In the last four years, we have personally met more than 100 professional clubs and teams and worked very closely with some of them in realising digital transformation and innovation. All clubs are saying that they are happy to embrace technology, but very few have really identified this as a do or die factor - it’s viewed more as a 'nice to have' in most cases.
We believe that sports clubs that do not become digital powerhouses by 2024 will not only be left behind and lose money and followers, but stagnation will seep into the dressing rooms and ultimately lead to their downfall on the pitch.
Innovation for clubs is much more than the next flashy thing; it is actually a tool to create tangible outcomes, to impact the bottom line - whether we are talking about using innovation on the pitch to boost performance, or the ability to attract new fans and amplify the fan experience.
Do it 365 days a year, 24/7, as this is what fans expect.
In one example, a Premier League club owner, when asked about innovation, said on stage: “Our fans are not interested in innovation; they want us to win, and personally, I’m old school. Love the game as it doesn't change…”
Sound familiar? Inferior technology, arrogance, or lack of vision?
The eight digital powerhouse club key principles:
1. Digital law of attraction - The Golden State Warriors have become a destination team, not just because they have Steph Curry, but because athletes want to be in the heart of innovation, and many of them have commented on the benefits of being near to Silicon Valley. We can extrapolate this to players wanting to be part of innovative clubs.
2. Gen Z is king - Peter Moore, the chief executive of Liverpool, said it best. When asked what keeps him up at night, he answered "Fortnite", not the fear of rival clubs stealing his star players. He fears that fans will lose passion, and that the quality of players will drop as a result of video games. Gen Z - those born in the late 1990s and early 2000s - love video games, so if clubs aren’t embracing esports, they are going down the wrong path.
3. Nurture startups through an innovation hub/accelerator - Embrace the local and global startup communities, leverage the free trials to demonstrate how things can be different, and justify a business case to implement them. It’s not difficult, but it takes time and initiative.
This is being done successfully at clubs like FC Köln and Arsenal, within organising bodies like La Liga and Uefa, and even at stadiums such as the Johan Cruyff Arena or Chelsea’s Stamford Bridge. While these are just a few examples, the key takeaway point is that accelerators are not limited to one entity, and need to become part of core culture for driving change.
4. Multiple club strategy – Having multiple clubs allows you to test and try innovation at one time and implement it later in a higher value club. City Football Group (CFG), the owners of Manchester City, are an example of this principle - owning multiple clubs on many continents allows them to test innovation, in places like the US or Australia, before implementing it in the Premier League. Many US owners have also adopted a multi-team approach in various leagues.
5. May the (digital) force be with you - If you can’t win on the pitch, you can win in the digital world. As highlighted earlier, not every club can win on the pitch, but anyone can win in digital ventures or esports, as the playing field is levelled. Take advantage of these opportunities now.
6. Own your smart stadium/venue – As we speak to many clubs, some of the first roadblocks we hear are “we don’t own our stadium, so we can’t implement digital ticketing or smart gates”, or “the Wi-Fi sucks and is out of our control”. It will be those clubs that control their own destiny with a venue that can implement innovation.
7. China and India presence- If you aren’t present in China, you cannot be a global super club. This isn’t a revelation to anyone, but it's more than just having a Chinese player. Innovation is happening in China faster than anywhere in the world. Embracing Chinese (and soon Indian) innovation will become a huge factor that differentiates the leaders from followers.
8. Community for real – The new catchphrase 'data is the new oil' shows how important it is to become a master in the art of managing and engaging with a global community through new digital media, and how vital it is to convert social fans into real fans. While Facebook and Twitter are necessities, embracing the next new thing (TikTok, FaceApp) is imperative. Do not stand still. Build a global community.
The Digital Powerhouse Club
If we look around European soccer, we see only a few clubs that have truly identified the opportunity to embed innovation as a core principle or as part of their strategic roadmap.
One great example is the Barcelona Innovation Hub with its big vision. FC Köln is the first club in the Bundesliga to run its own sports tech accelerator (now in its second year), integrating startup solutions into all its departments. Other great examples in soccer are Manchester City, who are taking a global approach leveraging trials with their teams on multiple continents, as well as participating in a global sports tech fund.
However, innovation isn’t reserved for the large super-teams. In fact, Real Sociedad, a legendary but mid-tier La Liga club, has adopted a digital transformation roadmap, including a smart stadium innovation programme for startups and, more recently, has been the driving force in establishing a global alliance of like-minded digital and tech savvy clubs in order to leverage economies of scale to compete with the super clubs.
On the other hand, the National Basketball Association (NBA) has many global trailblazers in the innovation space, but almost all clubs are far more advanced in adopting innovation than their European soccer counterparts. Three shining examples are the Sacramento Kings, Golden State Warriors and Philadelphia 76ers who, driven by HBSE, were also one of the first sports teams to acquire an esports club as well as establish an innovation hub.
Small soccer clubs don’t have to be left behind, and also have an opportunity to leverage innovation and compete with the big players. Dziki Warsaw, a second division Polish basketball team, works with numerous startups, offering them a test case and entry point into Europe or the basketball world. They are working with startups from Australia, Romania, Greece and India, giving them a team and platform to try and test their products. This isn’t difficult, it just takes a change in mindset and a cultural shift. Claiming this to be too expensive is a cop out.
In summary, while many soccer clubs say they want to be innovative, only a handful are really embedding innovation culture into all areas of their performance. In our opinion, there will be some very famous prominent clubs who will inevitably become the Kodak or Nokia of the sports world. It's bound to happen, and it won't be the first time we have seen this movie.
Adopting innovation starts at the top and needs to be endorsed from the top down and embedded as a culture in the club. Innovation is affecting all industries and we promise you that sport is no exception.
About the authors: Amir Raveh is the founder and president of HYPE Sports Innovation and HYPE Capital Fund, while Ryan McCumber is the founder of SportsTech.ai.