(Mt) – Personal Branding of Athletes Discussion

2021 outlook for the US sports industry 2021 outlook for the US sports industry Interview with Pete Giorgio During 2020, we saw two seismic shifts in sports: the pandemic and, equally as big, the social justice movement. Because of the pandemic, there are likely to be ongoing restrictions to in-person fan attendance at US sports events extending into 2021. This will drive sports organizations to put a higher priority on identifying new ways to drive revenue and creating year-round, two-way relationships with fans. The need is dire: For example, in 2020, National Football League (NFL) teams are expected to lose an estimated $5.5 billion of stadium revenue, primarily in the form of ticket sales, concessions, sponsorships, and sales of team merchandise.1 Although many different diversity, equity, and inclusion issues have been perennial challenges in sports, a new urgency was created because of the events in the summer of 2020. It has become clear that US sports organizations can no longer be passive spectators around issues related to inequality and injustice. While many organizations stood behind their players during team protests and calls for action, there is still a lot of work to do across the industry. I believe that the impacts of the events of 2020 will be felt by the US sports industry for years to come, and 2021 will be a pivotal year—challenging fans, athletes, broadcasters, teams, and leagues alike in new and unexpected ways. Pete Giorgio US Sports Practice leader Deloitte Consulting LLP Key takeaways In 2021, sports organizations should consider three key strategic opportunities to boldly position themselves to thrive in the future: • Leverage digital tools to drive new revenue generation models • Be active in addressing race, gender, and LGBT+ inequality and injustice • Explore new ways to fuel year-round fan engagement 2 About Deloitte’s TMT industry outlook series Deloitte’s 2021 outlook for the US sports industry seeks to identify the strategic issues that sports organizations should consider in the coming year, including their impacts, key actions to take, and critical questions to ask. The goal is to equip US sports organizations with the information needed to position themselves for a strong, resilient future. 2021 outlook for the US sports industry Three critical issues for the sports industry to consider in 2021 1. Reshaping and expanding revenue generation models With many traditional revenue streams disappearing virtually overnight due to the pandemic, sports organizations are grappling with how to fill the void. Forward-looking organizations should consider a broad range of potential solutions, including monetization of data pertaining to fans, player and team performance, and sports betting; novel real estate plays; and unique partnerships with technology companies to help elevate the fan experience. 2. Rethinking the role of sports in society Although the struggle for social justice transcends sports, leagues and athletes possess powerful platforms that can fuel significant change for society as a whole. US sports organizations should consider making social justice a core component of their mission, culture, and brand. 3. Redefining relationships with fans The hollow echo of empty or partially filled stadiums highlights the critical need to establish year-round, two-way relationships with fans. With the pandemic likely to remain a major challenge throughout 2021, it is important for sports organizations to invest in multichannel digital solutions (everything from streaming platforms and augmented or virtual reality to artificial intelligence and “virtual fans”) that can influence fan behavior and boost their level of year-round engagement. It’s likely no longer sufficient simply to host a stand-alone app, website, or social media account; they’re all important, and they should be tightly integrated across channels. 3 2021 outlook for the US sports industry 1. Reshaping and expanding revenue generation models Even with the challenges posed by COVID-19, in-person fan attendance will undoubtedly remain a critical component of any team’s business model. As such, leagues and teams should do everything possible to facilitate phased reopenings of sports venues as soon as possible. This includes taking all the steps required to make fans feel safe about returning to stadiums and arenas, along with making investments to improve the overall fan experience at games. However, many US sports organizations are realizing that they should expand their business models beyond stadium-related sources of revenue. With the NBA finishing its 2019–2020 regular season and playoffs in a fanless “bubble” due to the COVID-19 pandemic, the league was set to lose about $500 million,2 making it a necessity to find ways to bring back fans to arenas and to create alternative sources of revenue in 2021. Key opportunities for growth One of the biggest sources of alternative revenue for US sports organizations in 2021 could be data monetization, particularly in the areas of fan engagement, player and team performance, and sports betting. The market for data-wranglers and aggregators is heating up as organizations increasingly employ data analytics to guide decision-making and support their marketing efforts. In terms of fan engagement, data-driven platforms and artificial intelligence can help organizations sense the sentiment of fans, analyze the data to better understand fan behavior, and then connect with fans in ways that generate a better fan experience and new sources of revenue. This combination of sensing, analysis, and engagement can fuel monetization on an integrated e-commerce and socially active platform. Within the overall fan ecosystem, data can help organizations monetize different fan-engagement “zones” through specific value-added incentives. This can include engaging fans on social media, through the team’s marketplace (website, store), via in-game offers (merchandise, refreshments), and by using hyper-personalized mobile advertising and gamification (real-time games and scoreboards with prizes).3 4 More than ever before, big data is also being used in sports to glean insights pertaining to player metrics and team performance. These data-driven insights are changing how games are played, managed, and monetized. As a result, sports data has become big business: According to Research and Markets analysts, the sports analytics industry is expected to reach nearly $4 billion by 2023 as teams, coaches, broadcasters, and rights holders harness data to improve performance and connect with fans.4 In one recent data monetization deal, the NCAA signed a 10-year contract with a UKbased technology company to collect and distribute intercollegiate sports data, which is being packaged, licensed, and sold to media companies and other interested parties. Of course, it’s important that data monetization initiatives be conducted in partnership with players’ associations to help minimize the potential for foul play, such as competitors and hackers trying to use individual or league data to their advantage. Data is likely destined to become an even hotter commodity as avenues for sports betting continue to expand across the United States. Professional sports leagues and the NCAA have a major opportunity to profit from the sale of data to sports data intelligence providers such as SportRadar, who can then repackage it for sale to sports betting operators. It’s important to note that in both Tennessee and Illinois, for example, new sports betting laws require operators to purchase “official league data,” enabling leagues to take advantage of a revenue stream that’s already in place. As a result, leagues can cut data deals worth hundreds of millions of dollars without compromising their brands.5 In addition, partnerships between companies with sports broadcast rights and sports betting operators may become more common in the future as they seek benefits from vertical integration and data-sharing. Other potential revenue-generation activities include: • Expanding novel partnerships that allow one or more technology companies to showcase their products while improving the fan experience.6 Organizations should consider breaking away from traditional category management, especially in the area of technology, and develop complex stories and platforms in which multiple vendors can participate. For example, in April 2020, the NBA signed a multiyear partnership to create a direct-to-consumer platform that will use artificial intelligence (AI) and machine learning to localize experiences for the league’s global fan base.7 Capabilities will include offering games in fans’ native languages, letting them chat during games, alternative audio and video feeds, real-time statistical overlays, gaming elements, and using archive footage to augment the viewing experience. 2021 outlook for the US sports industry • Attracting private equity investment to address revenue shortfalls and working capital needs. For example, several private equity investors were considering a possible stake in Serie A, Italy’s top-flight soccer league, in the summer of 2020.8 • Growing the fan base by meeting the needs of groups that have not traditionally participated in or followed the sport. For example, the NHL has a unique opportunity to increase the accessibility and visibility of ice hockey to groups it may have overlooked in the past, such as women and people of color. The league can address this challenge by establishing a presence through community outreach and promotion. One step in the right direction is the newly established Hockey Diversity Alliance (not affiliated with the NHL), which seeks to “inspire a new and diverse generation of hockey players and fans.” 9 Key challenges to overcome While data monetization represents a significant opportunity for sports organizations, it does require a sizable infrastructure investment to generate the desired impact. These costs (for everything from data collection to potentially purchasing third-party data) can be hard to justify unless an organization truly understands the potential return on investment. Another related challenge is resolving the lingering question about who actually owns the data. Is it the team? The players’ union? The league? Of course, the data owner should also abide by specific data privacy regulations (such as the GDPR in the European Union and the California Consumer Privacy Act). In addition, as data plays an ever-increasing role in management decision-making, trust will likely become an even bigger issue for athletes. How will data-sensing mechanisms be monitored to ensure that player performance data is accurate? Although sports betting continues to expand in the United States, it poses a unique set of challenges. For one thing, it comprises a complicated ecosystem of players that is still sorting itself out. Another issue is that US sports betting regulations vary by state (some states require players to register physically rather than digitally; some allow mobile betting, while others don’t). As the popularity of betting grows in the United States, leagues should adapt their officiating programs and compensation packages. Leagues are looking to take a cut of the new sports betting revenue stream with proposals like integrity fees, but there are additional considerations, such as how the leagues are already benefiting via increased viewership and attendance. 5 Actions companies should take now • Prioritize investment in digital infrastructure, people, and processes pertaining to fan data. • Build broader business acumen across your teams, along with considering nontraditional partnerships that bring outside perspectives. • Be willing to be bold. Use today’s challenging environment as an opportunity to try new things. Strategic questions to consider • What technologies (for example, data infrastructure technologies or in-stadium data collection) can enable new revenue opportunities? • Do you have a coherent and comprehensive strategy for monetizing fan and athlete performance data? How could you implement that strategy more effectively? • What learnings can you take from other sports organizations and/or other industries that have done a good job driving new revenues since the start of COVID-19? 2021 outlook for the US sports industry 2. Rethinking the role of sports in society Leagues, teams, and athletes possess powerful platforms that can promote positive change for society as a whole. Sports organizations should embrace the critical role they can play in helping address race, gender, and LGBT+ inequality and injustice. Many fans expect it—and future growth likely depends upon it.10 In fact, sports organizations should seriously consider the potentially adverse effects on their bottom lines of not addressing issues related to inequality and injustice. Now could be the time for organizations to make social justice a key tenet of their culture and brands. In simple terms, organizations should ensure they are always aware of shifting societal dynamics and prepared to address them. The sports world has been transformed by social justice, with athletes having a stronger voice, demanding action and playing an even bigger part as role models.11 Sports organizations’ level of commitment to combating social injustice can directly affect relationships with those athletes. Although more than 74% of the NBA’s players are Black, it had just three Black general managers as of March 2019.12 To begin to turn the tide against systemic racism, bias, and discrimination, leaders should develop six signature traits, according to Deloitte research: commitment, courage, cognizance of bias, curiosity, cultural intelligence, and collaboration.13 By cultivating and practicing these behaviors, leaders can foster a more inclusive workplace—both today and in the long term. When it comes to taking specific action, sports organizations should consider following the LEAD framework developed by Deloitte. The framework defines four areas on which organizations can focus when crafting the best possible response for its specific culture, values, and workforce: • Listen: Be sure to gain a full understanding of the breadth of current challenges before taking action. • Engage: Use conversations to spark learning and the proper course of action. • Acknowledge: Encourage frank discussions of race, ethnicity, and potential gender bias in the workplace. • Do: Don’t just say you’re going to do something—do it, with urgency. Key opportunities for growth Social justice has become so critical that future growth will likely be predicated upon how authentic organizations are in responding to this challenge. Players and fans increasingly expect leagues and teams to play a proactive role in the social justice movement.14 Deloitte’s Global Millennial Survey 2020 supports the notion that a proactive response to social injustice may be especially important to younger generations, many of whom tend to be more values-driven in how they engage with brands and businesses. One exciting opportunity for sports organizations is to potentially capitalize on the role athletes now play as important influencers. Organizations should explore connecting their brands with athletes who demonstrate an especially strong sense of purpose (for example, women’s tennis star and social justice advocate Naomi Osaka). Another important trend to watch is the rising level of investment in women’s sports. For example, the WNBA saw a 68% increase in regular-season average viewership in 2020.15 By partnering with the right brands, generating innovative and interesting content, and collaborating with nonsporting celebrities, women’s sports teams can build their own profiles and generate a large fan following. Social media represents an especially strong vehicle for women’s sports and brands to gain exposure and influence fans.16,17 6 2021 outlook for the US sports industry Key challenges to overcome Despite some positive developments in 2020, the fact remains that systemic racism, bias, and discrimination will take time to overcome. A key is for sports organizations to make social justice an essential component of their culture and brand—now. Of course, not all organizations share the same view when it comes to the social justice movement. Across college athletics and professional sports, some don’t want the politics of social justice interfering with their entertainment. It may be necessary for sports organizations to find the right balance: allowing their players to express themselves on and off the field or court as they see fit, standing behind them when appropriate, but keeping the games professional and free of too much political content. Another challenge is protecting the mental health of athletes. Mental health is a universal problem, but in the context of professional sports, the pandemic, racial injustice, and increased pressure from unique working conditions have brought the issue more to the fore. Studies have shown that historic social and economic inequality, racism, discrimination, violence, and poverty create greater mental health challenges for African-Americans.18 “It’s a miracle any AfricanAmerican player turns out OK based on where we come from,” NBA Hall of Famer Charles Barkley has said.19 For professional LGBT+ athletes, there can be unique mental health pressures as well, with potential fears around coming out to teammates and fans and the repercussions for their careers.20 7 Although more players are beginning to speak out about their mental health struggles, leagues and teams should take proactive steps to address the mental strain that athletes are enduring in this pivotal time of social change and crisis. Approaches should include everything from having mental health professionals on staff to staging events dedicated to building mental health awareness. Actions companies should take now • Make social justice a key tenet of your organization’s culture and brand. • Thoughtfully evaluate how your organization does (or does not) support growth and pathways into leadership in an inclusive way. • Develop a charter statement that the organization can stand behind and publicize. This can encourage sponsors and donors to make their decisions based on league and team policy rather than specific player actions. • Develop internal and external expertise and relationships to manage mental health issues in sports. Strategic questions to consider • What steps can I take as a leader to personally improve working conditions within my organization? • What processes can I put in place to ensure the recruitment, growth, promotion, and retention of all employees within my organization to ensure that league and team leadership reflects the diversity of the athletes and fans of my sports? 2021 outlook for the US sports industry 3. Redefining relationships with fans Heading into 2021, it appears that the specter of COVID-19 will continue to haunt live sporting events across the United States— dramatically reducing fans’ willingness to return to stadiums and arenas. In one recent survey conducted by Seton Hall University’s Stillman School of Business, 61% of respondents who identified themselves as “sports fans” said they would not attend another live sports event until a COVID-19 vaccine has been developed and distributed.21 While it’s been increasingly important for sports organizations to tighten fan engagement for some time, COVID-19 has amplified the critical need to reimagine the way they engage with their fan bases. Their focus should be on unlocking the power of digital technologies to build year-round, two-way relationships with fans. First and foremost, those relationships should be built on a solid foundation of trust. As sports organizations attempt to navigate the COVID-19 crisis and thrive in the long term, they should focus on four dimensions of trust: physical, emotional, financial, and digital:22 • Can fans trust that physical locations (stadiums, arenas) are safe? • Can fans trust that their emotional and societal needs are being safeguarded? • Can fans trust that their economic and financial concerns are being served? • Can fans trust that their personal information is secure? According to the Deloitte Fan Experience survey, more than 60% of fans agreed that having a great “year-round experience” would make them more likely to become more engaged with their team in the coming season, while 55% said that it would make them more likely to purchase a ticket in the future.23 8 Once they’ve established a solid foundation of trust, sports organizations have an unprecedented opportunity to enhance their relationships with all fan types (from casual followers to fanatics) throughout the year. Deloitte’s fan engagement survey revealed that the more fans engage with their teams year-round, the more likely they are to purchase tickets and merchandise during the season.24 The study also found that: • 95% of fans currently have some form of interaction with their favorite team or league in the off-season. • 65% of fans say they want to receive some form of content from their team at least monthly during the off-season. • Across all fan types, those who engage just once a month in the off-season spend 40% more than fans who have no engagement during the off-season. To truly maximize opportunities in the area of fan engagement, it’s essential that sports organizations truly understand their fan bases—with the ability to segment fan groups (for example, casual fans, those “who love the game,” and fanatics). This segmentation allows organizations to strategically target and incentivize different fan groups based on their level of commitment and behaviors. For example, while fanatics might desire daily social media notifications, casual fans could find them annoying. Organizations should strive to find the optimal frequency for communications based on each fan’s profile. 2021 outlook for the US sports industry Key opportunities for growth First and foremost, it’s critical that sports organizations invest in the infrastructure required to power digital channels, streaming platforms, and augmented and virtual reality solutions. Organizations should consider employing a wide range of channels and content types to meet varying needs across their fan bases. For example, the Deloitte Fan Experience survey found that when seeking rapid updates, fans prefer to use sports news websites, television, and social media. Fan demographics also shape their channel preferences: Deloitte’s survey found that millennials are 40% more likely than baby boomers to use social media to obtain information about their favorite teams and players. In addition, 40% of fans in Deloitte’s survey indicated that the presence of real-time augmented reality stats on screen would increase their likelihood of watching a live game.25 Sports leagues and athletes also should move beyond traditional broadcasts and start interacting directly with their fans. For example, they should encourage their athletes to become increasingly active on social media year-round to maximize fan engagement and monetization opportunities. Recently, athletes from the NHL and NBA have leveraged leading social media platforms to provide a window into their personal lives, post workouts, host livestreams with other athletes, and even interview health experts to spread awareness about COVID-19.26 9 Athletes have also enhanced their brands and extended fan engagement by participating in live-streamed esports and casual gaming events. In some cases, third parties are doing a better job than teams and leagues in terms of making players more accessible to fans and providing a “behind-the-scenes” look at sports. Platforms like Barstool Sports use podcasts like Pardon My Take and Spittin’ Chiclets to fill gaps in the content that teams and leagues provide. Leagues and teams have the ability to offer this content and take advantage of the advertising and other revenues currently being won by third parties. As the US sports sector continues to transform digitally, many leagues and teams are also finding innovative ways to use advanced technologies such as artificial intelligence to customize content curation, uncover interesting statistics for fans, and employ chatbots for targeted promotions and sales of subscriptions and merchandise.27 Major League Soccer’s Los Angeles FC was one of the first teams to develop an AI-powered virtual assistant (Olly) to enable preordering from concessions and messaging via mobile phones, further enhancing the fan experience.28 2021 outlook for the US sports industry Sports organizations should consider several other vehicles to boost fan engagement: • Esports: As the popularity of esports continues to skyrocket, it is helping teams, leagues, and athletes boost fan engagement. For example, the COVID-19 pandemic led the NBA’s Phoenix Suns to simulate its remaining regular-season games on NBA 2K, streamed on Twitch. In their debut stream, set to mimic their scheduled game against the Dallas Mavericks, the Suns’ Twitch stream reportedly drew 221,000 views.29 • Fantasy sports: Studies have shown that fantasy sports make fans more likely to watch games on television and attend them in-person.30 • Sports betting: Fans who participate in sports betting are increasingly watching not only their favorite teams, but also any other games on which they’ve pl bets. • Fan districts: To help extend the in-stadium experience, teams should explore partnering with municipalities to build “fan districts,” such as Ballpark Village adjacent to Busch Stadium in downtown St. Louis or the development districts around SoFi Stadium in Los Angeles. • In-stadium improvements: To help bring fans back to stadiums, organizations should present a stronger sales proposition regarding the benefits of in-person attendance. Teams should consider making several improvements, including contactless technology, better in-stadium connectivity (taking full advantage of 5G wireless technology), and more player-fan engagement exclusive to the live venue. Key challenges to overcome Effective fan engagement relies heavily upon having the best data possible to enable highly personalized interactions with fans. As such, sports organizations should put the security of fan connections and data at the center of their digital strategies in order to maintain trust. As part of this effort, they should abide by data privacy regulations, such as the European Union’s GDPR and the California Consumer Privacy Act. These regulations have led team owners to reevaluate and improve the ways they gather, process, and store confidential fan and athlete data.31 As a result, sports organizations are emphasizing consent-based data marketing, increasing the roles and responsibilities of data controllers, and adjusting budgets to account for the cost of complying with data privacy regulations.32 10 Given the imperative to identify new revenue generation opportunities and ways of engaging with fans, sports organizations should attract and retain specialized data analytics talent. These skills are especially critical to targeting specific fan segments with personalized offers. Traditional sports broadcasters now face stiff competition from social media and streaming video services, all of which have secured deals to stream live sports events. Sports organizations are now challenged with balancing the needs of fans who primarily view traditional broadcasts and those who prefer the digital platforms.33 2021 outlook for the US sports industry Actions companies should take now Strategic questions to consider • Examine the actions of other industries. Explore and learn lessons from how retailers and consumer products companies have engaged customers over the past decade. • Without new games on TV or streaming services, where are athletes and fans connecting, and which channels are most effective at fan engagement? • Redevelop mobile apps, with a greater emphasis on delivering unique and added value to fans via content exclusives and personalized rewards programs. • How does a franchise’s mobile app support a holistic, data-driven strategy across the business? How does it leverage data to deliver premium experiences to fans? • Experiment with content and storytelling to create strong programming around teams and athletes. • How can teams leverage their most popular athletes to create more stories and fan touchpoints? • Prioritize fan data by considering a portfolio approach to events, products, and services that meet different needs across different touchpoints throughout the year. • How can leagues and teams take full advantage of 5G technology to boost fan engagement and the overall in-stadium experience? 11 2021 outlook for the US sports industry Looking boldly to the future In spring 2020, a couple of months into the COVID-19 pandemic, we stated that the US sports industry had an unprecedented opportunity to reevaluate its business models and build a new future. Success would likely require that sports organizations develop strong connections with customers, robust sensing and modeling capabilities, and the ability to continually reinvent how they think and operate. As we prepare to enter 2021, those imperatives remain unchanged. It has never been more critical for sports organizations to acquire the digital capabilities needed to unlock innovative revenue generation possibilities and new levels of engagement with fans. 12 At the same time, sports organizations should make social justice an indispensable element of their culture and brand. Race, gender, and LGBT+ inequities will only hinder the progress needed to build successful sports organizations of the future. To meet these challenges, sports organizations need bold leaders with a willingness to try new things. This includes looking beyond sports to leverage business approaches that have benefited successful companies in other industries. 2021 outlook for the US sports industry Endnotes 1. Mike Ozanian, “The Stadium Revenue Each NFL Team Will Lose If Games Are Played Without Fans,” Forbes, May 18, 2020. 2. Rob Schaefer, “Report: NBA could lose ‘nearly $500 million’ in ticket revenue without games,” NBC Sports, March 12, 2020. 3. Mohamed Anis, “Sense, Analyze, Engage: How to Successfully Monetize Your Fan Ecosystem,” Infosys, 2017. 4. Lee Rickwood, “Sports Scores, Stats and Big Data Analytics Bring Whole New Ballgame,” WhatsYourTech.ca, May 23, 2018. 5. Jill R. Dorson, “Best Ways for NCAA to Monetize Sports Betting,” SportsHandle, August 13, 2019. 6. Hookit, “How Technology Companies Are Leveraging Sports Sponsorships to Grow Their Brand,” December 6, 2018. 7. SportBusiness, “NBA Signs Multi-faceted Technology Partnership with Microsoft,” April 16, 2020. 8. Andrew Woodman, “Hard-Hit Sports World Finds New Fans: Private Equity Firms,” PitchBook, July 20, 2020. 9. Hockey Diversity Alliance, “Our Purpose.” 10. Ryan Barwick, “Sports Fans Are More Willing to Support Social Justice,” Adweek, August 31, 2020. 11. Sam Quinn, “NBA players want owners to be proactive, not reactive, in enacting social change, per reports,” CBS Sports, August 27, 2020. 12. Pete D. Camarillo, “Should the NBA Adopt the NFL’s Rooney Rule?” Medium, March 10, 2019. 13. Juliet Bourke and Bernadette Dillon, “The Six Signature Traits of Inclusive Leadership,” Deloitte Insights, April 14, 2016. 14. Chris Haynes, “Some NBA players remain dubious of owners’ commitment to social justice initiatives,” Yahoo! Sports, August 30, 2020. 15. Mechelle Voepel, “WNBA’s Cathy Engelbert says ‘pipeline is there’ for more diversity in league,” ESPN, October 1, 2020. 16. Izzy Wray, “Girls Aloud: Women’s Sport Booms,” Deloitte. 17. Deloitte, 2020 sports industry outlook. 18. Monnica T. Williams, PhD, “The Link Between Racism and PTSD,” Psychology Today, September 6, 2015. 19. Christina Similien, “NBA Stardom Isn’t a Cure for Mental Health Issues,” Ebony, October 10, 2019. 20. Alex Reimer, “Jason Collins says there’s still ‘fear’ among closeted NBA players about coming out,” Outsports, February 24, 2020. 13 2021 outlook for the US sports industry 21. Kelly Cohen, “Poll: Sports fans won’t attend games without coronavirus vaccine,” ESPN, April 10, 2020 22. Jennifer Lee, Bill Marquard, and Brenna Sniderman, “Embedding trust into COVID-19 recovery,” Deloitte, 2020. 23. Chad Deweese, Kat Harwood, and Lee Teller, “Say Goodbye to the Off-Season: Engaging Sports Fans Year-Round,” Deloitte, 2020. 24. Ibid. 25. Adam Deutsch, Kat Harwood, Lee Teller, and Chad Deweese, “The future of sports broadcasting: Enhancing digital fan engagement,” Deloitte, 2019. 26. Joshua Clipperton, “NHL players, teams trying to stay connected with fans during COVID-19 pandemic,” CTV News, Mar 24, 2020. 27. Venkat Viswanathan, “Why AI Is The Next Frontier In Sports Fan Engagement And Revenue,” Forbes, August 16, 2019. 28. LAFC PR, “LAFC Partners With Satisfi Labs To Launch In-Stadium Order-Ahead On Apple Business Chat,” July 18, 2019. 29. Bonneville International/KHTK Sports, “Phoenix Suns See Big Numbers As They Play Out Season On Twitch,” March 20, 2020. 30. Daniel Roberts, “As live sports return to TV, so do DraftKings and FanDuel ads,” Yahoo! Finance, August 4, 2020. 31. Ben Cronin, “Everton FC | Gathering fan data in the age of GDPR,” SportBusiness, March 21, 2019. 32. TGSM, “3 Ways GDPR Will Affect the Data Driven Fan Experience,” May 9, 2018. 33. Thomas Macaulay, “How technology is changing the sports fans’ experience,” Tech Advisor/IDG, July 31, 2019. 14 2021 outlook for the US sports industry Get in touch Pete Giorgio US Sports Practice leader Deloitte Consulting LLP +1 617 437 3459 pgiorgio@deloitte.com LinkedIn 15 This publication contains general information only and Deloitte is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional adviser. Deloitte shall not be responsible for any loss sustained by any person who relies on this publication. About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. In the United States, Deloitte refers to one or more of the US member firms of DTTL, their related entities that operate using the “Deloitte” name in the United States, and their respective affiliates. Certain services may not be available to attest clients under the rules and regulations of public accounting. Please see www.deloitte.com/about to learn more about our global network of member firms. Copyright © 2020 Deloitte Development LLC. All rights reserved. Personal Branding of Athletes: Name, Image, and Likeness Personal brand assignment Students will develop a personal brand assessment. The brand assessment can be completed with a focus on the student’s personal brand or an athlete’s personal brand. The assessment includes an overview of related brands and their influence on the personal brand, analysis of competitive brands, and a personal brand positioning statement. The personal brand assessment is completed individually and roughly 600 words. Students will submit this assignment via Canvas by November 15th. The assignment consists of five parts: 1. Describe the athlete (name, sport, team, background). Provide a link to their social media profiles. 2. Provide an overview of the related brands and their influence on the athlete’s personal brand. 3. Describe the unique brand positioning of the athlete. 4. Identify three ‘comparable but different’ athletes. Outline why they are comparable, as well as what makes them different. Provide their name and links to their social media profile. 5. Create a ‘personal brand positioning statement’ for the athlete. Requirements if you select an athlete other than yourself, the athlete should: • Currently be active in their sport • Have less than 50’000 followers on any social media platform (it’s ok if they have a combined following above 50’000). The brand assessment should be formatted visually appealing. Limited 0-69% Developing 70-79% Proficient 80-89% Exemplary 90-100% % 1 Athlete Overview Level of analysis results in basic or uncertain judgments that offer a limited amount of plausible or applicable conclusions. Errors in synthesis/interpretation result in limited inferences. Level of analysis results in judgments that offer some reasonable and practical conclusions. Some errors in synthesis or interpretation result in incomplete inferences. Level of analysis results in competent judgments that offer several reasonable, practical and qualified conclusions. Minor errors in synthesis or interpretation result in solid inferences. Related brands Level of analysis results in basic or uncertain judgments that offer a limited amount of plausible or applicable conclusions. Errors in synthesis/interpretation result in limited inferences. Level of analysis results in judgments that offer some reasonable and practical conclusions. Some errors in synthesis or interpretation result in incomplete inferences. Level of analysis results in competent judgments that offer several reasonable, practical and qualified conclusions. Minor errors in synthesis or interpretation result in solid inferences. Unique brand position Level of analysis results in basic or uncertain judgments that offer a limited amount of plausible or applicable conclusions. Errors in synthesis/interpretation result in limited inferences. Level of analysis results in judgments that offer some reasonable and practical conclusions. Some errors in synthesis or interpretation result in incomplete inferences. Level of analysis results in competent judgments that offer several reasonable, practical and qualified conclusions. Minor errors in synthesis or interpretation result in solid inferences. Competition Level of analysis results in basic or uncertain judgments that offer a limited amount of plausible or applicable conclusions. Errors in synthesis/interpretation result in limited inferences. Level of analysis results in judgments that offer some reasonable and practical conclusions. Some errors in synthesis or interpretation result in incomplete inferences. Level of analysis results in competent judgments that offer several reasonable, practical and qualified conclusions. Minor errors in synthesis or interpretation result in solid inferences. Brand position statement Level of analysis results in basic or uncertain judgments that offer a limited amount of plausible or applicable conclusions. Errors in synthesis/interpretation result in limited inferences. Level of analysis results in judgments that offer some reasonable and practical conclusions. Some errors in synthesis or interpretation result in incomplete inferences. Level of analysis results in competent judgments that offer several reasonable, practical and qualified conclusions. Minor errors in synthesis or interpretation result in solid inferences. Mechanics & Style Language use: 1) does not adhere to grammatical, spelling, or punctuation rules, 2) is wordy and does not use precise details, 3) does not establish context Language is: 1) adheres to grammatical, spelling, or punctuation rules, yet contains some errors, 2) is somewhat concise and includes some detail, 3) Language use: 1) adheres to most grammatical, spelling, or punctuation rules – contains few errors, 2) is mostly concise and includes many precise Level of analysis results in insightful and comprehensive judgments that offer a number of reasonable, applicable and highly qualified conclusions. No errors in synthesis or interpretation result in concrete inferences. Level of analysis results in insightful and comprehensive judgments that offer a number of reasonable, applicable and highly qualified conclusions. No errors in synthesis or interpretation result in concrete inferences. Level of analysis results in insightful and comprehensive judgments that offer a number of reasonable, applicable and highly qualified conclusions. No errors in synthesis or interpretation result in concrete inferences. Level of analysis results in insightful and comprehensive judgments that offer a number of reasonable, applicable and highly qualified conclusions. No errors in synthesis or interpretation result in concrete inferences. Level of analysis results in insightful and comprehensive judgments that offer a number of reasonable, applicable and highly qualified conclusions. No errors in synthesis or interpretation result in concrete inferences. Language use: 1) demonstrates sophisticated awareness and use of grammar and written mechanics and contains no 10% 10% 20% 20% 10% 20% 2 for information’s value, and/or 4) does not use an appropriate, professional style and tone. Format Surface features and branding need development throughout the report. The report lacks polish and/or appears unprofessional in nature. Possibly lacks branding throughout. somewhat establishes context for information’s value, and/or 4) somewhat uses an appropriate, professional style and tone. Surface features and branding meet expectations throughout the report. Professional look and feel to the report itself. details, 3) establishes context for information’s value, and/or 4) mostly uses an appropriate, professional style and tone. Surface features and branding are above average and cohesive throughout the report. Above average professional look and feel to the report itself. spelling/grammatical mistakes, 2) concise and includes precise language, 3) clearly establishes the appropriate context for why information is important, and/or 4) consistently uses an appropriate, professional style and tone. Surface features and branding are excellent and cohesive throughout the report. Superior professional look and feel to the report itself. 10% 3 2021 outlook for the US sports industry 2021 outlook for the US sports industry Interview with Pete Giorgio During 2020, we saw two seismic shifts in sports: the pandemic and, equally as big, the social justice movement. Because of the pandemic, there are likely to be ongoing restrictions to in-person fan attendance at US sports events extending into 2021. This will drive sports organizations to put a higher priority on identifying new ways to drive revenue and creating year-round, two-way relationships with fans. The need is dire: For example, in 2020, National Football League (NFL) teams are expected to lose an estimated $5.5 billion of stadium revenue, primarily in the form of ticket sales, concessions, sponsorships, and sales of team merchandise.1 Although many different diversity, equity, and inclusion issues have been perennial challenges in sports, a new urgency was created because of the events in the summer of 2020. It has become clear that US sports organizations can no longer be passive spectators around issues related to inequality and injustice. While many organizations stood behind their players during team protests and calls for action, there is still a lot of work to do across the industry. I believe that the impacts of the events of 2020 will be felt by the US sports industry for years to come, and 2021 will be a pivotal year—challenging fans, athletes, broadcasters, teams, and leagues alike in new and unexpected ways. Pete Giorgio US Sports Practice leader Deloitte Consulting LLP Key takeaways In 2021, sports organizations should consider three key strategic opportunities to boldly position themselves to thrive in the future: • Leverage digital tools to drive new revenue generation models • Be active in addressing race, gender, and LGBT+ inequality and injustice • Explore new ways to fuel year-round fan engagement 2 About Deloitte’s TMT industry outlook series Deloitte’s 2021 outlook for the US sports industry seeks to identify the strategic issues that sports organizations should consider in the coming year, including their impacts, key actions to take, and critical questions to ask. The goal is to equip US sports organizations with the information needed to position themselves for a strong, resilient future. 2021 outlook for the US sports industry Three critical issues for the sports industry to consider in 2021 1. Reshaping and expanding revenue generation models With many traditional revenue streams disappearing virtually overnight due to the pandemic, sports organizations are grappling with how to fill the void. Forward-looking organizations should consider a broad range of potential solutions, including monetization of data pertaining to fans, player and team performance, and sports betting; novel real estate plays; and unique partnerships with technology companies to help elevate the fan experience. 2. Rethinking the role of sports in society Although the struggle for social justice transcends sports, leagues and athletes possess powerful platforms that can fuel significant change for society as a whole. US sports organizations should consider making social justice a core component of their mission, culture, and brand. 3. Redefining relationships with fans The hollow echo of empty or partially filled stadiums highlights the critical need to establish year-round, two-way relationships with fans. With the pandemic likely to remain a major challenge throughout 2021, it is important for sports organizations to invest in multichannel digital solutions (everything from streaming platforms and augmented or virtual reality to artificial intelligence and “virtual fans”) that can influence fan behavior and boost their level of year-round engagement. It’s likely no longer sufficient simply to host a stand-alone app, website, or social media account; they’re all important, and they should be tightly integrated across channels. 3 2021 outlook for the US sports industry 1. Reshaping and expanding revenue generation models Even with the challenges posed by COVID-19, in-person fan attendance will undoubtedly remain a critical component of any team’s business model. As such, leagues and teams should do everything possible to facilitate phased reopenings of sports venues as soon as possible. This includes taking all the steps required to make fans feel safe about returning to stadiums and arenas, along with making investments to improve the overall fan experience at games. However, many US sports organizations are realizing that they should expand their business models beyond stadium-related sources of revenue. With the NBA finishing its 2019–2020 regular season and playoffs in a fanless “bubble” due to the COVID-19 pandemic, the league was set to lose about $500 million,2 making it a necessity to find ways to bring back fans to arenas and to create alternative sources of revenue in 2021. Key opportunities for growth One of the biggest sources of alternative revenue for US sports organizations in 2021 could be data monetization, particularly in the areas of fan engagement, player and team performance, and sports betting. The market for data-wranglers and aggregators is heating up as organizations increasingly employ data analytics to guide decision-making and support their marketing efforts. In terms of fan engagement, data-driven platforms and artificial intelligence can help organizations sense the sentiment of fans, analyze the data to better understand fan behavior, and then connect with fans in ways that generate a better fan experience and new sources of revenue. This combination of sensing, analysis, and engagement can fuel monetization on an integrated e-commerce and socially active platform. Within the overall fan ecosystem, data can help organizations monetize different fan-engagement “zones” through specific value-added incentives. This can include engaging fans on social media, through the team’s marketplace (website, store), via in-game offers (merchandise, refreshments), and by using hyper-personalized mobile advertising and gamification (real-time games and scoreboards with prizes).3 4 More than ever before, big data is also being used in sports to glean insights pertaining to player metrics and team performance. These data-driven insights are changing how games are played, managed, and monetized. As a result, sports data has become big business: According to Research and Markets analysts, the sports analytics industry is expected to reach nearly $4 billion by 2023 as teams, coaches, broadcasters, and rights holders harness data to improve performance and connect with fans.4 In one recent data monetization deal, the NCAA signed a 10-year contract with a UKbased technology company to collect and distribute intercollegiate sports data, which is being packaged, licensed, and sold to media companies and other interested parties. Of course, it’s important that data monetization initiatives be conducted in partnership with players’ associations to help minimize the potential for foul play, such as competitors and hackers trying to use individual or league data to their advantage. Data is likely destined to become an even hotter commodity as avenues for sports betting continue to expand across the United States. Professional sports leagues and the NCAA have a major opportunity to profit from the sale of data to sports data intelligence providers such as SportRadar, who can then repackage it for sale to sports betting operators. It’s important to note that in both Tennessee and Illinois, for example, new sports betting laws require operators to purchase “official league data,” enabling leagues to take advantage of a revenue stream that’s already in place. As a result, leagues can cut data deals worth hundreds of millions of dollars without compromising their brands.5 In addition, partnerships between companies with sports broadcast rights and sports betting operators may become more common in the future as they seek benefits from vertical integration and data-sharing. Other potential revenue-generation activities include: • Expanding novel partnerships that allow one or more technology companies to showcase their products while improving the fan experience.6 Organizations should consider breaking away from traditional category management, especially in the area of technology, and develop complex stories and platforms in which multiple vendors can participate. For example, in April 2020, the NBA signed a multiyear partnership to create a direct-to-consumer platform that will use artificial intelligence (AI) and machine learning to localize experiences for the league’s global fan base.7 Capabilities will include offering games in fans’ native languages, letting them chat during games, alternative audio and video feeds, real-time statistical overlays, gaming elements, and using archive footage to augment the viewing experience. 2021 outlook for the US sports industry • Attracting private equity investment to address revenue shortfalls and working capital needs. For example, several private equity investors were considering a possible stake in Serie A, Italy’s top-flight soccer league, in the summer of 2020.8 • Growing the fan base by meeting the needs of groups that have not traditionally participated in or followed the sport. For example, the NHL has a unique opportunity to increase the accessibility and visibility of ice hockey to groups it may have overlooked in the past, such as women and people of color. The league can address this challenge by establishing a presence through community outreach and promotion. One step in the right direction is the newly established Hockey Diversity Alliance (not affiliated with the NHL), which seeks to “inspire a new and diverse generation of hockey players and fans.” 9 Key challenges to overcome While data monetization represents a significant opportunity for sports organizations, it does require a sizable infrastructure investment to generate the desired impact. These costs (for everything from data collection to potentially purchasing third-party data) can be hard to justify unless an organization truly understands the potential return on investment. Another related challenge is resolving the lingering question about who actually owns the data. Is it the team? The players’ union? The league? Of course, the data owner should also abide by specific data privacy regulations (such as the GDPR in the European Union and the California Consumer Privacy Act). In addition, as data plays an ever-increasing role in management decision-making, trust will likely become an even bigger issue for athletes. How will data-sensing mechanisms be monitored to ensure that player performance data is accurate? Although sports betting continues to expand in the United States, it poses a unique set of challenges. For one thing, it comprises a complicated ecosystem of players that is still sorting itself out. Another issue is that US sports betting regulations vary by state (some states require players to register physically rather than digitally; some allow mobile betting, while others don’t). As the popularity of betting grows in the United States, leagues should adapt their officiating programs and compensation packages. Leagues are looking to take a cut of the new sports betting revenue stream with proposals like integrity fees, but there are additional considerations, such as how the leagues are already benefiting via increased viewership and attendance. 5 Actions companies should take now • Prioritize investment in digital infrastructure, people, and processes pertaining to fan data. • Build broader business acumen across your teams, along with considering nontraditional partnerships that bring outside perspectives. • Be willing to be bold. Use today’s challenging environment as an opportunity to try new things. Strategic questions to consider • What technologies (for example, data infrastructure technologies or in-stadium data collection) can enable new revenue opportunities? • Do you have a coherent and comprehensive strategy for monetizing fan and athlete performance data? How could you implement that strategy more effectively? • What learnings can you take from other sports organizations and/or other industries that have done a good job driving new revenues since the start of COVID-19? 2021 outlook for the US sports industry 2. Rethinking the role of sports in society Leagues, teams, and athletes possess powerful platforms that can promote positive change for society as a whole. Sports organizations should embrace the critical role they can play in helping address race, gender, and LGBT+ inequality and injustice. Many fans expect it—and future growth likely depends upon it.10 In fact, sports organizations should seriously consider the potentially adverse effects on their bottom lines of not addressing issues related to inequality and injustice. Now could be the time for organizations to make social justice a key tenet of their culture and brands. In simple terms, organizations should ensure they are always aware of shifting societal dynamics and prepared to address them. The sports world has been transformed by social justice, with athletes having a stronger voice, demanding action and playing an even bigger part as role models.11 Sports organizations’ level of commitment to combating social injustice can directly affect relationships with those athletes. Although more than 74% of the NBA’s players are Black, it had just three Black general managers as of March 2019.12 To begin to turn the tide against systemic racism, bias, and discrimination, leaders should develop six signature traits, according to Deloitte research: commitment, courage, cognizance of bias, curiosity, cultural intelligence, and collaboration.13 By cultivating and practicing these behaviors, leaders can foster a more inclusive workplace—both today and in the long term. When it comes to taking specific action, sports organizations should consider following the LEAD framework developed by Deloitte. The framework defines four areas on which organizations can focus when crafting the best possible response for its specific culture, values, and workforce: • Listen: Be sure to gain a full understanding of the breadth of current challenges before taking action. • Engage: Use conversations to spark learning and the proper course of action. • Acknowledge: Encourage frank discussions of race, ethnicity, and potential gender bias in the workplace. • Do: Don’t just say you’re going to do something—do it, with urgency. Key opportunities for growth Social justice has become so critical that future growth will likely be predicated upon how authentic organizations are in responding to this challenge. Players and fans increasingly expect leagues and teams to play a proactive role in the social justice movement.14 Deloitte’s Global Millennial Survey 2020 supports the notion that a proactive response to social injustice may be especially important to younger generations, many of whom tend to be more values-driven in how they engage with brands and businesses. One exciting opportunity for sports organizations is to potentially capitalize on the role athletes now play as important influencers. Organizations should explore connecting their brands with athletes who demonstrate an especially strong sense of purpose (for example, women’s tennis star and social justice advocate Naomi Osaka). Another important trend to watch is the rising level of investment in women’s sports. For example, the WNBA saw a 68% increase in regular-season average viewership in 2020.15 By partnering with the right brands, generating innovative and interesting content, and collaborating with nonsporting celebrities, women’s sports teams can build their own profiles and generate a large fan following. Social media represents an especially strong vehicle for women’s sports and brands to gain exposure and influence fans.16,17 6 2021 outlook for the US sports industry Key challenges to overcome Despite some positive developments in 2020, the fact remains that systemic racism, bias, and discrimination will take time to overcome. A key is for sports organizations to make social justice an essential component of their culture and brand—now. Of course, not all organizations share the same view when it comes to the social justice movement. Across college athletics and professional sports, some don’t want the politics of social justice interfering with their entertainment. It may be necessary for sports organizations to find the right balance: allowing their players to express themselves on and off the field or court as they see fit, standing behind them when appropriate, but keeping the games professional and free of too much political content. Another challenge is protecting the mental health of athletes. Mental health is a universal problem, but in the context of professional sports, the pandemic, racial injustice, and increased pressure from unique working conditions have brought the issue more to the fore. Studies have shown that historic social and economic inequality, racism, discrimination, violence, and poverty create greater mental health challenges for African-Americans.18 “It’s a miracle any AfricanAmerican player turns out OK based on where we come from,” NBA Hall of Famer Charles Barkley has said.19 For professional LGBT+ athletes, there can be unique mental health pressures as well, with potential fears around coming out to teammates and fans and the repercussions for their careers.20 7 Although more players are beginning to speak out about their mental health struggles, leagues and teams should take proactive steps to address the mental strain that athletes are enduring in this pivotal time of social change and crisis. Approaches should include everything from having mental health professionals on staff to staging events dedicated to building mental health awareness. Actions companies should take now • Make social justice a key tenet of your organization’s culture and brand. • Thoughtfully evaluate how your organization does (or does not) support growth and pathways into leadership in an inclusive way. • Develop a charter statement that the organization can stand behind and publicize. This can encourage sponsors and donors to make their decisions based on league and team policy rather than specific player actions. • Develop internal and external expertise and relationships to manage mental health issues in sports. Strategic questions to consider • What steps can I take as a leader to personally improve working conditions within my organization? • What processes can I put in place to ensure the recruitment, growth, promotion, and retention of all employees within my organization to ensure that league and team leadership reflects the diversity of the athletes and fans of my sports? 2021 outlook for the US sports industry 3. Redefining relationships with fans Heading into 2021, it appears that the specter of COVID-19 will continue to haunt live sporting events across the United States— dramatically reducing fans’ willingness to return to stadiums and arenas. In one recent survey conducted by Seton Hall University’s Stillman School of Business, 61% of respondents who identified themselves as “sports fans” said they would not attend another live sports event until a COVID-19 vaccine has been developed and distributed.21 While it’s been increasingly important for sports organizations to tighten fan engagement for some time, COVID-19 has amplified the critical need to reimagine the way they engage with their fan bases. Their focus should be on unlocking the power of digital technologies to build year-round, two-way relationships with fans. First and foremost, those relationships should be built on a solid foundation of trust. As sports organizations attempt to navigate the COVID-19 crisis and thrive in the long term, they should focus on four dimensions of trust: physical, emotional, financial, and digital:22 • Can fans trust that physical locations (stadiums, arenas) are safe? • Can fans trust that their emotional and societal needs are being safeguarded? • Can fans trust that their economic and financial concerns are being served? • Can fans trust that their personal information is secure? According to the Deloitte Fan Experience survey, more than 60% of fans agreed that having a great “year-round experience” would make them more likely to become more engaged with their team in the coming season, while 55% said that it would make them more likely to purchase a ticket in the future.23 8 Once they’ve established a solid foundation of trust, sports organizations have an unprecedented opportunity to enhance their relationships with all fan types (from casual followers to fanatics) throughout the year. Deloitte’s fan engagement survey revealed that the more fans engage with their teams year-round, the more likely they are to purchase tickets and merchandise during the season.24 The study also found that: • 95% of fans currently have some form of interaction with their favorite team or league in the off-season. • 65% of fans say they want to receive some form of content from their team at least monthly during the off-season. • Across all fan types, those who engage just once a month in the off-season spend 40% more than fans who have no engagement during the off-season. To truly maximize opportunities in the area of fan engagement, it’s essential that sports organizations truly understand their fan bases—with the ability to segment fan groups (for example, casual fans, those “who love the game,” and fanatics). This segmentation allows organizations to strategically target and incentivize different fan groups based on their level of commitment and behaviors. For example, while fanatics might desire daily social media notifications, casual fans could find them annoying. Organizations should strive to find the optimal frequency for communications based on each fan’s profile. 2021 outlook for the US sports industry Key opportunities for growth First and foremost, it’s critical that sports organizations invest in the infrastructure required to power digital channels, streaming platforms, and augmented and virtual reality solutions. Organizations should consider employing a wide range of channels and content types to meet varying needs across their fan bases. For example, the Deloitte Fan Experience survey found that when seeking rapid updates, fans prefer to use sports news websites, television, and social media. Fan demographics also shape their channel preferences: Deloitte’s survey found that millennials are 40% more likely than baby boomers to use social media to obtain information about their favorite teams and players. In addition, 40% of fans in Deloitte’s survey indicated that the presence of real-time augmented reality stats on screen would increase their likelihood of watching a live game.25 Sports leagues and athletes also should move beyond traditional broadcasts and start interacting directly with their fans. For example, they should encourage their athletes to become increasingly active on social media year-round to maximize fan engagement and monetization opportunities. Recently, athletes from the NHL and NBA have leveraged leading social media platforms to provide a window into their personal lives, post workouts, host livestreams with other athletes, and even interview health experts to spread awareness about COVID-19.26 9 Athletes have also enhanced their brands and extended fan engagement by participating in live-streamed esports and casual gaming events. In some cases, third parties are doing a better job than teams and leagues in terms of making players more accessible to fans and providing a “behind-the-scenes” look at sports. Platforms like Barstool Sports use podcasts like Pardon My Take and Spittin’ Chiclets to fill gaps in the content that teams and leagues provide. Leagues and teams have the ability to offer this content and take advantage of the advertising and other revenues currently being won by third parties. As the US sports sector continues to transform digitally, many leagues and teams are also finding innovative ways to use advanced technologies such as artificial intelligence to customize content curation, uncover interesting statistics for fans, and employ chatbots for targeted promotions and sales of subscriptions and merchandise.27 Major League Soccer’s Los Angeles FC was one of the first teams to develop an AI-powered virtual assistant (Olly) to enable preordering from concessions and messaging via mobile phones, further enhancing the fan experience.28 2021 outlook for the US sports industry Sports organizations should consider several other vehicles to boost fan engagement: • Esports: As the popularity of esports continues to skyrocket, it is helping teams, leagues, and athletes boost fan engagement. For example, the COVID-19 pandemic led the NBA’s Phoenix Suns to simulate its remaining regular-season games on NBA 2K, streamed on Twitch. In their debut stream, set to mimic their scheduled game against the Dallas Mavericks, the Suns’ Twitch stream reportedly drew 221,000 views.29 • Fantasy sports: Studies have shown that fantasy sports make fans more likely to watch games on television and attend them in-person.30 • Sports betting: Fans who participate in sports betting are increasingly watching not only their favorite teams, but also any other games on which they’ve pl bets. • Fan districts: To help extend the in-stadium experience, teams should explore partnering with municipalities to build “fan districts,” such as Ballpark Village adjacent to Busch Stadium in downtown St. Louis or the development districts around SoFi Stadium in Los Angeles. • In-stadium improvements: To help bring fans back to stadiums, organizations should present a stronger sales proposition regarding the benefits of in-person attendance. Teams should consider making several improvements, including contactless technology, better in-stadium connectivity (taking full advantage of 5G wireless technology), and more player-fan engagement exclusive to the live venue. Key challenges to overcome Effective fan engagement relies heavily upon having the best data possible to enable highly personalized interactions with fans. As such, sports organizations should put the security of fan connections and data at the center of their digital strategies in order to maintain trust. As part of this effort, they should abide by data privacy regulations, such as the European Union’s GDPR and the California Consumer Privacy Act. These regulations have led team owners to reevaluate and improve the ways they gather, process, and store confidential fan and athlete data.31 As a result, sports organizations are emphasizing consent-based data marketing, increasing the roles and responsibilities of data controllers, and adjusting budgets to account for the cost of complying with data privacy regulations.32 10 Given the imperative to identify new revenue generation opportunities and ways of engaging with fans, sports organizations should attract and retain specialized data analytics talent. These skills are especially critical to targeting specific fan segments with personalized offers. Traditional sports broadcasters now face stiff competition from social media and streaming video services, all of which have secured deals to stream live sports events. Sports organizations are now challenged with balancing the needs of fans who primarily view traditional broadcasts and those who prefer the digital platforms.33 2021 outlook for the US sports industry Actions companies should take now Strategic questions to consider • Examine the actions of other industries. Explore and learn lessons from how retailers and consumer products companies have engaged customers over the past decade. • Without new games on TV or streaming services, where are athletes and fans connecting, and which channels are most effective at fan engagement? • Redevelop mobile apps, with a greater emphasis on delivering unique and added value to fans via content exclusives and personalized rewards programs. • How does a franchise’s mobile app support a holistic, data-driven strategy across the business? How does it leverage data to deliver premium experiences to fans? • Experiment with content and storytelling to create strong programming around teams and athletes. • How can teams leverage their most popular athletes to create more stories and fan touchpoints? • Prioritize fan data by considering a portfolio approach to events, products, and services that meet different needs across different touchpoints throughout the year. • How can leagues and teams take full advantage of 5G technology to boost fan engagement and the overall in-stadium experience? 11 2021 outlook for the US sports industry Looking boldly to the future In spring 2020, a couple of months into the COVID-19 pandemic, we stated that the US sports industry had an unprecedented opportunity to reevaluate its business models and build a new future. Success would likely require that sports organizations develop strong connections with customers, robust sensing and modeling capabilities, and the ability to continually reinvent how they think and operate. As we prepare to enter 2021, those imperatives remain unchanged. It has never been more critical for sports organizations to acquire the digital capabilities needed to unlock innovative revenue generation possibilities and new levels of engagement with fans. 12 At the same time, sports organizations should make social justice an indispensable element of their culture and brand. Race, gender, and LGBT+ inequities will only hinder the progress needed to build successful sports organizations of the future. To meet these challenges, sports organizations need bold leaders with a willingness to try new things. This includes looking beyond sports to leverage business approaches that have benefited successful companies in other industries. 2021 outlook for the US sports industry Endnotes 1. Mike Ozanian, “The Stadium Revenue Each NFL Team Will Lose If Games Are Played Without Fans,” Forbes, May 18, 2020. 2. Rob Schaefer, “Report: NBA could lose ‘nearly $500 million’ in ticket revenue without games,” NBC Sports, March 12, 2020. 3. Mohamed Anis, “Sense, Analyze, Engage: How to Successfully Monetize Your Fan Ecosystem,” Infosys, 2017. 4. Lee Rickwood, “Sports Scores, Stats and Big Data Analytics Bring Whole New Ballgame,” WhatsYourTech.ca, May 23, 2018. 5. Jill R. Dorson, “Best Ways for NCAA to Monetize Sports Betting,” SportsHandle, August 13, 2019. 6. Hookit, “How Technology Companies Are Leveraging Sports Sponsorships to Grow Their Brand,” December 6, 2018. 7. SportBusiness, “NBA Signs Multi-faceted Technology Partnership with Microsoft,” April 16, 2020. 8. Andrew Woodman, “Hard-Hit Sports World Finds New Fans: Private Equity Firms,” PitchBook, July 20, 2020. 9. Hockey Diversity Alliance, “Our Purpose.” 10. Ryan Barwick, “Sports Fans Are More Willing to Support Social Justice,” Adweek, August 31, 2020. 11. Sam Quinn, “NBA players want owners to be proactive, not reactive, in enacting social change, per reports,” CBS Sports, August 27, 2020. 12. Pete D. Camarillo, “Should the NBA Adopt the NFL’s Rooney Rule?” Medium, March 10, 2019. 13. Juliet Bourke and Bernadette Dillon, “The Six Signature Traits of Inclusive Leadership,” Deloitte Insights, April 14, 2016. 14. Chris Haynes, “Some NBA players remain dubious of owners’ commitment to social justice initiatives,” Yahoo! Sports, August 30, 2020. 15. Mechelle Voepel, “WNBA’s Cathy Engelbert says ‘pipeline is there’ for more diversity in league,” ESPN, October 1, 2020. 16. Izzy Wray, “Girls Aloud: Women’s Sport Booms,” Deloitte. 17. Deloitte, 2020 sports industry outlook. 18. Monnica T. Williams, PhD, “The Link Between Racism and PTSD,” Psychology Today, September 6, 2015. 19. Christina Similien, “NBA Stardom Isn’t a Cure for Mental Health Issues,” Ebony, October 10, 2019. 20. Alex Reimer, “Jason Collins says there’s still ‘fear’ among closeted NBA players about coming out,” Outsports, February 24, 2020. 13 2021 outlook for the US sports industry 21. Kelly Cohen, “Poll: Sports fans won’t attend games without coronavirus vaccine,” ESPN, April 10, 2020 22. Jennifer Lee, Bill Marquard, and Brenna Sniderman, “Embedding trust into COVID-19 recovery,” Deloitte, 2020. 23. Chad Deweese, Kat Harwood, and Lee Teller, “Say Goodbye to the Off-Season: Engaging Sports Fans Year-Round,” Deloitte, 2020. 24. Ibid. 25. Adam Deutsch, Kat Harwood, Lee Teller, and Chad Deweese, “The future of sports broadcasting: Enhancing digital fan engagement,” Deloitte, 2019. 26. Joshua Clipperton, “NHL players, teams trying to stay connected with fans during COVID-19 pandemic,” CTV News, Mar 24, 2020. 27. Venkat Viswanathan, “Why AI Is The Next Frontier In Sports Fan Engagement And Revenue,” Forbes, August 16, 2019. 28. LAFC PR, “LAFC Partners With Satisfi Labs To Launch In-Stadium Order-Ahead On Apple Business Chat,” July 18, 2019. 29. Bonneville International/KHTK Sports, “Phoenix Suns See Big Numbers As They Play Out Season On Twitch,” March 20, 2020. 30. Daniel Roberts, “As live sports return to TV, so do DraftKings and FanDuel ads,” Yahoo! Finance, August 4, 2020. 31. Ben Cronin, “Everton FC | Gathering fan data in the age of GDPR,” SportBusiness, March 21, 2019. 32. TGSM, “3 Ways GDPR Will Affect the Data Driven Fan Experience,” May 9, 2018. 33. Thomas Macaulay, “How technology is changing the sports fans’ experience,” Tech Advisor/IDG, July 31, 2019. 14 2021 outlook for the US sports industry Get in touch Pete Giorgio US Sports Practice leader Deloitte Consulting LLP +1 617 437 3459 pgiorgio@deloitte.com LinkedIn 15 This publication contains general information only and Deloitte is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional adviser. Deloitte shall not be responsible for any loss sustained by any person who relies on this publication. About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. In the United States, Deloitte refers to one or more of the US member firms of DTTL, their related entities that operate using the “Deloitte” name in the United States, and their respective affiliates. Certain services may not be available to attest clients under the rules and regulations of public accounting. Please see www.deloitte.com/about to learn more about our global network of member firms. Copyright © 2020 Deloitte Development LLC. All rights reserved. T Temple University School of Sport, Tourism and Hospitality Management Personal Branding of Athletes: Name, Image, and Likeness Personal brand assignment Students will develop a personal brand assessment. The brand assessment can be completed with a focus on the student’s personal brand or an athlete’s personal brand. The assessment includes an overview of related brands and their influence on the personal brand, analysis of competitive brands, and a personal brand positioning statement. The personal brand assessment is completed individually and roughly 600 words. Students will submit this assignment via Canvas by November 15th. The assignment consists of five parts: 1. Describe the athlete (name, sport, team, background). Provide a link to their social media profiles. 2. Provide an overview of the related brands and their influence on the athlete’s personal brand. 3. Describe the unique brand positioning of the athlete. 4. Identify three ‘comparable but different athletes. Outline why they are comparable, as well as what makes them different. Provide their name and links to their social media profile. 5. Create a ‘personal brand positioning statement for the athlete. Requirements if you select an athlete other than yourself, the athlete should: Currently be active in their sport Have less than 50’000 followers on any social media platform (it’s ok if they have a combined following above 50’000). The brand assessment should be formatted visually appealing. 10% 10% 20% Athlete Level of analysis results in Level of analysis results in Level of analysis results in Level of analysis results in Overview basic or uncertain judgments that offer competent judgments that insightful and judgments that offer a some reasonable and offer several reasonable, comprehensive judgments limited amount of practical conclusions. practical and qualified that offer a number of plausible or applicable Some errors in synthesis conclusions. Minor errors reasonable, applicable conclusions. Errors in or interpretation result in in synthesis or and highly qualified synthesis/interpretation incomplete inferences. interpretation result in conclusions. No errors in result in limited inferences. solid inferences. synthesis or interpretation result in concrete inferences. Related Level of analysis results in Level of analysis results in Level of analysis results in Level of analysis results in brands basic or uncertain judgments that offer competent judgments that insightful and judgments that offer a some reasonable and offer several reasonable, comprehensive judgments limited amount of practical conclusions. practical and qualified that offer a number of plausible or applicable Some errors in synthesis conclusions. Minor errors reasonable, applicable conclusions. Errors in or interpretation result in in synthesis or and highly qualified synthesis/interpretation incomplete inferences. interpretation result in conclusions. 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No errors in result in limited inferences. solid inferences. synthesis or interpretation result in concrete inferences Mechanics & Language use: 1) does not Language is: 1) adheres to Language use: 1) adheres Language use: 1) Style adhere to grammatical, grammatical, spelling, or to most grammatical demonstrates spelling, or punctuation punctuation rules, yet spelling, or punctuation sophisticated awareness rules, 2) is wordy and does contains some errors, 2) rules – contains few and use of grammar and not use precise details. 3) 20% 10% : 20% is somewhat concise and errors. 2l is mostly concise written mechanics and

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