Professional Sports Teams Can Engage Fans All Year Via Customer Loyalty

Retailers can engage their consumers year-round in a variety of ways, but customer engagement in the world of professional sports can be tricky because they have specific game schedules that carve out a portion of the calendar year.

Loyalty360 talked to Richard Schenker, senior loyalty consulting director at Bond Brand Loyalty, about how sports franchises can engage their customers throughout the calendar year, deepening the emotional connection with the team.

Retailers can seek to engage customers year-round, but with sports teams, they have specific game schedules so what kind of challenge does that present from a loyalty/engagement standpoint?
Schenker: Retailers engage their customers daily, weekly, and monthly depending on the regular cadence of shopping of their retail vertical. They also have the benefit of being in an industry that is defined by seasonality. There are highly natural and relevant reasons to engage their customers for seasonal periods leading up to the Super Bowl, Valentine’s Day, Mother’s Day, Father’s Day, Independence Day, Back-to-School, Halloween, Thanksgiving, and of course, Christmas and New Year’s Day.

Whereas in the case of a sports franchise, their season falls into a defined period of time and interest in the team drops rather drastically in the off-season for most, but not all fans. To create an all year-round relationship with fans, sports franchises need to find reasons to engage with their fans beyond the regular season and playoffs. We fervently believe that sports franchises can create engagement and stimulate excitement with their fans all year round by leveraging data and employing loyalty mechanics to create continuity of two-way communication between fans and the brand proper. The off-season, in many cases, can be almost as exciting as the season itself for some teams and stimulating consistent attention is a pre-requisite for a strong fan engagement solution. Engaging fans after the season should be a natural activity.

For many professional sports, there is so much hype that goes into the free agency period, the draft, and training camp outside of the regular season. A loyalty design must embody features and benefits which draw fans into these key off-season activities with the same fanfare as the regular season. Bond Brand Loyalty believes that the right fan loyalty design and lifecycle management plan can engage fans all year round.

What trends do you foresee related to loyalty and the sports industry?
Schenker: Mobile loyalty is a strategic imperative for, not only the sports industry, but all industries. Specifically for sports, mobile enablement is highly appropriate and critical. In fact, we have been witness to many stadiums making significant capital investments to introduce free Wi-Fi. Whether in venue or out of venue, fans want to interact with like-minded fans (regardless of their location) and their favorite teams and enhance their sporting experience while watching the game. The convergence of digital, loyalty, and data is inevitable. Data is here to change the game and it will fuel the digitization and personalization of professional sports. It will, undoubtedly, customize experiences for fans and will facilitate new levels of loyalty and connectivity with teams and fans through mobile and social media connections.

There is no question that the monetization of data will become a key priority for franchise owners. Leveraging data across the entire enterprise will allow owners to not only offset their investments in loyalty and digital, but generate a new revenue stream in the face of rising operating costs. We see this unfolding in two areas: Internal and external monetization.

Internal Monetization 

These are just a few examples where we will be seeing franchises derive enterprise benefits of leveraging fan data throughout the organization.

Marketing and Content Optimization: The marketing departments of sports franchises will be a key beneficiary of internal monetization. By harnessing fan data, they will be able to deliver highly customized and relevant communications, content, and offers in a gated, purposeful, and measurable manner across all media. This will, undoubtedly, deliver greater utility to fans and result in improved marketing communications efficiencies. Fine tuning the in-venue and out-of-venue experiences of fan segments by better understanding their individual needs and desires will allow sports franchises to deliver customized and coveted experiences both in an expected and serendipitous manner. This will yield unmatchable excitement and fan endearment. Financial assessments of fan segments will permit sports franchises to better understand the financial potential of each segment. This will influence which segments they wish to invest in and divest of to maximize revenue and optimize their marketing spend.

Concessions and Merchandising: The marketing departments of sports franchises should not be the only beneficiary of such valuable data. As with other sectors, building a loyalty data asset can be costly, and the benefits need to be harnessed across the entire sports franchise. Utilization of fan segment data to unearth past transactional and non-transactional behaviors coupled with the use of predictive modeling will allow franchises to grow other areas of their business.

Just as with retailers, there are sales lift and shift opportunities as well as margin enhancement tactics which will be employed, all fueled by data intelligence. By building fan profiles and unearthing actual and potential upside share of wallet penetration across these lines of business, franchises will be able to optimize their targeted fan investments to incent the highest probability of behavior change.

Partnership and Sponsor Selections: Data utilization will also be leveraged when teams are making strategic decisions on partnerships and sponsorships. Historically, financial gains have been the key criteria for selection, but with a robust fan data base it will be imperative to place the fan at the center of such decisions. Analysis of key fan segment demographics, life stages, lifestyles, and preferences will ensure that decisions on partnerships and sponsorships will add value to the relationship between the fan and the sports franchise.

Ticket Sales Optimization: Ticket sales optimization will also be fine-tuned by analyzing specific fans’ price elasticities. Such demand exercises will lead to optimization of venue seats for sporting and non-sporting events.

As we can see, it is strategically imperative to leverage data cross an entire sports franchise to maximize the investment made in the infrastructure and human capital associated with such an endeavor. There are endless possibilities for internal monetization of data. We have no doubt that the sports industry will be quick adopters in this decade and the earliest of adopters will begin to reap rewards rather quickly.

External Monetization 

As with an internal monetization strategy, an external monetization strategy must leverage an active, diverse, and robust fan database to act as a strategic differentiator and deliver incremental revenue for a sports franchise. Sponsorships and partnerships in the world of sports will be redefined by the digital and social media revolution. Big brands have already begun to divert some of their broad media spend away from sports brands that can only offer broad advertising opportunities.

The majority of sponsorship spend today is to support the building of brand awareness and favorable opinion for both current and future customers, but current measurement practices make it difficult to concretely show evidence of this, or quantify the impact. As such, sponsors and partners are seeking alternative digital channels to optimize and measure their marketing spend.

Bond Brand Loyalty believes that sports franchises need to move rather quickly to develop the right climate to retain and grow these dollars. Sports franchises who want to grow their current brand monetization share with sponsors and partners will need to invest in Loyalty, data utilization and omnichannel content management capabilities. Like other industries, the convergence of these three disciplines is what the business of sports will need to invest in to reap the full benefits of external monetization. The following represents the key foundational prerequisites for an external monetization strategy:

  • Engaging Loyalty programs, which act to collect fan transactional and non-transaction signals wherever Fans connect with the sports franchise;
  • Data warehousing, analytical and measurement capacities and proficiencies;
  • Fan segmentation profiles augmented with third-party data to enrich fan profiles;
  • Omni-channel communications and content strategies, which allow the sports franchise and its fans to interact with each other based on fan preferences consistently across digital media;
  • Triggered and targeted campaign management;
  • Data and communications governance policies; and
  • Selling strategies for sponsors and partners.
Sponsors and partners will gravitate toward and shift their marketing investments to sports franchises that can facilitate highly targeted and measurable access to their fan bases. We have no doubt as with internal monetization, there will be a first movers’ advantage for those sports franchises that take the leap and invest intelligently in this new fan Loyalty data and digital frontier. 

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