Introduction In January 2016 at the ESSMA Summit in Bilbao, ESSMA organised four dedicated workshops around their areas of expertise; Pitch Management, Safety Management, Fan Entertainment and Stadium Management. Each of these workshops will be accompanied by a dedicated case study, collecting and presenting additional insights. This case study has been developed in the aftermath of the ESSMA Stadium Management Workshop in London and digs deeper into topics closely related to those covered during the workshop presentations. Within the ESSMA Stadium Management area of expertise, the content is further divided into three main components:
Editorial staff
2
Stadium development Accessibility Daily operations
Author
This particular case study aims to bring insights in how Stadium
Cyril De Greve
Management should be incorporated from the very beginning, even
ESSMA
during the construction process and how innovative approaches can
E: cyril@essma.eu
environment.
contribute to a better customer experience and sustainable
Layout
During the last few decades, the importance of proper stadium
Jonas Bogaert
infrastructure has risen significantly. Both players and fans have
ESSMA
become used to higher standards, the effect of which drastically
E: jonas@essma.eu
Editor Jan Stryckers ESSMA E: jan@essma.eu
changed the accepted status quo of stadium management. In the early days, clubs had a single aim - getting as many spectators inside the stadium as possible. Nowadays, clubs and stadiums are actively seeking options to give their fans and customers a mind blowing experience. Additionally, the number and value of TV Broadcasting rights deals are increasing year over year (European TV Broadcasting deals increased by 17% in 2015, compared to 2014). As the share of TV Broadcasting deals in club’s revenues is increasing, the clubs need
© August 2016, ESSMA All rights reserved
to make sure to meet the broadcasting requirements. When looking at the sources of revenue within the Big 5 (UK, Spain, France, Germany and Italy), major shares are related to TV Broadcasting rights (35%) and Commercial & Sponsoring revenues
The importance of Stadium Management: from development to operation
(32%). Ticketing signified just 16% of total revenues. When comparing the growth of different revenue streams (between the ’13-’14 and ’14-’15 season), ticketing revenues remained stagnant between seasoned, compared to the growth of Commercial & Sponsoring (+7%) and TV Broadcasting rights (+17%) as revenue sources. This shows that the traditional ticketing technique, fitting in as many fans as possible, has reached its revenue generating capacity.
3
Source: UEFA, 2015
The case study has been developed thanks to the support of various ESSMA members, who were willing to share their experiences regarding the topic of Stadium Management. We hope you will find this case study informative and that our conclusions will provide valuable insights to owners, clubs, operators, developers and public authorities concerning stadium management. If you would like to receive further information or to discuss the findings of this study, please contact us.
AV
Contents Background 1.
P6
Stadium Development
Alternative ways of financing
P 10
Trends and innovations
P 12
Fan communication
P 14
2.
Accessibility
3.
Daily Operations
P 18
VIP & Hospitality
P 22
Contactless Payment
P 24
Sustainability Management
P 26
Conclusion
P 28
BACKGROUND
On the 26th of April, after 27 long years of
Various
investigation, a jury found that the 96 people
predictors and factors for stadium attendances.
killed during the Hillsborough disaster could not
Within
be dismissed as an unfortunate accident. During
predictors of attendance were found to be the
the
emotion and the facilities.
investigation,
it
became
clear
that
inappropriate stadium infrastructure was one of the factors that contributed to the disaster. At the time of the Hillsborough incident, 1989, 58 of 92 UK League Cup stadiums had been built before 1910. In the aftermath of the disaster, the importance of investment and proper stadium management to maximise fan safety became clear.
studies these
have
studies,
investigated the
most
different significant
Thus, attendance at sporting events is affected by the emotion attached to the sports event and to the perceived quality and availability of facilities. The Emirates Stadium can be seen as a flagship reference
regarding
effective
stadium
development and management. The stadium, which was partly financed with the revenues gained from the naming right deal (100 million
As well as examining stadium management from
GDP over 15 years), is not just the home of
a safety perspective, clubs also started to see
Arsenal FC but is used 365 days a year. The 7000
their stadium as a way to connect and engage
VIP seats in the current stadium are generating
with the fans and, increasingly, as a way to
more revenues than the whole Highbury stadium.
generate additional revenues above and beyond traditional ticketing revenues.
The Money League report (published by Deloitte) proves that even 10 years on, Emirates Stadium holds first place, generating the highest match day revenues out of the 20 richest clubs in Europe. In 2015, the club generated 132 million euros from match day activities, representing 30% of their total revenues. (Source: Deloitte – Football Money League 2016)
AVIVA Stadium Dublin (Ireland)
STADIUM DEVELOPMENT
Alternative ways of financing
P 10
Naming rights
P 10
Case: crowd funding - KV Mechelen
P 11
Trends and innovations
P 12
Fan communication
P 14
Olympic Stadium London (United Kingdom)
The importance of Stadium Management: from development to operation
Alternative ways of financing - Naming rights Historically, the naming rights trend has been most prominent in the United States, but the market for sponsorship effectively froze between 2008 and 2010. However, economic recovery and the desire for new revenue sources have revived the idea of selling naming rights and corporate sponsorship opportunities, and a predominantly US market has now gone global. Naming rights are being bought and sold as part of the sports business model on the sale side and as brand strategy for the buyers. A company may choose to invest in its brand through naming rights in order to increase exposure and brand awareness, but the global explosion of naming rights is being driven by the desire of teams and stadium owners to increase revenue streams. (Source: World Trademark Review) The involvement of telecom companies is particularly significant. In the 2015-2016 season, the revenues generated by naming rights deals from telecom companies have more than tripled over a period of only 4 years. Most of the stadiums worldwide have previously been poor for phone signal and online connectivity due to network overloads and the sponsors are seeing this as an opportunity to activate their brands through the sponsorship and exclusivity allowed to them through naming rights deals. (Source: Repucom) Similarly to the realisation of the Emirates Stadium, naming rights are playing an important role within the 10
Espai Barรงa project (the stadium and site development project of FC Barcelona). Naming rights should cover one third of the total budget needed for the realisation of the project (200 million euros). However, naming rights deals are not only common among the top clubs, but are also significant for smaller and lesser known clubs and competitions. In the German 3rd division, 3 stadiums sold their naming rights for an amount varying between 0,5 and 1 million euros. In Sweden, Malmรถ FF was able to seal a naming rights deal, worth 2 million euros per season over a 10-year contract.
Source: ESSMA Member Section
The importance of Stadium Management: from development to operation
Football club KV Mechelen (Belgian Pro League) decided to extend and renovate their existing stadium, adding extra seating and standing capacity and new commercial functions (offices, catering, fitness, child care,‌). The club, which is the owner of the current stadium, redeveloped the stadium in 2 phases. These 2 phases, costing 9,1 million euros, will increase the total stadium capacity by 5216.
Old capacity
Future capacity
Seating capacity
4430
7061
Standing capacity
8090
10,350
Business seats
436
436
Loges & skyboxes
305
630
To finance the project, KV Mechelen partly involved their fans. Through bond loans, fans were given the chance to invest in their own club. The bond loans were disbursed by Yellow Red KV Mechelen VZW (the club) and fans could invest from a minimum of 1000 euros up to a maximum of 35,000 euros. The duration of the bond loans was set at 7 years, with an annual interest of 4,25% (gross interest) per year. In the end, the club was able to collect more than the targeted 3,5 million euros and had to close the subscriptions early due to the large demand from fans.
Source: ESSMA/Pro League Stadium Workshop, Marc Faes, April 2016
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The importance of Stadium Management: from development to operation
Trends and innovations In new stadium development projects, the presence of fan engagement and multifunctionality aspects are becoming increasingly common. This was highlighted during the Stadium Development Seminar with the presentation of the Nou Camp Nou, New SC Freiburg Stadium, Cagliari Stadium, Eurostadium Brussels and various Turkish projects.
The Arena 92, an indoor venue in the heart of the Parisian Business Center, will be a landmark in terms of experience and multifunctionality. The title of the project says it all: ‘The brand new arena where you can play rugby’, showing that the venue will be above all a multifunctional arena, not one solely focusing on rugby.
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The venue is built with 3 stands, in U-form. Unique to the venue, a giant screen of 2,500m2 will be installed to replace the 4th stand. This huge screen, combined with a unique projection system, will enable a mapping experience from the ground to the wall. Additionally, a LED-light system and LED ring system around the bowl will be integrated.
Central to the ‘multifunctional’ approach of the venue is its flexibility in terms of configurations. For concerts, the capacity can be switched between 20,000 and 40,000 thanks to curtains that can be extended or retracted in order to adapt the overall venue capacity. This flexibility enables the venue to attract a wider range of events, with expected sales of 1 million tickets per year:
The importance of Stadium Management: from development to operation
The whole venue has been designed to increase interaction between the fans and visitors and heighten the emotions attached to each event. The venue will offer high acoustic quality, has an English stadium configuration (a proximity of less than 6 meters from the touch line) and is air-conditioned for improved comfort. Additionally, the whole arena will have Wi-Fi coverage and thanks to the mobile application, which will be connected to the arena screens, an interactive experience will be created. Lastly, the venue will offer highly diversified hospitality options. In total there will be 3,000 hospitality seats, divided over 8 hospitality lounges and 96 sky suites. Both catering and decoration of different lounges and suites will be adaptable, in order to satisfy the different demands of all guests.
Type of events at Arena 92
Number
Rugby Championship
13
Rugby European Cup
3
Rugby Special Games
2
Concerts >30,000
8
Concerts 20,000 – 30,000
8
Family Show / Big Games
2
Indoor Sport
2
Indoor Motorsport
2
Conventions & Seminars
2
Corporate Events
50
Source: ESSMA Stadium Management Workshop, Philippe Ventadour, 2016
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The importance of Stadium Management: from development to operation
Fan communication Throughout the development of any stadium project, communication with the fans is an often underestimated aspect. Not just factual updates about how construction works are improving and when the stadium will be ready, but also concerning the impact the stadium will have on their personal situation.
Athletic Club, a club owned and managed by the fans, takes fan communication very seriously. Both the club and the old stadium were renowned for their tradition and the stadium was a biweekly meeting place for many fans. The popularity of Athletic Club was and is immense. With a capacity of 40,000, the club had 35,340 members and 7,678 Barrias (people wanting to become a member, who have paid 1400 euros to become a member in the future). This high demand for new memberships and the high attendances contributed to the plans to build a new and bigger stadium with a capacity of 53,000. One of the biggest challenges of Bilbao’s stadium project was the fact that the new stadium was to be built on nearly the same location as the old one. Therefore, in order to keep on playing in Bilbao, the 14
construction of the new stadium and the demolition of the old one had to be well planned. The old stadium had to be completely demolished before the new stadium could be completed and one side of the new stadium could not be used for fans yet. For the club it was vital to provide their fans with new seats equivalent to those in the old stadium. In order to achieve this, Athletic Club visited different European clubs to learn about how they tackled relocation issues. Arsenal FC (from Highbury to Emirates stadium) and RCD Espanyol (from Estadi Olímpic Lluís Companys to Estadi Cornellà-El Prat) were some of those consulted by Athletic Club to gain insight in managing fan communication related to relocation. In order to provide their fans with an equivalent seat, the club used 2 main criteria:
Current seat: respecting any blank, column, vomitories, so the relation with surrounding friends could be maintained
Seniority: seniority matters within the club, so the club calculated an average of age of seniority across the surrounding seats Important to mention is that all members were treated equally, the price of the ticket was not one of the criteria.
The importance of Stadium Management: from development to operation
However, there were still some differences between the old and new stadium (more rows in the main low tribune, new press stand and bigger away section in the new stadium), meaning that several members would not have an equivalent seat once the new stadium was completed.
The members were given 3 weeks to accept or refuse their new allocated seat in the new stadium and 15
register their choice on the official website. The procedure to “change� seat:
List 1: Selected on seniority (15,662) List 2: Barrias who already have a member within their family (5,957) List 3: Barria (4,854)
Over three months, 44 people worked to host the members and change and select their new seats. The club perceived this transformation as easy and, more important, the Socios perceived the system as fair. The transformation turned to be a huge success, efficiently carried out and with almost no complaints.
Source: ESSMA Stadium Management Workshop, Javier Ucha Marquiegui, 2016
ACCESSIBILITY
Case: Derby County FC
P 18
Matmut Atlantique Stadium Bordeaux (France)
The importance of Stadium Management: from development to operation
Accessible stadia are vital to welcome a maximum of fans and, more importantly, welcome all segments of fans. CAFE, the Centre for Access to Football in Europe, is working with supporters, clubs and governing bodies to make stadiums more accessible and create an inclusive matchday experience for disabled supporters across Europe. At the end of 2015, CAFE became a Strategic Partner of ESSMA, with the goal to raise awareness within the stadium industry.
One of the best examples in terms of accessibility is Derby County FC, highlighted by the fact that Level Playing Field awarded them with the “Centre of Excellence Award” for demonstrating the highest access and inclusion standards in accommodating disabled supporters and visitors on match (or event) and nonmatch days. Derby County takes a well-structured approach in order to provide the best possible facilities & services for their disabled supporters and arranges an Access Audit once every three years in order to get a clear view on the strengths and weaknesses of the stadium and its immediate surroundings. Also the Club operate a ticketing policy that recognises that disabled supporters may need assistance to fully enjoy the match day experience and offers a variety of reasonable adjustments based on individual supporters needs, not their 18
‘disability’. Disabled supporters are asked to complete a simple application form together with submitting the appropriate supporting documentation. With this information the Club can plan to meet their needs during their visit to the iPro Stadium and that accessible facilities and services are only used by the supporters that need them. The adjustments the Club can offer disabled supporters are as follows (subject to availability and qualification);
Personal Assistant/Essential Companion Level Access Seating
Wheelchair Space (choice of either pitch-side or elevated viewing platform) Accessible Parking Transportation from our car parks to the stadium, if required. Match Day Commentary (Via Headsets – just request one from the nearest steward) Facilities for assistance dogs are available Access to a disabled entrance if required. Rest Areas in the concourse are available Accessible toilets
The importance of Stadium Management: from development to operation
The Club have a dedicated Disabled Liaison Officer who works very closely with Derby County’s Disabled Supporters Club. This partnership together with the DLO being on the committee of the Safety Advisory Group is key to the ongoing progress and commitment in providing the best facilities, services and matchday experience possible. Recently, the Club have installed a new elevated wheelchair platform, due to the away section being relocated to a different part of the stadium; this is another great example of the Club’s ongoing commitment. This approach has resulted in a steady increase of disabled supporters attending the Derby County FC games at the iPro Stadium.
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Source: ESSMA interview, Emma Drury, 2016
DAILY OPERATIONS
Daily Operations VIP & Hospitality
Case: Paris Saint-Germain Contactless Payment Case: Twickenham Stadium Sustainability Management Case: Forest Green Rovers
P 22 P 22
P 22 P 24 P 24 P 26 P 26
Principality stadium Cardiff (Wales)
The importance of Stadium Management: from development to operation
Daily Operations - VIP & Hospitality During the last decade, the trend of including more VIP seating within stadiums has been significant. In the case study introduction, the importance of hospitality was briefly pointed out - the fact that the 7,000 VIP seats in the Emirates Stadium generate more money than the entire Highbury stadium. In the ‘Le rapport Grands Stades EURO 2016’, the commission Grands Stades Euro 2016 calculated that the average French stadium hospitality ratio (number of VIP seats/total stadium capacity) was 4% and lower than in neighbouring countries. The EURO 2016 stadiums, stadiums which were (re)built or underwent extensive renovations in preparation for the tournament, had an average hospitality ratio of 10%, which is significantly higher.
Combined with the increase in VIP seats, the level of services within the hospitality areas increased as well. Paris Saint-Germain invested 75 million euros in the redevelopment of their stadium. This investment resulted in the creation of additional hospitality lounges, multiple types of configuration and layout, new amenities and additional services. 22
The investments at Parc des Princes resulted in a 380% growth in revenues per seat in just 6 years’ time. This increase was only partly due to the investments in upgrading the stadium and VIP facilities. The club understood that they had to adapt their way of servicing as well. The club has developed several new services: Ambassadors team, Service areas in concourses, 3D PreOrder Platform, Outside stadia services areas, Concourses branding and a Stadium App. The Stadium application provides real-time video stream, replays, highlights and statistics. But the application is also used for secure messaging, match check in and to pre-order merchandise.
Source: ESSMA Summit, Julien Lepron, 2016
The importance of Stadium Management: from development to operation
23
The importance of Stadium Management: from development to operation
Daily Operations - Contactless Payment
Contactless payment is becoming increasingly common within the retail sector. Last year, the value of contactless transactions was more than during the previous seven years combined. In 2014 Deloitte research highlighted 4 benefits of contactless payment systems:
Reducing the need to protect customer data When someone pays using an NFC-device, a unique code (known as a token) is created, which is sent from the device to the merchant’s NFC-enabled till. The credit card number is not transferred which means in the event of a breach, only card information used in traditional transactions would be exposed
Higher speed of transaction All forms of payment have friction points: cash often requires change and has associated handling overheads and credit cards require PINs or signatures; but contactless payments require only a card or device to be placed on a compatible reader. Average cash payment can take up to 15 seconds,
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contactless can be as quick as 2 seconds. For large sporting arenas where there can typically be high volumes of activity in short periods of time, these time savings can have a significant positive impact operationally
Ability to attract higher revenues More money was spent in the UK using contactless than during the previous seven years combined and the average spend per person for card payments is higher than cash
Possibility to provide more personalised experiences Payments via card and contactless introduce opportunities to integrate additional features such as loyalty programmes as part of the fan experience.
The importance of Stadium Management: from development to operation
As part of the work undertaken in the last 4 years in the build up to Rugby World Cup 2015, Twickenham Stadium identified a number of key technologies that could have a significant impact on the fan experience and improve the operational processes during a match day. Traditionally predominantly cash driven, with a large number of bars and food and beverage outlets, there was a desire to provide visitors with the same service that they would experience outside the stadium. Chip and Pin and Contactless payments were available outside the venue in retailers and for transport, but only available in the large retail stores within the stadium. Prior to the Rugby World Cup, Twickenham deployed payment terminals on all bars and F&B outlets to allow for chip and pin and contactless transactions (this also include Apple Pay when it launched shortly before the start of the World Cup). The two main drivers were consistency of customer experience, and reducing transaction times. For thousands of transactions taking place over a short period of time, small reductions can have a big impact on customer waiting times. In 2013, 92% of transactions were paid with cash compared to 8% with cards. In 2015, this had changed to 41% paid with cards and during the Rugby World Cup this number exceeded 50% in the last 6 games.
25
One of the big advantages of Cashless payments has been the opportunity to access data and analytics that has not typically been available through the data insights programme provided by their acquirer. One of the remarkable findings was that only 3% of card payments bought both merchandising and F&B. These findings can be used to inform and direct new marketing opportunities (crossover offers, packages, etc.). The existence of live sales data is also beneficial in cutting variances. The use of real time software monitoring the transactions across the stadium, combined with the reduction in the amount of cash that needs to be handled has meant that, match day variances are down to less than 0.5% for most major events. Before the deployment of these technologies, it could take up to 3 days to close the event (in terms of transactions and financing), while nowadays this can be finished by the end of the day of the event. Additionally, in corporate boxes, retail is now carried out via tablets holding the merchandising catalogue in combination with mobile payments. Paper catalogues are no longer provided within the boxes allowing for a clean fan environment, and the ability to focus on how staff can engage with individuals within the corporate area rather than the processes and paperwork required has seen an increase in merchandising sales of 40%. Source: ESSMA Stadium Management Workshop, Ben Gibbons, 2016
The importance of Stadium Management: from development to operation
Daily Operations - Sustainability Management
The Paris Climate Conference, where 195 countries adopted the first-ever global, legally binding climate deal, showed the growing importance of sustainability in stadium management. One of the pioneers when talking about sustainability in sport is Forest Green Rovers football club. In 2010, the club was taken over by green energy supplier Ecotricity, which used football as a new channel to share their message and work. The ultimate goal was to create a truly sustainable football club. In order to achieve this, the Forest Green follows a few important principles. Firstly, the club developed an Eco-Management and Audit Scheme (EMAS) to identify and manage all significant environmental impacts. FGR is the only football club with EMAS. Another important component within their approach is green energy. The club uses 100% renewable electricity and also produces 14% of its energy consumption on site and focuses on efficient energy 26
consumption using measures like LED lighting and solar panels. On match days, waste management is one of the biggest challenges for all stadiums. Here, food packaging is recycled and waste cooking oil is converted into bio-diesel. Due to these and other measures, the club managed to divert 99.5% of waste from landfill. One of the most remarkable initiatives was the introduction of vegan-only catering. The integration of vegan food was not only launched to decrease the carbon footprint, but also of raising awareness among fans of issues around food production and possibilities to decrease environmental impact. Wildflower meadows have also been plated around the stadium.
The importance of Stadium Management: from development to operation
The range of initiatives has had a beneficial impact on the club. In addition to the decrease of waste and increased biodiversity, the carbon footprint per spectator has seen a 45% reduction since 2011/12 season. Water consumption per spectator has reduced by 34% since 2011/12
Source: Forest Green Rovers FC, FGR Footprint Report, 2014 27
Maybe the most positive and remarkable result is not the fact that waste to landfill is reduced, or energy is used more efficiently, but the fact that fans openly engage with the sustainable approach. A new stadium is currently being designed that will be at the forefront of green stadium design and management.
Source: ESSMA Stadium Management Workshop, Bruce Cockrean, 2016
Conclusion
This case study aimed to bring together insights
Additionally, the stadium infrastructure is one of
from different aspects of stadium management.
the few controllable factors within sports teams.
Stadium development, accessibility and daily
The development of efficient, multifunctional
operations all form part of the puzzle towards
and high-quality stadiums will continue to
better customer experience, diversification of
improve club and stadium sustainability.
revenues and organisational efficiency.
Finally, this case study was conducted in the
Within this case study, the indispensability of
aftermath
of
the
communication is highlighted several times.
Workshop
in
Emirates
Both during the construction process and
Stadium Management is one of ESSMA’s
operation of the stadium, interaction with fans is
domains of expertise and the association
key
provides dedicated:
in
order
to
fully
realise
potential
opportunities. Secondly, the integration of new technologies enables new opportunities for fan experience and additional revenue generation.
are
becoming
increasingly
important to club budgets, the importance of proper
stadium
underestimated.
management Research
can’t
be
underlines
the
Management
Stadium,
London.
Content (case study and in-depth articles)
Events (stadium tours and the ESSMA Summit 2017 in Lyon)
Although TV Broadcasting Rights and sports achievements
Stadium
Expertise (key industry experts & ESSMA board members, strategic partners and Stadium Partners)
importance of decent facilities as one of the crucial factors in spectator attendance of events.
Visit our website www.essma.eu to get more specific information on this area of expertise.
Emirates Stadium London (United Kingdom)