How to market and sell premium seating - a PanStadia
Q&A session with two of the USA's best.

eter Crowley, President of Colosseum and Robert Simon, President of GBSM Sports have been working together for several years to help United States sports facilities and teams market and sell premium seating - i.e. private luxury suites and club seats. Most recently, Crowley and Simon teamed together for the Pepsi Centre in Denver, Colorado and the Philips Arena in Atlanta, Georgia to sell-out their luxury suites and club seats. Both new arenas open in October 1999 and are homes to professional NBA basketball and NHL hockey and entertainment events.

PanStadia interviewed Messrs. Simon and Crowley about their expertise in selling and marketing premium seating.

PanStadia: Rob, is marketing and selling premium seating different from ticket sales or other sports marketing?

Robert Simon: Absolutely. When you sell a ticket to a sporting event such as soccer, it is a one-time transaction. When you sell a luxury suite, it is a long-term commitment - often ten years - for a substantial amount of money - ranging from 100,000 to 500,000 US dollars per year. In addition, it is a commitment for a significant amount of tickets. The suites typically cover more than 150 events per year, with an average of 12 to 16 seats per event. For any individual or business, that major commitment requires both a sophisticated and strategic sales and marketing approach.

P: What is the key marketing strategy for this high-end sale?

RS: Relationship selling. You need to build a long-term and patient strategy for identifying your target prospects, and then developing both a personal and professional relationship with them. They want to be taken care of and pampered as clients and as friends. Once you have that relationship established, you can then go in for the sell. By that time, they won't even feel that they are being sold to; rather it will feel as if you are helping them.

P: Does this "relationship selling" business take a long time?

RS: Not necessarily. With some prospects, you can establish this relationship immediately; others take more time. Either way, you have to have a co-ordinated sales effort to ensure that all prospects are taken care of. And you have to know when to go in for the close, and perhaps just as importantly, when not to.

P: Why is selling premium seating such a hot issue for arenas in the United States?

RS: Increasingly, the revenue from premium seating is critical to the success of a new facility and the teams that use it. Sports have become such an expensive business that without the revenue from premium seating, most new facilities and teams would fail. In addition, the banks or investors who back the teams and facilities expect quick returns on their capital, placing additional pressures on the teams and facilities to sell premium seating - and sell quickly. Finally, because premium seating is such a different selling process, many sports teams have failed or fallen short in their efforts to sell club seats or private suites. With this kind of pressure, most sports facilities and teams are looking for answers and help.

P: How have you helped facilities in the United States?

RS: We provide a comprehensive integrated approach to sales and marketing. Together, GBSM Sports and Colosseum provide the market research, sales and marketing strategy, public relations, creation of collateral materials (videos, brochures, logos, etc) and sales implementation - sales prospecting, presentations, management, co-ordination and on-the-ground selling. We also can assist in the selling of naming rights and corporate sponsorships - two other very important revenue-generating activities. We work together - Peter helps shape the strategy and sales approach and my firm supports Peter with additional sales strategies, tactics and materials once the sales process begins.

P: At what stage is your firm brought in to work on a project?

RS: We work best when we are brought in early - often two years before a stadium is built. The selling of premium seating actually begins when the public first learns about a new facility. Those first impressions through the media help shape their expectations and begin to build momentum. If we can help create excitement and expectations early, we can help ensure the success of the sales process that will occur one or two years later. Of course, we can be brought in at any time in the process. For one project, we were brought in halfway through, after the facility had already made mistakes in the marketplace.

P: What are some of the key things you tell your clients about selling and marketing premium seating?

RS: I have seven key points that I usually recommend:

Assemble the right team - make sure you have the right resources for both your internal sales force as well as your external sales support (including strategists, sales management, research, telemarketing, etc).

Know your product - you are selling a hierarchy of brands - the stadium (the hardware), the sports teams and entertainment events (the software), the suites, the club seats and the regular seating. Each has its own "brand" that must be understood, developed, and promoted.

Know your market - this is business-to-business marketing, and you must know who will purchase your suites and why. Small businesses? Large businesses? High net-worth individuals? How big is the market? What motivates them as buyers?

Develop the right strategy - so much of the success in selling premium seating is creating and maintaining momentum, momentum, and more momentum. But how do you do that? How do you create a sense of short supply and strong demand? How do you raise awareness about the stadium? How do you build relationships and yet move people quickly to close? Having the right strategy answers all these questions.

Use the right positioning - what is the unique sales proposition that will get people to buy suites? Are they looking to network for business, entertain clients, have the best seat in the house for sports, or enjoy luxury? Each stadium and each market has a different sales proposition that motivates buyers.

Develop the right messages - what are the key messages that you say over and over through all your marketing materials, scripts and client interactions? Repetition of the right messages will ensure success.

Create the right tactics - ultimately it comes down to execution. You can spend a lot of money on expensive brochures and videos, but that is not necessarily the right approach. Sometimes an email works better than a brochure. Sometimes a personal note is more important than a video. Sometimes a direct mail promotional item will work wonders. In one market, we hand-delivered a life-size leather chair to a prospective client to show them how luxurious our premium seats would be. We certainly got their attention, and they bought a suite! Choosing the right things to do from a vast menu of tactics takes experience, understanding, innovation, and creativity.

Also, it is always important to be nimble and adaptable. No matter how smart and co-ordinated the strategy, things change, and you must always be prepared to come up with a new idea or strategy at a moment's notice.

P: What is success? A sell-out?

RS: Of course, every stadium wants a sell-out of their luxury suites and club seats. But that isn't the only measure for success. You must also make sure you have priced the suites and club seats accurately, or otherwise you will leave money on the table, even with a sell-out. Moreover, in three or five years you will begin renewing the contracts for suite and club seat clients, so you must make sure that your initial sales process doesn't alienate your market. Arrogance is the worst enemy of a sports facility - assuming that your market has to buy because you are the only game in town.

The Philips Arena
Above: Inside the Philips Arena (92k). Right: Differing seating configurations add to the flexibility at the Philips Arena (96k).	Location:	Downtown Atlanta, Georgia, USA
	Seats:	18,750 to 21,000 (depending on event)
	Teams/Events:	NBA Atlanta Hawks NHL Atlanta Thrashers
	Entertainment (circus, shows, concerts) Suites:	96
	Club Seats:	1,800

PanStadia: Peter, what is your company and how did it begin?

Peter Crowley: Our company is called Colosseum. The original spelling and the history of coliseums intrigued us. Coliseums began as centres for entertainment dating back to 80A.D. in Rome. We thought that it encompassed the focus of our company. Today, there are over 30 new arenas and stadiums under development in the USA alone. When you look at the global market there is clearly an enormous amount of need for a company focused on maximising the very revenues that allow these structures to be built.

P: What is your focus?

PC: We deliver premium-seating revenue. Our collaboration with GBSM Sports has resulted in a very successful integrated strategy. We have developed the track record of delivering sell-outs.

P: Elaborate on your sales strategy and why it is successful.

PC: First, pricing is a key component in the strategy. There are many examples where because of flawed pricing; millions of US dollars were not recognised. Pricing will determine what sells first, the best seats or the worst. Most importantly you only have one chance to do it right...the pricing model will hurt you financially for years if it is wrong.

Second, packaging. The amenities in the package have to be both deliverable and affordable. Certain amenities in the package that have great appeal with little cost versus those which are costly to implement. A good example is those buildings that included beverages as part of their package. It drove their per capita revenue numbers down below budget. Another team included a free team jersey to all seat buyers as a promotion, and it cost them enormously in retail revenues. The key is to provide high-value amenities that do not cost very much to deliver.

Third, positioning. Each arena or stadium occupies a unique place in its community. There are certain selling messages that ring true in one market and not in another. Based on our early analysis we determined that at the Pepsi Centre in Denver, Colorado the word "luxury" was the wrong message. There were corporations downsizing and Denver is not a flashy city. We never used the word luxury in the entire presentation. Yet in Atlanta, "luxury" sells. The message we are creating for another arena project will actually emphasise the support for at-risk youth and urban renewal benefits of the project.

My next three points relate specifically to the sales effort; prospecting, process and perseverance. These three are completely interlinked. However, the process of the luxury sell is the crux of our success. We have developed a sales process that is so high-touch and relationship-driven that if used in conjunction with the right prospects it will result in maximum revenues.

P: Let me interrupt at this point; what makes your sale process so effective?

PC: In this age of automated tellers and telephone solicitation, we have returned to the roots of good salesmanship. We respectfully work with a client at their leisure in a very special environment. We deliver all information and overcome all objections in one hour. At the end of that hour the client of his or her own volition will either make a buying commitment or they decline and we move on to the next prospect. It is a well scripted and delivered sales strategy and has proven to be highly successful in all categories of luxury seating.

P: You make this all sound so simple, is it?

PC: It sounds simple on the sale side because there is such great effort expended on the front end.

P: Please expand on that.

PC: Before launching the campaign, a great deal of thought and work is given to developing the right game plan. We know that in every case we will have to stretch the market beyond those companies or industries that have traditionally bought premium seating. In some markets, we are introducing the concept of private suites or club seats because they never had an arena or stadium that had them. We also know that sequencing of the offering is critical in maintaining your relationships with your best clients. Your core customers consist of existing premium seat holders, season ticket holders, friends, family, etc. You must treat these customers properly. In addition, the building owner is going to have certain financial pressures. An example was one client who was leveraged and needed significant deposits up-front to secure financing. Through our strategy, they were able to garner a deposit equal to 50 percent of the first year lease payment. This represented four million US dollars that became available as security for the loan.

P: What sales materials are used in the luxury market?

PC: The proper tools are an important part of the sales effort. There is a tendency to build very elaborate sales and marketing centres consisting of a life-size mock-up of a suite or club seat area. What many facility management companies fail to consider is that the design of the marketing centre should support the actual flow of the sales process. We have been involved in the design of three such centres and as a tool, they cannot be beat. If they are not constructed properly they turn into very expensive office space. The other tools that are important are of course a database, a competitive analysis, and the proper collateral materials. For some arenas it makes sense to produce high-end collateral materials such as four colour glossy brochures and sizzling videos. But in other cases, we actually recommend producing very little - we have something of a secret weapon.

P: A secret weapon?

PC: Yes, we utilise a strategy that makes everyone feel like they are the only ones buying, and it works miracles. Come help us with an arena and you can learn the secret.

P: Do you have any plans to be involved in the U.K. or Europe?

PC: We are very interested in the U.K. and we are currently part of a team looking at the existing facilities in Berlin. We look forward to having our first international project soon.

Peter Crowley (right) of Colosseum may be contacted by telephone in Denver on (303) 733-9030 or by email at: pccrowley@mindspring.com

Robert Simon (below right) of GBSM Sports may be contacted by telephone in Denver, Colorado, USA on (303) 825-6100 or by email at: robsimon@gbsm.com