They Shoot... They Score! by Dr. Patrick Rishe

Author:Dr. Patrick Rishe
Language: eng
Format: epub
Tags: Sports Business
Publisher: BookBaby
Published: 2018-07-31T16:00:00+00:00

(2) In your experience, what are the most common strategic missteps organizations make at it relates to (a) how they develop business strategies in a general sense, and (b) how they allocate their sponsorship expenditures

MB: One example that sticks out on negotiation strategy took place a few years ago when we were asked to support the players union on their approach to likeness rights in the gaming space. Without getting into the details, it was a situation where the client didn’t have much data and was struggling to figure out the path forward in a highly dynamic market segment.

While it was a little outside our day-to-day work, we applied a structured approach to break down the key drivers of prospective revenue streams for the union, such as up-front guarantees and trailing license fees. We looked at the different models across other sports and their influence on those underlying drivers. And we furthermore examined the broader market context and how emerging models of gaming were likely to impact those same drivers.

We then pulled it all together with an actionable recommendation around the negotiation priorities and strategy overall. While a lot of complex work went on behind the scenes, it was presented in a simple, compelling sequence of about 5 slides. You can do the best work in the world, but if the client can’t digest it, you won’t motivate action.

With respect to missteps on developing business strategy, I prefer not to focus on the process. Ironically, I think strategy development process is itself an outcome. It’s an outgrowth of the corporate culture in which it operates. Companies with healthy cultures ask probing questions, aren’t afraid to be intellectually curious and adopt better, more rigorous process hygiene. Companies with unhealthy cultures rubber stamp recommendations or use the process as political football. Those models lead to bad outcomes in terms of strategy development, not any specific missteps in an otherwise sound process.

You see this reflected sometimes in how sponsors allocate their sponsorship budget too heavily towards rights fees without understanding the importance of activating those rights. You wouldn’t spend $5M for 30 seconds of air time in a Super Bowl ad without leaving money aside to produce the commercial, right? So why would you spend that amount on sponsorship rights without a plan to activate them? Additionally, most media assets are efficiently priced - the surplus value is found in creative and insight-driven approaches to activating your assets.

Another driver of missteps in allocating sponsorship is the failure to invest in measurement. Yes of course the Insights guy would say that, but sponsorships are multi-faceted with a lot of different pieces to execute. It’s impossible to get every element right immediately, and fan preferences are always evolving. So of course, you need to measure to help optimize both your strategy and tactics. Unless you find out what’s working and what’s not, you’ll be looking at the issue through a keyhole instead of a window.

PJR: From your firm’s perspective, what are the keys in today’s

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