The CFOs discussed considerations and challenges related to fan experience, technology innovation and team finances.
The fan experience
- Despite evolving health and safety protocols, fan compliance remained high. Fans’ willingness to adopt such policies helped prevent outbreaks, allowing teams to continue opening their events to larger crowds.
- Surveys of season ticket holders revealed that their primary concern was the value of the experiences offered along with season tickets, such as player VIP sessions and “inside access” events. Some CFOs speculated that fans accustomed to virtual events may question the value of in-person attendance and other add-ons.
- Many teams prioritized technological upgrades like cashless transactions, electronic ticketing, mobile ordering, upgrades from magnetometers to radio frequency systems for security. A frictionless experience for fans is the goal and one team has even implemented a future-ready tech enhancement of facial recognition technology to improve the entry process.
- One CFO discussed the launch of a new app for season ticket holders. Through the app, season ticket holders will be offered exclusive discounts and in-game experiences that cannot be transferred to other fans. This can increase the value of season tickets and provide an incentive to get the most valuable fans into the stadium rather than buyers on the secondary market.
- Fans’ concerns about health and safety are making teams evaluate technology investments on items that were previously considered optional in a pre-COVID-19 environment. One CFO commented that in the effort to try to get fans back, “the investment is worth it”.
Revenue, costs, reporting and forecasting
- Alternate revenue streams such as sports betting and NFTs can mitigate some of the losses experienced from reduced fan attendance. One CFO discussed how the ability to create partnerships in the legal sports betting space helped offset the losses from limited capacity at games.
- Managing costs, especially related to hospitality staffing, where it was becoming increasingly difficult to hire and keep quality staff, was an issue. While attempting to scale back on costs, teams needed to reinvest some savings into implementing COVID-related health and safety protocols for staff, such as COVID-19 testing.
- All CFOs acknowledged challenges in keeping up with demands to produce reports and forecasts during the COVID-19 pandemic. One particularly frustrating challenge was trying to provide updated reporting based on constantly changing assumptions and variables. Long-term forecasts beyond the next several years were also difficult when inputs only forecasted the short term for the next several months.
The CFOs agreed that as health and safety restrictions are lifted across the country, most teams are planning for close to pre-pandemic levels of ticket sales in the near future. Teams recognize that fans have different risk tolerances and are investigating offerings to help them feel safe and to remind fans of the experience and value of attending games in-person.
To arrange an interview with KPMG’s Shawn Quill, please contact Mike Alva. You can read more KPMG insights on the sports industry here.