Paciolan Founder Jane Kleinberger moderates a panel with Bernie Mullin of The Aspire Group, Eric Nicholls of USC Athletics, and Brad Sexton from IMG Learfield Ticket Solutions. (VT photo)
REPORTING FROM COLUMBIA, S.C. — The times are changing, largely due to technology and how audiences consume advertising via social media. Technology has allowed outsourcing to thrive, while the digital age has increased the ways in which companies, teams and bands can communicate with the audience.
Change was a recurring topic here at the Sport, Entertainment & Venues Tomorrow conference Nov. 19-21, which was attended by a record 350 industry professionals, professors and students. The next SEVT, which is produced by the University of South Carolina and Venues Today, along with IAVM’s Region 5, will be March 16-18, 2016. There will be no 2015 conference to accommodate the date change.
Take a Ticket
When it comes to ticketing in college athletics, outsourcing has taken huge strides as recently as this decade. As Paciolan’s Jane Kleinberger put it during this year’s gathering, “10 years ago it didn’t even exist in college athletics, and now it’s the name of the game.”
The main reason for the growth of outsourcing is supported by statistics. Bernie Mullin of Aspire Group said that the numbers are pretty simple.
“College athletics revenue streams are, for the most part, under assault,” he said, adding that ticket sales and student attendance are both going down.
“There are three choices: in-house, power house, or nut house; which basically means do it yourself, outsource, or do nothing.”
In Division 1 football, his company has been able to average about 442 more paid tickets per game in 2013 than in 2012. The NCAA as a whole, including those with in-house sales teams, was down about 68 paid admissions per game, with most not reporting the student portion of it.
Those who did nothing were down 440 paid tickets per game.
That’s about a 900-ticket difference between what an outsourcing company is able to produce versus doing nothing, which Mullin equated to about $250,000 per year.
Arizona State was one of the first to invest in an outbound sales operation, eventually hiring Aspire Group. The difference in overhead made a significant impact on overall cost.
“Arizona State’s overhead is 50 cents on the dollar for every dollar in pay, and you have 34 people and a $1.5-million payroll,” said Mullin, who added that Aspire Group’s overhead for them is nine percent, saving the school more than three times the management fees.
Professional teams will likely continue to build their own staff. Eric Nicholls, Associate Athletic Director at University South Carolina, said that, all things being equal, having an in-house sales team is great, but it’s difficult to recruit the best talent and, at the college level, have high enough compensation to attract the best sales people.
Go Social
One of the main things several panelists focused on was the change in social media.
“A couple of years ago we were hoping social media was the holy grail to communicate with all of our fans for free, but algorithms keep changing,” said Nicholls, who added that between Facebook and Twitter, the university regularly reaches about 10 percent of its fan base.
Early on, social media success was based on the number of followers an entity had. Now, it’s all about engagement.
In order to combat the demoralization associated with reaching only a sliver of followers, Nicholls and others have dabbled in paid advertising. After doing some experiments last year wherein paid posts significantly outperformed organic content in terms of engagement, USC Athletics invested more of the budget this year in social media.
“I used to think of Facebook and Twitter as my free way to reach an audience with the push of a button, but now we have to pay to reach that audience,” he added.
Live Nation’s Kim Shriver said that the social media platforms have basically throttled promoters with the idea of promoted posts. Still, there is an upside.
“The fun thing about Facebook and Twitter is that you can grind down and target your audience tightly or spread it out — you can even geotarget,” she said, adding that flexibility is key. “If something’s underperforming, change out what you’re posting and change what you’re doing. It’s actually fun.”
Though budgets for advertising have generally stayed the same overall, more of the budget is being allocated for social media.
Jason Rittenberry of IRG Sports + Entertainment said that his company has managed to cut advertising and marketing dollars that would have traditionally been spent on radio or television while increasing the advertising on social media, leading to an overall savings of about 10 percent.
“It’s all about return on investment,” he said. “With online advertising, even paid, the dollars are still fairly low and you can get a lot of reach with a small amount of dollars. We’ve been able to cut the overall budget and are getting the same reach, or even better.”
“While we’re selling tickets on social media, it’s not a silver bullet,” Rittenberry added, saying that the amount of time, energy and effort spent on social media campaigns sometimes leads to a disappointing amount of tickets sold. However, he considers selling 2,000-3,000 tickets online for a 20,000 person show a success.