Sports analytics -- the "who do we sign, and how do we improve play" number crunching -- rocketed into public consciousness when Moneyball hit the big screen. But equally important to teams are the analytics involved in getting and keeping fans in the seats.
At game time, business analysts aren't much concerned with player stats or team records -- on a professional level, at least. Rather, they're busy trolling the data for ways a team can do things like improve the fan experience, maximize attendance, and boost online and park purchases. You might say the offseason is crunch time for those in charge of segmenting season ticket holders for targeted sales pitches.
I chatted this week with Jim Alexander, senior director of business analytics, and Jason Witzberger, manager of business analytics for the Pittsburgh Pirates, about how they use analytics for such purposes. Alexander, who just completed his 24th season with the Pirates, launched the business analytics department a few years ago. A longtime sales and marketing guy who ultimately directed the ticket sales department, Alexander recognized the need to pull insights from the team's data. Witzberger joined the organization as a baseball operations intern in 2008 and moved over to the analytics department the following year.
"As the sales director, I recognized that we were searching for opportunities in the dark," Alexander said. "I always felt like I was an analytical individual, that there's a logical process to selling, and we didn't have the information we needed to do that logical selling." He approached his bosses about forming an analytics team. Ultimately, he got the go-ahead to "become the spoke of the wheel, to pull in all the information we can and make sure we crunch data and disseminate information and become a very efficient sales and marketing department."
As evidence of improved efficiency, Alexander and his team used retention scoring to raise season ticket renewals by 6 percent for the 2012 season. Using SAS for Sports, the team learned which ticket holders the Pirates were at the greatest risk of losing. "We were able to create a score through the modeling and push out that information via our CRM system, so it was readily available to the sales reps, and they could make sure to give extra attention to those we'd scored as the harder customers to retain." The system uses internal data as well as data culled from external consumer data sources like Acxiom.
With that 6 percent bump, the Pirates hit a renewal rate of about 86 percent. This offseason, it's working to push that figure above 90 percent, Witzberger said.
The critical fact is that, the longer a season ticket holder stays with a team, the better the chance that individual will keep renewing, Alexander said. "So with a team like the Pirates, when winning isn't something we're doing very often, although we're getting better at it, it's important to be able to identify those folks who historically would only be around with us for one or two seasons."
The team can then figure out how to appeal to those ticket holders on an individual basis. Maybe that means an invitation to game events, a baseball signed by a star player, or an interaction with the front office. These are all in play, but the Pirates don't necessarily know right now which will change the renewal outcome, Alexander said, since it's too early in the process. "But at least we're in the position to know who we should be going after to keep them with us for longer than the historical one or two years. We can discover the right touch points," such as customer experience surveys.
The 2012 season ended Oct. 3, and the renewal process for 2013 is just getting going. "We're renewing at a faster rate than we have in previous seasons, and all indications are that we're in a good position to meet those accelerated goals."
If you're a baseball fan, have you noticed your ballpark experience has improved of late? If so, how much of that do you attribute to the team's analytical capabilities? Share on the message board below.
Beth writes As for the Marlins... maybe it was the lack of an analytics that was the problem rather than bad advice from an analytics team?
Seems to me this illustrates the need for management (or whomever) to focus and apply the analytics onto the right issues/problems. In the Miami Marlins case, using CallMeBob's information, I'd reckon that management and all their hired whiz kids were laser-focused on that new stadium. Catering to fans, the "fan experience", etc. apparently weren't even on their radar. So "retention scoring" ... whazzat?
Keeping the customers happy is the name of the game in baseball, as well as any other business. If only more firms would take the efforts neeed to discover what's important to the 'fans.' Making customers into happy fans will keep the profits increasing or at least stable in bad times.
@Beth re: online sales -- last year I bought tickets online from the Pirates and later found out that due to a conflict, I wouldn't be able to go to the game. The Pirates' web site had tools to enable me to re-sell my tickets (no refunds or exchanges, but at least help), and when a guy bought them from me, I simply transferred the redemption codes to him -- all online, all electronic, never even met each other. Their systems helped me as a fan to avoid letting the tickets, and my money, go to waste.
@Beth: The construction of the new Consol Energy arena has done immeasurable good for the Penguins, but the current lockout and associated standoff isn't helping anyone. Hockey enjoys a more fanatical fan base than does baseball (at least in good hockey markets like Detroit and Pittsburgh), so the long-term harm to the Penguins should be minimal, especially given the awesome house they play in. I am less familiar with the role analytics plays in the atmosphere and service they provide, but it is high enough quality that I would not be surprised to learn that they're using analytics to not only retain fans, but to more deeply understand what makes fans happy. Millionares fighting with billionaries does not make fans happy though.
I live in the Pittsburgh market and can attest to an outstanding stadium experience at PNC park, notwithstanding the team's failing seasons on the diamond. Though the team doesn't win as much as it needs to, fans come to the park because it is a great park and the organization creates an excellent atmosphere there. I'm biased -- one of my former students works in analytics for the Pirates, but bias aside, the success the team has had using analytics to improve their product is tangible on game day at PNC Park. Come on over and we'll go to a game together this summer!
It's interesting to think that I just don't have a credit score, but possibly a retention score with multiple companies. However, if companies can isolate those they are at most risk of losing and offer them a good deal, that is a good thing. I'm sure my cable company has a score for me that translates into "true sucker".
I agree with you on stadium atmosphere's role in encouraging fans to come to the stadium. I believe the only way to create a perfect atmosphere is to ensure that stadium goes house-full in every match and for that a lot of homework has to be done on fans; through thorough analysis and marketing techniques.
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