Tech Disruption Still Needs Industry Knowledge
I’m not as amazed as I should be by the blog post by SF Delta’s CEO Brian Andrés Helmick, who as with many tech folks, tend to misread that application of their devices goes way beyond just the illusion of having more technology at your finger tips.
Last year, The SF Deltas were gaining media coverage, mostly blog posts, proclaiming “how tech disrupts sports” – they were going to have every social media channel going, broadcasts in different languages, and just fully engage every people with a new type of fan experience. And they’ve been drawing about 2,423 a match.
They were even going to have AI tickets!
They were brazen about going to Eventbrite, rather than Ticketmaster!
This team was going to have VR for its fans!
Somehow the Indy Eleven, which along with The SF Deltas are also in the North American Soccer League, are a runaway hit in Indianapolis. The difference might be in the sports sales executives running that Indy Eleven. I don’t know of any experienced sports executives running the Deltas.
Did I mention they are getting less than their stadium capacity and blaming Trump for it? Seriously, there are a lot of things that you can fixate on Trump for, but I’m gonna give him a pass on this…
I’m not making fun of the SF Deltas, but let’s ask a question: Who did they hire that has previously worked in the sports industry to sell their tickets? Their corporate sponsorship? Who is at the head of their marketing with previous sports experience? The Bay Area has a TON of people who have the experience necessary in these categories. Hell, two legendary sports marketing professionals, Andy Dolich and Pat Gallagher, live down the road from the SF Deltas. Dolich fully understands “tech” – as witnessed with the Indoor Football League team that he helped as a “tech startup” last year. Would The SF Deltas ownership have ignored Steve Jobs if they were attempting to do a tech company if he were living right down the road? Doubtful.
Apparently, The Deltas’ ownership learned only this year that pro sports is a very complex business.
They ignored that part of it because “tech” knew better. Imagine if a sports owner decided to run a tech company, but not hire as many programmers or engineers as possible. Then blamed the consumer for not downloading the product.
They also use drop counts not tickets distributed. Any ticket director worth their salt would tell you the opposite. But then again, who were the people that they hired for this great new franchise?
One of Helmick’s ownership ideas is to have his fans mass tweet Marc Benioff (CEO, Salesforce), to get him to buy the team. Yes, because having 3,000 tweets makes someone invest in a North American Soccer League team, especially the one losing money.
It’s interesting to see that the SF Deltas’ new tech ownership decided to go with an old playbook – put the onus on the fans for not showing up instead of examine what the team didn’t do to attract them.
They even hosted a Reddit AMA in February, which means “fans were excited!”
Don’t forget the sudden Raiders Nation $15 ticket discounts, because sports fans are all the same, meaning NFL fans watch soccer, etc.
One of the key components to this is that the Deltas didn’t get a lot of money from fans upfront. They also play in Kezar Stadium, a 10,000 seat stadium built in 1925 and remodeled in 1990.* This doesn’t sound very “tech” to me. The Deltas are even listed on the wikipedia page for Kezar, which I’m sure is a bigger issue for them than actually going out and selling ticket packages individually. After all, “tech” solves everything.
Do Twitter followers equal buyers? Do Facebook Likes or Instagram Follows mean people will actually show up at your venue?
The SF Deltas decided to “disrupt” the entire business model of sports, because fans will just come out. It is a common misconception about sports, that fans are mindless without choices and will do what you want simply by holding a game or match. In essence, the SF Deltas have the same issue as every defunct “hobby” team bought by a super fan, they act like sports bars, thinking that just because they have “sports programming” on, that their job is done. As anyone who has worked in sports for a while will tell you, turning the lights on is only one small part of sports sales. You still gotta sell people, and get them to buy early.
Tech disruption is great.
I can go into any supermarket, overturn one of the fruit stands, and “disrupt” it. But unless I actually learn the supermarket industry, unless I get my hands dirty and try to really understand what that industry is, I cannot hope to change or alter some of the aspects of it. Whether I have a better app or not.
A lot of vendors come into the sports space because it is a sexy industry to be in. They see the logo. The market caps of buying power are much smaller than those of even a Fortune 2000 company, but they see the logo. And they think its going to be easy to sell to that industry. After all, they have better tech to offer.
The problem lies in that a tech company doesn’t usually understand the sports space. Everyone thinks its damn easy to sell a ticket. Or that sports won’t be able to handle “disruption” by tech, instead of the other way around. After all, everybody loves sports, right? They forget that a lot of people don’t actually want to pay for sports, and aren’t mindless about their purchasing decisions. They also forget that their “tech” typically has a lot of issues with massive facilities full of human bodies which actually stop a lot of WiFi & cellular connections – based on simple science of sending and receiving waves of information.
It is easy to never have to sell in the sports industry, yet provide the idea that you have all of the answers. But selling a ticket isn’t a simple transaction. There are a lot of steps to it. Just like when “tech” tried to disrupt tickets, having 50 different e-ticket platforms with the suggestion that all people needed was a simplier way of processing tickets. Most of those e-ticket platforms have either bought each other or gone out of business, still leaving the majority of marketshare to Paciolan and Ticketmaster, two systems that are antiquated in having the latest bells and whistles, but actually have people with industry experience running them on the backend.
A recent tech company made a splash with purchasing a European ticket platform. Did it for almost $100 million dollars so they “disrupt” the primary as they had the secondary. Only issue is, they didn’t understand one of the key facets of the marketplace. European ticket platforms don’t have fundraising donor components to them – they straight sell tickets – and without a fundraising donor component for a U.S. ticket platform, you might as well be dead in the water.
I’m not against tech, or the “disruption” that it brings. But I do think without industry leaders as part of the game plan, your tech becomes useless to most consumers.
These are things you learn when you hire people who have worked in the industry for decades. Not someone who has spent their life programming, and watches sports on their smartphone, and thinks that they will “disrupt” it by having more tech.
*Editors Note: I mistakenly put Boxer Stadium instead of Kezar Stadium for the Deltas’ venue. Thank you to Bradley Peters who wrote in about the mistake, thus I am correcting it.