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Volume 26 No. 208
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SBJ Unpacks: The Road Ahead -- Team Leaders Dish On Key Issues

More than 400 attendees heard leaders from throughout the sports industry today during SBJ's "The Road Ahead" virtual event series. A few comments stood out to me:

  • LPGA commissioner Mike Whan said, “I won’t mortgage the future to make 2020 look better.” That’s an incredibly challenging mindset -- in any aspect of life -- to maintain during a year where the situation has changed so fast, so often, and looking ahead often seems like a pointless effort.

  • Legends' Bill Rhoda expects fans to see cleaning personnel much more prominently at venues than in the past -- before, during and after events. Rhoda thinks the pandemic will have the same effect on cleanliness and the hygiene of public areas that the 9-11 terrorism attacks had on security. 

  • And the USTA's Deanne Pownall talked about trying to recreate some of the U.S. Open experience in fans’ homes, including the tournament’s famous Honey Deuce cocktail. A Honey Deuce sounds pretty good right about now.

-- Bret McCormick

 

INDUSTRY LEADERS ON THE TIMES AHEAD

  • At today's "The Road Ahead" virtual event series, leaders across sports business identified the story or issue they’ll be eyeing most closely in the weeks and months ahead.

    • Dolphins President & CEO Tom Garfinkel: “I don’t know that it’s a specific sports business story. I think I’m consumed with kind of where we are as a society. This is an important time in history. The polarization of our society, the marginalization of facts and truth, the ubiquity of yellow journalism. The need for leadership, like we talked about, that’s rational and courageous.”

    • Blues President & CEO of Business Operations Chris Zimmerman: “Quite honestly I’d say it has to do with what’s going on in Washington (DC) and what they’re going to do next in terms of the HEROES Act or any other major stimulus programs.”

    • Hawks CEO Steve Koonin: "I am amazed at the power of the sports gambler. The stock market had one of the great economic rebounds from March until recently. There’s a lot of belief that it was sports gamblers looking for action. … If sports gaming becomes legal around the country ... it’s going to be a major economic factor that changes a lot of behavior in sports. I think we’re just on the beginning of that story and I think it’s going to be a massive one.”



PANDEMIC ACCELERATING CHANGE ACROSS TV PRODUCTION

  • Sports TV production has been forced to evolve amid the pandemic, with leagues and networks adapting on the fly to increase access and innovation for viewers. Both NASCAR races and PGA Tour events have used drone footage to showcase unique camera angles, while ESPN has been pumping in fake crowd noise for the network's coverage of baseball in South Korea to make up for no fans in attendance. 

  • ESPN Senior VP/Production & Remote Events Mark Gross today as part of "The Road Ahead" virtual event series said he initially thought fake crowd noise would not “sound authentic” and would come off “just a little bit cheesy.” Gross: “We were pleasantly surprised from day one that it actually sounds good. It's at the right level -- it's not overwhelming.” 

  • Golf Channel Exec VP/Content & Exec Producer Molly Solomon opted against crowd noise for PGA Tour coverage, but did convince Rickie Fowler to be mic’d up in Ft. Worth earlier this month. Solomon said mic’d players had long been a goal, and the current situation across the sports landscape “opened up doors” to try something new. Solomon: “There are going to be so many innovations that come out of this. … When we get all our toys back that it is going to prove really, really fruitful.” 

  • What do these recent developments mean for viewers moving forward? SBJ’s John Ourand notes the key for TV networks is “all about getting more access.” Networks expect these crowd-less games to let leagues and athletes become more comfortable with providing that peak behind the curtain. Ourand: “Once networks get that access, it's unlikely to go away.”


Fowler wore a microphone for the PGA Tour's return in Ft. Worth earlier this month
Fowler wore a microphone for the PGA Tour's return in Ft. Worth earlier this month
Fowler wore a microphone for the PGA Tour's return in Ft. Worth earlier this month

 

LOSS OF MiLB SEASON HITS HOME FOR BOTH STAKEHOLDERS & FANS

  • While Minor League Baseball's announcement this afternoon that the season is canceled was a foregone conclusion, the news was no less devastating for executives, players and various stakeholders in the 160-team MiLB world, writes SBJ's Eric Prisbell.

  • More than 41.5 million fans in 2019 attended minor league games, which are a timeless, indelible part of American culture. MiLB Senior Director of Communications Jeff Lantz told SBJ in early April that the traditional season would not be played if fans could not attend games because teams need ticket and concession revenue just to offset gameday operational costs. Almost three months later, there is still no clarity on when fans will return to sporting venues. 

  • MLB informed MiLB that it will not be providing its affiliated teams with players this season. Instead, MLB will use "taxi squads" for players to help bolster depth on major league rosters. The cancellation of this season is especially painful for fans because it comes at the same time MiLB is expected to contract some 40 teams once it and MLB reach an agreement over a new Professional Baseball Agreement. It remains to be seen just how deeply other MiLB teams, many of which have been hit hard by furloughs and layoffs, will be affected by the loss of a 2020 season.

 

SAFETY PRECAUTIONS PARAMOUNT AS MLB PLAYERS REPORT

  • Here is what MLB players can expect as they report tomorrow to their respective Summer Camp sites, according to SBJ's Eric Prisbell.

    • They will all undergo a multifaceted intake screening, with staggered appointment times to prevent groups from congregating during the process. The screening consists of at least three components:

      • A temperature check with a contactless thermometer administered by a representative of the team's medical staff.
      • A saliva-based or nasal swab diagnostic COVID test.
      • And a venous blood collection or dried blood spot sample for antibody testing. 

    • Players then will be required to self-quarantine at their residence until results are reported some 24-48 hours later. If results are negative, the player may then report to Summer Camp and enter the team's facilities. If the results are positive, he will continue to self-isolate and will be treated consistent with other protocols for positive test results. 

  • As far as expectations go, Yankees Senior VP & GM Brian Cashman said in a conference call today that he doesn't expect all players to be ready to start camp Friday because of the staggered intake screening appointment times and because of potential logistical challenges related to travel. 

 

MORE NFL TEAMS OFFERING FANS AN OUT FOR 2020

  • At least one quarter of the NFL is now allowing season-ticket holders to skip 2020 with no negative implications for their long-term relationship with the club, reports SBJ’s Ben Fischer. The Bills, Dolphins, Texans and Rams can be added to the list that previously included the Patriots, Giants, Jets and Bears

  • Dolphins President & CEO Tom Garfinkel told "The Road Ahead" virtual event series that any Dolphins fan who considers themselves at an elevated risk for COVID-19 will be allowed to roll their accounts over to 2021 and miss 2020. The Dolphins are particularly concerned about fans over 65, a group for whom the disease is more deadly, a spokesperson said. The Bills, Texans and Rams also issued similar offers to any season-ticket holder, without tying it to risk status.

  • With virtually every aspect of NFL ticketing still up the air, the Bills took the additional step of saying they “will not be charging or taking any additional season ticket payments” until guidelines are established. The list of teams offering a year off is likely to grow, and it may not include teams that did not reply to SBJ inquiries or publish their letter to ticket holders.

  • Allowing ticket holders to skip 2020 may ease the challenge teams face of deciding which fans can attend if attendance is capped by law, but it creates another one: Demands for refunds. The Texans are offering a 10% credit on food, beverages and merchandise as an incentive to roll over their accounts rather than seek a refund.

 

 

SOUNDERS’ HEALTHCARE PARTNERS ENGAGING AMID PANDEMIC

  • Teams and leagues have been trying to figure out ways to stay engaged with their fan bases during the pandemic, and the Sounders have been able to do so by “acknowledging and joining the conversation on the public health side,” according to Manager of Corporate Partnership Sales Enoch Andoh. As part of SBJ’s “The Road Ahead” series, Andoh today said teams have to accept that their “goals and initiatives and objectives kind of shifted through all of this.”

  • Andoh: “A lot of assets we can't deliver on because they're match-date related. And so a lot of interesting conversations. But we’re trying to get creative with our partners and really just being able to help them with their messaging, as that's even shifted multiple times in the last three months.” Andoh noted the MLS is Back tournament is seeing a “shift to virtual kind of signage … which is great in some respects, but not every partnership is focused on ticketing or signage and impressions.” 

  • Also on today’s panel was Tom Kruse, chief strategy, integration & innovation officer at CHI Franciscan, whose healthcare firm is the Sounders’ training jersey partner. He said the team’s strong fan base has been a benefit during the pandemic. Kruse: “(If) you can get people to believe that this organization believes in us, believes in our providers, appreciates our providers -- that goes so much further than the LED sign we're missing out on.”

  • Marketing agency Bendigo Founder & Principal Jeff Sofka noted the Sounders early during the pandemic created a project allowing fans to “put up their community heroes and present them in a way that saluted them online.” Sofka: “It was great. We moved it fast, it's been an important part of the whole digital landscape and social media that the Sounders have done around CHI Franciscan.” Sofka noted the company is “pretty close to finalizing some really amazing amplifications of that” around MLS’ return. 

 

APPAREL, FOOTWEAR SALES REFLECT NEW REALITY

  • During a Sports & Fitness Industry Association webinar today, NPD industry analyst Matt Powell painted a bleak picture for most sports apparel and footwear sales during the pandemic, but noted some industry resilience, with sales spikes in home exercise equipment. Ecommerce, of course, is rocketing, writes SBJ's Terry Lefton.

  • “Going into the pandemic, we said ecommerce’s potion of athletic footwear sales would grow from 30 percent to 50 percent in five to 10 years,’’ Powell said. “That time frame has been cut in half.’’ Government-enforced shutdown of most sporting sporting-goods retailers exacerbated what was already an over-retailed category. Powell said that 9,000 retail doors closed in 2019 and that 20,000-25,000 doors would close this year.
     
  • Athletic footwear illustrated the overall industry difficulties, since it was up 3% for the first two months of the year, before crashing 32% for March-May. Early indicators for June sales were up double-digits, however, with the running category trending well. “Coming out of the pandemic, people are going to more focused on healthy lifestyle, so running should be strong,’’ Powell said. 

  • By brand, Nike footwear sales declined 20% for the first five months. Nike’s Jordan Brand was down only 6%, buoyed by “The Last Dance” documentary. Adidas, Skechers and New Balance footwear sales also dipped around 20%. 

  • Sports apparel/activewear had its own roller-coaster ride, up 1% during the first two months of 2020, but down 18% for the year through April. Not surprisingly, sweatpants were one of few bright spots, since it’s “the work-from home uniform,’’ according to Powell. On the equipment side, health and fitness equipment sales climbed a remarkable 63% for the first four months of 2020.

  • As for holiday sales being a possible panacea? “I'm not real optimistic,’’ Powell said. “We’ve got millions of people out of work and I think we’re going to be in a very challenged position for a while. There isn’t a quick snap-back for the business.’’
 
 

ICYMI: OUTSIDE CONTRIBUTORS -- DRAWING UP A GAME PLAN

  • Tonight's op-ed is from sports media consultants Ed Desser and John Kosner, who write under the header, "Thoughtful, Creative Planning Will Put New Normal Into Focus."
  • "Re-think. Have you put your most pressing problems into priority order? With revenue prospects down, how best to trim expenses? What do your media and sponsorship agreements state in terms of force majeure, and compensation adjustment procedures? How best to maintain these vital relationships? We are just beginning to understand the ramifications of COVID from a media rights perspective. Anticipate some form of renegotiation."
  • To read Desser and Kosner's full contribution, click here

 

CHECK OUT THIS WEEK'S SBJ

 

SPEED READS

  • As he approaches the end of a 24-year run as ACC commissioner, John Swofford said he’s encouraged by the way conferences and institutions are working together to solve the riddles caused by COVID-19. Swofford: “There’s a more cooperative spirit in college athletics than I’ve seen, especially conference to conference. The sharing of information, the sharing of best practices, it’s going to be critical to whatever the outcome is on playing or not playing.” See more from Swofford in tonight's SBJ College from Michael Smith, as well as a look at why Learfield IMG College and Under Armour aren’t immune to the country’s economic upheaval.

  • NFLPA President JC Tretter today in an open letter to players "warned that the fight for safety amid COVID-19 has only just begun and that football won’t happen until the membership feels safe." Tretter: "Professional athletes in every sport have to regularly fend off criticism that our profession should be considered less of a job and that we shouldn’t fight for protections and benefits. As we begin our fight for necessary COVID-19 protections, these recycled misconceptions will be used to undermine the strength of our union and the legitimacy of your career.‘' The full letter can be read here.

  • Home workout solutions remain in high demand amid the pandemic, as today Lululemon agreed to acquire startup Mirror for $500 million. Per Techcrunch's Anthony Ha, even when gyms "begin to reopen in different locales, many will likely be wary of returning to a potentially high-risk enclosed space." Lululemon also became an investor in Mirror late last year.

  • Two members of the Nuggets’ traveling party "tested positive for the coronavirus over the weekend, prompting the team to close its facilities," according to the Denver Post. A source said that since the weekend, "another member of the traveling party has tested positive." That brings the Nuggets' total to "at least six confirmed cases since the season’s suspension." A source said that the facility is "expected to be closed through at least Thursday, with the possibility of re-opening the gym Friday."

  • The Wall Street Journal's Laine Higgins writes when the pandemic shut down American sports in March, college football "had the benefit of time." But now with the season two months away, the virus is "surging strongly, especially in places, like the South, where college football is king." University administrators are "coming to grips with an unhappy reality: the biggest stadiums in the U.S. are going to look pretty lonely on Saturday afternoons." 

 

NEWS YOU NEED FROM SPORTS BUSINESS DAILY

 

SBJ UNPACKS -- THE ROAD AHEAD

 

 

 

Something related to coronavirus and sports business catch your eye? Tell us about it. Reach out to Austin Karp (akarp@sportsbusinessjournal.com) and we'll share the best of it.