TicketManager chief executive Tony Knopp has warned sports teams they must learn to adapt if they are to survive the weakening of demand for lucrative corporate tickets across North America.
In a social media post, the leader of the California-headquartered event and guest management platform said data shows “a blood bath is coming in sports ticket, suite and sponsorship renewals” over the coming year, which he believes will be the worst since the financial crisis of 2008-10 as squeezed companies ruthlessly cut costs.
Knopp said that only major league sports’ legacy teams, such as baseball’s New York Yankees and basketball’s LA Lakers, will be spared from the “rough” times ahead. Those outside that small number must adapt by offering short-term contracts and allowing resale, he argued.
“Companies are demanding one-year terms from all vendors,” Knopp said. “Teams doing so are getting renewals, but at the heavy cost of giving up multi-year contracts. It’s a bad choice to have to make.
“Sports buyers understand the multi-year dynamic. Procurement and finance execs being introduced to the process to do the cutting, however, don’t care. In fact, they’re paid to break that practice. Consider a 1+3 renewal. Something to help get through ‘the now’ with a compromise on the second renewal.
“Procurement needs wins. So even if you renew them, give them a win they can hang their hat on.”
On resale, Knopp said: “Companies told they can’t re-sell while they’re going through cost- cutting are p*ssed. Trust me, they tell us like it’s our fault too. One under-performing team told a customer who was about to burn 600 tickets for a game: ‘tough luck’. That deal is up next year. I can tell you from being in the room, that’s not going to go well. Teams can stand on whatever silly principles they like but is it worth losing the customers over?”
Knopp argued that the current renewal season is different to recent years, as for the first time since the late 2000s there is genuine competition for reduced business spending.
He said: “Companies are going to cut good and valuable inventory. They are mandated to and it is already decided. They’ll give reasons, but it won’t matter. Either you’re on one side of the cut line or the other.
“Hopefully the teams adapt quickly – something they’ve never done in the past.”