponsorship investment attract new customers by increasing the volume or efficiency of one or more steps on that customer acquisition pathway?

How could the sponsorship proposal be fine-tuned to make customer acquisition as efficient and effective as possible in this program?

One of the traditional methods of looking at customer acquisition is the “purchase funnel.” A typical purchase funnel may have the following components:


As we move down the funnel, the raw number of consumers goes down, while the per-consumer value goes up. Broadly speaking, the two ways to increase sales are to channel more people into the top of the funnel by increasing awareness, or to increase the percentage that transition from one level to the next.

A sponsorship marketing program could be targeted at increasing awareness to drive more consumers into the funnel, improving the degree of connection with the brand to move consumers down the funnel, or both.

An awareness-focused campaign is generally more expensive, given the wider net a company must cast. With a smaller budget, sponsorship can be very efficient at driving desired behavior from those already in the funnel, since you already know much more about them.

Each goal must have an objective set of measures that can be used for evaluation. If it can’t be measured — so-called “soft goals” — it can’t be affected, and any resources devoted to such goals are essentially wasted from the perspective of corporate decision-makers.

Trial vs. preference

Let’s look deeper at two of the funnel levels: trial and preference. Each can be addressed in a sponsorship marketing program, but measurement and accountability work a little differently.

Trial is relatively easy as a sub-goal. If you tie your sports marketing program to a coupon or other redemption channel, such as a dedicated website, it’s easy to track how many consumers tried your product or service as a result of contact with the sports marketing program. The numbers can then be compared with other previous marketing programs to determine relative efficiency.

Nike wanted to lasso the Jordan brand halo for its entire product line.

This type of direct feedback also makes it easy to try out various tactics within the program to see which work best, such as on-site activation versus a Web-based contest. Adjustments may be made as the program moves forward, driving increased efficiency. This approach gives sponsorship marketing an advantage over mass-media marketing, which is much harder to adjust midstream.

The necessary follow-up step is to compare the conversion rate of those who try your product via sponsorship marketing versus those who engage in trial through another marketing channel:

Which one of these generates a higher percentage of long-term customers?

Which type of customer buys more volume, or opts for the more premium offering?

Preference, sometimes coupled with loyalty, is another common goal of a sponsorship marketing program. This frequently is where the idea of brand association comes into play.

Bic reaches for the rugged outdoorsman market with the Tough Mudder sponsorship. 

When Nike went all-in to associate its brand with Michael Jordan, the company wasn’t merely courting the handful of elite basketball players who could approach Jordan’s on-court skills. They wanted to lasso the Jordan brand halo for its entire product line. In a more recent example, Bic razors’ sponsorship of the Tough Mudder races may be an attempt to associate shaving with extreme manliness, battling the rising tide of rugged, three-day beards in popular culture.

Preference also can be measured, traditionally by using consumer research. One problem with the consumer-research method, though, is that typically there is a significant time lag between the consumer contact and when you get data, making it more difficult to fine-tune tactics. This may work best on a multiyear sponsorship.

Communicate success

Ideally, the measures should have a degree of consistency over time in order to evaluate whether you’re doing better or worse than before, allowing you to communicate the ongoing success of your program.

But don’t remain wedded to outdated goals just for the sake of comparability. Identifying the measures you will use beforehand not only saves time and trouble later, but it also can help the entire sports marketing team to focus on desired outcomes. By communicating these goals internally, those outside the marketing department will more easily recognize whether their initiatives could help — or may indeed hinder — what you’re trying to accomplish.

For the community relations group, the sports marketing program may provide themes or access to celebrities that would offer an ability to generate positive news coverage in a fresh new way. Major corporate financial announcements can be timed to take advantage of attention generated by the sports marketing program, or to avoid competing for media attention. After all, you don’t want your all-star spokesman to be fielding questions about layoffs or plant closures.

The result is a more productive, integrated team effort that recognizes the value and contributions of your programs.

Raymond Bednar ( specializes in advising and implementing optimization strategies for investments in marketing channels at Hyperion Marketing Returns - Rockefeller Consulting in New York City.

It’s time to face facts: We are standing on the precipice of an inactivity epidemic that will rob our industry of billions of dollars over the next few years. As sports and fitness leaders, we have a responsibility to reverse these trends.

Research from Sports Marketing Surveys Inc. shows the percentage of inactive or totally sedentary Americans increased from 25 percent in 2007 to 28 percent in 2012. This represents 10 million active Americans becoming “couch potatoes” in that five-year span. Perhaps most eye-opening, this number is projected to balloon to more than 31 percent by 2018.

For our industry, that increase will represent a painful $28 billion reduction in sports and fitness retail consumption alone. Fandom also will be affected, with research showing that fandom drops dramatically when Americans become inactive.

The Physical Activity Council classifies Americans in three categories:

1. Inactive or sedentary: Not active in any of 104 activities once in the last year.

2. Active: Participating in any of the 104 common sports or fitness activities.

3. Active to healthy standards: Participating three or more times per week in any of the 104 activities.

According to the council, an “active” person spends twice as much on sports clothing, footwear and equipment as an “inactive” person. People who are “active to healthy standards” spend three times as much. The council also indicates that fandom increases by as much as 100 percent when “inactive” Americans become “active.” These statistics reveal not only what is at stake as the inactivity pandemic continues, but it also should convey the urgency of action required.

PHIT America is a campaign and cause launched in 2013 to encourage regular exercise and physical activity. We know the sports industry has long catered to the most-frequent participants, but all of us have to think about the total market of active Americans. In order to preserve the market as we know it and reverse the damage done by this inactivity snowball, PHIT America believes companies must begin to invest in programs and initiatives with two goals in mind:

1. Creating more individual sport programs focused on a fun and social experience for the average participant.

2. Working together to fight the inactivity pandemic by converting couch potatoes into active and healthy consumers.

There are examples of sport programs that are beginning to reverse the trend, but we need more effort from everyone to get America moving. To fight the inactivity pandemic, we need to focus considerable effort and investment on making sports and fitness participation more relevant in the minds of Americans. By informing people of the importance of staying active, we can improve the overall health of the country and significantly grow our customer base. At a time when more Americans are watching sports than ever before, it is our responsibility to come together to make activity and fitness a bigger priority.

In March, PHIT America joined together with athlete and industry partners for the SFIA National Health Through Fitness Day in Washington, D.C. During this day of lobbying, we met with congressional leaders to share the benefits of physical activity for individuals and the country, and to urge them to support the Personal Health Investment Today (PHIT) Act.

If passed, the PHIT Act would allow Americans to use pre-tax dollars on fitness-related expenses, including everything from soccer cleats to gym memberships. This financial incentive encourages Americans of all ages to stay active. At a time when Congress does not agree on much, this piece of legislation boasts strong bipartisan support: Introduced in the House in March 2013, the bill has 19 Democrats and 17 Republicans as co-sponsors.

PHIT America, together with more than 150 sponsors, is working to create what’s called the Movement for a Fit and Healthy America through a coordinated mix of education, advocacy and grassroots campaigns. Every company, organization, retailer, league and national governing body should be part of this cause and campaign. It is critical for everyone in this industry to work together to combat the inactivity epidemic head-on.

Jim Baugh ( is president and CEO of PHIT America (

In “How use of business analytics could have benefited union” (SportsBusiness Journal, April 14-20), author Charles Grantham, who served as executive director of the National Basketball Players Association from 1988 until 1995, suggests that players’ unions would benefit from a greater use of analytics. Mr. Grantham’s article contains several factual inaccuracies and misleading assertions.

Mr. Grantham refers to both “tighter salary caps” faced by players and “financial footing lost over the last 20 years.” To the contrary, since 1994 the NBA salary cap has grown from $16 million to over $58 million, and NBA players have seen their average salary nearly triple from approximately $1.8 million to $5.2 million, the highest in all of professional team sports.

In questioning the purposes and effects of the NBA’s rookie salary scale, Mr. Grantham asserts that salary saved on rookie contracts goes back to NBA teams. The CBA expressly guarantees that players in total will receive approximately 50 percent of specified leaguewide revenues each year. As a result, the rookie scale has no effect whatsoever on total player compensation.

In discussing the importance of tracking league revenue to ensure that players receive their designated share, Mr. Grantham states that “leagues block union access” to important financial information. In fact, an accounting firm jointly retained by the NBA and the Players Association audits league and team revenues each year precisely to ensure that NBA players receive their CBA-specified share. The NBA also has elected to turn over to the Players Association extensive additional financial information during past rounds of collective bargaining, including audited league and team financial statements.

Finally, Mr. Grantham recommends that a larger percentage of players compensation be deferred as a means of helping players “relieve some of the financial stresses of retirement.” We agree and proposed doing so in our most recent negotiations. Yet it should be noted that NBA players already receive, in addition to their salaries, a team-funded pension, a 401(k) plan with a 140 percent employer match, and other substantial post-retirement benefits.

Mike Bass
NBA Executive Vice President, Communications
New York