When customers are fans: What sports teams can teach us about engagement

Sports teams have ready-made advocates called fans. I'm one of them. But what do they do to keep these advocates engaged? Not the easiest thing, because the fans expect some return on their passion.

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The value you provide is a feeling that the customer is valued.

If you didn't know it already, I love sports. Mostly team sports. I loved playing them when I was younger, and following them now that I'm older. To catalog my personal interests because that's what sports fans do, here's a short list.

When I was younger:

  1. I was a good power hitting, horrible fielding baseball player.
  2. I was a slow wide receiver with really good hands in football.
  3. I sucked royally at basketball - to the point that my face was more often catching passes thrown to me than my hands.
  4. I never played hockey really - at least not on skates.

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Now that I'm older:

  1. I am a diehard New York Yankees fan. My company -- The 56 Group, LLC -- is named after the 1956 Yankees because that year:
    1. The Yankees beat the Dodgers to win the World Series.
    2. Mickey Mantle, my childhood hero, won the Triple Crown.
    3. Don Larsen pitched a perfect game in the World Series.
    4. I watched my first ever Yankees game with 6-year-old eyes.
  2. I have no second baseball team, though I will root for the Mets on occasion and find someone to root for in the World Series preferably the American League team - unless it's the Mets and this year, if it's the Cubs I'll root for them (I lived in Chicago for 22 years) even though I didn't want Aroldis Chapman to be leaving the Yankees - even for the Cubs - or anyone.
  3. With the NFL, I love the New York Giants and have two "second" teams that I root for - The Green Bay Packers (largely because my wonderful friend Wayne Hintz roots for them) and the Los Angeles Rams (because my BFAM and fellow influencer Brent Leary is more diehard about the Rams than I am about the Yankees).
  4. In basketball I root for the New York Knicks with my second team being the ubiquitous Golden State Warriors - though not because of Steph Curry and his stand up teammates but because Kenny Lauer, their VP of Digital and Marketing is a great friend - and I do like the team because they are good eggs.
  5. In hockey, it's the New York Rangers - and there is no second team - though in a pinch I'll root for the Islanders.

I can keep going but I think that you might see two important themes here:

I'm from New York originally, and once a New Yawker always one.

I am a typical sports fan who LOVES teams though they are businesses and institutions that, at a business level, function just like all other businesses and institutions.

AND the latter one is what I want to talk about when it comes to sports the vertical, not sports the emotion sucker.

For the last four years I have been a participant in what is arguably tied for my favorite conference in any given year. (It would be my favorite, but I chair CRM Evolution and would be remiss in not making that one my favorite.) That is the SEAT conference. SEAT stands for Sports Entertainment Alliance in Technology and is the product of the amazing Christine Stoffel who is the founder, CEO, President, and creator of the SEAT Consortium, a community of thousands of sports business professionals. (In her modesty, she doesn't talk about the fact that she was the CIO of the Arizona Diamondbacks in 2007 when women executives in professional sports were even scarcer than they are now - and that's beyond rare at this point).

This conference is their community gathering and I've seen attendance grow in the four years I've been going -- from 450 (in Kansas City) to 650 (Miami) to 1,000 (San Francisco) to 1,200 at the one I got back from in July, SEAT 2016 in Las Vegas. I have been so active that I now sit on their Global Steering Committee as either one of the only or only non-sports industry person. And I love every minute of it.

What do sports teams need to do to acquire and retain their already passionate fans, and even the new upcoming generations of fans.

What makes this conference so remarkable is that it is the gathering of the world of professional and some collegiate sports business leaders. Even though it has a strong technology bent -- with CRM and digital marketing being leading tracks -- it does not target only the tech leads for teams and leagues and sports-related other institutions. Also in attendance are the marketing, sales, and even corporate management leaders, who have an interest in how to engage fans via use of the technology one way or the other. Unlike many of the pure tech company conferences, it is highly outcome-focused. What do sports teams need to do to acquire and retain their already passionate fans, and even the new upcoming generations of fans, given the pressures imposed by sports revenue - which is discretionary.

What I mean by that in the context of customer engagement is that sports has a unique set of "problems" (some of them being of the variety that some of us like to say, "I could only WISH I had problems like that") that only perhaps the entertainment world (which, I guess, technically they are subset of), has. Let me outline it to you.

The "customers" of sports teams are already advocates for the most part. Fan rooting interests are not often lukewarm. It's usually white hot. Just check out any hashtag of any team during a game and watch what the fans are saying about the team they love. You'd think they now HATE them but the reality is that they root SO hard for the team that when they are losing for even a minute, they are frustrated.

Or think about it this way: If team acquires some player for whatever millions of dollars and you don't like the player your response is that you can't believe how they are spending "our" money. Ummm, it isn't our money. Or a very small part of it may be - like .000001 percent of the total revenue - but for the most part - its "their" money. That would be the owners.

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The net result is that sports is probably the only vertical (outside of the entertainment world) that doesn't have to create advocates - it just has to figure out what to do with them. Advocates who are not only promoting the team but vested emotionally in its success.

The downside is that each advocate -- because they are so invested in the team -- has a high degree of special expectations. They want (and, more often than is warranted, demand) a highly personalized interaction with the team or the players or the front office or the personnel at the stadium because their emotional engagement is deep and personal. They have enterprise-level - meaning BIG - expectations.

As a Yankees fan, my general expectation is that we are going to do whatever it takes to win the World Series the year we happen to be in. This year we are rebuilding - and surprisingly, I'm good with that - but it's surprising because it goes against the grain of my expectations - which are decades long held. I expect the NY Giants to invest in the personnel that will get us to the playoffs. I expect little to nothing of the Knicks and I expect the Rangers to get to or near the Stanley Cup finals. But I also think I know how to manage and run the team - which, of course, I do - err, I don't.

That said, regardless of my managerial prowess, minimally, as a diehard fan, I also expect that my experience at a game is going to be amazing, win or lose, because tickets are so damned expensive - and because I root so hard. Is this a reasonable expectation? Not entirely. The fact that I root really hard is not something that guarantees me anything from the team but heartburn when they are losing. However, again, my spending is discretionary, so I don't have to support the team either with my dollars.

The problem sports teams have is that because they spend so much on the players they are seen to be enterprises when it comes to revenue and personnel - and they aren't. There are four franchises in the world that have the revenues to be at the low end of the enterprise scale. The Dallas Cowboys ($4 billion), REAL Madrid ($3 billion), Manchester United ($3 billion) and the Yankees ($3.4 billion). ALL of them are considerably smaller than Salesforce.com for example, which from a revenue perspective is the smallest of the Big 4 software technology companies.

Sports fans are passionate advocates that you didn't struggle to create, but they still have to remain engaged.

Yet, the sports team fans expect a very deep level of engagement - and they expect the team to provide them with what they need - tools, consumable experiences, access, to support the level of engagement they are looking for. But the revenues are mid-market sized for the most part - and the bulk of the money goes to the athletes - who are paid for their skills and entertainment value - meaning they can fill seats and sell merchandise - and those incredible amounts of money, beyond the imagination and scope of any ordinary human being on the planet enhance the myth of the enterprise size of the business. But not only is the revenue mid market, but the staff size is small business and underfunded. So we have enterprise expectations for mid-market companies with small business sized staffs. Whoops. That can make things untenable - because the company has to deliver.

The other huge problem is competition - but not for league titles. The real competition for sports as a business is not the other teams in the leagues and divisions. It is movies, restaurants, vacations, and staying home. For example, the National Football League knows that its biggest competition is the couch in man caves with very large screens - and a good bar or restaurants with good take out nearby. The experience of watching an NFL game on TV in that environment easily beats going to a game at a stadium which gives you effectively one camera angle unless you watch the giant TV screen at the stadium!!

In other words, the dollars allocated to sports, passions notwithstanding, are discretionary dollars. They are not a required spend like food, clothing, shelter. Not only is it the same dollars that might be spent on restaurants, movies, vacations etc. they also might simply not be spent. During a recession or a bad individual financial period, discretionary dollars tend to go to either required expenditures (food, etc.) or are hoarded "just in case" of a job loss, a price increase, or a rough patch of any kind. So if a sports organization is not producing the kinds of experiences a fan expects, including a good team, then, the discretionary dollars are spent elsewhere - because they can be. People may not be able to go without food or health care but they can go without attending sports events. And they can still be satisfied due to the ability to watch it on TV or via digital streaming.

So what does that mean for sports franchises - these medium sized companies saddled with enterprise expectations competing off the field for currency with other entertainment venues, necessary dollar expenditures or no expenditure? It means that even though they have an existing passionate fan base - already existing advocates - they can't be blinded by that.

Let me explain. Fans may be passionate, but that doesn't mean that they aren't looking to be satisfied with the relationships that they have with those teams. Think about your own relationships in life - if you are continually disappointed by someone or upset with or ignored by someone who you think you love - will you continue to love them? Of course not. Or at least, under normal circumstances, not likely. That means, as Madonna once said, the team in question has to justify your love.

Keep in mind, this is what teams must do, not what they think they have to do. Their bread-and-butter is the season ticket holder and especially the always renewing season ticket holder. The person who buys season tickets in any format (partial, x number of games, all home games) is typically doing it for many complex reasons. His/her emotional connection to the team, the team's history and legacy, civic pride, business, reminders of childhood when it was simpler, etc. So the triggers to get them to renew their season ticket purchase are many.

For example, the Philadelphia Flyers used to bring the season ticketholders with a reasonably likely propensity to renew to a gathering at Wells Fargo Arena of like people. It was held in the Hall of Fame room and comfort-food level drinks (wine, beer, soft drinks etc) and comfort food (ice cream, popcorn, etc) were provided as the season's ticketholders were pitched on renewal. But the key was that it was the Hall of Fame room - which has photos of the history of the Flyers - the tradition of the championship teams - to remind some of the ticketholders that this is a legacy-rich hockey team with a history of winning. KEY to renewal was the nostalgia for the past - in addition to the better mood generated by comfort food according to a study in the Journal of Psychology in 2014. The results were that 86% of the season ticket holders who were approached this way, renewed early -- meaning more cash in the bank and less angst for the account managers who handled those ticket holders.

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But there is also, in each and every sport, a battle they have to fight with inertia. That means how can you make the stadium/arena experience significant and good enough to get the fan to the event rather than just watching it at home. Each sport has a different set of problems when it comes to that. In baseball for example, the stadium experience is actually part of the reason that the fans go and its markedly different from the "watch the game on MLB.TV" experience.

But in football, watching at home is far better (for many people) than being at the game and the stadium plays a much lesser role. So, for example, the San Francisco 49ers have started to make Levi Stadium an experience unto itself - meaning you could come to the stadium without a game and still (possibly) find enough engagement to make it worth a trip. The 49ers have been smart enough to recognize that their fan base is digitally connected, highly visual and sensory in general and is looking for an experience that is more than just a game. As a result, they have installed over 2,000 iBeacons - Bluetooth-enabled sensors that are embedded in floors, walls, ceilings, etc. so that they can track the movement of individual fans and, tied to their mobile device, provide a personalized experience via that mobile device at the game. They have relatively high speed internet provided via Comcast Business Internet that gives their fans connectivity that works mind-blowingly well at scale. Paul Kapustka of Mobile Sports Report found that the speeds ranged from 27+ mbps to 57 mbps. Holy...crap. That's amazeballs. How?

This is done by providing a router every hundred seats in a stadium of 68,500 seats. There are 400 miles of cable and 1,200 distribution points. The net effect is optimized offers for food, or merchandise tied to the individual fan's likes and dislikes (e.g. Colin Kapernieck who might be either these days). It means 4K video screens driving play analysis that is made visible to the fans during the game. It can mean an interactive mobile app with a location aware device that provides you with the best lunch deal in the area that you are in, the shortest lines to whatever, but also the app becomes the screen for in game replays.

The New England Patriots take the in-game replays one step further. One of the key reasons that people prefer watching football at home is that the camera angles that Fox or ESPN or whoever provides them, give them a much better view of the game and with more insights on the game. You don't get that at the stadiums. Or maybe you do...

What the Pats do is provide unique angles and unique camera "services" such as a mic'd up player followed throughout the game, that you will get on the app or the big screen video monitors but that the TV networks can't provide you. The idea is that you as a fan become more immersed in the experience of the game on the field by being at it. That is fan engagement par excellence.

But the true cutting edge when it comes to sports and fan engagement appears when you understand that teams are not just teams but at the core of a broader fan experience. This thinking is best presented by the Vice President of Digital and Marketing of the Golden State Warriors, Kenny Lauer, who is not only one of the most advanced/forward thinkers in the sports world, but comes from a customer-facing background back in the days when he was a consultant with Peppers and Rogers. So he gets this engagement thing.

Kenny put what is the most contemporary outlook succinctly in an article in VentureBeat in 2015, right after the GSW won the NBA championship.

"It's all about how you enhance the experience...It's not just about basketball, but about being an entertainment company...people want to be entertained-- how will their lives be better with the Warriors in it?"

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With the Warriors new stadium being planned and built in San Francisco, Kenny is leading an effort to re-imagine the fan experience around the area being an entertainment venue of which the team and game itself are a part, not the whole.

The Warriors are veterans in the use of technology for enabling fan engagement and even IoT for the team itself. For example, they test smart clothing and sleep masks (Neuroon sleep mask in particular) to see how it might improve athletic performance. They measure, measure, measure.

This extends to fan engagement and the re-imagination of the fan experience even in Oracle Arena, their current rental stadium. They use beacons to pinpoint fan location and activity; they use mobile apps that tie to the beacons to generate offers and other individually useful information for the fans, they use Instagram, Facebook, Twitter, Vines, and have tested Google Glass as a precursor to figuring out how to bring virtual reality to the fan experience. And they measure, measure measure to see what value is there. For a more detailed look on this - check out this interview that Brent Leary, CRM influence par excellence, did with Kenny Lauer in 2015.

What does this all mean when it comes to customer engagement, advocacy and lessons to be drawn?

  1. Sure, sports fans are passionate advocates that you didn't struggle to create, but they still have to remain engaged - and their expectations are higher than the norm, because they are advocates and their devotion is expected to be met with some devotion back. Your assignment, if you should accept it, is to find out what that "some" means.
  2. That means that if you have advocates -- or your game plan is to create them -- understand that the level of customer experience that you have to provide is one that suits their behaviors and one that at the same time supports the company's ability to spend on it, without bankruptcy as the outcome. Sports franchises are mid-sized companies with small business-sized staffs and enterprise level customer expectations. Therefore, they must be prudent in spending so that it impacts the customers in ways that give them the ability to maintain their passion and makes them want to continue to interact and transact - and feels personal - even though you are impacting many customers most effectively, not one at a time. Though there are one at a time exceptional behaviors that need to be noted and acted on too.
  3. Having advocates is a great thing, but at the same time a very demanding one. Don't underestimate its value to your business OR the value you have to provide to the customer/advocate. The value you provide is a feeling that the customer is valued. Not a thing. No more, no less. It's a feeling that you care enough about them to give them what's good enough to keep them interacting with you. Not delightful. Good enough. THAT will provide them with the kind of engagement that leads to a great customer experience - over time.
  4. But when it comes to sports, there is no substitute for a team that is winning - no matter what you do. Just thought I'd throw that in here.

See you later. I'm going downstairs to watch the NY Giants play the New Orleans Saints. Giants have to win. (UPDATE: Giants 16, Saints 13. YES!).

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