In Part II of this blog interview, Tim Zue, Director of Business Development for the Red Sox baseball franchise, continues his conversation with Anametrix CMO Pelin Thorogood. They explore how data analytics is changing the ways that the Red Sox engage with their fans – and the opportunities for continuing to improve the “conversation” in the future.
How does your use of analytics impact decision-making and what particular areas most benefit?
One of the sets of data that we use is from fan surveys that we conduct at Fenway Park and online via email. Any new idea, whether it’s changing a game start-time or selling tickets in a new way, usually gets tested in the field with surveys. And sometimes we’re surprised. Sometimes the results will validate an idea, but other times we might learn something unexpected, which is a good thing.
Market research is the core of our data analytics, and fan surveys are at the center. We do surveys extensively, covering more than 30 topics every year. We generate survey data from every game, and we also conduct email surveys. They’re extremely valuable, though we take them with a grain of salt because they are not perfect. But within a certain margin of error, the surveys help to guide Red Sox decision-making.
Ticket pricing is the second big category in our data analytics. We learn a lot from the primary ticket buyers. Which tickets sell early and for what games? What sections are leading sales? But we also try to learn from the secondary market ticket data. We might have tickets with a face value of $30, but then we find that they are selling online for $60 every game. That is one way that we try to determine which sections in the ballpark might be more suitable for a modest price increase versus those that should be kept flat. The secondary market is truly dynamic, based on what fans are willing to pay for a specific game and in what section. We study that data very extensively to help make ticket-pricing decisions.
The third is in the area of no-shows. We obviously want our fans to purchase tickets, but we also want to make sure the ticket gets used, not only because they might buy a hot dog or 
a beer, but also because we want as many people as possible experiencing Red Sox baseball at Fenway Park. So if the tickets were purchased, we want to make sure they are used. We study who’s not coming, to which games, and why they may be “no-shows.” And you can imagine how much data we have – 37,000 to 38,000 tickets for every game. Our systems know what gate and turnstile those tickets were scanned, the section of seating and the time.
A sports business, perhaps more than many others, is about loyalty, the whole concept of Customer Lifetime Value. After all, you don’t want to sell tickets to just one game but to get fans to keep coming back for many years. How does that factor into your analytics?
That’s a really good question. Historically, we have not done a good job of segmenting our customers. Certain customers are what might be described as Family Man Phil. He likes day games because they are better for the kids. He doesn’t need the best seats because his seven-year-old doesn’t have to sit in the front row. But he wants a good experience for his family. In contrast, you might have Businessman Bob, who wants the best seats and prefers weekday evening games. These two types of fans might have very different criteria for what is important to them, and it is our job to understand that and market effectively to both types of fans.
We want to do a better job of customer segmentation. And we are also very focused on doing a better job understanding Customer Lifetime Value. As you pointed out, we look at our fans and think of the concept of “cradle to grave.” Many fans are “born into” being a Red Sox fan because their families are fans. However, it is our job to ensure that they stay loyal fans for life, and understanding each fan’s Customer Lifetime Value is an important part of that.
A family of Red Sox fans spanning four generations. Image courtesy of Rep-Am TimeOut blog.We want to make sure we cultivate that relationship with every fan to make that individual a priority and encourage him or her to come to games frequently. We don’t have that capacity currently, to understand the Customer Lifetime Value of all of our fans, but it’s definitely the direction we plan to go.
Your customers engage with the Red Sox over generations. And it’s a much more emotional connection than most other purchase decisions. How might micro-targeting improve Customer Lifetime Value?
Much of our marketing is currently being done with a shotgun. Here’s an example. We have a fantasy camp that costs roughly $5,000, and you must be 30 years or older. The camp is open to both men and women, but historically the vast majority of the participants have been male. To market that program now, we send an email to our entire database, knowing the program probably doesn’t have interest to 97 percent of the people getting the email, either because they are too young, female, or not able to spend $5,000 on a week with the Red Sox.
We want to get smarter in that marketing, drive better click-through rates, better conversion rates and, ultimately, not saturate the market with these emails. So going back to Family Man Phil and Businessman Bob, right now they get nearly all of our emails. But in the future maybe we’ll want to send offers to our family fans that might include Saturday afternoon specials, while Businessman Bob gets the Wednesday night premium ticket special. We aren’t there yet – we’re building the engine to identify the interests of our fans, to segment and personalize what we’re sending them. That’s the end-goal, to be more targeted with our approach.
In what other ways has the Red Sox business become more data-driven, both from the view of aggregate data and also the various segments?
We feel very fortunate in comparing ourselves, for example, to a big consumer products company. I’m sure these companies are very good at understanding their customers and why they might buy one toothpaste brand over another. But there’s only so many touch points that the company will have with its toothpaste customers. They might see an ad on TV. Maybe they “like” the product on Facebook.
Think of the Red Sox or any sports team. We probably have 20 or more touch points, if not more. You can buy a ticket from us. You can buy a ticket from the secondary market. You can go to a game, buy a hat or get a hot dog. You can watch us on TV, “like” us on Facebook or follow us on Twitter. Our fans can donate to the Red Sox foundation or take a tour of Fenway Park. We see all of that as incredibly valuable.
But right now it’s still just a valuable opportunity. We haven’t yet linked all those touch points. In a perfect world, we will 
have a system that allows us to track our fans whenever and wherever they engage with us. We might have to give some loyalty points, for example, to find out who watches the games on TV. That’s good. But imagine if we know that fan Tim Zue did these things with the Red Sox, the frequency he did them and the change from last year. We would know exactly what Tim Zue looks like as a fan.
So that’s the big picture. We want to link all of the touch points that a sports team like the Red Sox has that many other businesses simply do not. We want to take advantage of the new insights we discover and have a much more relevant “conversation” with our fans.
Thank you, Tim. You indeed have a wealth of traditional and digital touch points that provide you comprehensive demographic, point-of-sale, social and online behavioral data about your fans. You now have the opportunity to draw multi-faceted profiles of the many types fan personas. And, this new micro-segmentation will enable you to engage with your fans in a much more targeted manner. Exciting times for both the Rex Sox and your devoted fans! From what I am gathering, “Moneyball – the Sequel,” with the data-driven approach to the business side, promises to be at least as riveting as the Original. 