Monday, September 22, 2008

San Antonio Business Journal: Spurs Are Facing Big Hurdles In Hard Times

Team’s parent looking for ways to expand audience
by W. Scott Bailey
San Antonio Business Journal

The San Antonio Spurs entered the 2007-08 NBA season as defending champions. But the four-time champs failed to sell out all of their home games or to get past the Los Angeles Lakers in the Western Conference Finals.

Now the team’s parent company, Spurs Sports & Entertainment, is working to create a more diverse market-penetration strategy in an effort to connect with a larger potential base of support. Some marketing experts caution, however, that the parent company of the Spurs faces multiple challenges.

In July, Spurs Chairman Peter Holt announced a series of top-level front-office changes within the organization. They included the promotion of Rick Pych to president of SS&E.

Now, with the 2008-09 season only weeks away, Pych says SS&E officials are working to find more Spurs fans.

“The initial mission is to step back and do the research,” Pych explains. “We’ve done a pretty good job of knowing who our customers are. We haven’t done as good a job of knowing who our potential customers are.

“That’s what we want to find out. Who are they? How do we get them to our events?”

SS&E has tapped The Atkins Group, a San Antonio-based advertising agency, to help it reach a larger audience. Atkins replaces Creative Civilization, which resigned the account this summer after working with the organization for more than a decade.

Pych says Atkins will play an especially key role in the research effort.

“We’re going to spend a lot more time figuring out how to reach that 70 percent of the city that probably has not been to AT&T Center,” he says.

Atkins principal Steve Atkins says his agency will also help the Spurs find new places to deliver their messages.

“We hope to bring a lot of interactive and online strategies to the table,” Atkins says.
No piece of cake

The Spurs say the way they need to do business moving forward requires some shift in strategies.

“So much has changed in the last 10 years in how you reach people,” Pych explains. “It used to be that if you put an ad in the local paper and on local TV, you probably covered everyone. But that doesn’t work anymore.”

The plan, he says, is to put more emphasis on new media outlets. Atkins, Pych says, will be key in helping SS&E find those outlets and make the connections.

“The Spurs’ promotional efforts can and should be reaching specific larger audiences — not just with more messages or greater media volume, but rather more targeted messages to more specific lifestyle segments with more relevance,” Atkins explains.

But one veteran marketing executive familiar with the Spurs says Atkins is taking on the Spurs account at a tough time.

“You had four championships in nine years, the economy was in better shape, AT&T was still (based) in San Antonio,” says the marketing executive about the team Creative Civilization worked with in recent years. “But all of that has now changed.”

Earlier this year, AT&T Inc., for which the Spurs’ arena is named, did indeed announce its plan to relocate the company’s headquarters and some 700 top-level personnel to Dallas.

Since then, there have been more concerns raised about the state of the national economy, and about more potential belt tightening among Americans.

“There will be some challenges. This is no piece of cake,” says Al Aguilar, co-founder of Creative Civilization. “But San Antonio has a love affair with this (Spurs) team that dates back to the ’70s.”

Atkins agrees these are more complex times.

“The reality is economic pressures are growing and the discretionary income available for family-based entertainment is going to be more and more stretched by gas prices, food prices and such,” he contends. “Right now, we are also bombarded, involved and distracted by a national election.”

Atkins adds, “I believe all of this creates the need to be very different, relevant and value-oriented in messaging the Spurs game experience. Campaign efforts will need to compete aggressively for those entertainment dollars... .”

Pych acknowledges that there are some hurdles ahead. “People do have more (entertainment) choices and less free time, it seems, than ever before,” he says.

How do the Spurs break through the clutter and address any concerns?

“It starts with the research,” Pych says. “We’ve got to know the market better. But I think we also need to take a look in the mirror, to see if the product that we are offering needs something different to appeal to more people.”

Pych says the SS&E may also have to consider making some “infrastructural changes” at AT&T Center in order to attract more fans.

“The research will hopefully help tell us some of this, how we can reach more people, how we may need to change with the times,” Pych says.

Meanwhile, Pych says SS&E will also be working closely with Atkins to create a new brand for SS&E that should benefit its teams and AT&T Center.

“We’re all excited about the opportunities,” Pych says. “There is a lot of enthusiasm and passion about this.”

Says Atkins about his firm’s opportunity to work with the Spurs: “It represents the big time.”

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