Leading with Innovation: The NBA’s Re-Examination of Events and Experiences

February 7, 2023 Leading with Innovation: The NBA’s Re-Examination of Events and Experiences

Joey leads strategic planning, new asset creation, business development, data analytics and process improvement for the NBA’s marquee global events including the NBA All-Star Game, NBA Finals presented by YouTube TV, NBA Draft, NBA Draft Lottery, NBA Summer League, Jr. NBA Global Championship, international preseason and regular-season games, and affiliate league events with USA Basketball, WNBA, and the NBA 2K League. 

For the podcast, Joey shared with host Jim Andrews how the league is throwing out the playbook and taking a new approach to special events as it looks to move beyond content. Below are edited highlights of the conversation.

 

Jim: I don’t usually ask guests about their background and career path, but your story is so interesting that I would love to have you give us a quick overview of how you went from a kid on Long Island to playing baseball and becoming a Rhodes Scholar finalist at Georgetown, to law school in Ireland, back to Georgetown Law for a J.D. to the World Bank, a major law firm and eventually, in 2019 to the NBA! 

Joey: I’ve been really fortunate. I was raised by a New York City firefighter and that’s been instrumental to the way I view the world. The rule in our house growing up was to be a servant of others. My dad always said the true test is if your neighbor’s house is on fire, do you run towards that fire. I have spent my career identifying fires. Sometimes big opportunities, sometimes big challenges and obstacles, and I have always tried to run towards those. That has taken me on a varied career path, from spending a couple of years in Ireland, and before that spending two years in the Dominican Republic building a nonprofit and charity called Beisbol y Libros. I spent years at Jones Day, which is an incredible international law firm, before becoming general counsel and chief operating officer for a start-up live events company called The Headfirst Companies, which went on an incredible growth story, before ending up at the NBA. 

I thought we were at a seminal moment at the league, making a transition to becoming a direct-to-consumer business and to finding ways to have a more direct relationship with our fans. That offered a lot of opportunities to how we would rethink what was possible for a league in driving fandom. 

One of the real differences in the league is that it’s cool to rock Logoman. What other league has that? Most sports fans are fans of a team. And that’s certainly the case at the NBA. But it’s also cool to be a fan of the league. I think that’s an incredible opportunity that we have in the league office to reimagine what the responsibilities and opportunities are for the NBA. 

Jim: I think for a long time there was a prevailing thought that “people don’t root for leagues.” But the NBA is an exception. I also want to acknowledge that your dad was a 9/11 hero. He was one of the firefighters who ran into the World Trade Center and fortunately for him, he survived although the other members of his company did not. 

One of the many things you are responsible for is the new NBA Experiences platform. You’ve said NBA Experiences will “throw out the old playbook and innovate” in the experiential area. Can you share some of the ways that you plan to do that, or are already doing that? 

Joey: It starts with the thesis that we are in a dramatically different world than we were pre-pandemic. If the pandemic has taught us anything about consumer behavior, it is that it’s a completely irrational decision to ever get off your couch. We lived on our couches for two years. We were able to work successfully, we were fed entertainment, and we could eat from world-class restaurants. Coming out of it, there was this idea of pent-up demand for events and experiences, and that was certainly true. 

But if you think deeper about what is an event, you find that the pent-up demand may be a little bit shakier than we imagined. When you look at restaurants in major cities, they are down at times almost 80 percent. We are seeing movie theater attendance down. If you change the definition of an event to something of the everyday variety, you find that the pent-up demand isn’t as ubiquitous as some may think. 

For us, we think special events are on the rise. The idea that in the future people may do less, but with more intensity. That’s a really important statement and a theme for NBA Experiences. 

So we are building a premium experiential business and in the first year we are seeing almost 70 percent of our NBA Experiences fans coming from outside the home market of the event. We are looking to create custom, bespoke experiences that you can only have through your fandom of the NBA and your connection to NBA Experiences. 

We don’t want to deliver traditional hospitality, a ticket and a hotel. People have done that for years. Instead, we want to offer the types of moments that allow you to express your fandom in a unique way tied to that event. For example, one of the experiences that we offer at the NBA All-Star Game is for fans to serve as stand-ins during rehearsals. So you have fans pretending to be LeBron James as the pyro goes off, etc. That’s an important time for our production team. They need to do that testing anyway. Allowing those fans a peek behind the curtain is a moment that while it’s connected to a ticket and meet-and-greets and on-court access, is the special moment that makes the experience unique. We’re offering that across our entire marquee event landscape because we see it as a seminal moment to connect with our most important and valuable fans around the world. 

Jim: You mentioned to me earlier that you didn’t want to see another idea presented that begins with on-court photos. We need more than that now. 

Joey: Our fans crave access and insight. I look through those two lenses and ask, “Does the experience we are building offer those two things?” If it doesn’t, it may not be the right thing. We want to make sure we are giving our fans the opportunity to see and hear from, talk to, live through moments that they could not have gotten otherwise. That’s the bar and it’s so much higher because it needs to get someone off that couch in this new world. Those lenses require more creative vision moving forward. 

Jim: We’re talking about premium experiences, which come with a premium price. Is there room here for the average fan who doesn’t have thousands of dollars to pay for the ultimate VIP experience? 

Joey: I never describe NBA Experiences as a premium business because of the connotation of pricing that goes along with that. It’s an access and insight business. Ultimately that means we need to build a product ladder that allows our fans to experience the event wherever they sit on that ladder. And there are multiple factors that determine where they are. It may be time, it may be location, it may be price. When we think of all those things, there is a lot we can offer that allows our fans to experience with an inside lens.  

That may be things like NBA executives. I have the unique ability to call on my colleagues and ask them if they are at the NBA Draft to talk about the numbers and the analytics behind draft decisions and to discuss how the draft operates so that fans can appreciate the complexities of something like the draft. Those types of experiences don’t have to push the price line to a place that’s unachievable. 

The other thing we’ve really thought about is the way in which our fan events are delivered through this lens. If you think about from the ticketing side, we have spent so much time thinking about what the right package is for our fan. “What are the four things we should include and what’s the price?” To me, in this decentralized world where personalization and customization is so important, why do we make that choice? We should be letting our fans do that. 

Our fan events are where we are able to test that thesis. One of the things we’ve done, is for our largest fan events, we no longer create packages in the same way. Instead, I think of it like Lego blocks. I want to create 12 different Lego blocks—one for fashion, one for music, one for art, one for technology, one for participatory experiences on the court, one for meet-and-greets, one for panels—and then let the fan determine which blocks fit together for him or her. 

What we saw in the first year we tested this was our average order size tripled. When we were no longer concerned about just driving attendance but were thinking about how to get fans to experience this at a deeper level, and when we stopped telling our fan what they wanted and gave them the power, they were interested in creating the package that worked best for them. 

Jim: That would appear to be an expensive or resource-intense approach. It’s often more efficient to assemble the blocks and sell them as a set. But it sounds like even if that’s true, the results are worth it. 

Joey: It is for us. It may not be right for every event. You have to be fine with two things.  One, you have to be comfortable with all of the constituent parts as standalone products. Two, you have to be comfortable that two people sitting next to each other may be having very different experiences. So often, our experience has been tied to seat location. It may tie to the access you get to a certain club or the entrance you are able to use, or the extra merch that you get. But why is that the only lever that can differentiate? That’s why I hope we can carry this beyond fan events into other ways we think about ticketing, because it’s giving fans the personalized experience they want, and allowing us to do that at scale. It’s difficult to deliver each fan a moment. That’s always been the challenge. But if we can create these types of tracks, it gives the fan personalization without having to have a different ticket for every single person. 

Jim: In our previous conversation, you said the league wants to be “a direct-to-consumer business beyond just content,” which meant a re-examination of the entire way its events are designed. Can you explain what “beyond content” means in this context and talk some more about redesigning events and how that all manifests? 

Joey: We are certainly an incredible content operator and that is a big piece of our direct-to-consumer business, but it can’t be the only piece. So when we see our experiences and want to give fans opportunities to connect with the NBA in real life through our live events, we also think of those events as content-generating machines. There are so many unique moments that happen at our live events that we want to make sure our fans can access. It does impact how we think about them. 

For example, if you have these special event moments that fans want to get off the couch for, then you have to extend the rubber band. You have to give them more experiences. When we think about NBA All-Star, when I first came to the NBA, it was a four- or five-day event. Now it’s a six-month event.  

We start launching with digital experiences. We created something called the NBA All-Star Rewards Program, where we’ve partnered with 100 entrepreneurs in Salt Lake City around the theme of entrepreneurial empowerment. By partnering with them, we’re giving our fans an opportunity to engage with each of those businesses. When they go into the four walls of that business, through an AR digital scratch-off in the NBA Events app, they can instantly win meet-and-greets, merchandise and collectibles and can also earn All-Star Rewards points that can be used for tickets and experiences throughout the weekend. 

We have also created NBA Ice Buckets, which is located in a highly trafficked mall and allows our fans to participate in All-Star in the months leading up to All-Star, not just the weeks. That’s created a tentpole moment and created multiple touchpoints in real life. That type of scalable extension is crucial to our strategy. 

Jim: How much of an impact does the market where the event is taking place have? Salt Lake City is clearly a different market from not only New York or Las Vegas, but even from Cleveland, where All-Star was last year. 

Joey: Great ideas play. What’s important is that things are custom curated. When we set our goals for each event, we want to amplify the values and vision of the league, but also of the city and is temporally relevant. We could never put this All-Star on again. It’s custom to the moment. 

For example, last year in Cleveland, we had the idea of turning a traditional cost center into a revenue driver. Some of our costs are things like signage, and our fans are always asking to be able to experience that signage. So what if our signage and branding was art and we treated the city like an art gallery. So we created what we called the first citywide shoppable art gallery. All of our branding around the city was minted on the blockchain and we allowed our fans to purchase that art in both physical—we would mail them a replica piece of the court—and digital form. 

It was a more engaging way to deliver our branding and also offered a unique storyline. We told the story of all the previous all-stars from the state of Ohio through that art. Like a gallery, each piece was connected to the next, so you had to walk around the city to experience that gallery and understand why we put one piece where we did compared to another. That was an interesting idea, it was at the right moment for fans to engage and it was tied to a storyline that connected to the time and place. When you do all three of those things, that’s a magical recipe. That shoppable art gallery is not the right idea this year. Those parts don’t line up in the way they did over a year ago.  

Jim: I have to say when I first heard about that, I was skeptical about how many fans would be interested in purchasing those items, but you had some good results. 

Joey: We sold out of many of those pieces, which was exciting, but we were really happy with the engagement and not just because of the new revenue opportunities. One of the things we did with the money was donate over $100,000 to Covid relief in Cleveland, so it opened another opportunity for us to show that we are socially minded at every turn. 

But also we wanted to take fans on a journey, offer them more storylines in a city like Cleveland where people were saying, “It’s too cold to be outside.” All of these pieces were outside. Could we engage with the city dynamics in a new way? That was exciting about much of the engagement we had for that platform.  

Jim: International is clearly a growth area, not only for the NBA but for other major U.S. pro sports leagues, with more pre-season and regular-season games being played. Can you talk about the business reasons for that and also the business model you have for your international events?  

Joey: David Stern was a leader in pushing the NBA to be a global sport and we still follow his vision to this day. There are over 120 international players on NBA teams. We are a global sport. That offers us permission and opportunities to bring our game around the world. 

Visiting places such as Paris, Tokyo, the Middle East, Mexico this season is important not just because of the game, but it gives us the ability to extend these tentpole moments. We don’t look at it as bringing a regular-season game in a three-day window. We’re thinking about how to extend that experience, offer touchpoints, use NBA Experiences, think about our fan strategy in a way that allows a multi-prong connection through this high heat moment. 

When we were in Abu Dhabi, almost 80 percent of our NBA Experiences fans come from outside the UAE. It’s not just the ability to experience the game locally, which is important, but it’s also an opportunity for our global fans to come to those destinations and experience a game in their time zone, to travel to parts of the world they may not have experienced before, to bring our players to parts of the world that they many not have been to. Those rich cultural moments were what we were missing during those two years when we were unable to travel without as much freedom. I would expect that our international strategy is only going to expand. Certainly we have the BAL in Africa, that is of vital importance to the growth of the NBA on that continent.  

Jim: With my background, I always look at things through a partnership lens, and you and I were discussing the games in Japan last October, including the P&L model you have for the international games and how the partnership revenue fits in the picture. Can you share a bit about that? 

Joey: Our partnership with Rakuten was part of the reason we were able to bring those games to Tokyo. We worked with them to have a fan night in between the two games we played there. We had a concert experience that was a part of it. From a partner perspective, being able to have ownership of an experience like that and deliver it to some of your most important constituents is really exciting.  

Jim: I’d like to learn a little bit about the nuts and bolts of how partners become involved with new events, as typically there is an interesting dynamic between offering opportunities to existing partners, especially the largest ones, but also seeing this as a chance to bring in new sponsors who want to be involved with the league. How does the NBA approach that—both philosophically, if you will, and practically in coordinating things between your team and the Global Partnerships group? 

Joey: Some of the new experiential businesses we are creating is that they offer new assets that intrigue certain partners. Some of those are right for our current partners—and we want to make sure we are taking care of the incredible partners we have because they are so instrumental in telling our story.  

But what’s also exciting about these new assets is they offer new opportunities to engage with partners who have not had the right moment come across for their brand, even though they were fans of the league and we were fans of them. Or it may find an opportunity for an existing partner to tell a different story. 

It’s growth. For our team on the Strategy and Development side, we need to push to build new profitable businesses so that we can offer opportunities to our partners. But one of the things I have always found challenging in the partnership world, and one of the hard parts of the job for my colleagues in Partnerships, is the idea of “Do you have a partner for me, because I can’t do this if not.” 

I’ve never believed that’s the way the relationship should work. The way my team works is that we want to build a standalone profitable business. When we do the financial modeling, I don’t want to include sponsorship. That should not be required for us to get the idea across. I want to show the business’s unique value and trust in my Partnerships colleagues that in time the business will find its right corporate partner who will be able to amplify that business. That may mean waiting until year two or three of the business. 

So it starts with ideas that are profitable through some of the other revenue streams like tickets, experiences, collectibles, merchandise. It also comes from reimagining things you could not have sold before, but which with new technology you can.  

Take our All-Star VIP Pass that we sold last year at auction. We were never able to sell multiple years of All-Star inventory, but by putting it on the blockchain, we were able to reimagine something like a traditional seat license and offer a pass for five years of All-Star experiences. We don’t even know where we are going in those later years and yet we were able to find an incredible audience who were able to engage and identify with a product like that.