Monday, January 2, 2017

Innovation Is Name of the Game in 2017

It is the time of year for predictions about what will happen in the coming year. You name the topic, and you can likely find predictions about expected trends or developments. Predictions are informative for giving a heads up on what areas to pay attention to in the coming year. And, predictions can be provocative when they push boundaries of current practice or performance. 

So what are the predictions for sports business in the coming year? An online search for articles on 2017 predictions for sports business returned some likely topics:
  • E-sports
  • Virtual reality
  • Big data
  • Shifting media consumption
  • Fan engagement

This list yields no surprises as they are front burner priorities for many sports properties and companies. The pressing question is whether these trends become opportunities or threats for an organization. The difference maker will be innovation.

A Simple Definition

Innovation is crucial to an organization’s growth. And, it is said if you are not growing, you are dying as a business. Why is innovation central to an organization’s growth? It is central because of what innovation represents. Simply put, innovation is “creating new value.” When you create new value, you maintain or enhance relevance of your products. We tend to think of innovation as new value that benefits users- think cashless concessions or smartwatches that capture personal fitness data. Innovation can be internally driven, too. For example, gleaning deeper insights from customer data to make staffing decisions that enable better customer service to be delivered during peak periods. 

Squandering an Affinity Advantage?

In Chapter 1 of Sports Marketing (by Fetchko, Roy, and Clow- Routledge, 2016), one trait that distinguishes sports from other industries is a phenomenon referred to as an affinity advantage. What is an affinity advantage? It is a positive affective (emotional) disposition people have toward an object like a brand. Sports brands enjoy an affinity advantage over non-sports brands in that people are inclined to show their affinity for a brand. A quick look around the coffee shop where I sit writing this article I saw people wearing apparel with logos of Nike, University of Alabama, and Dallas Cowboys. I guess the Cuisinart, Kroger, and Purina fans were at home… although I have never seen those “fans” anywhere. The point is many people are willing to make an emotional investment in sports brands unlike any other brand relationship they have.

That said, an affinity advantage is more like a head start than outright competitive advantage. Brands possessing an affinity advantage should cherish and safeguard it, not take it for granted and assume it will always be present… because it will not. It will be interesting to see how ESPN and other sports media brands fare in 2017. The days of TV-centric sports consumption are over, not to dismiss TV as an important communication medium. Realities of media consumption include reliance on multiple screens and more people not glued to the big screen at all. Innovation is the tonic media brands will have to rely on to leverage their affinity advantage and deal with shifts in consumption. Otherwise, the head start gained by the affinity advantage will be negated. ESPN and other sports media brands will be challenged to “create new value” to adapt to consumers’ shifting interests and behaviors. 

Happy New Year- Be innovative in 2017!