How Sales Management in Pro Sports Can Catch Up to Corporate America

Why do parents, teachers, politicians, managers and salespeople continue bad practices? Four reasons and the ways we express them are:

  1. We do what was done to us and assume it was best practice.
    • “Look at me, I turned out OK didn’t I?”
  2. We lack the depth and breadth of relevant education to recognize bad practices.
    • “See, you can succeed with any background!”
  3. We judge outcomes based on the exception rather than the rule.
    • “Look at her, she started here and is now vice-president!”
  4. We lack the courage to meet the demands of reality.
    • “I know this isn’t working, but I can’t change what I’m doing now.”

Sports sales recruiters often ask applicants, “Why do you want this job?” The wrong answer is, “I just love sports.” The irony is when it comes to pay, work hours and benefits, they literally bank on the applicant’s love for sports to compensate for, well, real compensation.

How Do We Know the Sports Sales Management Model is Broken?

Sales 101

First, consider some basic 101 principles of sales management. These quotes are directly from a leading sales textbook 1

  1. To attract and keep the best talent compensation must be uniform within the company and in line with what competitors’ salespeople receive.
  2. Salespeople who perceive the system as unfair may give up or leave.
  3. A constantly changing system may lead [salespeople] to constantly change their activities but never make any [more] money.
  4. Companies that do not emphasize service or do not anticipate long-term customer relationships typically rely heavily on commission plans.
  5. Salespeople working primarily on commission have little company loyalty and certainly are less willing to perform activities that do not directly lead to sales.

Inside sales reps in sports do not receive compensation in line with what they can get anywhere else. Top salespeople often see the system as unfair (given effort & reward) and leave as soon as a client sees how good they are (and offers multiples of current pay). Teams frequently “play with the lights” changing compensation systems in ways that rarely favor the rep by making the rep more money. The shift toward service-only reps leaves inside sales reps relying heavily upon commission and sacrificing customer welfare and service. As a result, few have loyalty and are certainly unwilling to do non-sales related activities.

Turnover

Second, consider the effects and costs of turnover. Average sales turnover across industries annually hovers around 25%. 2 Typical sports sales practice is to recruit a new class of inside salespeople every 4-6 months, suggesting something closer to the average turnover among car salespeople (~70-75%). 3 Some are promoted (internally or externally), but most leave the industry voluntarily or involuntarily.

Costs of turnover are estimated between $75,000 to $200,000 per salesperson4, taking into account recruiting, training, and lost sales. You can calculate yours here. The NBA estimates third-year reps generate 3.4 times the revenue as first-year reps. Unfortunately, relatively few get to the third year.

If I fail over half of my students each year, you wouldn’t say I’m a good teacher. In our program, we can’t blame the students. We recruited them. The same is true for teams. If annual turnover is anything much more than the non-sports corporate average (25%), at some point we must have the courage to start looking at the system and grasp the reality.

Training

Most sports sales managers are interested in training. The problem is the low proportion of these with any professional training in personnel management, compensation structure, leadership, and other sales management responsibilities. Many make great effort to learn to compensate for the lack of formal training (i.e., business management-related degrees). A few have had professional selling courses. A few have MBAs. Most were selected on the basis of being great salespeople, rather than management skills–which are two quite different things.

Sales students not taking the sports route are often hired by companies like Oracle, IBM and other major corporations who offer starting pay closer to $100,000 than $30,000, even while spending months in training before ever making a sale. We don’t expect teams to be on par with Oracle. But, $10-$20 an hour and first year commissions won’t attract the best talent among graduates who just spent tens or hundreds of thousands of dollars getting an education and accruing student loans.5

A New Model

Sales executives and managers (in sports) routinely bring in motivational sales speakers and hold weekly pep talks. Why? Because the nature of the role and associated benefits of the job aren’t intrinsically motivating on their own merits.

One of our partners, Spurs Sports & Entertainment, decided to do something about it with the support of leadership, including Frank Miceli and Tim Salier. Lindsay Beale, Director of Business Development at SS&E, walks us through the four steps they undertook.

Step 1: Look at the hard truth

We studied our sales work force and realized we were recruiting talent, investing resources into their professional training and development and they were leaving our organizations for other local corporations in sales roles.  We thought we had the hiring and recruiting figured out. We found individuals who really wanted to sell. For years we felt our compensation was competitive to other sports organizations. This helped with recruiting, but when you hire talented salespeople, they have opportunities outside of the sports & entertainment business.

Corporations look for talented salespeople from reputable organizations. They use aggressive recruiters, signing bonuses, high base salaries and competitive compensation packages to attract them.  We realized we couldn’t compete with them–specifically with our representatives with under 3 years of tenure.

We worked with finance and HR to evaluate our current sales structure to establish a plan to address our top concern of retention.  Through our research it was also clear compensation wasn’t the only place sports sales are behind the corporate sales world.  We are currently in the process of addressing sales retention by reviewing three areas: compensation, sales enablement and culture.

Step 2: Create competitive compensation

Teams may think their compensation is competitive with other teams, but that is the wrong comparison point if the goal is to retain talented salespeople. We restructured in four ways.

  1. Supplement commission in the first few years with a higher base salary to provide stability while the sales representatives build their books of business. [Among S3 partners moving in this direction, this ranges from $30,000 up to $42,000 for base pay.]
  2. Restructure commission to reward all sales revenue. We realized our commission structure heavily rewarded products that more tenured representatives were selling but weren’t incentivizing newer representatives.
  3. Provide a strong upside for top sales representatives, with clear rewards and recognition for high achievement.
  4. Hire sales representatives at a full time, full benefits position. No seasonal positions.

Step 3: Give them the tools

We established a Sales Enablement strategy applying digital tools, analytics and strategic processes to allow our sales team to excel in their jobs.

  1. Utilize data and analytics.
    • Lead Scoring
    • Appending data to sales leads to target individuals for specific campaigns
      • Examples: Outer markets for weekend plans or high net worth individuals for premium events.
  2. Invest in technology to improve sales efficiency.
    • Conversica, artificial intelligent sales assistant
    • Zip Whip, texting platform
    • ZoomInfo, business to business prospecting tool
    • Linked-In Sales Navigator
  3. Train and develop adaptive selling skills.
    • SS&EU: Classes are offered during work hours, are hands-on, and cover a variety of topics. They are facilitated live by in-house experts to encourage the cultivation of ideas and relationships across departments. SSEU is supported at the highest level of the organization and every executive teaches a different course.
    • Internal and external sales trainers
    • On the job sales training

Step 4: Create a people first culture. Really.

  • Provide a clear path for internal promotions.
  • Recognize each seller has an individual selling style. Coach, develop and set metrics to fit each representative.
  • Promote work life balance for everyone.
    • Eliminate the following phrases from management vocabulary:
      • Grind.
      • First one in, last one out.
      • Outwork everyone else.
    • Focus on quality of work and their commitment to the sales process, goals and team.
      • Commitment (you want) vs. Compliance (you must)
  • Allow flexible hours that still meet business needs.
  • Increase self-empowerment. Encourage reps to make their own decisions on how to manage time and activities to reach goals rather than micromanage to the numbers.
    • Coach reps to improve each day and strive for stretch goals they set for themselves.

Conclusion

We believe the S3 program can recruit more and better talent to the major the more teams buy into the new model aimed at development and retention. Just because teams can recruit people to fill each sales class with low wages and benefits doesn’t make it the right thing to do–either for the candidate or the team’s welfare. Basic sales management principles show us how we can do better.

Some teams are taking the lead. Since word has gotten out, others have reached out to say they are following suit. Do you want to join them? Are you in?

  1. Selling: Building Partnerships, 2014, Castleberry & Tanner, New York: McGraw-Hill. Quotes straight from the book are in italics.
  2. https://www.ringdna.com/blog/work-to-retain-sales-reps.
  3. https://www.wardsauto.com/dealer/maxdigital-out-stem-74-turnover-rate-among-dealer-salespeople.
  4. Sales Management: Analysis & Decision Making, 2012 Ingram et al., London: Sharpe.
  5. Even if it isn’t a private school (average ~$35k/year), public school still costs at least $10k/year for tuition/fees alone.

November Newsletter

by Will Evans – November 2018

S3 Alumni Spotlight

Vishal Nagarajan

Vishal Nagarajan (S3 2018), KORE Software, Junior Associate

Tell us about your experience at Data Strategy Day?

“S3’s Data Strategy Day was a great experience. For the students there, being exposed to the information the various speakers provided is invaluable and will go a long way to jump start their careers. For alumni and other business professionals in attendance, it was a great opportunity to reconnect, network, and learn how other areas of the industry are growing and advancing. Very much looking forward to next year’s Data Strategy Day!”

S3 UPCOMING EVENTS

Premier Partner Day

  • When: November 9th, 2018
  • Where: Foster 143/144, Baylor University
  • Why: To introduce S3 seniors and juniors to the best sales career opportunities and internships in the sports industry.
Brand Strategy Day

  • When: January 25th, 2019
  • Where: BBVA Compass Stadium (daytime) and Toyota Center (evening)
  • Why: To engage, educate, and recruit students interested in careers in brand strategy and partnership sales, service and activation in sports & entertainment.
  • Register: baylor.edu/business/s3/brand

Data Strategy Day Speaker Highlights

S3 Alumni at Data Strategy Day Top: Colby Conner, Matthew Burke, Chase Kanaly Bottom: Vishal Nagarajan, Leslie Horn, Brooks Byers, Alex Karp

Leslie Horn (S3 2012) – StoneTimberRiver and SSB
StoneTimberRiver, now a part of SSB, is a third party vendor for CRM solutions serving over 60 professional sports teams and entertainment events. Horn serves as the manager for Client Services. At Data Strategy Day, Horn spoke about the importance of proper training for using CRM at teams and organizations. She noted that the biggest problems she sees with teams are bad data and bad usage of data.

“CRM can be an amazing tool to increase the efficiency of your organization. However, you get out what you put in. If you have bad data, you are going to have bad results, no matter how good your salespeople are.”

Grant Bills – (S3 2009) – FISH Technologies

FISH provides strategy and services to derive optimal results, and derive meaningful insights from events and conferences. Fish has worked with hundreds of events including the NBA and NHL All-Star Games and the 2018 College Football Playoff. Fan interaction at events begins with gaining data through app-signups and tablet registration. All data is tracked through the fan’s app, and gamified experiences engage fans and reward them for active participation. As Bills explains,

“The FISH Platform ensures that the entire event ecosystem is connected and measurable. This ensures fan engagement is tracked throughout the entire event footprint: understanding where they engage, what they collect, what they share, and how that behavior applies to a refined Unified Fan Profile.”

Thank you to our guest speakers from 4FRONT, StoneTimberRiver/SSB, and FISH Technologies!

Want to get involved with S3? Click here or email Ian_Young@baylor.edu

Do MLB giveaways and special events influence attendance?

Do MLB giveaways and special events influence attendance?
by Kirk Wakefield – October 2018

Forbes reported before the 2018 season started that clubs planned over 1800 special event promotions, including about 28 giveaways per team on average. The Cardinals (49), Dodgers (42), and Cubs (41) all topped 40 giveaways. The Marlins (11), Athletics (14), and Diamondbacks (15) were the least giving. If you’re already seeing a pattern, you may be onto something.

Not everyone follows MLB attendance with the same passion as I do. I’ve been tracking and analyzing MLB attendance trends decade by decade since 1990. In the 1990s and early 2000s, it was the rash of new stadiums drawing fans to the game. As we move into the current decade, the strongest predictor of attendance is the presence of star players (represented by total payroll) and the fact that each new year brings overall lower attendance. Winning has always been important, but always behind star power and stadium-related factors (including capacity). Ticket prices, as we’ll see shortly, rarely influence annual attendance. Instead, we can reliably predict next year’s prices based on this year’s attendance.

What about giveaways and special events?

We don’t have historical, annual data on the number of giveaways and special events offered by team. But, thanks to Forbes, we have them for 2018.

It’s not enough to ask, “Are more giveaways and special events correlated with attendance?” You must account for anything else that might influence attendance. Thankfully we did this for you.

To explain average attendance (right) we include the following factors for each team:

  1. Total payroll in dollars
  2. Won/loss percentage
  3. Stadium capacity
  4. Special Events
  5. Giveaways
  6. Population/Franchise Index 1
  • Fan Cost Index (see Team Marketing)
  • Park factors: Runs scored; Home runs

 

The results

We can explain 91.3% of the variance in attendance with these factors. If you think that is high, you are correct. We rarely explain over 90% of anything. If you’d like to play with the data yourself, click here to download. 2

We numbered the factors above for a reason. They represent, in order, those factors with the most influence on attendance. Total payroll (B = .411), winning (B = .328), and size of the stadium (B = .313; i.e., bigger stadiums like the Yankees and Dodgers) each strongly predict average attendance.

Special events (B = .224) and giveaways (B = .198) significantly influence attendance (p < .05). But, not so fast. We took a deeper dive on the relationship of giveaways on attendance. The relationship is not linear.


As most readers likely guessed, what we see is the classic sideways-S curve of a cubic function. Ok, maybe you don’t hit these kinds of curves very well. But, you can see from the graph that teams offering few giveaways (e.g., Marlins and A’s) fared poorly.  As teams offer 10-20 giveaways, attendance increases. However, the dip in the curve shows a good many teams with 20-40 giveaways actually decrease in attendance. This is bad.

What is good? Going all out. The teams offering 40 or more fared very well. This finding is consistent with the philosophy of making the big even bigger. Rather than using promotions only to shore up lousy games, make the big game weekends too big to ignore. The spillover excitement offers a windfall to attendance overall.

What is better? More giveaways and special events give fans more reasons to go. Without, you’re just selling baseball. With, you’re selling entertainment. Want baseball fans to bring less motivated family members and friends? Give them a reason. Many reasons.

The unconvinced are saying, well, those are the Dodgers, Cubs and Cardinals. They have bigger or better stadiums, or winning teams, or maybe bigger markets. We accounted for all of that, remember? These numbers don’t lie. The number of giveaways explain or predict attendance (apart from everything else), and the effect increases at an increasing rate.

Conclusion

The results also show that special events significantly increase attendance. Teams like the Padres (172), Brewers (136), and Royals (126) benefitted from these appeals to different market segments to increase attendance above what it would have been without them. We can argue those with the fewest special events (Red Sox, Mets & Yankees) didn’t need them because of the other factors going in their favor. What might they have done with them?

Finally, it’s always interesting to note the cost of going to the game doesn’t influence average attendance. Neither did any of the park factors, like runs scored or home runs. The total market size and inter-city rivalries help attendance, but just as it has from 1990-2015, it is the least (although significant) effect.

 

  1. The PFI accounts for larger markets + total major league franchises in the DMA. The New York teams lead the way with the largest population and the most (9) major league teams.
  2. To get 91.3% R-Squared you need to include the quadratic and cubic functions for giveaways.

S3 September-October Newsletter

S3 September-October Newsletter
by Ian Young – October 2018

S3 Alumni Spotlight

Blake Pallansch

Blake Pallansch (S3 2015), Phoenix Suns, New Business Team Manager

How did S3 prepare you for a sales management position?

“S3 did a great job of preparing me for a management role. I felt very knowledgeable about the structure of an organization and the amount of time and hard work associated to make a move into leadership. S3 also prepared me for how to succeed in the role early on with a high level of integrity.”

What is one piece of advice you have for S3 students looking for jobs or internships in sports sales?

“Learn as much as you can at every event and opportunity you have to meet people through S3. Fully utilize the platform S3 provides to you. You have so many opportunities to meet with and learn from some of the best leaders in this business. S3 provides the groundwork for students to gain a head start on long-term success in an exceedingly competitive industry.”


S3 UPCOMING EVENTS
Data Strategy Day

  • When: October 5th, 2018
  • Where: Foster 250, Baylor University
  • Why: To engage, educate, and recruit students interested in careers in data science, data strategy, or digital marketing.
  • Register and find details online at www.baylor.edu/business/s3/data.

S3 Internship Spotlights

Collin Kensinger – New York Mets

“What we learn in adaptive selling is a great foundation for what you do as an intern with the Mets. Dr. Lehnus’ class equips you to apply what we learn much more in-depth once you are on-board with a MLB team. The highlight away from work was taking a sunset cruise around New York to see so much history and amazing sights like Ellis Island & the Statue of Liberty, One World Trade Center, and the Brooklyn Bridge.”

Tatum Lowe – BBVA Compass

“I learned how to effectively manage partnership relationships and evaluate those partnerships and the ROI from partnerships like the BBVA Compass Stadium and the Houston Rockets. S3 more than prepares you for internships. Dr. Wakefield and Dr. Lehnus gave us all the necessary skills to succeed in the workplace to build relationships and exhibit a strong work ethic. So many people don’t understand these two basic issues. Having these skills definitely gives us (S3 majors) a leg up on the competition in the sports industry.”

S3 Summer Internships

 

 

Want to get involved with S3? Visit www.baylor.edu/business/s3 or email Ian_Young@Baylor.edu

Baylor S3 Shifts Gears

Baylor S3 Shifts Gears
by Kirk Wakefield – July 2018

Change is good. We can say, “One day….” or “Day one….” Around here, everyday is Day One.

What’s changing with Baylor S3?

New S3 brand

In 2018 we re-positioned as the Center for Sports Strategy & Sales (S3). Why? Because sponsorships is so 2006, when we graduated our first class in Sports Sponsorship & Sales (see below for a fun blast from the past). Brands engage with fans of properties (and S3) as a partnership not a donation. Thanks to Jose Lozano and The Company, we have a cool new logo.

New S3 Tracks

The strategy in S3 is shifting to build career paths in Brand Strategy, Data Strategy & Sales Leadership. Each track has seven senior-level S3 alumni who advise, create and participate in relevant activities. All S3 partners are invited to join us for any and all of these events.

  • Brand Strategy: Corporations design brand strategies as partners with leagues & teams to attract, engage and keep customers. Agencies help guide brand strategy to reach corporate objectives. Media partners execute brand strategies through event broadcasts and related media. We prepare students for careers negotiating, planning and executing strategic partnerships employing branded content and experiences. The best fit for this track are creative strategists. Partners include:
    • Brands: Phillips 66, AT&T, BBVA Compass, SAP,Denny’s, RMC/Pizza Hut, NRG/Reliant, Topgolf, Daktronics
    • Agencies & 3rd Parties: The Company, BAV Consulting, The Marketing Arm, Baylor IMG, Learfield, Peak Sports, Friedkin Group, 4Front
    • Properties/Teams: Dallas Cowboys, Houston Rockets, Houston Texans, New Orleans Saints/Pels, Texas Rangers, PGA Tour, Space Center Houston, On Location Experiences, Circuit of the Americas, Baylor Athletics
    • Media: Fox Sports Southwest, Root Sports
  • Data Strategy: Sound data strategy enables brands, (eSports) teams, media and agencies to (a) plan, lead, organize and control marketing & sales strategies, and (b) execute digital marketing strategies. We prepare students to create, manage, analyze, report, and deliver actionable data insights & campaigns to drive revenue. The best fit for this track are analytical problem-solvers. Partners include:
    • Companies: 4Front, KORE Software, Stone Timber River, E-15 Group, SSB Info, SEAT Consortium
    • Properties/Teams: Madison Square Garden, Cleveland Cavaliers, Dallas Mavericks, Houston Astros, Houston Dynamo, LA FC, LA Kings/AEG, NBA, New York Yankees, Orlando Magic, Texas Rangers, Utah Jazz
  • Sales Leadership: Sales is the lifeblood of any organization. We prepare students to generate revenue through ticket & partnership sales representing professional & collegiate teams, eSports or third-party rights holders (for NCAA properties). As future servant leaders we value people, purpose and performance, in that order. The best fit for this track are competitive high-achievers.
    • This track isn’t new, but our approach to developing sales leaders and professional selling is. We now have eight Premier Partners helping us change the face of sports sales: Las Vegas Golden Knights, Madison Square Garden, Houston Rockets, Houston Texans, Phoenix Suns, San Diego Padres, Spurs Sports & Entertainment and the Tampa Bay Buccaneers. Read more here under “Sales Leadership Partners.”

No Big Board Meeting, but Big Fridays

To enable equal opportunity for students to pursue and partners to recruit to S3 career paths, we have three separate days for partners, alumni and others wishing to join us. These events are on Fridays, typically before an on-campus sporting event.

  • Data Strategy Day
    • October 5, 2018. StubHub, Stone Timber River, KORE, 4Front & SSB join us for a day of data drama and excitement. Read more & register here.
  • Premier Partner Preview Day
    • November 9, 2018. Premier partners are invited to campus to meet students at the S3 Club Lunch (11:45-1:15) and interview juniors (internships) and seniors (careers) in the afternoon.
  • Brand Strategy Day
    • January TBA (until NBA schedule is released) in Houston, TX at BBVA Compass Stadium for day sessions featuring partnership strategy sessions with BBVA Compass, Phillips 66, Toyota, and The Company, followed by activation in action the same evening at a Houston Rockets game. Stay tuned to www.baylor.edu/business/s3 for updates & registration.
  • Sales Leadership Day
    • February 15, 2019. Hands-on training seminars with team sales managers and partnership sales professionals, followed by panel sessions and interviews for internships & careers. Read more & register here.
  • eSports Day

Want to join us?

Our S3 Leadership Partners and many industry friends built Baylor S3 into what it is today. With our highly selective major, we continue to place over 96% before graduation across every major league and among leading agencies and brands. Working with distinctly innovative minds like Tami Walker (Phillips 66), Patrick Ryan (Eventellect), Kelly Roddy (Schlotzsky’s), Derek Blake (LQ), Adam Budelli (StubHub), Mary Hyink (Fox Sports SW), Heidi Weingartner (Dallas Cowboys), Greg Grissom (Houston Texans), George Killebrew (Dallas Mavericks) and Marc Jackson (Madison Square Garden), S3 students intern, learn and work with the best in the business.

Starting this year, Baylor S3 and Baylor Athletics, with Mitch Mann and Ryan Eklund, will work hand-in-hand on data strategy and student ticket sales projects. Thanks to support from Baylor Athletics, S3 graduate Ian Young is on-board as S3 Research Assistant while splitting time as Research Analyst for Team Sports Marketing LLC.

If you’re interested in learning more about our program and potential involvement, please feel free to inquire.

Want a QUICKWAY for a great activation strategy?

Want a QUICKWAY for a great activation strategy?
by Itzayana Aguirre – February 2018

Sponsorship Shorts: QUICKWAY

Wesley Abercrombie (S3, 2017), the General Manager for Partnership Sales at Southeastern Louisiana University Athletics, shared this creative partnership activation strategy:

If the basketball team makes eight 3-point shots, everyone at the game wins a free slushie from our local convenience store partner, Quickway. We keep track of it by hanging up letters on a wall. Once it spells out “QUICKWAY” everyone knows they win slushies. We call it our “Slushie 3-point shot tracker.”

How successful is the promotion?

Wes explained,

Tonight, there was 30 seconds left in the game, and the team hadn’t hit the challenge yet. It spelled “QUICKWA” and we were just waiting for the clock to run out to win the game. The other team wasn’t even playing defense at this point! Fans were literally standing up yelling “one more three” at our team from the stands and our coach heard it!

So as our team was waiting for the clock to run out, coach told our point guard to just go ahead and shoot it, to try to complete the challenge for our fans. He missed the shot, but it was really cool to see the fans react to our promotion the way they did and to see our coach acknowledge it instead of just letting the clock run out to win the game. The best part was, the partner was at the game, and texted me saying that the promotion was the best form of marketing he has ever seen.

Share your story

Wes worked with Quickway to develop a powerful partnership platform that engages the team, coaches and fans for an ultimate experience. Share your Sponsorship Shorts story if you would like to be considered for a feature on the Baylor S3 Report!


Wes Abercrombie is an employee of Peak Sports Management, which manages sales & marketing for Southeastern Louisiana Athletics. 

Do you have your P’s in order?

Do you have your P’s in order?
by Kirk Wakefield – January 2018

People. Purpose. Performance. (Pictures.)

S3 2018 Board Meeting

Paul Epstein challenged the room of executives, managers and students to truly put people first. With over a decade of managerial experience in pro sports, most recently as Director of Sales at the San Francisco 49ers, Paul shared how their sales organization was transformed by helping people “find their WHY.” When organizations put people and purpose first, performance takes care of itself.

Tim Salier, Vice President of Franchise Operations at Spurs Sports & Entertainment, shared how the Austin Spurs G-League team faced high sales force turnover and low productivity. Putting people first, the sales structure was flattened, base salaries of account executives increased above $30,000 and career planning began with stretch assignments to strengthen skill sets in other areas. The results? Revenue rose 300% and more sales reps stayed in place after rampant turnover in the years prior.

Putting Your Money Where…

Chase Jolesch, Director of Ticketing & Premium for the Vegas Golden Knights, stated, “If people truly come before purpose and performance, we must act upon it. We can’t say we care and then ask people to work for less just because it’s sports.”  Shawn McGee, Vice President of Sales & Marketing at Homestead Miami Speedway added:

U.S. Compensation Across All Industries

I’ve seen both sides—low base and high commission and higher base with less commission. In the past, I fully subscribed to mitigating risk by paying a lower base and providing a more substantial commission, as well as forcing the salespeople to drive revenue in order to increase compensation.  However, at my current company, we pay a higher base and little commission.  At first I thought it would lead to lazy salespeople and lack of urgency to hit numbers. We actually found it allows us to source better talent who are still driven to reach the goals…and we can retain those sales people.

Research from the NBA suggests sales reps accept positions with a team for the potential career path and that a lack of clear career path is the main reason for leaving. We agree. Millennials, like most of us, want to be a part of something bigger than ourselves. We want to see a future and purpose in what we do.

Some studies report compensation is rarely a reason for entering a sports sales career. That’s because starting salaries are often far below other industries. The table (right) offers pay comparisons to similar positions across all industries (i.e., not sports). If we want the top talent, will we get it by paying under market rates? If we want to maximize revenue, can we do that by offering the minimum?

Those on the brand, data and agency side of sports are largely competitive with the general market. We look forward to those responsible for ticket sales to lead the way in attracting and keeping top talent.

Leadership Style

As leaders it comes down to our own personal purpose, values and approach to managing and leading others. Do we see our relationship with employees as more parent-child (Theory X) or adult-adult (Theory Y)? Which do you think achieves the best results with today’s generation? (Hint: Same as when this first came out in 1960. You have to know your Y.)

People are different. Some more different than others. We think most S3 graduates are ready to perform, but variance exists. Learning new skills requires more direction, but once learned need more support and coaching. Research shows over half of leaders use the same leadership style regardless of situation or person, which translates into not meeting the needs of employees at least half the time.

Situational leadership adjusts to the person-situation. The best leaders know when to delegate, support, coach or direct, based on the employee’s skill development. (See Situational Leadership Model below.) Managers who put people first focus on knowing individuals, what makes them tick (their why) and adapt to meet their needs. Results follow.

Source: KenBanchard.com

The Spurs Sports & Entertainment (SSE) organization puts situational leadership into action. When Allen Schlesinger took an innovative approach to social selling that gave up on cold-calling leads, SSE unleashed Allen to become the leading revenue generator in the NBA’s developmental league (now G-league).

The Cost of Leadership Failure

Replacing a sales rep takes 3-4 months and typically costs at least 150% of the reps’ compensation in lost revenue and added recruiting & training costs. We might have a different view of turnover if we pictured $75,000 walking out the door each time one leaves.

Average turnover in sales across all industries generally hovers around 25% each year. Common thinking is (a) if turnover is over 25%, the problem is management not the employees, and (b) employees leave managers not companies.

Why do employees leave managers? In the sports industry, not unlike others, we promote the best salespeople to become managers. Unfortunately, great sales people make terrible sales managers, as about 1 in 6 suited for sales are good fits for management. We know this is true in sports–the best players are rarely good coaches or managers–so why do we think it works in business?

The Secret of Success

The good news is other ways work. Members of the S3 Advisory Board, like Eric Platte at the Atlanta Hawks, have sales management training programs that identify quality candidates with the right mixture of sales competency and openness to servant leadership to develop into future managers.

The 49ers Sales Academy is a result of a culture shift based on People–Purpose–Performance, in that order. How did they transform the sales force?

First, the focus changed from a “manage up or out” to a retention approach. They asked, “How can we find people who have not only the basics to succeed but whose strengths can shine in the organization for years to come?” The search is for great talents, great people–those who want to do something special.

Second, they took the external sales philosophy of “every seat has a story” for customers and applied it internally to employees. In recruiting, that means taking deep dives into why they are in this business and their values that determine how they do what (sell) they want to do.

Third, once a part of the team, management continues the process of starting with WHY to engage and listen to employees to identify themes to incorporate systems and behaviors to accomplish purposes important to employees. (See diagram, right.) Performance is not the objective, but the result of a people→purpose orientation.


Thanks again to Paul Epstein for bringing these words and illustrations to life–and who now continues his journey to inspire others at the BW Leadership InstituteAre you interested in learning more about the Center for Sports Sponsorship & Sales (S3) at Baylor? Do you identify with the WHY & HOW of what you’ve just read–and want to join us? Visit www.Baylor.edu/Business/S3Thanks to those who traveled to Waco to experience record-breaking cold. Check out your pics below! Click on one to begin the slide show.


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