2014 MIT Sloan Sports Analytics Conference First Pitch

Case Competition

Dan Reaves | Sandeep Satish

February 16, 2014

Impact of Analytics on the Fan Experience

Agenda

2

Impact of Analytics on the Fan Experience

1. State of the Stadium

Defining the context in which teams face challenges in capturing value off the playing field

2. Understanding the problem

Identifying the pain points in the current market environment and understanding their long-term impact

3. Digital Fan Pass Solution

a. Overview

b. Building a Robust Data Foundation

Will teams ever know who is in the building? How can we collect, track and manage fan data?

How do we effectively incentivize venders to assess the individual fan?

How to innovatively understand a cash-paying consumer

c. Leveraging Fan Pass to Drive Business Growth

How does a deep dive into the in-stadium customer provide opportunities for increased revenue?

Which Fan Profile is the Most Valuable?

d. Personalizing the Fan Experience

How can we provide a personalized, differentiated in-person fan experience?

4. Conclusion and Q&A

State of the Stadium: Establishing Context

3

• Teams have limited insight into the behavior of their individual fans once they are

within their venues

• In the current environment, teams are unable to exactly identify who is sitting in the

seats, who is buying jerseys or concessions, and what these individuals truly value

• Teams can create and capture additional value from their fans IF they can somehow

identify who they are, what they value, and what their in-game spending habits are

• The implications are significant: a team that knows who shows up, who buys what

(and how), and why can extract additional value through targeting, retention, and

premium pricing

1. Assess current market pain points to better define opportunity space

2. Evaluate provided data set and current technologies to identify connection points

3. Synthesize technology options with insights from data analysis to build a sustainable

CRM solution that allows a team to 1) better understand the fan and 2) act upon this

data to capture value

The Challenge

The Importance

The Starting Line

52%of fan purchases in

2013 where no data

was collected (cash)$88M

worth of purchases

in those data-less

transactions39%

more money ($) per

purchase when fans

used credit vs cash

Understanding the Problem

4

Purchaser – User Disconnect

• Tough to track ticket exchange from initial

purchaser to actual game attendee

• Particularly acute amongst teams’ most

valuable customers (season ticket holders)

Lack of Data-Rich Transactions

• Cash is the dominant transaction type

and it provides the least user data

• Need to encourage more “data-rich”

payments (e.g. credit card) to build more

robust database and valuable analytics

Anonymous Fan

• Prevalence of secondary ticket markets

and purchaser-user disconnect cloud the

true identity of a given ticket holder

• Without a profile, it is near impossible to

personalize experience

Snapshot vs. Stories

• Each transaction only provides a small

snapshot of fan behavior during games

• Need to link data to create a complete in-

game “story” of each fan’s experience

Bottom Line ImpactPain Points

• # of unique fans differs from

general team attendance figures

• Repeat customers are engines

of premium revenue growth

• What exogenous factors drive

attendance?

• Correlation to performance,

weather, other entertainment ?

• “Cash as king” limits opportunity

to develop understanding

• Transition from impulse to data-

driven marketing promotions

• Revenue dollars flow from team

to secondary providers

• How to anticipate for events like

Jeter’s retirement?

Innovations and StrategyThe Digital Fan Pass Application

5

Fa

ns

Digital Fan Pass – Overview

• Scan ticket barcode with app to activate profile

• Track loyalty points

• Load money onto ticket to buy food, drinks, etc.

• Receive points, deals and promotions

Skybox Loyalty Program

• CRM solution to track fan

history and interactions

• “Status” levels to encourage

initial sign up, improve

retention and increase

engagement

• Platform to build a more direct

team-fan conversation

Digital Fan Pass App

• Manage fan profile and loaded

ticket value

• Track Skybox loyalty program

• Find personalized coupons,

deals and promotions

throughout the stadium

• Manage logistical items like

parking, seating charts, etc.

Vendors• Analyze purchase histories to

optimize inventory and pricing

• Utilize Skybox Loyalty program

to streamline promotions

Team• Leverage fan profiles to improve

targeting and increase ROI

• Maximize customer lifetime

value via more effective fan

engagement

Stadium Management• Use fan profiles to better

manage parking and traffic

before/after game

• Personalize stadium experience

via app6

Digital Fan Pass is a mobile application and loyalty program that builds, cultivates and maximizes a team’s most important

customer relationships

Building a Robust Data FoundationDeep customer insights and advanced analytics rely on a diverse and robust dataset. With Digital Fan Pass, we use incentive

structures and personalized benefits to cultivate buy-in, engagement and, ultimately, a steady stream of linked data.

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Fan Profiles

Skybox Loyalty Program

Advanced “Fanalytics”

Critical Activities Impact

• Ticket barcode scanner enables any fan, any time

to sign-in and create a personal profile

• Delivering unique content and promotions will

incentivize fans to keep coming back each game

• Clean mobile interface allows fans to easily

manage loyalty points, loaded ticket value and

every transaction from parking to concessions

Fan-specific data

collected from the

turnstile to the

concession stand

• Skybox fan loyalty program functions as a CRM

solution with direct user engagement

• Building a tiered reward structure will encourage

fans to attend more games and increase purchase

frequency

• Creates an ongoing conversation between teams

and their fans that extends beyond the final score

Increased customer

lifetime value through

incentives and rewards

• Increase $ per purchase by driving increased use

of credit-based purchases

• Develop “data-share” analytics that help optimize

inventory and pricing

• Utilize fan data in app to track and manage traffic

flow throughout stadium

• Centralized medium to effectively deliver

information to fans (e.g. security alerts)

Optimize fan

experience to increase

personalization

AND

enhance operational

and marketing

efficiency

• Team: True database of fans that continually develops; ability to target

and market specific individuals/clusters

• Fans: Engaging application, portable, benefits for loyalty

• Vendors: Targeted advertising within application

Leveraging Fan Pass to Drive Growth

• Free application with premium

service

• Premium service

Order in from your seat

Access to premium seats mid-

game if allowable

Bathroom / concession line

updates so fans can optimally

leave their seats

Identity

• Leverage rewards system platform

to build initial database of users

• Fans use their fan pass for all points

of access in and out of the game

Build status levels online by

pre-registering

Use rewards number in the

game for concessions, ticket

store etc.

Status achievements engages

consumers to continually use

the app

Technology

• Sync between website and mobile

application for 24/7 use

• Scanning capability to swipe at

concession stands, reward status gets

updated immediately

• In-game alerts for team promotions

Value Creation

• Fans have an incentive to use digital

fan pass to build skybox loyalty which

can generate significant rewards

• Allows fans to keep track of all games

they’ve attended, what they’ve

purchased, and aware of all upcoming

opportunities (same for the team)

• Allows teams to monitor each fan

since activities within the stadium are

directly pushed to the application

Value Capture

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• Credit card cross-promotional

packages to facilitate and encourage

card over cash

• Even if cash is used, users can swipe

to build loyalty points (teams would

still know who these consumers are)

• Users can transfer / sell tickets

through fan pass, thus helping teams

recoup revenue loss from secondary

market providers

Personalizing the Fan ExperienceFan V

alu

e

Revenues generated through

ads on mobile / websites that

are exactly targeted to a

certain consumer

Consumers pay monthly/annual

fees to gain access to benefits

within the game – access to

players, better seats, etc.

Design, build and manage

websites and mobile products on

behalf of teams to identify and

extract value from consumers

Encourage social

community built around

reward status / in-game

experience

Risks & Uncertainties

• Fan identity can be captured even on

cash transactions since users can gain

significant loyalty points

• Preferences of individual consumers

can be monitored / tailored since

profiles are constantly being updated

Who’s Most Important?Fan Pass -> Profile Quantify the Impact

Assets-Activities-Advantage

• Invest in mobile products to monetize and take advantage of

the emerging mobile advertising opportunity

• Pursue complementary strategic value advantages to the fan

such as in-game updates, social gaming, and premium food

access

Profile Advertising & Sponsorship Subscription Technology & Production

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• Tech savvy, frequent attending, high

disposable income fans would be the

most important profile to identify

• Opportunities for synergies amongst

vendors, teams, sponsors etc. to craft

specialized packages for these fans

• Tickets that season ticket holders sell

can now be tracked – scan the app and

the profile is updated with the ticket

information

• Reward status recognizes the in-game

attendee

• Need to build initial momentum to get users to register online

• If fans don’t scan / utilize digital fan pass in-game, teams face

the same issue of not truly knowing their fan identities

• Infrastructure / development costs?

Conclusion

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For teams to maximize their performance off-the-field and in-stadium, they need to:

1

2

“LISTEN” – collect and link data from each fan interaction in the stadium from ticket purchase to parking

UNDERSTAND – use fan data to build and recognize specific fan profiles

3 CREATE – design a unique and personalized fan experience that is customized based on identified profile

4 CAPTURE – capitalize on additional value creation through optimized targeting, retention and pricing

Digital Fan Pass delivers on these needs with an end-to-end customer relationship

maximization system

Know the Fan

Transition from

understanding who

purchases tickets to who

actually is in the seats and

what they value

Maximize Fan Value

Profiling your fan is not

enough; you must be able

to create and then capture

value through pricing

mechanisms and strategic

partnerships

Motivate Partners

Generate an ever-growing

database of fan data that

vendors, sponsors and

other stakeholders can

mine to personalize their

fan interactions

Build Their Story

Collect more data per

transaction and quickly link

these interaction points to

create a customized story

of each fan’s experience

Kellogg Team

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Dan Reaves“CEO and SVP of Marketing”

• Experience: Undergraduate dual degree in Systems Engineering and

Economics and four years of management consulting experience mainly

focused on technology implementation and risk analysis

• Favorite Team: New York Yankees

• Favorite Sports Statistic: BCS…kidding, its Wins Above Replacement (WAR)

Sandeep Satish“CFO and President of Business Operations”

• Experience: Undergraduate degree in finance and international business from

NYU Stern and four years of investment banking experience at Citigroup

• Favorite Team: New York Yankees

• Favorite Sports Statistic: Ultimate Zone Rating (UZR)

Appendix

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Slide 3

Support Data and Analysis

Data from Aramark_SloanConferenceSampleDataSets_20140210.xlsx

52%

• = Sum of cash purchases at Arena, MLB and NFL ÷ Grand Total

$88M

• = Sum of cash purchases at Arena, MLB and NFL

39%

• = dollars per credit transaction ÷ dollars per cash transaction

• Dollars per credit transaction = total credit receipts ÷ total transactions

• Dollars per cash transaction = total cash receipts ÷ total transactions