One Premier League club owner, when asked about innovation, said on stage, “Our fans are not interested in innovation; they want us to win, and personally, I’m old school. Love the game as it is doesn’t change…”. Sound familiar?
Digital Transformation in the world of sports
In the last 4 years, we have personally met over 100 professional clubs and teams and worked very closely with some of them in realizing digital transformation and innovation.
Most sports clubs are saying that they are happy to embrace technology, but very few have really identified this as a do or die factor. It’s viewed more as a “nice to have” in most cases. We believe that sports clubs that do not become digital powerhouses by 2024 will not only be left behind and lose money and followers, but stagnation will seep into the dressing rooms and ultimately lead to their downfall on the pitch.
Innovation for clubs is much more than the next flashy thing. It is actually a tool to create tangible outcomes. To impact the bottom line, whether we are talking about using innovation on the pitch to boost performance, or the ability to attract new fans and amplify the fan experience. Do it 365 days a year, 24/7, as this is what fans expect.
We have put here some suggested measures, sports club should consider:
The 8 Digital Powerhouse Club Key Principles:
- Digital Law of Attraction — The Golden State Warriors have become a destination team, not just because they have Steph Curry, but because athletes want to be in the heart of innovation, and many of them have commented on the benefits of being near to the Silicon Valley. We can extrapolate this to players wanting to be part of innovative clubs.
- Gen Z is King: Those born in the late 1990s and early 2000s. Peter Moore (CEO of Liverpool) said it best. When asked what keeps him up at night, he answered “Fortnite”, not the fear of rival clubs stealing his start players. He fears that fans will lose passion and that the quality of players will drop as a result of video games. “Gen Z” loves video games, so if clubs aren’t embracing Esports, they are going down the wrong path.
- Nurturing start-ups through an Innovation HUB/ Accelerator: Embrace the local and global startup communities. Leverage the free trials to demonstrate how things can be different, and justify a business case to implement them. It’s not difficult, but it takes time and initiative. This is being done successfully at the 1.FC Koln and Arsenal clubs, within leagues (La Liga, UEFA) and even hosted by stadiums (Johan Cruyff Arena, Chelsea Stamford Bridge). While the names listed are not many, the key takeaway point is that accelerators are not limited to one entity, and need to become part of core culture for driving change.
- Multiple Club Strategy — Having multiple clubs allows you to test and try innovation at one time and implement it later in a higher value club. The owners of Manchester City are an example of this principle — owning multiple football clubs on many continents allows them to test innovation in the US or Australia before implementing it in the EPL. Many US owners have adopted the multi-team approach in various leagues, including groups like HBSE (Sixers, Devils, Crystal Palace, and Team Dignitas esports), Fenway Group (Red Sox and Liverpool) and MLSE (Leafs, Raptors, Toronto FC, and Argonauts).
- May the (Digital) Force be with You — If you can’t win on the pitch, you win in the digital world. As highlighted earlier, not every club can win on the pitch, but anyone can win in digital ventures or Esports, as the playing field is leveled. Take advantage of these opportunities now.
- Owning Your Smart Stadium/Venue — As we speak to many clubs, some of the first roadblocks we hear are “we don’t own our stadium, so we can’t implement digital ticketing or smart gates” or “the Wi-Fi sucks and is out of our control”. It will be those clubs that control their own destiny with a venue that can implement innovation.
- China and India Presence- If you aren’t present in China, you cannot be a global super club. This isn’t a revelation to anyone, but it’s more than just having a Chinese player. Innovation is happening in China faster than anywhere in the world. Embracing Chinese (and soon to be Indian) innovation will become a huge factor that differentiates the leaders from followers.
- Community for Real — The new catchphrase “data is the new oil” shows how important it is to become a master in the art of managing and engaging with a global community through the current and new digital media, and how vital it is to convert social fans into real fans. While Facebook and Twitter are necessities, embracing the next new thing (TikTok, FaceApp) is imperative. Do not stand still. Build a global community.
The Digital Powerhouse Club
If we look around European football, we see only a few clubs that have truly identified the opportunity to embed innovation as a core principle or as part of their strategic roadmap. One great example is the Barcelona Innovation HUB with its big vision. 1.FC Köln is the first club in the Bundesliga to run its own sports tech accelerator (now in its second year), integrating start-up solutions into all its departments. Other great examples in football are Manchester City, which is taking a global approach leveraging trials with their teams on multiple continents, as well as participating in a global sports tech fund. Innovation, however, isn’t reserved primarily for the large super teams. In fact, Real Sociedad, a legendary but mid-tier La Liga club, has adopted a digital transformation roadmap, including a smart stadium innovation program for startups and, more recently, has been the driving force in establishing a global alliance of likeminded digital and tech-savvy clubs in order to leverage economies of scale to compete with the super clubs.
On the other hand, the NBA has many global trailblazers in the innovation space, but almost all clubs are far more advanced in adopting innovation than European football counterparts; specifically the Sacramento Kings, Golden State Warriors and Philadelphia 76ers who, driven by HBSE, was also one of the first sports teams to acquire an Esports club as well as establish an innovation hub.
Small football clubs don’t have to be left behind, and also have an opportunity to leverage innovation and compete with the big players. Dziki Warsaw, a second division Polish basketball team, works with numerous start-ups, offering them a test case and entry point into Europe or the basketball world. They are working with startups from Australia, Romania, Greece, and India, giving them a team and platform to try and test their products. This isn’t difficult, it just takes a change in mindset and a cultural shift. Claiming this to be too expensive is a cop-out.
In summary, while many football clubs say they want to be innovative, only a handful are really embedding the innovation culture in all areas of their performance. In our opinion, there will be some very famous prominent clubs who will inevitably become the Kodak or Nokia of the sports world. It’s bound to happen, and it won’t be the first time we have seen this movie. Adopting innovation starts at the top and needs to be endorsed from the top down and embedded as a culture in the club. Innovation is affecting all industries and we promise you that sports are not immune to the future.