The Ins and Outs of Sports Sponsorship: What Characterizes the Best Deals and Activations

@njh287; www.dsmsports.net
On episode 307 of the Digital and Social Media Sports Podcast, Neil
chatted with Nick Kelly, CEO of Encore Sports and Entertainment.
Nick discusses the insights picked up throughout his career, including
stints at NASCAR, as a senior leader of sports partnerships at Anheuser-
Busch InBev (AB InBev) and Verizon, and Charlotte FC / Carolina
Panthers.
What follows is a collection of snippets from the podcast. To hear the full
interview and more, check out the podcast on all podcast platforms and at
www.dsmsports.net.
Best Of The Digital and
Social Media Sports Podcast
Episode 307: Nick Kelly

Nick’s Career Path
“I’ve had a pretty interesting career. I mean, I started, probably, the
first ten years of my career doing everything I could to try and get into
sports. I was working in PR agencies across West Virginia and
Baltimore, and eventually was able to land a job doing business PR at
NASCAR, which was, at the time, trying to show value to their official
partners and telling their story about how NASCAR is driving their
business.

“I was able to translate that into a PR job at Anheuser-Busch, just
through relationships I'd established at NASCAR, and was still in PR
my first year there. What I've been fairly successful at is building trust
and establishing the right relationships internally in the PR role that
when they were looking to go a new direction on the sports side, and
within relocating to New York, I was offered the opportunity to head
up the North American sports division, which they just assumed with
my background in NASCAR, I knew everything. Clearly that was not
the case.

“I did that for almost six years, and it was awesome. I mean, I learned
everything there, from negotiating my first real team and league
contract to players, and we tried to, with the support of our leadership,
do things differently. I think that the alcohol space and the beer space
specifically is constantly challenged. So it was one of those things of how
do we get more value out of our partnerships. And when I started, we
had 130 partners. When I left, we were at 80 or 90. They're probably
still hovering around there, maybe a little bit more. But everything looks
different now. I mean, the landscape, how we looked at contracts — you
know, we went to an incentive model. We were able to start marketing
players. We kind of gave up rights in the spirit space because we were
overpaying to block it for so long. So it really shifted a lot over that time.

“So it was an awesome job. I learned a tremendous amount, not only
about the industry, but working within a super complex organization.
It was a super matrix of global, local problems — not problems, but it
wasn't clean. It was a three tier system, we didn't know the end
consumer. But then, through that and being somewhat successful, I
was offered the opportunity to start an MLS team (Charlotte FC) with
Mr. [David] Tepper. I did that right in the middle of Covid and
learned a ton. I mean, I was one of the first employees on the business
side, and we had to stand up a team which got up to about 80 people.
We did everything from selling sponsorships to selling season tickets
to, you name it.

“Towards the back half of my first year, I oversaw, like the sporting side,
too, which I probably spent too much time on because it was fun and
something I never thought I would do, but — it certainly wasn't a
distraction. But I was super proud. I wasn't looking to go to the team
side, it was more along the lines of being able to do a startup. And that's
really what it felt like was a startup because, I mean, we did everything
from finding office space to furniture to all the ticky tacky stuff, building
a season ticket strategy, selling season tickets from scratch. And we sold
more than 20,000 season tickets in the first year, which, when you put
in perspective, is almost more than every NBA team, most of the MLB
teams. So for us to sell in the middle of Covid for an MLS team 20,000+
season tickets is something we were really proud of.

“I had the opportunity to learn from a really smart, experienced
leader, a guy named Tom Glick, who'd been at City Football Group
and other places. So, I also felt comfortable going into the role
knowing that I wasn't flying blind. Then shortly after that, I helped
with trying to merge that and the Panthers together. I learned a lot in
that process. Just more about, I would say just the dynamics of these
holding company type models where there's multiple teams and
everything. And we tried to, and probably improperly force a single
culture across, you know, two distinctly different teams. One was very
established versus one was brand new.

“I used to push this and, both of my brand side jobs, it's a very great
sales pitch when you have a CRM or sales team come in and they're
like, Hey, you should buy across our portfolio. But then when you
actually get deep into that conversation, it's not that simple. So, you
know, we probably pushed a little too hard trying to make it a one
stop shop. But it's just one of those things that it still is something all
of the industry is trying to push for. But it's hard. I mean, the
dynamics are different between the NFL and the NBA, and if you have
a European club, it's a whole lot different.

“So I learned a lot there. From that point on, I thought I wanted to
start an agency. I really was just like, alright, like, I've got enough
background, talked to a lot of people I trust, and they're like, You're
going to be a beer guy if you go to market, your only brand side
experience is on the AB side. You've got to be able to prove that you
can do it at other places, and you're not really a product of the system,
which is Anheuser-Busch. Because, look, there's people who've been
wildly successful before me and after me. So you got to be able to
prove it's not just AB, it's you.

“So I went to Verizon, learned a ton. And not necessarily the
principles of, like, sports marketing. I learned a ton of more just
managing an even more complex industry. Even in the fact that, like,
we were there allowed to do business back, and I'd never been in a
position where I was responsible for a P&L of, alright, you're spending
X $100 million, but you are required to make back X $100 million.
And that part for me was if it was an awesome challenge.

“It also changed the dynamics of the conversations you were having
with teams and partners, because you would go into a conversation
trying to coordinate, and having spent time on the team side, I had an
appreciation for how hard it was. You're trying to coordinate the COO
or the CFO with the CRO, with the President, that very often they
have conflicting agendas and not negatively, but the CFO wants to
basically manage a P&L that is clean, you know, profitable where the
CRO is trying to maximize revenue. But when you're looking at, Hey,
we need you to spend $25 million on a new digital antenna system for
your new stadium, the CRO is, like, great, I'm going to charge you this
back to be the official, but the CFO is then diving in on, like what?
How much are you charging me for that? Could I get it for less?

“So it gets super complicated. And I don't have to be the expert on all
the technology, I just have to be able to facilitate the conversation and
get everybody in the door and keep all lines of communication
moving. But it was great. The same thing there, we did, in the two and
a half years I was on that, we did about a quarter of $1 billion in
revenue back from the teams. So that part was you felt like you were
driving value and not just marketing, but true revenue back to the
business to where our CEOs, you know, talking about big deals that
we did on earnings calls and those types of things to where it was
really moving the business. So that was great.

“So I'm wildly not prepared to run an agency because I've learned a
lot, but it's been fun, man. I think it's just been all the uncertainty, all
of the selling yourself has been challenging for me. I hate talking
about myself, but, you know, there's moments where — a good
example is we've been talking to a client on Olympics and stuff we've
done 3 or 4 years ago with the Olympics and USOC; I'd forgotten how
much we'd actually had done. So it's been kind of nice, too, to pull on
your experiences that you may not have used in a while. And you get
to work with a lot of wildly different people with different challenges.
So that's a long winded way to say it's been an up and down and all
over the place career.”

On metrics for success in partnerships and how it has evolved during Nick’s
Career
“What I've realized, especially, I think I was very siloed in focus on how we
measured success at AB for so long that, having taken a step back on the team side
for a brief period of time, seeing different industries and how they measure
success and then even coming to the Verizon side, what I learned is that you can't
be so hamstrung on the way that you measure is the only way to measure. Because
I think that what we realized when I was at AB or even at the NASCAR side, I'll use
Verizon, because I can confidently talk about the differences. On the AB side, it
was very marketing heavy. Like, we can never really tie it to direct sales: one,
because it was super complicated, and two, it was illegal. Like I could never walk
into Yankee Stadium and say, Well, only 70% of the beer you’re selling here is only
mine, but I'm paying you 100% of the sponsorship revenue. What gives?

"Like, on the Verizon side, you could be very black and white. So a lot
of it was very marketing ROI driven, brand lift, social media
engagements, a lot of the soft metrics, but they mattered. And look,
sports still are probably the number one, if not the biggest marketing
pillar or marketing channel you can have to drive brand awareness,
because if you can get a marquee asset, signage, activation whatever,
and a big market — like, if you were an unknown brand, you look at
what SoFi does and look at all these naming rights deals — for trying
to gain credibility, brand visibility; like, nobody knew who SoFi was
when before they did the stadium, and now it's huge. It's synonymous
with sports in LA. Whereas, when you're an established brand, your
metrics change. You are trying to drive more tangible results.

“Like on the Verizon side, for us, a lot of it was business back. A lot of
it was what is the value I can pass to our 130 million consumers? Like,
I've got 130 million consumers, what do they get as a Verizon
customer and a Washington Commanders fan? Like, is there 10% off
the team store? Is there early access to tickets? We didn't really even
take into consideration a lot of the soft metrics. They were there, but
that wasn't really driving the immediate value back to us.

“But then, we're helping a client now that has very low visibility, they
just signed a jersey patch deal and their number one metric is
awareness, and their number two is building their CRM. Like, that is
nowhere on the radar for a lot of the more established brands, but if
you're a new brand, that is the most valuable thing you can do. So I
think that when I was younger, I just assumed everybody wanted the
same kind of cookie cutter. A little bit [of it] was being naive, but the
second part was, you gotta imagine, ten years ago, all of these
sponsorship ROI companies were just kind of popping up saying they
had the silver bullet to tell you if this was working, but the reality is
it's kind of on the brand, because the metrics change.

“The other thing is that your internal objectives change. So if your
ROI is not changing with your metrics, you're never going to be able
to show the true value. And you need the partnerships to have the
flexibility to change the ROI model with you.”

“All of us understand there's a tremendous amount of value in first
party data. I think what we're seeing though, across the board, is that
what the end brand does with it is wildly different. Some are super
sophisticated; they can drop it into their broader data pool or CRM
and start connecting dots, building models against the type of
consumer profile. Others just drop it into an email blast and they just
keep doing it that way. So the value of the data is truly dependent on
the company, it'll eventually become one of the most important assets
all the teams have if it's not already.

“But, you know, there's still value in some of the historical assets.
Like, I'm guilty of, when I was at AB, I mean, we used to poo poo all
over outfield wall signs and things like that. That didn't work for us,
but that matters a lot for other people. It's one of those things that the
data piece is, especially for companies that are DTC or they don't have
any data; like I'm speaking for soft drinks, beverages, all those stuff —
because there's a tiered model out where they can't, you know, you
don't go direct to consumer. The ability to engage and get this
consumer data that you can't get yourself becomes that much more
valuable. But the hard part is a lot of the teams rely on agencies to
basically build programs to build that CRM because the capability
doesn't necessarily exist in-house.”

On the emergence of digital assets and how the value was assessed
“Kind of a two part answer is we were fortunate enough at both locations. So
when I was at AB, ‘l’llI use the NFL as an example, we had 28 of the 32 teams
when I was at Anheuser-Busch and then at Verizon, we had 22 or 23 of the 32.
So what we ended up doing is creating our own internal rate card, so when a
team came to us and said, Well, here's the league average, and it's like, Oh,
that's cool, but I've got 28 teams, I have a better league average than you do
because I have 28 contracts. I can tell you what I'm paying. But again, it goes
back to we also arm them with our rate card. We would just say, Guys, I've got
28 teams, this is the blended rate we pay for a social media post. This is the
blended rate we pay for an email blast all the way down to LEDs and you name
it. We also know that there's variability off of quadrants of New York versus
Memphis and basketball or whatever.

“But the reality also became of that, too, the data that their owner is seeing
wasn't necessarily the right data. Because, look, when a team gives their report
for the SABER report, they're reporting as accurately as they possibly can.
However, when you say that, you know, AB is paying me $1 million a year, that
may not be the case because it may only be $600k, but then they bought a
bunch of extra tickets and then they bought a suite, and you don't want to be in
last place. So you're saying the total commitment from AB is a million? Again,
they're not doing anything wrong, but it becomes much more of the partnership
itself may have been $600k. So that's where we would help educate the teams
on how we built it. And it was always a painful process. But the second time
around we did a contract or the third time they understood, like, this isn't us
being aggressive or cheap or unfair. It's just like we have a better perspective of
what the marketplace looks like because we own the marketplace. So that
helped.

“I think that the bigger challenge became as new assets came online,
and we wanted to create them with teams, I think we both struggled
to price them. It's like, Hey, we want to come up with a content series
for TikTok; well, TikTok just started, we've never priced that out. Or
when we signed the deal, they only had 20,000 followers, and when
the deal comes up, they've got 3 million. And it's fair. So I think it
became a little bit more of like we do understand the rate card is a
league-informed baseline of what teams charge, but not all teams are
created equal. And honestly, the content that teams create isn't all
equal.

“So you know, there were teams like the Jaguars when, for a while,
they made amazing content, but their numbers didn't necessarily
stack up in terms of reach and scale, but we would pay a premium for
Jaguars content because the engagement was high. They did an
amazing job. Like they listened and put the brand first, where other
teams maybe had tighter restrictions. So it is probably the most
challenging part of the negotiation is the asset valuation, the back and
forth. But I will say, too, the hard cost is probably the non-negotiable.
Like, we understand that you have production costs.

“...We moved to this variable compensation or incentive driven model
in our contracts. And one of the things that we put in there was we
would have a social media or content series and we would put targets
against it, and you'd get 80, 90 or 100% of your deal or of the target
number; let's say we said $30,000 of incremental or incentive based
on the baseline of the contract. And it would be, you know, ten, 20, 30
for certain milestones, but it would be based on engagement or reach.
And we got super detailed in those contracts of, like, it had to be a
combination of both. It couldn't just be in your market.

“You know, we're doing this because you have a national fan base.
And then to your point, if all of a sudden I'm getting a bunch of clicks
from Africa or Australia or other places, that doesn't count, because
that does nothing for me. So we got to a point where we were
incentivized together financially to create the right content series that
hit the metrics because, look, we always budgeted to pay 100%, so we
weren't incentivized to not lead these guys down the road to success.
And it helped a lot.

“It was a lot of work. I mean, I think that that's probably the only pieces;
in theory, we probably had 15 to $20 million a year at risk that was based
in incentives. But, you know, we fully expected to pay it. But it was very
time-consuming and cumbersome to coach all the teams on how to get to
that successful metric. And it was based on everything from the social
media side, we even did it off of attendance or championships so they
can just get paid their bonus now, so then when the renewal comes up,
it's like, Oh, we're more valuable. It's like, I already paid you for that.
Like, we already paid you for winning a championship, but if you don't
go to the championship, if all of a sudden you go from winning the NBA
Finals to not making the playoffs, it's not like I have a chance to come
back down. So it helped us in forecasting a lot.”

“The way you think about it too, is, I mean you could have 28 NFL deals and
all of them have varying Super Bowl championship bonuses in it, you've only
got to basically budget for the one most expensive version because only one of
them can win. So that's where the reality for us is, is that we put it in
everywhere, and you probably have 1 or 2 teams that if they won, great, but if
they didn't win, somebody else won, there could be 100 or $200,000 delta in
this team went to the Super Bowl versus this team. And honestly, the bigger
Super Bowl bonuses came for teams that you wouldn't expect to win the Super
Bowl that we’ll happily pay for; where, you know, at the time, the Patriots were
winning every year, there was no world we were ever going to put one in there
because like, it was just kind of an accepted at that point that there was a high
likelihood they were going to win, and we put in a bonus that was more like
pay for the parade, pay for the championship marks, stuff like that.”

On how concepts for branded digital content and activations come together
“Most times, brands are looking, if they have a league sponsorship, they try to get some
uniformity across all their local partnerships, so they can amplify it nationally, so a
local team partnership can feel national and it doesn't feel hyperlocal. So with the
celebration part, like the silly stuff we did, even all kinds of other like, you know, Hit
the Buds and things like that that Budweiser does. And on the Verizon side, it was like
Verizon Access. We could show Verizon Access moments across the country, amplifying
nationally, and it would be relevant to you no matter what. But then we did have
localized content, like behind the scenes or mic’d up or the phone call for the draft that
the teams would bring to us as part of a partnership, or it just made sense to us from a
brand perspective that we wouldn't necessarily try and replicate. However, if somebody
had a great enough concept, we would take it and say, Hey, next year, we did this in this
market, we want to do it everywhere, so we're going to kill the old whatever it was, and
let's all lean into this because we saw a tremendous amount of engagement.

“But I do think that it works both ways. But to your point, on like the
partnership, in communication of it. It's like nobody on the brand
side ever goes into a deal trying to think, like, I gotta get as much out
of this as possible because we're likely not going to renew. The brand
side is overly incentivized because they have probably fought to get
this deal, so they need to make it look like it's the smartest decision
they have ever made or recommended to their CMO or CEO by
getting a ton of value out of it and then ultimately renewing the deal
because it was such a great investment. And most times when a
partnership doesn't work, it's either, one, a change of strategy which
the team can't help, or two, the brand itself didn't put the right
resources to get the most out of the partnership.

“Very seldom is it that the team has not provided or been flexible
enough for the brand to get the value out of it. Because, look, no team
wants to take any category back to market. So I think it becomes more
of a lot of the communication has to come from the brand and the
agencies to to get to success, because you having to justify why you
spent X amount of dollars on a partnership and why that was a bad
decision three years later, it's tough, because it puts your job at
jeopardy.

“But the other part is just that, and oftentimes they'll blame the team.
They'll just say the team sucks, the team was hard to work with,
whatever it is, when in reality either their plan when they originally
signed the deal wasn't right, or the second problem really was it's just,
when the strategy changes, there's nothing anybody can do.
Oftentimes a new CMO comes in and says that person liked baseball
and I like basketball. Like, can't do anything about that.

“But when you're in those brand roles. And I think that that's the one
thing that we're counseling some of our clients on now is like, you
fought for this, you fought for, or your CMO handed you this or your
CEO, you need to make it work. You're not in a position, and the
teams should know that, like, they're in a position to make all of these
deals work. And when they're being a pain in the ass and they're
asking you for stuff, it's not because they're being selfish, and it's not
because they just are trying to get more than they want, it's like
they're trying to justify the expense they made, period.”

“I had a boss at one point and she used to say, she used to talk about both
agencies and partners. And she's like, you get the value and you get the work
that you deserve. So if you are a good communicator and a good partner and
you're a win-win type of mentality, you'll get great work, you'll get great
value, you'll get all that. But if you are a true selfish pain in the ass or just
blame, like, Oh, it's the team, or it's the brand team, or it's finance, like,
you're going to get what you get. So I think that that's always been true…it is
such a small industry, so making other people look good makes you look
good, and if you do anything truly selfish, it'll follow you. Like, there are still
people I will not take a phone call from; some of the stuff they pulled where
it's just like, I don't have any trust anymore. So, l think that that's one of
those things that, because it's such a small industry, it'll follow you.”

On building the strategy and operation to get Charlotte FC off the ground as a
new MLS club
“We were very fortunate because — look, I mean, our owner provided a
tremendous amount of resources to be successful. We hired fairly fast, and we
prioritized like, we kind of made like ten big blocks. Like, all right, what are the
things we can knock off and in what order? So it was, we had a brand, how do
we get in the community? We had a bunch of season ticket deposits from when
we announced the team three years earlier, so how do we convert those season
ticket deposits into actual season ticket purchasers? The thing for us was we
lost a ton of momentum — announced the team in 2019, Covid hit, and then I
started in February of 2021. So like there was a whole year of like, Are we even
going to do this? Is the team actually going to show up? So that became the first
challenge.

“However, for us, it became like getting back in the community. We
had to fight with everything else going on between, and the Carolina
markets, it's like Panthers and college football and college basketball
are 1A and 1B, and soccer, while extremely a big part of the youth
movement there, and they have some good college programs
historically with men's and women's at UNC and Wake [Forest] and
Clemson. There was a palpable value of, alright, ‘This can be my
team.’ Like, this could be our first new team in 25 years. We can have
all the new transplants to Charlotte, which is a growing market, it
would be great. But man, we pulled out every trick we could. We had
pick-a-seat days, we went to like every brewery within 40 miles and
had pop ups for season tickets and giveaways.

“We took every what normally would be a small moment and made it
a big moment. So when we unveiled our jersey, Ally was an amazing
partner and we invested tons of money, and having a jersey unveil
party, we had a very steep, I would say, consumer perception because
we were the first MLS team to do PSLs (personal seat licenses). So we
actually had to go out there and proactively state the value of that. But
we lost a little bit of trust from, I would say, our diehard supporters,
so we created the Chief Fan Officer role, which was a gentleman who
had a bunch of background and experience across WNBA, soccer,
everything, and his whole job was to be the conduit between us and
the supporters. And, you know, some days we felt like he didn't work
for us, which was challenging. But that was his job.

“We had so much momentum and success in terms of building it to where we still
have the biggest MLS match ever, with 74,000 people. We put very aggressive
publicly stated goals out there. Like we said we wanted to be number one in the
league for the biggest match ever. We wanted to be number one in attendance.
And, you know, by doing that, it helped rally the team and the fans of like, alright,
well, we want to be that, too. So we did have the largest match. I mean we averaged
number two in the league, just because total capacity in Atlanta, [they] built an
amazing product in Atlanta, so we're probably 7 or 8 behind them. But being bold
enough for us to state what success looks like; like, you know, there were a lot of
internal fights about it because they're just like, Well, if you don't hit it, it looks like
failure, even though it's successful. But for us, it's like we needed something
because we were just very much caught in an abyss of Covid going back. And all the
schedules were all messed up, too, because, I mean, you had basketball going on in
the fall, you had all these other things happening. Like for us, fighting for any
airspace was tough.

“So, I learned a ton. I'm extremely grateful for the opportunity. We
did everything. We built community platforms, we sold season tickets,
single game tickets. And you know, I now have a now a tremendous
amount of respect, not that I didn't before, but even more so of the
ticketing world, like, it is so hard, and we only had 26 games. The
baseball, basketball, hockey side, like I mean, those guys, I mean, in
the success of we were very fortunate with our expansion team. So
demand was there no matter what. But if you're stepping into a
franchise that's 20, 30, 50 years old and they're not doing great, and
you're now the new Head of Tickets. Like, I have so much empathy
and respect for, if you're able to turn that around.”

“And the other part is too is like, I was fortunate there was a guy who was our
CRO named Jake Burns who came from baseball, and he was a good guy. And
as well as Tom Glick, I wanted to move from season tickets to single game
before the turn of the new year, and they're like, you gotta wait till one month
out and I'm over here stressing because like, even our initial match, like our
inaugural match, we're trying to do 74,000 people, and we were sitting on, let's
call it 17 or 18,000 tickets. And it's like, how are we ever going to move it? But
to their credit, they were right. We didn't start selling single games until late
January and then we're able to sell out the inaugural home match. We averaged
just over 30,000 for the regular season, but because we relied on experience,
people who have done this before. When you're sitting on a 20,000 base and
you're only really looking between group sales and single game tickets to move
a couple thousand tickets a game, it was far more approachable.

“That was the one thing that I was fortunate to have, was people
who'd been through it before. So like, I wasn't making dumb gut
decisions off of zero experience, but too proud to ask — like I asked
everybody. I called Jim Frevola, who just launched the Vegas Golden
Knights, I called Atlanta, and they were amazing to deal with.
Anybody who launched a team, I spent so much time asking dumb
questions because. And look, I've offered the same for the last couple
years to new MLS teams, NWSL teams, because nobody wants
anybody to fail. I'm pretty sure I annoyed a bunch of these guys
though, because like, I would just call and ask about the littlest thing
just to make sure I wasn't like seeing it wrong.”

On the role of partners in launching and establishing the new team
“I think that the person and just the organization that has probably
done the most in terms of stepping up and doing this is probably Ally.
We were fortunate to get to know Andrea [Brimmer] and her team
when I was in Charlotte. And, you know, their ability of, one, stepping
up financially and supporting on the sponsorship side from NWSL,
WNBA, like their front and center. And they don't just write the check
and then walk away and hope the partners do it all. They're
amplifying on their traditional, social media, above the line,
everything; they're there.

“They've done a great job of connecting the dots, so they don't just hand
the NWSL a check and then say, I don't have anything left for you,
broadcast partners or players. They've been able to close the loop. They're
supporting the broadcast partners. Then they're making demands in a
very responsible way of like, We need to see this more on linear
[television]. We need to see this more in the right time slots. And it really
takes somebody with the right vision and the right brand, with the right
vision to pull it forward because the commissioners of these leagues are
in a tough spot because they want to drive as much revenue as possible to
the league to then disperse out to all the owners. Then obviously they
want the teams driving their own revenue too. But when you get a brand
like Ally who does the full flywheel of every point, everybody gets a little
piece and everybody's getting elevated — it's hard.

“And I think that that's really where the Angel City guys and the Valkyries have
done an amazing job leaning into their local market and getting the local
brands themselves with the amplification of the national to really drive not only
the valuation, but just the fan and customer experience. It feels premium and
it's not that much better than the next place, but the way they do it is so
polished, it's so professional and you feel like you're a part of a community.
They've just invested on the up front. And look, they were both successful
before they ever played their first match or first game, so where it's the upfront
investment instead of hoping it comes along the way, and that's where I think
you saw both of those markets invest heavily up front, so once they actually had
it, like they had a successful season before the season even started. Both of
those teams could have not been good on the field, and they were both actually
great, and they still would have been successful because the lead up to it was so
well managed.”

“One of those things, I learned early on in my career was, like, having
worked in NASCAR is those aren't fake stats, the brand loyalty, brand
affinity, brand consideration, all of the things that matter from a
brand perspective, NASCAR is probably the most effective buy you
can have because it truly is. The fans are smart enough and educated
enough to know that my driver may not be on the track unless you
know X brand, McDonald's, or you know, Shell-Pennzoil if they're not
sponsoring Joey Logano, Darrell Wallace, may not have a ride. So
they value and appreciate that. And they understand the business
model of sports marketing more than maybe other brands do because
it drives the sport.

“And I think that that's why you still continue to see, I mean, the
ratings have actually been great this year, but regardless of how the
sport's doing on attendance and ratings wise, the diehard fan base,
which is huge, appreciates the sponsors more than any other sport.”

On the affect big-name brands can have on the perception of emerging
leagues when they partner with them
“We weren't naive to the influence we had when we were at either one
of those companies I worked at, because, we knew that if we came on to
a league early on because we believed in it, it helped establish
credibility for the league if you have, you know, a Budweiser or Verizon
on board early. And it was just very much a ‘Do we believe that this is,
one, good for us because we're hitting another audience?’ And two, ‘Do
we believe they have the infrastructure in place to actually go and drive
even incremental value for us than we actually are investing?’ And we
saw hundreds of presentations over the years from esports teams.

“And, you know, we did Drone Racing League for a while, all these
other ones where it was just like, you know, it meant a lot. For us, it
became a little bit more we got on the sales tour with them promoting
like, well, why did you invest? And they would just say, Hey, can
brand X call you and tell you about what you're doing in our sport?
And it's like, sure. So we became some and oftentimes in these
emerging sports we became a little bit more of like an evangelist for
why did you invest. And look, we felt that it was a privilege and also a
responsibility of like if we were investing here, we got to see that it
works.”

“I think the one other piece too is that also, one of the things we
misinterpreted early on before we started doing surveys with the
Panthers and Charlotte FC fans is there was less than 20% overlap like
and it was a new audience, it was a younger audience. It was clearly more
diverse. And the way we communicated to the Panthers could not be the
way we communicated here. And it could be incremental both ways. If we
could convert a Panthers fan to come to a game and a Charlotte FC fan to
come to a game, it was a bigger pie for the total organization. But you
know, you look at the piece, and just to backtrack for a second, is the way
that the Valkyries and the guys at Angel City FC did it, every time they
had an astonishingly expensive number come out like, Hey, like this is
how much courtside seats are or season tickets anywhere else in the
country, everybody would be like, oh my gosh.

“But they were really smart about ‘Here's what you get as a customer here’. Oh,
we just signed a big player, we just got a big sponsor. Oh, we have a new
minority owner. That, and I don't mean distraction in a bad way, but they had
enough momentum distractions around the team that when the prices came
out you're like, Oh of course they are. This is a big deal, this is a real thing. So
you were almost distracted by the fact that you felt like you were buying into
something of considerable value versus some of these clubs, they don't have the
benefit of that, and they just roll out season ticket prices, and the first thing
you're going to get is, like, that's expensive. It could be last in the league, and I
would say it's expensive. But they did such an amazing job of creating other
moments of momentum and noise that was positive that when the prices came
out that oftentimes are very challenging, they were ready for the headwinds.
And they had fans being like, Well, you get this or you get that. And like, man,
they just did such a good job.”

On what Nick is watching in the space today
“I've been really fortunate over the 10 or 15 years I've been working in
the industry to work with amazing agency partners. I mean, pretty
much if you can think of the top 10 or 15, I've worked with them at
some point, and I've learned a tremendous amount, and they've
helped us and me personally be successful. I think that over the last 4
or 5 years, my last couple years at AB and even at Verizon, some of
the stuff that I was looking for from the brand side was some more
partnership and stuff that I think that only anybody can help you with
who has been in your shoes.

“So like, what I ended up doing while I was both at AB and Verizon was
building up my own network of peers that were, at the time it was Justin
Toman at Pepsi or Frank Nakano at Chase. And even now, it's like Ron
McQueen at Cisco and the Coke team and everybody else and our ability
to compare notes, because I didn't have anybody else to talk to; like
nobody had ever been through what I'd been through or was going
through — why are my budgets getting cut? How do I go and sell this in?
How do I rework these things? And from an agency perspective, it was
just like, they're all amazing, talented, well-rounded people. But because
they hadn't been through what I've been through — like, I didn't need a
15 page pretty deck, I needed four slides that were financially driven off
of bullet points that looked like it came from McKinsey.

“That really is where we've been able to step in with both established brands
that just need help with that. Like, they may have an experiential or an
activation agency that's doing all of the beautiful activations at football
stadiums and Super Bowls across the world, but they need help selling in
their three year plan. Or they need help explaining to their new CEO how
this works. And I think the other part about it is we're very conflict avoidant;
like, we are very clear guys. We are only working with brands, we're not
working with teams and leagues, we're not selling anything. So the opinion
you get from us, the counsel you get from us is transparent. It's going to be
very much what's best for you because there is no conflict. And I know that
all the agencies have a wall that they claim that they have up, but deep down
we always know that there is still risk there of, you know, they're going to sell
you their wares or they're getting pressure, which, it is what it is.

“The other piece that's maybe unique to us is that we come in and say
what we want to focus on and what we do well, and we would argue
we're the best at, which is the brand consulting side, leveraging the
teams to get the most value out of it. But if you're looking for social
media content or you're looking for hospitality or you're looking for,
you know, something a little bit more specific where there are better
people than us, we’ve built kind of a network of like, Great, here are
the four content companies we would talk to for what you're looking
for at varying price points. Here are the PR agencies, here's
everything else.

“And it's the transparency of we're not white labeling it ‘Encore
Experiential’ or ‘Encore PR’. Like if you want us to continue to lead it,
great, but we want to be very transparent that we're bringing in the
best that we think that you deserve, versus you have to use ours. I
think that that model has been extremely well received because, you
know, you don't have to pay for a PR agency or an experiential agency
365; we can just brief them on your behalf, 3 or 4 of the best agencies
out there will bring you ideas and when you need it, great. And when
you don't, you don't.

“So we're pitching much more of a leaner, efficient model of having
some experienced executives, counsel you 365, make you successful
internally and externally. And then when you need something bigger
and better, we'll work with your other agency partners or we'll help
you find it. So it's been eye-opening. I mean, I know what I know well,
which is how to do the job; the agency world, it's cutthroat. I've
learned a lot. I don't think I've been in, you know, ‘He doesn't know
what he's doing’ behind my back in a shorter period of time than I
had in the previous 15 years.”

From Nick’s time as a football player at Marshall, does he remember watching
Byron Leftwich get carried down the field during that famous game?
“So I was on the team then. I was there from ‘01 to ‘04 and we were very fortunate
my first two years that he was the quarterback because, I mean, we were top 25
every year. He was special, right? I mean, he was a great leader. You know, he stuck
around, played all four years, which is rare now, but man, that guy was different.
He came in, played, came back to the ball game; like he didn't have to at that point.
He was a first round draft pick, but, man, it's still one of the most impressive things
I've ever seen…
“It also goes back to the point too, is like he had enough trust from the coaches and
everybody else that they knew that they weren't going to get him out until he
absolutely [had to]. And there came a point after we scored a touchdown, I was
like, alright, now I'm going to leave. So, like he didn't want to lose.”

How would Nick describe his first time experience in NASCAR? And a bonus
question, what does you think of the current state and outlook for NASCAR?
“I remember my first race was the October Bank of America race in Charlotte.
It was literally my first week. So, fortunately, I didn't have to travel anywhere,
I had just relocated to Charlotte. And man, I was just blown away about, on
the business side, how long of a weekend it is; because, I mean, you have a
truck race on Friday and a Nationwide race on Saturday, you had Sprint Cup
Sunday. But, man, just the size and scale; like,100,000+ people every
weekend being there, and they're hanging out for days. Like, they're not just
showing up for, like, a two hour tailgate and walking in, they're creating their
own little community. So, you know, the power of sports for me really kind of
blew up at that point of just how passionate they were.

“I will say that [NASCAR President] Steve Phelps and the team have
done an amazing job. What Covid did to the sport as a whole and
where they brought it back and the evolution of the cars and the
broadcast contracts. It's one of those things that I don't know that it'll
ever rival the NFL or NBA, but the fan base is still humongous. It's
brand loyal, it's avid, and they are doing a great job attracting a
younger fan base.

“I credit a lot of my success in the sports industry, just what I've
learned from people like Jon Schwartz and Brett Jewkes and those
guys when they were there because, you know, they were trying to be
the start of a new brand and a new generation of NASCAR. I learned
so much because, you know, we're selling on the heels of the high, so
[when] we're on the backslide, how are we trying to get it back? Just a
flat line. So they've done an amazing job.”

The partnership activation for a brand that Nick was not working with
that has most impressed him and why?
“I'm blown away by the work that Amex does at US open. It is such a big
activation. Like, physically, it's a large activation footprint, they do it for
three weeks. You know, the amount of customers that they engage with,
the way they lean into it, going into the months leading into it, how they
amplify it, coming out of it — to be able to sustain a premium hospitality
like that., they partner with Momentum on it, they do it so well. And I've
been multiple years and there's never really been a step back in the quality
of it. I know they probably invest a fortune in it, but it seems like they get
the value out of it and it's just, you know, it's hard enough to stand up a 1
or 2 day activation, but to do it for 21 days is extremely impressive.”

What is Nick’s AB InBev drink of choice? And a follow up, as an AB
InBev employee, when Nick was there, what kind of discounts and
free product did employees get access to?
“My favorite, still, is Bud Light Platinum. It's a 6% Bud Light. It just
tasted smoother. I mean, we had the marketing schtick was it was
triple filtered, and it was just great. I personally enjoyed it. It had a
little bit of a sweeter taste.

“And, you know, the marketing benefits were amazing. I mean, the
product, we got two cases a month when we lived in St. Louis. Then
when we relocated to New York, we got a couple hundred bucks a
month through, I think it was Drizly, where you could basically buy
products. So you were never in need when it came to providing it. And
the other part is when we had new products launched and we had a
lot, they usually send you 1 or 2 cases to give to friends. So there was
never a shortage of product.”

Nick’s most memorable or favorite pro sports event that he’s ever
attended
“I guess it's timely is the Cubs-Indians game seven in Cleveland [in
2016]. Fortunately enough, myself and some of our coworkers at AB
is we basically drove from New York to there day of the game, went to
the game and it rained, and it was awesome.But just the overall
energy and it being historical and everything else was awesome. We
had some content lined up. It was the first time we'd ever made, at
least when I was at AB, like, culturally relevant content that was
timely.

“So we worked with the team at Vayner Media to create a Harry Caray
voicing the World Series championship, and it was awesome. But it
was so contingent on them winning. And so, selfishly, for us, we were
invested a lot. We really loved the content, but they had to win. So it
was kind of like hey, great for the Cubs and the Cubs fans, but also for
us, it helped really change our marketing strategy because of the
success and the engagement of the content that we created there. We
went on to create countless amounts of pieces of content around
Derek Jeter, Dale [Earnhardt] Jr., Dwyane Wade, that was because of
that. So the game itself was historical, but it also truly transformed
how we were doing partnerships and activations on the Anheuser-
Busch side.”

“It was a hard sell because we'd never done anything like that, and
you're making a proactive investment and that is not cheap. And
shooting and finalizing content. Then we had probably 30s of a 2.5
minute video that we shot live, like from all the bars and stuff like that
around the city. But we'd already sunk a bunch of costs on the front
end. So it really was a big gamble. It goes back to like, you know, your
job’s always on the line type of thing. We convinced them to invest a
couple hundred grand and if they lost it, we just lit it on fire. So we
got very lucky.”

The most important lasting lesson or key takeaway Nick will take
away from his time as a CEO in pro sports with Charlotte FC and
Tepper Sports
“I think the biggest one, and this is your coworkers, your boss, your
fans, and I've heard it from like 5 or 6 different people, so it's
definitely something that I think resonates, but the whole like, you
build trust in drops and throw it out in buckets. It takes time and, you
know, piece by piece and bit by bit you build up trust over deals you
do, meetings you have, presentations and transparency — but one
screw up and you're starting from scratch if you're even given the
chance to start over.

“I think that that's really where it's just trying to express, no matter
how young somebody is on my team or within the industry is
transparency is the number one thing that usually will set you free.
Even if it's a bad decision, you doing it in the most transparent way —
‘This is why I'm doing it’ or whatever. If you fail, or screw somebody
over, at least there is some authenticity to it versus covering it up or
doing it maliciously. So the trust side; I feel like I've been able to
move up within an organization or around the industry because of
trust and transparency.

“It's just, like not everybody believes in it, like it's an aggressive young
woman’s, young man's type of game when you're in your 20s and 30s
selling, pushing hard, traveling to events. But there's a reason, why it
all kind of, I don’t want to say falls off a cliff, but the amount of people
who stick around 40 and plus is because you're either exhausted,
because this is a very hard industry on the team side, or your ability to
to build up that network is hard. And it's hard to carry the trust and
sometimes it's out of your control. But if you can protect anything
about your career, it's going to have to be just the character and trust
that you establish, because without that, your ability to get the next
big job is almost impossible.”

What is Nick's POV on the narrative and the data of younger
generations and even current generations not consuming alcohol like
they did several decades ago or even even a decade ago?
“Yeah, it's fascinating. Like, I don't know that we've ever seen a curve
like this. I think it really is just everybody's being more health
conscious. There's a lot more information out there about everything
we eat and drink. It is a whole generation of people who truly have
alternatives. And even outside of taking care of their health. They can
do cannabis products, even nicotine from pouches and stuff is at a
higher clip than it used to be, so there's a lot more alternatives out
there.

“I think that the beverage industry has done a great job of pivoting to
non-alcohol or low alcohol to continue to try and take that. I think
that it's going to not be a trend that goes away, but also there's people
adapting. You see what High Noon and Surfside and even AB and
some others are doing to find what is a lower calorie, spirits-based
version of a cocktail that I can make that is accessible, easy, low sugar,
low calories? So it's challenging, but it always evolves. Like, when I
started 10 or 15 years ago, cider was a big thing. Nobody talks about
cider anymore. Craft beer was booming, and now tons of craft
breweries shut down every day.

“We're seeing the evolution of ready to drink cocktails, spirits-based
or malt-based, and then, you and I have talked about it briefly is, I
truly do believe there's a world where this cannabis-infused beverages
are going to become more and more attractive to leagues and teams
as they become further regulated, because it's a new category and
everybody's pressured to grow revenue. And if you can create a new
category that the traditional spirits and beverage companies don't
play in, and you now create a brand new clean vertical; I mean, sky's
the limit.

“So it will be a little bit harder because it's not national. So there’s not
necessarily the funding there to go get big deals. But your ability to
cobble together a THC and a CBD based drink in your market, you see
colleges like Louisville doing an amazing job, but it'll become one of
those things that, it could be extremely lucrative in the near future.”

The best meal to get in New York and where to
get it. And also, tell us about your best
barbecue experience down in Charlotte
“Oh, man. So, barbecue is a lot easier. There's
this place, Midwood Smokehouse; man, I love
that place. I was back in Charlotte last week, I
went twice. It's been there for a while. They
have a mix of normal barbecue stuff, but then
they come up with barbecue Mexican versions
of tacos and everything. It is the one place
when people come to town, I don't care if
you're looking for formal or fun, that's always
the place I recommend.

“And in the city, my go-to for every
meal is kind of like when people are
like, Where should we meet, is this
place called The Smith. They have like
7 or 8 locations across the city, but it's
kind of American bar fare. Nothing
super fancy, but it's a good vibe and it's
affordable. So, yeah, I'm pretty basic. I
don't need the super fine premium
dinner. I'll take the barbecue at
Midwood and The Smith in New York,
and it's easy enough.”

The specialized software app that Nick has found particularly helpful in his work
“My last job at Verizon, because data was so important to us, we worked with
this company called Distinct. It is a back end data platform for us to, as it's really
hard to get built into large organizations like direct CRM within an organization.
So we were able to use [Distinct] to show so much greater value on the team side
by getting them directly into our CRM database, and their ability to educate us,
too, like, Hey, here are the questions you should be asking. Here are the data
points you should need to help supplement what you already have. I became like
an ambassador to everybody else, I literally was just calling friends at Coke and
other places, being like, everybody keeps talking about data; like this will make
you look smart. And I think it was just because, like, they were small and I felt
like I had an in, so I helped a ton, because I could just go to my peers and say,
You guys should try this.

“Because, look, we all have the same handful of services. We all use
Sponsor United, we all use Greenfly on the social amplification side,
and a lot of us are using KORE. So you got three core assets that we're
using, but I was like, add this to your portfolio because, on the brand
side, you oftentimes rely on the agencies to to run this for you. But
there's probably 20 or 30 brands who want to own it themselves. So it
helped us internally to further validate the investments we were
making.”

Tell us about a recent or upcoming or active partnership or client project
with Encore that Nick is particularly excited about right now
“One of the things we've been transparent about is we've been helping
this company called Game Seven. Mark Messier and Matt and Ike
founded basically an entertainment company that has apparel, they did a
content series with Connor Schell and everybody for Amazon. They
recently took on the jersey partnership with the Rangers. And, you know,
it's been extremely rewarding because they have such a strong foundation
of founders, but also they know what they don't know. Like, we're helping
them navigate a complex partnership with MSG plus the Rangers and
helping them get — they're all about brand awareness and CRM and
revenue, and it's just like it is the right mix.

“But it's also the opportunities are endless because they own the
Game Seven IP. They're in content now. They could be in collectibles,
they could be in all these other things. So it's been a really fun client
to challenge us, too because it's not like some of the other people that
are established and they're just like, Hey, help me with this. This is
much more of an open-ended what else could we be pushing on? So
it's been super fun.”

Nick’s All-Star to Follow
“This guy named Jordan Rogers (@jordanrogers). I don't know if you
follow him or not; man, I feel like I know a lot about the industry as a
whole, but then his perspective — and he has a podcast called
Brandfathers, just more being in the apparel and the performance
space. Like, I realized that, having worked on the brand side of a
sports marketing agencies and stuff like that, we weren't endemic to
the sport the way that some of these apparel companies are and just
their thoughts of how they look at athletes and how they look at the
sales cycle. I mean, I listen and consume a lot of his content every
day.

“And more importantly, it's just like, even as TikToks, which are
snackable, which is just like, Hey, here's a new Sun Day Red, here's
my opinion. And the way he does it just feels like it's not like he's
talking down to you, like he's the smartest, it's very well-positioned.
So he's a fun follow. I've learned a ton just about, like, how they dealt
with athletes in the past. So that would be my recommendation
because I have probably the same thing you have, Neil, which is like I
have the same 3 or 4 newsletters that everybody gets, and they're all
great for differing pieces. But his is just completely different than
anything else I follow.”

Where to find Nick and Encore on digital/social media and web
Nick is @NickKelly on LinkedIn and find Encore at https://encore-
se.com/

@njh287; www.dsmsports.net
Thanks again to Nick for being so generous with his time to share his
knowledge, experience, and expertise with me!
For more content and episodes, subscribe to the podcast, follow me
on LinkedIn and on Twitter @njh287, and visit www.dsmsports.net.

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