Kirk Wakefield

Season 3 - Episode 332

August 14, 2020

Kirk Wakefield
Kirk Wakefield

The world of sports has been squarely in the news in recent weeks, as teams, leagues and players grapple with the implications of the COVID-19 public health crisis. Dr. Kirk Wakefield, the Edwin W. Streetman Professor of Retail Marketing and executive director of Sports Strategy & Sales in Baylor’s Hankamer School of Business is a nationally-recognized researcher and sports business expert. In this Baylor Connections, he analyzes how teams at both the professional and collegiate levels navigate change, engage fans and work to make the best of uncertain times.

Transcript

Derek Smith:

Hello and welcome to Baylor Connections, a conversation series with the people shaping our future. Each week we go in depth with Baylor leaders, professors, and more discussing important topics in higher education, research, and student life. I'm Derek Smith and we're talking sports today with our guest, Dr. Kirk Wakefield. Dr. Wakefield is the Edwin W. Streetman Professor of Retail Marketing and executive director of sports strategy and sales in Baylor's Hankamer School of Business. An expert in sports marketing, psychology, sales, and more, Dr. Wakefield has conducted research across all facets of the sporting world and consulted for numerous sports franchises and brands. Dr. Wakefield has developed Baylor's renowned sports strategy and sales program and it's advisory board of over 95 members from major league teams, leagues, and corporate partners. His insights have been featured in a variety of national magazines, programs, and newspapers including Forbes, USA Today, and numerous academic journals. A lot going on in the world of sports in the era of COVID-19. So you've been very busy and we appreciate you making time today to join us here on Baylor Connections. Dr. Wakefield, welcome to the program.

Kirk Wakefield:

Thank you very much, Derek. Yeah, a lot has been going on even in the last 24 hours with some of the conferences pulling the plug on fall football, saying they might play spring football. Which seems curious because then what are you going to do? Turn right around and play fall football again? So that's just mind boggling. Then you have, of course, the big 12. It looks like SEC and ACC saying, "We're going to play ball." And maybe you've seen the memes I have towards Nebraska saying welcome home, come back. Ohio State, want to join us? So yeah, that's all very interesting. And forget about, I mean, good grief, professional sports, we've never seen anything like this. Right?

Derek Smith:

Right. Well, let me ask you this as a professional, let's ask you to start off with a question about questions. As you look at the landscape in both college and the pros right now here in mid-August of 2020, what are the questions that you find yourself asking the most and the ones that most intrigue you?

Kirk Wakefield:

Yeah, I was on a couple of calls a day, one with friends at the Miami Dolphins, another one with Columbus Blue Jackets. And then yesterday, I guess, well also today, with the Houston Texans. And what came up really in each of these discussions and almost seemed like every discussion recently is, yeah, so what's changing in the way we do sports sponsorships and partnerships now that we're having to do? So they're having a lot of make goods because the things the brands plan for in the stadium with the fans, they're not happening. So they're having to shift. Well, the question is are the ways that we're shifting towards digital, of course, broadcast with things in the bubble and everything else, and whatever will happen this fall with football, or more social media, more experiential things, using things like Zoom calls with players? Is that necessarily worse? I don't know, it might be better. It was what I was talking a little I guess the Dolphins guy or could have been the Texans. But we were saying that might be better going forward, frankly, much like education. If you'll let me step off on a little bit of a separate or adjacent platform, which is is the way we have been teaching necessarily the best? It's the way we've been doing it. Maybe some of these things we're forced to do with hybrid classes and some online, maybe not all bad.

Derek Smith:

Yeah. So there's a learning curve that everyone's dealing with, but the end result could be some better practices down the line in every industry.

Kirk Wakefield:

Yeah. That's my take on it. And one of the questions I get, because I also run a research firm that works with, I don't know, a couple dozen teams and 160 some odd brands that we do sponsorship research on, and the question is, "Oh, well, man, are we going to have worse results this year because there's no fans in the stands?" All right. So here's an interesting fact. Say the Dallas Cowboys, they have, according to some sources, 17 million fans that follow the Cowboys. You know how many people actually attend a game in a given year? Well, once you count season ticket holders who go most of the games, let's say six or seven of the games, and all the other unique visitors, it's only about a little less than half of total attendance. We're talking about a few hundred thousand out of 17 million. So guess what? Every year, the Cowboys are reaching, and every other team for that matter, are reaching the vast majority actually comes out to 97% of their fans, they're reaching not at the game anyway. So I think what people are figuring out is, "Oh, wait a second." It could be that those things that we plan just on game day at the venue, I mean, that certainly effective for those people, but guess what? You've been reaching them, 97% of them, through digital, TV, radio, social, other events. And by the way, year round, right? Not just on game day.

Derek Smith:

What you're talking about is engaging your fans and keeping them involved in your brand and in your team or your program. When we talk about the word engagement in a broad sports lens, when you talk to your colleagues in the sports world, what are we talking about when we say engagement?

Kirk Wakefield:

Yeah. I mean, it does mean different things to different people, for sure. But I think most of us would say it means taking some action on the behalf of the brand or behalf of the team, whatever it might be. So you're acting. So if it's social media, it's not enough to be exposed to that ad for that player and that brand that's sponsoring them to be an influencer. It is did I like it? Did I do something with that? Social posts. And of course, maybe repost it or retweet it. So that's taking an action is what it amounts to.

Derek Smith:

We're visiting with Dr. Kirk Wakefield here on Baylor Connections. We're going to talk more about engagement, but I want to ask you, we've talked about some of the positive ways that teams can approach this, but let's ask specifically about the lack of fans in the stands because sometimes it's easy for fans, you hear the numbers involved in sports, contracts for players and TV, and you can kind of glaze over a little bit. But when you think about the bottom line of the games themselves, the fans, the fulfillments and sponsorships, like you mentioned, souvenirs and food, what is the impact right now of not having those things? And how is that shaping the way teams address these other issues?

Kirk Wakefield:

Yeah. So in case anybody thought I was passing off as if it was unimportant that fans aren't there, no, it's huge. I was talking about it from the sponsor standpoint of can I reach them? We can still reach them and engage them. From the team standpoint, I mean, I think most people that are listening to this have seen the headlines of the billions of dollars lost because of no fans. I saw something maybe a little bit outside of the typical US fans listener, but saw F1 results, motor sports in the UK, Europe, and so on, and places in the US as well. But I want to say it went from like 620 billion revenue down to something like double digits or 620 million down to double digits, millions of revenue. So it was however many, like 100 fold. I can't remember. It was horrible for no fans in the stands. And then the same is true. It kind of breaks down differently by league. So the NFL, frankly, is probably least affected by the attendance, although it's still huge, but I think last time I looked it's about 25% of their revenue. So take 25% of a huge number. Okay, it's still huge. It's much more critical for MLS and hockey where a lot of their revenue, maybe as much as 40% or more of their team revenue, is based on tickets and attendance. So yeah. And then imagine college sports. Then, again, maybe even more so.

Derek Smith:

When you think about the domino effect of not having games, from your standpoint, obviously there's a lot we don't know, even as some sports leagues are actually actively playing right now like Major League Baseball, we've see what's happened with the Miami Marlins and St. Louis Cardinals, some outbreaks on those teams. So we don't know what's going to happen day to day. But when you think about the domino effect of sponsorships, of jobs, certainly health, first and foremost, what are kind of your thoughts about the sports leagues that are at least keeping their options open right now, as opposed to, as you mentioned, you have the Big 10 and Pac 12 have right now said it's not happening in the fall?

Kirk Wakefield:

Yeah. Well, here's my personal view, which might be also a professional view. I just gush in that way. My personal view and leaning over to the professional view is that most of those decisions are not really based so much on safety, as much as it is on liability, as some of our listeners I'm sure have seen. If you think about it, for college sports, for the athletes themselves, good grief. They couldn't have better care than what they get at athletics. So if you're telling us that it's for their safety, that's hard for me to swallow. Could you say it's for the safety of the fans? Maybe. So fine. But I think it's mostly just not wanting to be liable if and when that, because it will happen, somebody gets COVID and they go, "Oh, well, that never would have happened if you hadn't had my child there." Of course, they omit the possibility that your child would have also gotten it wherever else where they would have had less care on many levels. So that's my take on it.

Derek Smith:

Sure. When you think about, you talk about college athletics versus pro athletics, obviously there's a lot of similarities when you think about sponsorships, when you think about fans in the stands versus not. But what are some of the key differences in the way that you say you mentioned the Dallas Cowboys versus a collegiate team, a collegiate program has to approach this?

Kirk Wakefield:

Yeah. I mean, on the sponsorship side, I'd say the advantage the pros have is these huge databases of hundreds of thousands of fans that are addressable that they can reach and market to, if you will, all year long. You may have seen, I think I included one of the articles on Forbes. I took a look at web traffic data. And you can see that actually even in the off season, pro teams get about half as many fans. They're still roaming their websites during the off season. Interestingly, college sports, they have pretty steady web traffic on there. Like our Baylor Bear site, the sports related websites for college sports, there's a lot of web traffic that's there. What college lacks though is a little bit of the ability to directly address them by email campaigns and other ways to market to them. Whereas pro teams have that ability through their databases. But everybody still has the website. Everybody still has social. And still some, I guess, extracurricular, experiential things that are now kind of gone to Zoom. Like I mentioned, having Zoom meetings. I'm sure everybody's done those, but you can do them in mass and you can have guests actually get there easier than you could have before perhaps.

Derek Smith:

This is Baylor Connections. We are visiting with Dr. Kirk Wakefield, the Edwin W. Streetman Professor of Retail Marketing and executive director of sports strategy and sales in Baylor's Hankamer School of Business. And you talked about social media. If you think about it right now, about the only place fans can can gather in large groups is on the web. Obviously not going to the games or you're not connecting at the sports bar or what have you. Has that fact and what you've been studying in any way shaped your thinking even more about fan passion and the role of social media in harnessing that?

Kirk Wakefield:

Yeah, I think I saw some numbers, I know I did early on, maybe the second or third month of the pandemic, if you will, that social media uses up at least 7% for those that can be reached through Facebook ads, let's say, or other sponsored ads on Instagram or Twitter are up in large percentages because yeah, what else are you going to be doing? And they're still following their teams and their passion, right? So again, that's a good sign on the sponsorship side that you now can probably reach more or will be reaching more than previously. And they're more tuned in. I always think of what a friend of mine, Jon Heidtke, he used to be a general manager at Fox Sports Southwest. And he said to us a few years ago, and we were talking about fan passion and he said, "You know, what we have with the regional sports networks like the Rangers and Mavs and so on, Spurs, is we have the lean in factor." And you think about sports versus anything else except for maybe The Bachelor, I don't know.

Derek Smith:

Dancing With The Stars?

Kirk Wakefield:

Yeah, I mean, it fits there too, right? So you've got that lean in factor where you're sitting in your seat, leaning in paying attention, even you're not skipping out on the commercials because you don't want to miss a play. And you've noticed that. And by the way, this is still also an advantage during what we we're learning. You've seen this for a while in golf, you've seen it in NFL where they play through. So they're showing the match, they're showing the sideline during commercial and the commercial's taking up half the screen. I mean, that's really smart, right? So if I'm a passionate fan, which I am, I'm not stepping away if I can help it because I want to see what's going on even if it is dead ball. Yeah, I want to see what's happening then. So yes, they're hanging out on social, they're visiting the team website 365. I think that's one of the biggest, I think, breakthroughs that teams are getting and picking on the partnership or sponsorship sales side. They're realizing, "Oh yeah, maybe we won't even have games. Does that mean people don't care anymore?" I mean, no. They do. They're still going to your website. They're talking about you on social. So wow. I can still reach them. And I don't have to just think about, "Well, it's that Saturday, those eight Saturdays or six Saturdays or whatever it is at home. Plus the away games."

Derek Smith:

You mentioned the split screen on television and certainly ways that television and technology are pioneering new ways people can watch the games, and online. One thing that sports has going for it is that it is live and it is appointment viewing. From the standpoint of advertisers, for companies that would like to reach sports fans and sports broadcasts, how unique is sports now in an era that most people have DVR? And if they start, like you mentioned, let's just say Dancing With the Stars or The Bachelor 15 minutes late and they can just fast forward through all the commercials. Maybe some people do that with sports, but not as many. How unique of a position does sports have when the games are going on? How appealing is that for advertisers right now?

Kirk Wakefield:

Well, you may have seen or our listeners may have heard how ad space has been sold out quickly for MLB, NBA, Turner Broadcasting, and so on have sold out, I think, of all their ads. And maybe Fox, I think, did the same with their baseball, or very close to it. So it's obviously helped that pent up demand. But one of the things that I was talking with ... So I have good friends out at Fox Sports and on their research side. And their campaign has been sports is now. And that's true, right? Compared to anything else, sports is, well, almost anything else, it's now. And later is not so good. I mean, it's almost like if you weren't there watching, you somehow didn't have an influence on it, on the game. Like, "I got to be there somehow to have an impact." So yeah, I think that's what makes sports and anything that's a live performance ... Well, it's really just sports because you think about concerts and other things, guess what? Or like you were saying, I can record any of those other things and it's still going to be pretty much just as good. Sports is definitely now.

Derek Smith:

Right. Visiting with Dr. Kirk Wakefield here on Baylor Connections. And Dr. Wakefield, we mentioned sports strategy and sales, which you and others under Dr. Darryl Lehnus really pioneered this over the last 15 years or so. 15 years, correct?

Kirk Wakefield:

Right. 2006 were our first grads.

Derek Smith:

2006, your first graduates. And let's just say right now I were one of your S3 students, a recent graduate working for a professional sports team in a position that is reliant on connecting with fans and, as you said, getting them to engage financially. What's some of the advice that you would give me about navigating the uncertainty yet also looking for those areas to potentially problem solve creatively?

Kirk Wakefield:

To me, the biggest thing is recognize your fans want to hear from you. In fact, with Baylor Athletics, who we work with in the S3 program, we have students who intern there and we help them with research. And one of the things that we were working on about in May, I remember the question came up is should we ask Baylor basketball fans if they ready to renew? I mean, it's a pandemic, right? Should we be asking them? I go, "Why don't we find out?" So we sent out a survey and some of our listeners probably completed it. And we've found the vast majority, I can't remember what, it was well over 90%, when we asked the question, are you ready to renew basketball season tickets? Said, "Yes, now." Three months into the pandemic. And so, I mean, that's kind of obvious as to why, I guess, our basketball fans would be willing to do that. Yeah. But I did some other research that found that was true for NHL fans, NBA fans. They wanted to hear from them. And in fact, I've always likened it to, as I've talked with various teams and so on advising, I guess, on this is what kind of friend are you if when things get tough, you go go dark? Right? Well, you're the team I love. And you should be hopefully reaching out to me because you love me too. Right? And you're communicating with me. And please don't take away the opportunity for me to be engaged, take action, to give you my money if I want, or to help, which is how Baylor fans think of it. Right? I mean, I think we want to help. We are, we want to give our money for the vast majority of us, right? We want to support. And the same is true for professional sports. So that's what the research I did showed, that both at Baylor and among professional sports fans. So that's what I tell you is your fans want to hear from you. Even if it's just to have a conversation, they want to hear from you. And then you can afford to play it cool for a little bit, but I think you'll find that many of them are willing to buy season tickets even now with the uncertainty. And in fact, that was one of the national surveys I did that found that, interestingly, kind of counterintuitive, that fans are actually more likely to be buying season tickets going forward than less likely. Part of it's the stimulus money that's stimulating. If you still have your job and you still have that income, or if you have extra money coming in from the government, anyway, it's stimulated more interest in buying season tickets, not less.

Derek Smith:

Visiting with Dr. Kirk Wakefield. And I'll ask you, Dr. Wakefield, we mentioned your S3 new students. And I know you've got students who have, some graduates who have done fantastic things. Brag on them for us, if you would, a little bit. What are some of the places and some of the roles that when you think of your graduates over 15 years, things that they're doing and ways they're impacting the sports industry?

Kirk Wakefield:

I mean, really, that first class is a good example. We had Todd Pollock, who's the vice president of sales and ticket sales and service at the Vegas Golden Knights. We have Drew Mitchell, who's the associate athletic director for Conference USA, basically the CRO. We have Lindsay Beale, who's director of sales down at the San Antonio Spurs. We've got a number of people in our analytics side. Those are all kind of the sales side. We have a number students now on the analytics side who are probably 20 to 30 different teams. So like Victoria Ham's a manager up at the New York Yankees. So we have a bunch of those out there that are very loyal, they interact with our students. We've got meetings set up this fall with class reunions on Zoom for every two years of graduates. They'll be meeting with us. Also to send off Darryl Lehnus, who's retiring this fall. Darryl and I've created the S3 program. Darryl gets to meet with them, as do I, to review old times and also introduce them to the new S3 director, which is Dr. Lane Wakefield, who oddly enough, is my son.

Derek Smith:

That's great, absolutely. Well, you and Dr. Lehnus have done a lot of great work and excited to see what the future holds there as well. As we head into the final couple of moments here on the program, Dr. Wakefield, I think we've talked a lot about, over these last 20 minutes or so, focusing on the business side, because frankly, we talk about a lot of the other things so much up in the air, and obviously this is your area of expertise anyway. But I'm curious what you think from the standpoint of we use the word new normal a lot, right? People talk about the new normal with the idea that once things get back to "normal," what is normal will be a little bit different than what we're used to. Are there areas that are going to be, that you think when you look at whenever life comes back to whatever that normal looks like, sports is going to be different, or it's going to look different in this area? Are there any areas that stand out to you as being right for a change when things come back?

Kirk Wakefield:

Yeah. I think one huge area is just the working from home, right? So I've talked with a number of executives who, on the agency side and also on the team side, who they found, guess what? You can work at home. I can trust you to do well. And people are saying, "I don't want to come back to the office, or at least much less." So they have to make those decisions as to I guess those expenses, whether to cut them or what. Probably the cut part. So I think that's going to be different. I think we will see more, of course, people selling, on the sales side of what we do and the analytics jobs, those can be done at home. And so I see a lot more of that still done, if you will, at distance. And where they live matters a little less than are you close to the office? I also think on just the selling of tickets, for instance, I think what we're learning is maybe you can sell a lot more online. I mean, good grief. Every other industry has been booming. During the pandemic, what have they been doing? Lululemon selling way more online. Even the brands that weren't that good at selling online like Under Armour, their sales shot up, even though overall they've been somewhat down. So I think the same thing is going to happen with tickets. You're going to see more digital selling, more online, fewer probably people in the sales department. So people that previously were there, they might decide maybe we need fewer of them when we return. That's not necessarily a great thing for a lot of our graduates, but what I hope our graduates are doing is thinking, "Okay, what's the next step?" So their skills, good news for them is they've got good data analytics skills, should have the ability to shift and do just fine.

Derek Smith:

Well, we know you'll continue to problem solve and they'll continue to problem solve. And we'll look forward to see what that looks like. And hopefully, as we mentioned, we see the news The Big 12 this week is moving towards playing. And assuming that's able to stay on track, we'll hopefully look forward to seeing you out around the games at some point this fall, Dr. Wakefield. We appreciate your time today.

Kirk Wakefield:

Thank you very much.

Derek Smith:

Thank you. Dr. Kirk Wakefield, the Edwin W. Streetman Professor of Retail Marketing, and executive director of sports strategy and sales in Baylor's Hankamer School of Business, our guest today on Baylor Connections. I'm Derek Smith. A reminder, you can hear this and other programs online at baylor.edu/connections. Thanks for joining us here on Baylor Connections.