Wednesday, January 11, 2012

Nets CEO Yormark on strategies: a press release a day, never talk publicly about ticket giveaways

The 4/16/09 session at the Argyle Executive Forum, in which Nets CEO Brett Yormark acknowledged few New Jersey fans would follow the team to Brooklyn, also included a frank description of the team's public relations strategy (pump out a press release a day) and veiled practice of distributing free tickets.

Keep in mind that this was the end of the last season at the Meadowlands, before the team was clearly moving to Brooklyn and before the announcement of the two-year interim move to Newark.

The p.r. strategy

What do you do without a big marketing budget? You rely on free publicity, which you steadily stoke. Yormark said:
Now, we’ve defined ourselves I think, hopefully with respect to the All-inclusive experience, the value proposition, the best-in-class service but the question is, without huge marketing budgets, how can you tell the world? How do you let them know who you are and what differentiates Nets basketball from the Garden or from the Yankees or the New York Giants? And if you know anything about the Nets, we drive business PR. That’s what we do. We’ve got a young man who runs our business communications department and his responsibility is every day to get a press release out. Let everyone know who we are and what we’re all about and if they can’t buy now, that’s okay but pre-dispose them to the culture and to what we do and why we think we’re different and over the course of the last year or so, we have been everywhere from USA Today to local newspapers, to Wall Street Journal, to CNN Fox, to CNBC, ESPN Fox. Not only are you building your fan base, but you’re building your brand at the same time. So for some of you, you know that play on both sides, this has been a terrific way for us to truly elevate a halo over Nets basketball and get people a reason to buy us.
Yormark on comps 

Here's how Yormark danced around the question of ticket giveaways.

He was asked: 
What percentage of your business is, are season ticket holders versus transient and you talk a lot about customer and rewarding current customer and branding and loyalty but is there an opportunity like in the hospitality business to integrate the Nets, and extra tickets or… do you spend much time – is it very profitable for you in the transient seats that aren’t sold?
His response: 
Well, for us, well that’s a great question. We – couple things. About half of our attendance is, are your full season seat holders and partial plan holders and then we rely on, on individual tickets, group programs and projects, much like you. And then other community related programs to fill that house every night, or at least try to fill it. But for us, it’s about safeguarding the brand. So even if we have to discount to get people in, we need to do that because if you walk around Manhattan, and for many of you who live here or for that matter come here to visit you typically don’t find yourselves in restaurants where there’s no people. Okay, you gravitate to people, to restaurant where you know people go to; they’re having fun; it’s a vibrant atmosphere. And we feel the same way. We can’t discount to the point of compromising you know what a season ticket holder has paid. So we’ve made a little bit of a shift. You’ll never see us in print or just verbally discuss discounting; it’s more about value. Value versus discounting, I think there’s a differential between the two so we’re going more towards value than discounting because I think based on our advisory board, our, some of our full time season ticket holders, people that are paying you know the ticket price, they were somewhat taken aback by some of the discounting they were reading about or hearing about. So we changed that and it was a great comment by our season ticket holders and – so that’s, hopefully that answers your question.
A huge number of comps

That last season at the Meadowlands was particularly tough. Here's what Forbes reported in December 2009:
Talk about losing fans in a hurry. The Nets handed out 5,200 comp tickets per game last season to try and get fans to show up at their current home, the Izod Center.
in Brooklyn, there's a cap on issuing "complimentary tickets representing more than 15% of the Arena’s aggregate seating and standing room capacity," according to the bond offering statement.

In this last season in Newark, they're still pushing discounts. I got a call the other day offering two tickets for $30, including $20 in concessions credit (I may yet buy some), and a significant break for higher-end seats.

And StubHub has lots of tickets for cheap. See for example:


How Yormark talks

That Argyle Executive Forum transcript is worth a look to see how Yormark employs business buzzwords. They include:
  • "the value player"
  • "I'm going to top-line a couple of things"
  • "our value proposition"
  • "It's truly about the touch points"
  • "it’s been a terrific ‘feel good’ and hopefully later on, we can monetize it"
  • "a great value creation"
  • "a best-in-class experience"
  • "insulate yourself if the product goes south"
  • "mandate buy-in from top to bottom"
  • "Live out of the box"
  • "Value creation, that is the buzz word"
  • "it’s all about hiring on the court now in the product cycle, character guys"
  • "We’re going to investment spend in all the right areas"

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