Adam Karg and Jonathan Robertson | Five big questions for sports managers identified at SportNXT

The sports industry is changing. Fast. From blockchain to Black Lives Matter, sports managers must be aware of an ever-growing number of trends and new forces affecting the industry. The basics of the sport remain the same. Successful leaders must remain focused on their core business—creating unparalleled experiences for sports consumers—while addressing a new wave of product and organizational considerations.

These were the key messages from more than 800 sports leaders gathered at the SportNXT conference in Melbourne last month to address the big question: what’s next for the sports industry?

From Adam Silver to Megan Rapinoe, from Lord Sebastian Coe to Stefano Domenicali, some of the sport’s brightest minds gathered to address the big issues facing the industry including broadcast, social change, data, technology, esports, climate change, fan engagement and more sports diplomacy. After listening to and speaking to this outstanding cast, we distilled five key questions sports managers need to ask themselves and their organizations:

Adam Karg

1) What does it take to provide our consumers with unparalleled sports experiences?

The core business of sports organizations has evolved to focus on seamless, unique and affordable sports experiences in stadiums and at home. Consumers associate great experiences with value. The battle for their wallets and eyeballs is on, and sports companies are adopting new tactics and strategies to win.

Key trends include: the power of storytelling in customer acquisition, such as the impact of Netflix’s Drive to Survive on Formula 1 audiences; and “driveway-to-driveway” event delivery, where event organizers use new technologies to enhance the fan experience when commuting to and attending major events. Elite athletes are redesigning stadiums so fans can connect and investing in storytelling to create movie-like viewing experiences at home.

The best sports experiences just keep getting better. Second-rate sports face the challenge of sustaining consumer attention and spending when compared to the top-end experiences, and there is a risk that the gap between the haves and have-nots will widen. Still, building memorable customer experiences should be at the forefront of every leader’s mind.

Jonathan Robertson

2) What does the future sports media landscape look like?

As revenue streams diversify, the relationship between sport and the media continues to be the key driver for sport organizations. The rights distribution business continues to be impacted by the fragmentation of sports content providers and platforms. These now offer consumers more choice and more features by leveraging second screens, commerce integrations and gamification.

There is an urgent need to consider the different roles of sports organizations and media outlets when it comes to being the “custodians of the fan base”. If knowing customers and having customer relationships is critical to all businesses, what impact does it have on where and how sports fans spend time-wasting sports-related content? Is it the sports organizations themselves, the media or both that should own, program and develop content for the audience?

The pandemic has changed the way sports and media organizations work and collaborate. Some have successfully merged more closely to increase audiences and evolve sports media delivery. Collaboration can improve experiences and create new sports media features and interaction points.

3) How can we use technology to create value?

The creation of value through the use of new technologies is probably the greatest opportunity for sport. Blockchain and NFTs, while still in the early stages of adoption, have potential applications in stadiums, ticketing, and consumer goods. Gaming, esports, web 3.0 and the metaverse also offer new perspectives.

When adopting new technologies, sports organizations need to look beyond immediate revenue and consider a broader range of KPIs.

Different technologies can reach different groups of fans. Interactive experiences and media-based NFTs are used to engage highly engaged existing audiences. Gaming and esports are used to grow fan bases.

As innovation outstrips regulation, issues like data governance and maintaining safe and inclusive spaces become critical for stakeholders.

4) What are our environmental, social and governance responsibilities?

From BLM to #metoo, from climate change to trans inclusion, sport exists at the intersection of rapidly changing societal forces. Approaches to social change, inclusion and equity are not driven by yesterday’s administrators, but by the expectations of the next generation of fans. To attract future lifelong consumers, admins and marketers must listen, empathize, and act to ensure the rhetoric is translated into authentic and meaningful change.

5) How do we run organizations in the sports industry?

Interpersonal skills remain a prime asset to lead modern organizations in times of increasing complexity and uncertainty. More than ever, managers need to lead in a goal-oriented manner. Several leaders noted that society is increasingly turning to sport for social leadership as other institutions become less relevant while the visibility of athletes and sports organizations expands worldwide. In societies that are becoming increasingly polarized, leaders must be able to empathize with and authentically interact with diverse stakeholders, build relationships based on trust and respect, and develop welcoming organizational cultures.

Along the road

To maximize recovery from a turbulent and uncertain 24 months, sports organizations need to be positioned as innovative and build a reputation for being open to new ways of thinking and ideas around experiences, technology and the social outcomes of sport. In addition to focusing on core business and revenue, sports organizations must be open to disrupting their own businesses and be leaders in creating economic and social value.

At the same time, approaches to customer and business growth require balanced and considered decision-making that is born in diverse organizations.

Adam Karg is Associate Professor at Swinburne University of Technology and Director of the Swinburne Sport Innovation Research Group.

Jonathan Robertson is an Instructor in the Sports Management program and Director of the Masters of Business (Sports Management) at Deakin Business School.