The pandemic threw professional sports teams a major curveball, accelerating change already happening across the industry--from revenue diversification to digital transformation.
As sports attendance came to a sudden halt, teams increasingly turned to alternative income sources to make up for lost game-day sales, including virtual experiences, brand licensing deals, premium content and more. But continually investing in change and planning growth across an escalating number of revenue streams and channels can be difficult to do with standard FP&A solutions.
Finance and operations teams within the professional sports arena, it was clear, needed something new.
Professional sports teams require real-time cross-departmental financial and operational reporting to accurately track a wide range of revenue streams and expenses in a market that is constantly evolving.
When stakeholders ask questions about the numbers, there's no time to search through and aggregate data from multiple disconnected spreadsheets. So to be able to adapt and drive growth, finance teams in the professional sports industry need planning and reporting agility.
Accomplishing that--and unlocking the advantages of agility--means solving three key challenges.
From live events to virtual experiences, teams need to continually adapt to new media and channels to keep fans' attention, protect business interests and drive revenue growth through new opportunities.
With a multi-pronged revenue generation approach in place, sports teams can reduce the risk of any one event having an outsized effect on business--like when a pandemic cuts off ticket sales. Beyond stadium seats, sports revenues include business interests across a growing variety of channels, including broadcast rights, sponsorships, merchandise licensing, digital channels and more.
To accurately measure and plan for diverse revenue streams, disparate data sources need to come together to build a story that helps leaders make sound business decisions. But with data located across various systems, including general ledgers (GL), ticketing, enterprise resource planning (ERP), fixed-asset registers, fan engagement and more, it can be difficult to consolidate that data in an accurate and timely manner.
To conduct real-time analysis, build their stories and drive informed and agile decision making, finance teams in professional sports need an industry-specific solution that can automatically integrate data across systems into a central record of truth broken out by each unique revenue source.
Solution: Create a Single Source of Truth
Combine financial, ticketing, suites, sponsorship, merchandising data and more into one single source of truth for increased visibility, accuracy and efficiency. By automating data integration, finance teams can spend less time manually aggregating data or collecting data into reports--and spend more time on strategic analysis instead.
While professional sports teams get a share of national league revenues, they must also carefully track the revenue they earn themselves at the local level, including ticket sales, concessions and corporate sponsors, as well as non-game, stadium and other multi-entity streams. With these revenue streams managed by different departments, often in different systems, finance teams in professional sports must collaborate cross-departmentally to create financial visibility and accountability across the organisation.
Manually sending reports back and forth between department heads overseeing different revenue streams is inefficient and error prone. There are too many moving parts to keep track of and often a lack of consistency in how numbers are reported. Finance teams in professional sports need a way to efficiently collaborate across the business and share key metrics.
Solution: Set Up Consistent Workflows
Use pre-configured planning templates, reports and dashboards to help give department heads a consistent way to input data for strategic financial and operational decision making. Then, create workflows to automatically share these standard reports with key stakeholders at regular intervals (such as monthly or quarterly) as well as on demand.
Game-changing events, such as the pandemic, injuries to star players, new digital channels and emerging viewing preferences, all create a lot of unknowns for sports revenue planning and budgeting. And finance and operational teams need to keep on top of all of them in order to pivot effectively when the time comes.
So, even though NBA teams, for example, couldn't have predicted that revenues would contract by 10% in the 2019-20 season due to lost ticket revenue, merchandise and sponsorship sales during the pandemic, they should have been prepared for an unexpected adjustment. In fact, game-day revenues are always fluctuating based on a number of factors, including who's playing that day.
With that in mind, finance teams need to plan for different scenarios as new revenue streams and a variety of risk factors shape financial outcomes. Whether the outcome is new growth or unexpected losses, finance leaders need the ability to quickly adjust revenue estimates and update budgets to flex to the new reality.
Solution: Leverage Real-Time Scenario Planning
Plan for the future using real-time data from all sources for forecasting and scenario modelling. With accurate data and the right planning and reporting in place, finance teams can see what the future may hold and how different revenue streams could impact the bottom line.
Vena for Professional Sports Teams gives your finance team complete planning and analysis capabilities within one pre-configured solution built to meet the unique challenges of professional sports.