Sports, Technology, and the Aura: SEAT 2013

Summary:SEAT 2013 is the premier sports executive conference. It stands for Sports Entertainment Alliance in Technology and 450 sports execs gather to discuss and share best practices and issues impact the entire sports world and are worth looking at for CRM and social - customer facing strategies and tactics. Take a gander.

I love sports.  When I went to Northwestern back in the day, given that I wasn’t terribly gifted as an athlete, though could hit a baseball pretty well and had awesome hands as a receiver, I figured I could be a sports reporter or sports broadcaster, a life I saw as decidedly cool and glamorous.  Well, let’s just say life took me in other directions – for a long time more crusading directions –and I didn’t end up with the job of my youthful dreams.  Yet, my love of sports – team sports – continued unimpeded.

So here it is, many decades later and I’m just finished with a speaking gig (of a kind) at SEAT 2013 – an acronym for Sports Entertainment Alliance in Technology. Do the English and you’ll figure it out. I know you’re smart.

SEAT 2013 is a conference of sports executives and leaders primarily though not exclusively focused on technology systems in sports. It is becoming if it isn’t already, THE event for the technology-related and technology-savvy sports executives – which is a considerable number. The spectrum of attendees is genuinely awe-inspiring.  It ranges from the (for example) President of the Kansas City Chiefs NFL team to the founder of college ticket provider Paciolan to the CRM guru for the New York Jets to the CIO/CTOs of multiple leagues (NBA, MLB, NFL, MLS).

The core themes – which will give you a BIG hint as to why I was there are – CIO level discussion; social media and, ta da, CRM.

In fact, there is an intensive focus on CRM that is refreshing.  A solid 2.5 days of CRM discussions and, separately, social media discussions – that are fascinating in what they reveal about the sports world as a vertical industry – both good and in need of solution.

The Conference

Before I get into some of the insights from this fascinating and extremely enjoyable group of people, let me tell you a little about the nature of this well run conference. SEAT is the brainchild of Christine Stoffel and Chris Dill, a duo who own a sports consulting/events management firm – which is pretty much the two of them with some support for specific events and a group of young mentees who are all bright, detail oriented and locked into contemporary communications. This small staff coordinates an event of big aura people with style and a strong twist of creativity and uniqueness that shows itself in the little things like food choice for breaks or evening events.  Additionally, all the expected norms for events are done without any visible glitches. Given that there are always glitches, this is a good thing; the conference attendees don’t know that the glitches occurred because they were handled.

The content and its organization are designed to both maximize the value the attendees who pay a fair amount to attend and the sponsors which often means tradeoffs and balance. The host city which obviously will have major league sports teams sits on the stage, as do the sponsors, the speakers who are often associated with the attendees teams or leagues or sports and the speakers who aren’t (like me). So there is a lot to balance but Chris/tine and company pull it off with aplomb.

They pay attention to details – such as making sure there is great Wi-Fi – which , I am happy to say there was – and it was entirely separate from the hotel’s Wi-Fi.  They make sure that the snacks are interesting – one 3pm break featured soft pretzels with two types of sea salt, 5 types of mustard and for a drink Java Monster – cold caffeine both light and normal and dark varieties.   Their younger staff were both actively participating in the infrastructural and logistics and acting as good will ambassadors. For example, one of them, a recent college graduate, BJ Scott, not only was a high volume tweeter throughout the conference (he used the hashtag #SEAT2013) as his primary vehicle, but he proved to be a great evangelist for the conference and made a point of circulating in any of his spare time to see that the attendees were getting what they needed. Plus he’s a really smart guy and asked questions so he could learn as he rolled. The staff there rocked.

Are there things that I thought could be tweaked? Sure.  I’m going to talk to Christine about them and make sure I get my observations to her.  The one issue that I saw at the conference – and it might have been the only one, is that a few of the vendors were selling way too hard on the stage with a range of b.s. that went from straight pitches to one vendor who literally attacked a “class” of vendors – “big vendors who don’t really understand you sports people like I do” in effect being what they said (though close to a paraphrase actually).  To show you how well handled this conference was, when I raised it to Christine, she had already had the conversations she needed to have and the problem had been handled.  Amen, sister. 

There’s so much more I could talk about but that’s not really the subject of this piece. But in sum, the folks who ran this show – all of them – deserve a round of applause (Clap! Clap! Clap! +70(INCREASING IN VOLUME) and finally dying out).

The State of the State in Sports

Okay, let’s start to nail down what’s going on the sports “vertical” when it comes to CRM/SCRM and customer facing technology. Some of this is based on my general study and activity in the space, the rest on what I learned from the conference.

I don’t know if you noticed the “” around vertical but sports represents something so unusual, it’s hard to think of it as a vertical industry though of course it is.  But it’s different.

Know why?  It has an aura.

In order to understand sports strengths and weaknesses from an industry perspective, you have to understand the aura and the reality.

A sports team’s aura is that it is this huge enterprise that has vast resources that are devoted to gargantuan endeavors – chief of which is paying its athletes salaries which seem to be beyond the ken of mortals.  Think about the bubble that the sports world is in and also that it projects.  You hear every day of the year that so and so, who went 16-5 with a 2.58 ERA signed a multiyear contract for only $7 million a year and that was a steal given his upside.  Only?  How many people do you know that make that in a lifetime?

OR

That so and so had a horrible year, batting .237 with 44 RBIs so he was given a salary bump by the arbitration guy of only $750,000.  Only?  In the real world, the equivalent decline in other business workers’ productivity gets them fired. 

Yet, we all accept this as a norm – and honestly, as absurd as all this sounds, it’s a norm that we don’t begrudge if they produce for “our team.”  Our identification with these teams is so strong there are endless debates on sports talk radio and TV about how “our” money is being spent on players that we don’t think it should be spent.  Since when is it our money? I personally don’t remember buying the Yankees. You?

But that’s the aura representing. It’s the aura of a gigantic enterprise engaged in huge deals for Olympian (in the gods on Mt. Olympus sense) results that lead to massive outbursts of civic pride and love or disgust when things go wrong.  Because the Kansas City Royals are having their best year in the last more than a decade, civic pride is everywhere (The conference was held in Kansas City). In restaurants, at bars, on street corners at random, in the hotel I stayed at – the very nice, kind of lively Sheraton KC at Crowne Center, there were constant and highly intelligent conversations going on randomly among the citizens of the city about the Royals - everywhere.  Last time I saw this near ubiquity was in Green Bay.

The aura of sports supersedes the business reality by a long shot. When it gets down to it, at best, sports teams are on the upper end of the mid-market.  They are not enterprises with oodles of cash and lots of staff.  The largest of them, my suffering-this-year New York Yankees is, even if you include its regional sports network (which is an independent entity actually) is a $2 billion business – barely bordering on an enterprise. Most of my clients are far bigger than they are.  

But the aura persists and the fan’s expectations are based on what they think sports teams have to deliver, besides winners.  They are expecting an optimum experience each time they touch the team – be it at the ballpark or on TV or at some other event. Which means assigning staff and spending money that many teams, especially small market teams just don’t have.

This is compounded by the fact that sports teams are hugely competitive – though not how you would think. Most of you will think that the competition is on the field – and it is to some extent.  But the business competition is among the vendors who you spend your discretionary dollars on or inertia. Thus business competition is:

  1. Anything you spend a discretionary dollar in any way which could be a movie, a piece of electronic equipment for a home theater, a night at a great restaurant, Disneyland, etc.
  2. Any local event that is going on during the game or is a discretionary spend in general.
  3. They compete with themselves on TV.

At the SEAT conference, there were multiple discussions around the fan experience at the stadium in the context of competing with fans staying at home and watching the game on TV so they are all (in all sports) trying to optimize the in-person venue experience so that fans will want to come out sometimes, rather than watching the game on TV. The two problems that they have to deal with are:

  1. Inertia - fans would just as soon stay home as go to a ballpark.
  2. TV contracts – the TV rights are expensive and TV stations are more interested in eyeballs, than feet, so to speak.  So sports teams have to trend carefully trying to drive fans from TV to the park.

But the competition gets tougher than that.  For example, until they got their business act together, the up and down Premier League Football team, the Norwich City Canaries, competed with the fact that farmers (they are in a semi-rural area) worked on Sundays – game days.  Not exactly what you would expect for competition. Yet, the stadium was nearly empty.  They spent a year plus re-examining their business model, fan strategy and realized that they needed to make massive changes – and they proceeded to do more than talk about them. They actually changed them. The results are staggering – seven successful businesses from ticketing to events to merchandising to catering, a full stadium (6000) with a 3 year wait on season’s tickets.  Among many other things.

There is one other consideration concerning the aura of sports that actually occurred to me while I was at the conference.

We all tend to think that there is a ready-made audience for sports if they can capture it and focus their attentions correctly – and that would be the fans. The dogma about fans is that they are passionate and committed to the teams that they root for.

That’s correct.  But incomplete.

Fans are devoted to teams (e.g. NY Yankees) and their sports (e.g. NASCAR) but they are not advocates for the business.  They have little to no interest in helping a team sell their tickets, memorabilia, food, corporate events etc.

Yet, there is precedent for passionate devotees supporting sales.  The community retail model is built around this in fact.  Karmaloop’s street teams are a living proof of passionate members of the online retail clothier’s community who are literally selling Karmaloop’s varying brands and getting rewarded for it.  Here’s a case study for you to look at that will give you an idea what Karmaloop does. Not sports, but a high touch retail industry that has passionate brand advocates nonetheless.

The real dilemma for sports is how to take this highly passionate fan base with somewhat inflated expectations and meet the expectations, and still make money when they have the resources of an organizations that is smaller than the perception of the fans and the demands of the fans really allow.

There are a couple of other that I noticed at the event which may or may not be pervasive but is in any case are noticeable problems.

The Problem:  the sports industry seems to believe something of an urban myth. It goes, “we are behind the rest of the world when it comes to programs, engagement, fan involvement and the systems and the technology that enable it.”

The reality is that they aren’t very far behind when it comes to specific tactics that they engage in with the fans.  Each of them has a program or a technology that they are implementing (or more) that are geared toward fan engagement.

But what isn’t present in any large way is a programmatic, strategic effort – any real holistic planning on the part of the teams or the sports themselves when it comes to either CRM or social channel communication – which is (wrongly) treated as separate in many of the organizations that were represented among the 450 conference attendees.

For example, when someone leading a panel in the CRM track asked how many of the 100+ attending the track had a strategic CRM plan, literally four raised their hand. That was it.

But, that said, when they have a strategic plan – when the idea of engagement is deep into their DNA they can be brilliant.

Take note of what might be my favorite sports team strategy – the Philadelphia Flyers.  Check out this case study.

What makes this strategic is that it is across the entire organization, is deeply rooted in the culture of the organization, and involves every single employee. It also has a distinct return on investment (ROI) and results that benefit the whole team not just the sales deaprtment. 

The Problem: they also have this very narrow (almost myopic) focus (as expressed to me by many at the conference) on ticketing, sometimes to the exclusion of all else.

This was a pervasive comment to me from multiple executives. It gets expressed other ways too – along the lines of – “how can I convince my organization about the need for CRM since we always sell out all seats?”

The answer is simple. If you’re only concerned or primarily concerned with tickets, then you are leaving many other revenue opportunities on the table.  Too much to go through in this post, but see the example of the Norwich City Canaries above. 

The Problem: There is a distinct separation between social and CRM in the sports organizations.  They are not taking advantage of the opportunities that are there for brilliant and deep personal information from their individual fans that can be put in a system of record and then worked with to gain insight into the individual fans including the season’s ticket holder.  CRM in its current social form is ideal for these sports teams.

The Technology

SEAT 2013 confirmed what has been obvious when it comes to sports  technology.

  1. Microsoft Dynamics CRM dominates the team sports world. I mean totally dominates. Salesforce is there, SAP is starting to show up, but MSFT is the leader by  far.
  2. There is a unique particular requirement for sports which is that the CRM applications have to link to ticketing systems. There are 3 of prominence that the sports world deals with. Ticketmaster, Paciolan (which has a huge college footprint) and Tickets.com.  The links to the ticket data (which the varying firms are now willing to provide to some extent) is vital to the teams.
  3. Just like the rest of the world, they are now beginning the marketing automation journey, but because their fan base is highly tech savvy – described by more than one sports executive there as “early adapters” they are looking into social marketing as part of what interests them and have a strong interest in mobile.  ClickDimensions, which I hadn’t seen in two years, was there and gave me a demo of their marketing automation platform – and trust me – it is good and in the price range of a mid-market company.
  4. The other technology that got a lot of discussion beyond CRM was Wi-Fi.  This was a bit strange because one exec in a session said that “Wi-FI at stadiums has to be as ubiquitous as bathrooms.”  The strange part is that I think this has been evident for about 5 years. The problem is of course, 40,000 people trying to use Wi-Fi at once chews up a LOT of bandwidth.  They seem to have reached the conclusion that this is something that they have to do in any case.
  5. Saw one cool technology called FanCam which essentially can take a picture of a 90,000 person stadium and drill down to a closeup of any individual there. They have tagging and even the ability to use video with an individual picture. They also have a highly effective mobile app and can tie social streams to the picture. This is a 50,000 megapixel photo that as the founder put it “if printed it would be 3 times the size of a football field.”  See the technology at CRM Evolution to get a sense of  how you can use the FanCam for customer experience.

 A Shout out to the Strategists

There were a lot of executives at the event but a few particularly stood our for their strategic savvy in their presentations or in conversations.  Among the best were:

  1. Russell Scibetti, Director of Relationship Management, New York Jets 
  2. Charlie Shin Senior Director CRM and Fan Engagement, Major League Soccer (MLS)
  3. Steve Hank, Assistant Athletic Director, Arizona State University
  4. Mark Donovan, President,  Kansas City Chiefs

What distinguished these folks was that they were all thinking across siloes.  Russell, someone I've known for quite a while, not only thinks strategically but acts that way (as do the others).  He thinks about the Jets from the standpoint of "mutually beneficial value" rather than just how to sell tickets better. He thinks about fan engagement and he also thinks conceptually, being author of a blog called "The Business of Sports" that covers the entire industry.  Big stuff.  The other three are more focused on their own particular sport, but have the same broad analytical skills and apply them to their programs - Charlie to the entirety of Major League Soccer, Steve to Arizona State University (he is so good that I covered him in CRM at the Speed of Light) and Mark Donovan across the KC Chiefs board.  Russell and Charlie will be on the sports panel at CRM Evolution next week - well worth taking in. 

So for now that's it. Of course, I will continue to cover this amazing vertical - because of its unique properties and because I'm a HUGE sports fan.  For now, though, I just need the Yankees to get hot. 

Topics: TechBizz, Software, Wi-Fi

About

In addition to being the author of the best-selling CRM at the Speed of Light: Social CRM Strategies, Tools, and Techniques for Engaging Your Customers Paul Greenberg is President of The 56 Group, LLC, a customer strategy consulting firm, focused on cutting edge CRM strategic services and a founding partner of the CRM training company, BP... Full Bio

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