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Orlando Magic CEO on the benefits of big data

Panel discussion at SAS Global Forum Executive Conference focuses on analytics in sports

Alex Martins, Orlando Magic

“Approximately 67 percent of analytics professionals say analytics are game-changing,” explains  Scott Vaughan, CMO for TechWeb today at the SAS Global Forum Executive Conference, “But only 42 percent believe their companies see it that way.”

For one organization right here in Orlando, where the conference is taking place, the benefits are clear and - literally - game changing.

Customers and businesses are churning out data faster than ever, and decisions have to be achieved in the board room almost as fast as they are made on the court.  Blink, and you’ll miss an opportunity.  It’s not just the speed of data; it’s the volume and variety, too.

At a panel discussion , SAS CMO Jim Davis discussed sports analytics with Orlando Magic CEO Alex Martins. Whether using analytics to improve the game or to improve customer relationships, Martins  understands the pressures and opportunities of doing it right to avoid missing valuable opportunities.

Read on for highlights from the conversation.

Jim Davis: Are organizations seeing analytics as a true game-changer?

Alex Martins:  We adopted an analytics approach years ago, and we’re seeing it transform our entire organization.  Analytics help us understand customers better, help in business planning (ticket pricing, etc), provide game-to-game and year-to-year data on demand by game and  even by seat.  For example, analytics helps us forecast ticket sales.  It has helped transform the game itself.  Moneyball is truly at play in professional sports now. GMs and analytics teams look at every aspect of the game, including movements of players on the court to transform data to predict defense against certain teams.  We can now ask ourselves, “What are the most efficient lineups in a game?  Which team can produce more points vs. another lineup?  Which team is better defensively than another?”

We used to produce a series of reports manually, but now we can do it with 5 clicks of a mouse (instead of 5 hours overnight in anticipation of tomorrow’s game).  We can have  dozens of reports available to staff in minutes. Analytics has made us smarter.

Davis: What is big data to you?

Martins:  Big data helps us understand customers better. It helps us gather personal preferences to customize the experience they have with our organization.  Big data helps us forecast our business – on a year-to-year, game-to-game, hour-to-hour basis to determine demand for a specific seat.  We priced seats before on lower vs. upper bowl.  Now, based on our big data, we can measure demands for specific seats, not whole sections.  Big data helps us figure out what to charge for tickets by opponent and by game.

Big data helps us predict our business moving forward.  It has helped by giving us a predictive renewal model – the core of our business is season ticketholders.  SAS helped us create a model based on tenor, use of tickets, merchandise purchase, interactive with season holder events, and more to help us predict who we need to reach out to for renewal.

Davis: What are the critical decisions you rely on?

Martins: The  core of our business is our season ticketholder base.  We work hard to get 10,000 season ticketholders every season. We have to determine what will create greatest opportunity to sell out every night.  In the past, we had a touch point program with sales reps who interacted periodically througout the year, without knowing a lot about the customers. Now, the analytics allow us to model out the perfect circumstance by which a season holder will renew.   We now know who their favoite players are, and can reach out to them with things that make a difference, and make it personal. Through our scoring model, we can reach out to them with resell options, and merchandising options that appeal to them personally.  Predictive modeling is where we succeed.

Davis: You can buy the best data repository, best analytics, fastest platform but you won’t succeed unless you deal with cultural issues within your organization.  What are the issues that organizations face in terms of adoption and how to get over them?

Martins: You have to have belief and buy-in at the top of the organization for analytics teams to have support to grow your approach.  Other CEOs in the NBA have been slow to adapt.  A lot of our execs and coaches are used to how it’s always been done.  This whole approach to, “I know in my gut that guy can play,” but without data to support that, it’s hard to adapt.  Our teams have delveoped models and forecasts that hit on the money.  It only takes a couple of proof instances to help transform folks into believers of analytics.  Our analytics team reports to the CFO.  We meet bi-weekly to see how it’s working, what we want to do in the future.  For us, you have to have buy in from the top down to trasnform it across all the silos.

Davis: How is the relationship between IT and the business unit?  Is IT moving closer?

Martins:  Analytics have brought IT closer to the organization.  IT used to be an island, now they’re engaged in helping us create models and engage tools like SAS. They get fired up about improving the business,  too.  Our partnership with analytics has shown the power and value of the IT team to the rest of the business.  It gives folks the tools to be more efficient and make the right decisions – and help them win games.

Davis:  You’ve heard us talk a lot about high-performance in-memory analytics during this conference.  Loading billions of rows in-memory to turn processing time from hours to minutes.  Have you thought about what that means to your organization?  

Martins:  Getting real time data is the next step for us in our analytical growth proess.  On a game day, getting real time data to track what tickets are available and how to maximize yield of those tickets is critical.  Additionally, you’re going to see major technological changes and acceptance of the technology on the bench to see how the games are played moving foward.  Maybe as soon as next season you’ll see our assistant coaches with iPads getting real time data, learning what the opponent is doing and what plays are working. It’ll be necessary in the future.

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