A case of the Experience Economy: The Soccer Spanish League (LFP)

Lack of attendees at the Spanish Soccer Stadiums

Recently, I was listening to my favorite Spanish radio station when a debate came up about the lack of attendees to the Spanish soccer stadiums. I must declare that, although I live in Portland, Oregon, it is part of my weekend obligations to watch one or two (or three) games of the Spanish Soccer league and, as any Spaniard reading this will easily understand, watching soccer on TV and listening it through the Radio is a very special experience...
Anyway, back to the debate, the commentators were regretting the fact that in many of the stadiums the stands were half empty and were blaming the high price of the tickets for this situation; they were arguing that a significant price reduction would raise sales which would create a more supportive environment for the local teams and, from a financial point of view, it would generate higher revenues than the current scenario.

Messi vs Cristiano, FC Barcelona vs R.Madrid

At this point I would like to address this matter through the lens of the Experience Economy (*) and try to answer the following question: What do the fans exactly buy when they pay for a game ticket? If we look at the stats published but the LFP (Professional Soccer League in Spain) datos asistencia estadios LFP, out of the 8 stadiums with the highest attendance, 7 belonged to the top 7 clubs of the league table, which shows that the top teams fans seem to be buying a Winner Experience. If the team is having a good season, the chances of victory are higher which justifies the price of the ticket. Among these winner teams, a few stand out because their roasters include some of the world best soccer players (ie. FC Barcelona or Real Madrid), therefore, in this case their fans are also able to watch  every weekend the beautiful game of these top players. Interestingly enough, when any of these special clubs visit any other stadium, tickets are sold out to watch the stars of the opposite team. We could name this a Football Stars Experience.

My next point might be a bit controversial in Spain, but it does explain why in other leagues, mainly the English one, in spite of the fact that not all teams can win, most of their stadiums are sold out week in, week out. In England what the EPL spectators are also buying is a Tribal Experience. It is not by chance that the biggest football replica market is the English one; the atmosphere of their stadiums, the singing of their supporters, the history of their clubs are not comparable with any other league in Europe, and that sense of belonging to a group/club is experienced every game at the home (or often away) stadium. For the most part, the English liturgy is not part of the Spanish Football culture and therefore the tribal experience is not particularly interesting for the Spaniard consumer.

Will a ticket price reduction increase significantly the attendance of supporters to the Stadiums? I don't think so, unless a price cut guaranteed a better performance of the team, which is highly improbable. The stands are half empty because the holistic experience offered is not attractive:

-If you drive your car to go to the stadium, you'd better arrive at least 2-3 hours earlier or otherwise you will have to park really far away from your seat. You can expect traffic jams and long delays after the game, which is particularly annoying if on top of that your team has lost. If you use public transportation, the long lines and delays are also the norm.
-The seats at the stadium, far from being comfortable, are exposed to the weather conditions.
-The Catering stands are limited (long lines), low quality, limited offer and particularly expensive.
-Even if you buy a good seat ticket, chances are that you will be close to somebody who will spend the whole game insulting the referee or the striker of the opposite team... a very unpleasant experience for families with kids.
-You pay for 90 minutes of soccer, that's it. Not even a big screen to watch the replays is allowed in the stadium; nothing (any type of entertainment) happens before (in the surroundings of the stadium), at half time or after the game.
-Back home, fully stressed, you wonder if it is really worth to pay a single euro for this type of experience.

The NBA show

Perhaps this is a very extreme vision of Soccer day in Spain, but let's compare it with a similar experience in the NBA: Most of the games are sold out, no matter how well or bad the team is doing that season. Why? Because on top of Winner or Basketball Stars experiences (or not), their games offer a holistic entertainment for the attendees (especially families) before, during and after the game:
-Games and activities outside the arena and during the game on the Court.
-Cheerleaders and Dancers offering performances during the game
-Diverse and plenty of catering options with a fast (and expensive) service.
-Screens on the court that allow to see again the best plays from any seat in the arena.


Obviously, different sports (Soccer and Basketball) in different sport centres, so it is not a matter of copy/paste the formula but to understand that, even for a non big Basketball fan, an NBA game is an entertaining sport show, an experience likely to be repeated.

The Spanish Soccer games could be sold out again if consumers obtained an Entertaining Football Experience for the prices of their tickets. The LFP and Clubs executives should think about enhancing each and every element of that experience to make it memorable, extraordinary and repeatable every weekend. Certainly, this won't be an easy task but the return can be huge.

(*) B. Joseph Pine in the The Experience Economy: Work is theatre & every business a stage (1999), describes the Experience Economy where consumers don't purchase only goods or services but demand more and more experiences, memorable events that connect with them in a more personal way.

Un caso de Economía de la Experiencia: La Liga Española de Fútbol (LFP)

Estadios medio vacíos en el fútbol español

Recientemente, escuchaba en mi cadena de radio favorita un debate respecto a la asistencia de público a los estadios de fútbol españoles. Debo aclarar que aunque vivo en Portland, Oregon, forma parte de mis 'obligaciones' del fin de semana el verme uno o dos (o tres) partidos de la Liga y como cualquier español que lea estas líneas entenderá, el fútbol seguido a través de la radio, es otra cosa... De vuelta al debate, los comentaristas lamentaban el ver muchas de las gradas medio vacías y achacaban este problema al precio (alto) de las entradas; argumentaban que una bajada significativa de los abonos y tickets por partido llenarían los estadios, crearían un ambiente más propicio para el equipo local y desde un punto financiero probablemente generaría tantos o más ingresos que el actual escenario.

Messi vs Ronaldo, FC Barcelona vs R.Madrid

En este punto, me gustaría abordar el tema desde el punto de vista de la la Economía de la Experiencia (*) e intentar contestar a la siguiente pregunta: ¿Qué compra exactamente el aficionado cuando acude a la taquilla y paga por una entrada al estadio? Si atendemos a los datos publicados el año pasado por la LFP, (datos asistencia estadios LFP) de los 8 estadios con mayor afluencia de aficionados, 7 de ellos pertenecían a los 7 primeros clasificados en la liga, por lo que parece ser que los aficionados de los equipos mejor situados en la tabla están comprando una Experiencia ganadora. El equipo está funcionando y las posibilidades de ver a tu equipo ganar son elevadas y ello justifica (en mayor o menor medida) el precio de la entrada. Dentro de estos equipos ganadores hay algunos que, además, sobresalen por tener en sus filas algunos de los mejores jugadores de mundo (FC Barcelona o Real Madrid) con lo que a esa experiencia ganadora se añade el poder ver a esos jugadores top que hacen las delicias de cualquier aficionado. Curiosamente, cuando cualquiera de estos equipos visita cualquier otro estadio, éstos también se llenan para ver a las estrellas del equipo contrario. Podemos pues llamar a ésta una Experiencia de estrellas del fútbol.

Lo que voy a decir a continuación puede crear cierta polémica pero creo que explica el hecho de que en otras ligas, como la inglesa, a pesar de que, lógicamente, no todos sus equipos pueden ocupar los puestos más altos de la tabla, la mayoría de sus estadios se llenan de público cada fin de semana. En Inglaterra muchos de los espectadores de la EPL están comprando también una Experiencia tribal. No es casualidad que el mercado más grande de réplicas de equipos de fútbol es el inglés, el ambiente, los cánticos, la historia de los equipos de la Premier League no tienen comparación en ninguna otra liga del mundo y esa pertenencia a un grupo/club se experimenta en el estadio de fútbol cada fin de semana. La liturgia inglesa no forma parte de la cultura futbolística española y aunque es cierto que en los clubs españoles hay grupos de aficionados incondicionales que acuden al campo con sus camisetas, bufandas y cánticos, no dejan de ser una cierta minoría en todos los estadios.

¿Un reducción del ticket de entrada aumentaría significativamente la afluencia de público a los estadios? Creo que no, salvo que la bajada de precios garantizará mejor juego y victorias del equipo local, algo difícil de creer. Los estadios no se llenan porque la experiencia ofrecida es poco atractiva:

-Si vas en coche, tienes que llegar 2 ó 3 horas antes de que empiece el partido o aparcar a más de media hora de distancia a pie del estadio. La salida no está exenta de atascos y retrasos que requieren armarse de una paciencia infinita... imagínate cuando además tu equipo ha perdido. Si usas transporte público, las colas y retrasos suelen ser la norma.
-Cuando llegas al estadio, te sientas en un asiento que acostumbra a ser incómodo y lógicamente expuesto a las condiciones meteorológicas.
-Los puestos de catering (venta de bocadillos) son escasos (larga cola asegurada), de calidad dudosa y especialmente caros. Así que en muchos casos acabas trayéndote el bocata de casa.
-A pesar de sentarte en una buena localidad con tu familia, parece ser que siempre tienes que coincidir con algún energúmeno que no para de insultar al arbitro o al delantero del equipo contrario haciendo la experiencia poco recomendable para familias.
-Pagas una entrada por 90 minutos de fútbol, sin ni siquiera una gran pantalla cerca para poder ver las repeticiones de cada jugada. No pasa nada antes del partido (ni en los alrededores del campo ni en el campo), no pasa nada en el descanso y menos al final.
-Cuando llegas a casa estresado, te planteas si realmente vale la pena volver a pagar ni un euro por una experiencia así.

El espectáculo de la NBA

Quizás sea ésta una descripción exageradamente negativa de lo que es una tarde de fútbol en España, pero comparémoslo con la experiencia equivalente en la NBA americana: La mayoría de los partidos tienen sus entradas vendidas en su totalidad, de todos sus equipos, sin importar como estén jugando esa temporada. ¿Por qué? Porque además de ofrecer una experiencia ganadora (o no) y de juego brillante (o no), la NBA ofrece un espectáculo global para familias antes, durante y después del partido:
-Juegos y actividades en el pabellón antes del partido
-Cheerleaders y Dancers durante todo el partido
-Juegos y atracciones durante todo el partido
-Servicio de catering diverso, abundante y rápido (eso sí, bastante caro)
-Pantallas a la vista de cualquier asiento del estadio que te permiten ver la repetición de cualquier jugada

Lógicamente, son diferentes deportes (fútbol y basket), en diferentes instalaciones deportivas por lo que no se trata de copiar y pegar la fórmula pero la idea es que, no importa lo aficionado al basket que seas, al final de un partido de la NBA sales pensando que has visto un espectáculo deportivo entretenido, y lo más probable es que vuelvas pronto.

Para llenar otra vez los estadios de fútbol españoles es necesario ofrecer un Experiencia de entretenimiento futbolístico. Los responsables de la LFP y los Clubs deberían pensar en como elevar todos y cada uno de los elementos que conforman esa experiencia y hacerla memorable, extraordinaria y repetible cada domingo. No es una tarea fácil pero los réditos pueden ser excelentes.

(*) B.Joseph Pine en The Experience Economy: Work is theatre & every business a stage (1999) describe la economía de la Experiencia como aquella en la que los consumidores han dejado de consumir sólo productos o servicios y demandan cada vez más experiencias, eventos memorables que conectan con el consumidor de una manera personal.

Do you really know who is your customer?

We are transitioning into The Experience Economy (1), where consumers often commoditize goods and services -bought both almost on the basis of price- and are demanding experiences, that are just goods and services staged in a particular way.

The offering of experiences is the field where any business, no matter its size, can incorporate a huge amount of true innovation. You don't necessarily need a massive R&D investment to create a memorable experience, but for that, it is critical to understand who is your target consumer, so you can personalize any type of service.

Let me illustrate this with a real example of a company I have recently collaborated with: a Tattoo Removal Clinic based in Portland, OR. There were no doubts about the service to offer,  but the question was: who is our consumer? After discussing this with the Clinic staff, we actually found out that there were 2 different type of customers:

1. The 'soccer mom', a 30 plus years old mother, middle class sub-urban with enough household incomes to afford investing on 'fixing a mistake' from the past (Note that I use the word mistake  without any intention to judge tattoos but with the purpose of describing the thought process of that consumer).

2. The second type was the tattoo lover, a male or female who is into the tattoo culture and often needs to 'clear up' her or his canvas (skin) to add new designs to their body.

Well, if we want to personalize this service and create an extraordinary experience, the business will be very different depending on who will be our target consumer. In the first case, the soccer mom, the approach will be very 'clinical', similar to a health care experience: excellence and reliability are some of the features that should be present in every step of the process.

With the second type of consumer, we can create a very innovative experience far from a typical 'healthcare environment', and closer to an extension of the Tattoo studio with empathic staff who understand the tattoo culture, obviously, without compromising the quality of the service.

As you can see, exactly the same service with the same (laser) technology, can be staged in 2 different ways depending on the customer we are targeting.

So, when it comes to start up or reset any business, we need to first ask ourselves the following questions:
1. What are we offering: goods, services or experiences?
2. If we want to compete offering experiences, who are our consumers and how we can serve them to create memorable moments?
3. Finally and based on the answers to the first 2 questions, how will we organize our company to deliver those extraordinary experiences?

The only way to avoid the commoditization of your services is to customize them... always.

(1) Joseph Pine II, The Experience Economy: Work is Theatre & Every Business a Stage, 1999

Personal Stylist, new frontiers

Human Progress is linked to the access of the masses to products and services that were only at the reach of a few in the past. Only a small number of privileged wealthy members of the society had access to cars before Henry Ford revolutionized its method of production and made them accessible for the general public. Probably, our grandparents started to watch the TV by the local store windows or at the closest neighbor house who decided to 'invest' on that new device. Equally, personal stylism was considered not so long ago, a service who could afford only an minority: movie stars, politicians or celebrities in general. This is not the case anymore...

I asked one of my former colleagues, who had a reputation for spending big money filling his wardrobe, why he was buying most of his clothes in the web MrPorter.com:  'because I don't have much time to create my own outfits, Mr.Porter makes my life easy". It is true, webs like MrPorter (or her 'sister' Net-a-porter.com) among other virtues, they simplify the purchase process by creating combinations of clothes from different brands that are compelling and credible. This is what I call a Stylist phase I service. A global stylist.

Companies like stitchfix.com or trunkclub.com are evolving the online Stylist service by deeping a bit more into personalization. After requesting relevant information of the potential customer (sizes and shape, brands she/he wears, purpose of the purchase...) these companies deliver a curated set of clothes that match customers' style within their budget. Interestingly enough, recently has been published that Thread, a London based startup, has raised $8million to scale their personal styling service with the participation of Hi-Tech capital into a project that tries to blend art (Stylists) and science (Algorithms) to provide the perfect outfits to their customers (Thread). By the way, it is not a surprise that Thread will appoint Terry Betts as Head of their Business Development, a co-founder of MrPorter.com. This evolution is what I call a Stylist phase II service, since we move from generic to personal outfitting.

So, personal stylist is not a niche anymore, it will grow and more companies and brands will tap into this type of services that represent a 1 on 1 conversation opportunity with the consumer, a true personal relationship with your customer. So, what can we anticipate as future business opportunities in this area?

-First of all, I believe that there is a Fashion Stylist phase III opportunity (and even phaseIV). Today, all these services are coming in an 'static' way: they can analyze your sizes and tastes and propose you a set of clothes that match tastefully that information, but we all have history, tones of clothes in our wardrobe that we still can use. Who is going to help us to combine the old and the new to multiply exponentially the number of outfits available for us? What about our jewelry, our glasses, our watches, our make up... can we be offered a more holistic service, more personal and equally affordable?

-A Stylist service is about a 1 on 1 commercial relationship that can be easily transferred to many other areas of our life. For example, Food and Health: today we go to the Nutritionist to know what to eat and separately attend Cooking lessons (on line of physical) to become the Master Chefs, at least in our home... can somebody merge these two and offer us a tailored made Cooking course adapted to our taste and our health situation, a very personal service!

-And finally, will that 'make it personal' trend represent any opportunity for local small business? Last week my wife received the attached 'personalized' ad in her Facebook account. They found out that Monica was born in Barcelona, Spain and it is resident in the USA, so somehow they thought that if she received a design with a map of Spain, our national flag and the words 'Barcelona' and 'Spain', she would be so touched by the offer that, in tears, would order that T-shirt not only for her but also for the rest of the family and friends... The effort was fruitless, since, without entering into any political/cultural details, the proposed design was irrelevant and distasteful. This is an extreme example of a missed online personal connection for lack of local and personal relevance. I believe that there are many opportunities out there for small business, integrated in the communities where they are located, to create premium personal experiences. No make mistakes, though: local and small should not be a reason to operate outside the latest technologies.

Hmmm...Merchandising, really?

I tittled my first entry of this blog "Let's talk about Merchandising..." and I guess that some (or many) of the readers who gently took the time to read my thoughts, questioned if all that was really about Merchandising. The term Merchandising is used in very different areas and that's why it can create some sort of confusion. For example:

-Merchandisers (not Merchants) are the ones that work on the retail floor setting the store, loading product on the shelves, folding clothes at the tables, etc..
-Visual Merchandisers are the ones that make sure that the external look of the store is compelling. Normally they organize the floor lay out, take care of the windows and make sure overall the store look sellable.
-Merchandising is also what the Walt Disney organization masters: sell the intellectual rights generated by their movies and characters to companies that manufacture and commercialize products. They are a well-oiled machine to licensed their 'brands' and collect massive fees for that (Did you know that the top sold wedding dresses in the US are licensed by Walt Disney and inspired in their princess characters...?). Professional sports clubs (NFL, NBA, European Soccer clubs...) generate extra incomes thru the commercialization of products (mainly apparel) bearing their logo; they call this Merchandising revenues.

Nothing wrong in any of the points above, however my use of the term MERCHANDISING is way more holistic; a modern approach to a function that I firmly believe should be elevated in any consumer company that operates in multiple channels of distribution and geographies. The main role of the Merchants in any organization will be to create the maximum number of different premium consumer experiences in the marketplace. They will sit between the production and sales team and determine the assortments that need to land in the different countries and channels of distribution to enable the strategic targets of the company. Easy to say, very difficult to accomplish.... I will touch on all this in my next entries.

Let's talk about Merchandising....

I have to confess it: I wasn't able to buy a pair of glasses at warbyparker.com; I tried... but I couldn't. I am 47 years old and wearing glasses since I was 3, to my far-sightedness and astigmatism, when I turned the glorious forties I added the need of reading glasses, or in other words, progressive lens. WP are kindly enough to send you up to 5 pairs to your home so you can try them and then return all of them with your prescription so they can set up the proper graduation to the pair(s) you choose...all free of charge. However, they also need another piece of information: your pupillary distance (PD), this is what the optician marks in your lens to measure the distance between your pupils, and you need to find it yourself with the help of a 'card with a magnetic strip'... Hmmm, it doesn't seem to difficult but what if I do it wrong, I am pretty clumsy... really, is it worth the risk?

Don't get me wrong, WarbyParker.com is a terrific e-commerce concept, with a well thought sales process designed to overcome any potential mental obstacle that consumers might find (or create) to buy glasses on line. But, there will be always consumers like me (who knows, perhaps it is because I am not one of those Millennials geeks but a proud Generation X scout) that will prefer to be attended by an optician who will give them a professional advice on the kind of glasses that fits better with their shape of face and who, at the end of the sale, will measure their PD...

I love watches, I own a small collection, definitely less units than what I would love to have and for sure way more than what my wife think I need... I say that it is an investment, it is not... Anyway, my favorite brand is Rolex but I would never buy a Rolex in an Rolex-only-store, why? Because buying a high-end watch, a master piece of manual craftsmanship, is a very special event and I need to feel that I am giving other brands and models the same chances to be bought; I also need the expert advice of a sales clerk who, in the end, will probably confirm that I need to buy the model I thought I will buy even before I set a foot in the store.

I also love to drink coffee, not those massive mugs of lattes or similar that you can buy anywhere in the world but just a simple shot of expresso (perhaps with a little bit of milk); when it comes to a cup of coffee for me, less is more and sugar is a must. Have you ever bought coffee at an official NESPRESSO store? If you haven't done it, I would strongly recommend you to swing by one of these outlets and, if yes, I am sure that you will agree that the consumer experience is absolutely premium (store lay out, visual merchandising, customer service...); I have to admit that I receive a better treatment buying a few boxes of Livanto Cupsoles in a Nespresso store that cost me less than $50 than my experience buying my last car of a pretty premium brand whose name I will spare in this blog. As a result, I am consuming now more coffee than before.

On the tittle of this entry I was proposing to talk about Merchandising, and that's what all of this is about. Mastering the basics of Merchandising, companies will be able to maximize the number of premium retail consumer experiences and hence maximize their revenues in the long term:

-The online channel is, without any doubt, the one that offers the maximum potential of growth; some companies (many) will have to figure out how they will play in this area before the train has left the station and it is too late. Some others, like WarbyParker started online but perhaps will have to explore the possibilities that a brick and mortar expansion can offer them to reach, for example, risk-averse consumers like me.

-Obviously, it is easier to control your own retail and many companies are expanding what they call their Direct To Consumer operations, opening their brand only stores in different formats (flagship stores, inline stores, factory, etc...). This represents a tremendous opportunity to connect with their consumer without any bias and if the retail is done properly an extra margin generator thru the vertical operations. But, not every company can or should create their own stores and definitely not all consumers want to buy alway in a mono brand environment, no matter how much loyal they are for a given brand, like Rolex.

-Sometimes the opposite of Premium is not 'cheap' but ordinary. Any brand can present themselves in a premium way even in an entry level retail environment as long as they do it an extraordinary way. Nespresso stores are premium and different to a general grocery outlet where you can buy a bag of coffee beans. The final product, the cup of coffee, is pretty much the same, the buying experience is different  and the consumption of coffee at home has increased because there are more way to have access to the same product. Consumer companies need to figure out how they build their product lines to assort different retail propositions; if they do it successfully, they will achieve a healthy long term growth.

In the next entries of this blog I will talk about the different aspects of the Merchandising function and how if implemented properly in the modern organizations can be a key enabler to achieve the strategic objectives of any corporation.