As fans return to stadiums and arenas, pro sports teams have been emphasizing the fan experience, which is critical to re-engaging fans and reminding them of the joys of the in-person, live game day experience. However, a shortage of workers can undermine those efforts.
The fan experience and the labor shortage were among the hot topics discussed by sports executives from professional sports teams across football, baseball, hockey and soccer who gathered recently for a virtual KPMG sports industry forum to share priorities and leading practices as they navigate the complexities of the 2021 season.
Up to this point, COVID-related expenses have been the largest contributor to increased operating costs for sports teams. Labor costs are now becoming the biggest concern for sports CFOs and operations executives, especially as capacity restrictions continue to ease across the country. In this challenging labor market, teams have turned to third-party sources to recruit staff for ticketing, concessions, housekeeping and other game-day operations roles. The additional expenses, combined with overtime for workers who have remained, have become exorbitant.
In addition to the increased cost to source labor, franchises are concerned about even being able to fully staff operations on game day. When stadiums and arenas are at full capacity, if concessions, security, or merchandise operations are not completely staffed, longer lines compromise the fan experience and jeopardize both maximizing fan spending and fan perception of the “new normal” game day experience. And while temporary workers may seem like a viable option, executives note that such staff may not be as familiar with stadium operations and services as full-time or seasonal workers, leaving the fan experience lacking.
The labor shortage adds greater value to the use of technology to bolster the fan experience. The sports executives in the forum are using new technology to reduce friction points, including lines, security protocols, contactless concessions, and crowding inside their facilities. Several franchises have implemented new point of sale systems and have noted large upticks in cashless and digital ticketing adoption as fans returned. Additionally, some franchises have experienced higher per capita spending on food, beverages and merchandise after implementing cashless transactions, but it is unknown whether that increase is driven by convenience, shorter lines due to capacity restrictions, or fewer pregame tailgate parties. Technology is often expensive to install, and, regardless of the short-term positive signs, executives believe that the long-term return on investment will determine whether technology-based services become a permanent part of the fan experience.
Even with tech enhancements, determining a solution to address the labor shortage is a top priority for sports teams in order to continue to make progress in bringing sports fans back to a great experience.