The world of professional sports and entertainment is transforming as fan expectations change, all enabled by digital technologies. To learn more about customer experience, we speak with Jonathan Becher, president of Sharks Sports & Entertainment LLC, the parent organization of the NHL’s San Jose Sharks hockey team and three ice sport facilities in Silicon Valley.

Prior to joining Sharks Sports & Entertainment, Becher spent a decade at SAP in a variety of senior roles, including Chief Marketing Officer and Chief Digital Officer. A three-time CEO, Becher is a frequent speaker at technology industry events, and is a regularly published author on a variety of topics, including the popular blog Manage By Walking Around  http://jonathanbecher.com.

Transcript

Jonathan Becher: Touching hundreds of experiences, all touchpoints, it's just too much. And so, I have to look at the weakest points in the chain and focus on those first.

Michael Krigsman: We're speaking about customer experience and fan experience with Jonathan Becher, President of Sharks Sports & Entertainment.

Jonathan Becher: Sharks Sports & Entertainment is the parent organization of several things. First of all, as you mentioned, the National Hockey League San Jose Sharks, also the American Hockey League San Jose Barracuda, the SAP Center (which hosts between 160 and 180 events every year), a network of three public ice centers, and a nonprofit foundation. All of that together is considered Sharks Sports & Entertainment.

Michael Krigsman: The focus of your business is putting on what?

Jonathan Becher: You kind of hinted at it in the beginning, which is, we're most famous, of course, for ice hockey and for the professional hockey team, which is the Sharks. And so, people think of us in the sports business. But in fact, the reason our name is "sports and entertainment" is we're actually in the entertainment business.

For example, last night in our biggest of the four buildings, a Columbian superstar named Maluma (which is one of the biggest acts in the world) played. Over the Labor Day weekend, we had four shows of Monster Truck. We have the Harlem Globetrotters here quite a lot.

We have plenty of hockey, both professional hockey and you can learn to skate, ice dancing, other ice sports, but we are in the business of entertainment. That's the fundamental thing of which one of the entertainments is professional hockey.

Michael Krigsman: Why is this entertainment dimension so important?

Jonathan Becher: The formula for sports is very simple, and it mostly boils down to: does the home team win or not, and (maybe) is the beer cold? Then the average sports fan is happy.

More and more, people don't come to venues just to see what happens: does the home team win? They come to make memories. They bring their kids, so they themselves want something.

They're coming (if they want to come in person) to remember what their overall experience looks like and what that journey is. The barrier for the entertainment isn't whether they can last nine innings at a baseball game or three periods at a hockey game or four at a football game but, rather, whether they want to get off their couch.

The competition, frankly, is streaming. It's shows like CXOTalk, Netflix, and other things as well. And so, if the whole industry doesn't recognize we're in the experience business (and much like retailers compete for share of wallet), we're competing for share of entertainment. That's the focus of this industry.

Michael Krigsman: Your focus then is the attention of people who will come to you rather than stay home, for example, and watch Netflix.

Jonathan Becher: Yes, with a big caveat, which is, they can stay home and watch us as well, and that's good. Is it better if they come to our physical location? Yes. But we all learned (if we didn't already know it over the last 17 months), we live very much in a hybrid world. And so, while there are reasons for them to show up in our physical spaces, we're okay if they interact with us digitally as well.

In fact, for me personally, my role and my focus (beyond the overall strategy) is I have emotional and practical leadership for two of our strategic objectives.

  • One of those strategic objectives is nontraditional sources of revenue growth. We call it "Think Beyond the Rink." TBTR: Think Beyond the Rink.
  • The other strategic objective that I'm emotionally responsible for is reimagining all of our experiences from scratch so that they are digital and mobile-first as opposed to in-arena first.

Michael Krigsman: You're talking about experience (fan experience, customer experience). Why don't you like that term "customer experience"? It seems kind of the essence of what you're focused on and working on.

Jonathan Becher: I worry about the phrase because it puts the focus on the word "customer." For most practitioners, when you put the focus on the word "customer," they immediately think transactions and how to develop a transactional relationship. Therefore, the focus becomes, how do you make money?

There are many, many experiences – both in our industry and, frankly, in every industry (including the tech industry) – which do not have to be anchored around revenue, do not have to be anchored around the transaction.

In my old life (when I was a tech company person), we used to often say, "We want to turn customers into fans." In this industry, it's almost the reverse. You want them to be fans first and some of them you'll convert into customers (meaning that you'll end up doing revenue).

I think the best analogy for people in the technology world is to think about freemium or try-before-you-buy models. You need your product, your offering to be compelling even when people are not paying for it. Then for the subset of people that make sense, then you convert them into a revenue relationship.

I'm not anti-customer experience. I'm anti-practitioners, which unfortunately is most of them that immediately look for the transaction pivot points and think those are the most important things.

Michael Krigsman: Certainly, for many practitioners, for many marketers, the focus is on the revenue because that's what they're tasked to do by their CEO, and that leads to metrics that involve revenue and, from that, radiating out, we have customer experience that is transactional or, ultimately, comes down to measurements that are about money and transactions.

Jonathan Becher: Right. Therefore, maybe the metrics are set up incorrectly, and they shouldn't start with revenue, but they should start with propensity to buy or loyalty or willingness to consider your offering. Maybe we look at the traditional. Even though everyone likes to say the phrase "The funnel is dead. It's no longer this linear model anymore," in the back of everyone's mind that still drives their behavior.

Michael Krigsman: What's the issue then, fundamentally?

Jonathan Becher: Fundamentally (at least in our world), we think about touchpoints in isolation not just uniformly. People talk about the end-to-end experience. Unfortunately, in many cases, the ends they talk about aren't big enough.

As an example, when people come to our physical building and we send them, which we do every night (a subset of them), "Did you enjoy yourself? What was the best? What was the worst part?" almost invariably the single worst part of the experience was getting to the building, was traffic on the freeways, or difficulty parking.

Now, for most businesses, you could say, "Well, that's not my responsibility. I don't control the real estate. I don't control the freeways. That's outside my end-to-end experience." But yet, my customers, my fans, my guests are telling me that's what they care about the most.

That means I've got to extend my aperture and think about other ways to get people physically to my building. Think about digital experiences in addition to the in-person experience because that's where the satisfaction is coming from.

Yet I've got to be careful, which is, I have to recognize that touching hundreds of experiences (all touchpoints) is just too much. And so, I have to look at the weakest points in the chain and focus on those first.

Michael Krigsman: Your metric, your ultimate metric then is that long-term relationship with the customer. Would that be correct?

Jonathan Becher: That is right. In fact, one of the things we're most proud of is, at our season ticketholder base – our franchise is 30 years old – we have more than 1,000 season ticket holders that are with us from the very beginning. That kind of longevity in relationships, you don't have in many other organizations.

Michael Krigsman: In almost any business, if you were to take that broader lifetime value perspective, it would lead to a less transactional set of interactions and, in a way, it's kind of surprising that more organizations don't do that. There must be reasons why.

Jonathan Becher: In my opinion, the two reasons are, one, we live in an instant gratification culture. I think we all know that. Long-form art is dead.

Unfortunately, Michael, there have not been any CXOTalks in the world where people listen for 45 minutes. We're used to the soundbites.

Transactions are instant gratifications, and many companies, particularly publicly held companies, have to report revenue quarterly. The Street watches them, and so long-term relationships don't become nearly as important as instant short-term gratification.

Most, not all, professional sports and entertainment organizations are privately held, and we're in a situation where we have a single owner who allows us to think two, three, four, five years down the road (long-term) rather than have to worry about the tyranny of the urgent.

Michael Krigsman: We have a really interesting comment from Peter Coffee on Twitter. Peter Coffee has worked for Salesforce for many years, and he was a very prominent technology journalist before that. I've known Peter for a long time.

In response, Jonathan, to your comment, he says, "Do not define the competition as those who do what you do. Your competition are those who satisfy the same need, which may be something as general as entertainment experience rather than something like sports interest."

Jonathan Becher: Completely agree. As you heard me say, I don't think of the other Bay Area sports teams. For those of you who don't know, we're in northern California.

The 9ers, the Warriors, the A's, the Giants, et cetera, I don't view them as our competition. As I said, share of experience, I worry more about streaming digital services and, in the old world, maybe movie theaters and restaurants, because those are other ways of delivering experiences. So, I completely agree with his comment.

Michael Krigsman: So, as you're thinking through this fan relationship, how does that anchor your decisions as the president of this very rich and complex organization?

Jonathan Becher: The first thing is balancing what we call guests versus fans. Guests are those people that physically show up at our building. Fans are those that interact with us in one of the many touchpoints that we have.

There is a limit to the number of guests that you can have. Our building capacity – hopefully, the fire marshal is not listening to us – is about 17,500 people. Maybe there are a few more there for playoffs, et cetera, but that's it. There's a limit to that capacity, which is why I talk about "Think Beyond the Ring."

But of our roughly 1.5 million registered fans, the vast majority of them have never actually been to our building. Many of them don't even live in northern California. And so, most sports and entertainment franchises optimize for the 17,500 that are in your building, and I'm trying to flip that formula on its head and optimize for the 1.5 million that may or may not be able to get into our major building every day.

For example, we've invested a lot of money in something called the 1991 Club – that was the year we were founded – which are experiences for out-of-market fans, including local meetups, but premium content that is designed for them even though they'll never be in our building.

Michael Krigsman: How does all of this ultimately translate into the revenue calculation, because you are a business after all and, ultimately, that's what you're thinking about?

Jonathan Becher: The good news here, Michael, is I actually don't measure that revenue right now. I measure the growth of the loyalty and the footprint, having in the strategy said, "That doesn't become a significant revenue component until fiscal year '23," so we're in the third year of a five-year strategic plan of which we're (actually, to be fair) slightly behind our growth rates – pandemic influenced, like many other business models as well.

The minute that somebody says, "What percentage of revenue is it?" and it's single digits, then a traditional business model goes, "Ah, single digits. It's clearly not working. Stop working on that." But it's the right long-term growth, even if it's not short-term impacting my revenue.

Michael Krigsman: There are not too many people who come on CXOTalk and describe a five-year plan the way you just did. Five-year plans tend to be more abstract. But for you, this is something very visceral and directly impacts your bottom line during the interim.

Jonathan Becher: I'd like to say we had this all figured out in year one and we're doing exactly in year three what we knew we were going to do in year one. That would, of course, be ridiculous.

Like tech companies, we generate a whole series of experiments, and we could certainly talk about some of the experiments that have failed and not worked out. This is one that's been particularly successful.

Each year, we pivot the plan a little bit, pour a little more gasoline on that fire, and grow with what was a more loosely described objective when we started. Each year, we sharpen. We know more about what that fifth year looks like as we get closer to it.

Michael Krigsman: We have a very interesting question from Arsalan Khan, who is a regular listener, and he asks great questions. Thank you, Arsalan, both for listening and for your questions.

Arsalan (on Twitter) says this: "You're describing a holistic customer experience from home to digital to stadium and back. What are the budget constraints to do this and who thinks about this? Is it the CEO, the CFO, the CIO? How do you execute the strategy?"

Jonathan Becher: Yeah, budget constraints are, of course, for every business on the planet, one of the things do to there. What we say is, "Don't start with a budget in mind."

Too often in my career, projects or initiatives that I thought would be transformational died early in their progress because they had too much money or too little money. So, we start with what needs to be done and, later on, assign a budget to it. Frankly, some things get scaled-down and other things get scaled up.

The question about who is responsible for it is, I think, the critical one for us. We don't have any C-level things. We're not a very hierarchical organization.

You notice I called myself the president, not the CEO. We don't have a CFO. We don't have a CIO. We have no C-level titles, no CMO. That's partly to flatten the organization and to recognize that we're all responsible for things like experience.

We do have a woman who runs a team, which is called the Experience Team. She's the x-factor (I joke with her), et cetera. But in the classic racy chart, she's accountable as well as responsible. All of us on the leadership are responsible, but she's the one that holds us accountable to deadlines, to objectives, et cetera.

Michael Krigsman: You're describing this very holistic view of the relationship that you have with your customers. How do you begin? Do you look across all of the various interaction points? How do you begin, and how do you optimize it as you go?

Jonathan Becher: Well, the good news (or the bad news, depending on what you are) is, in our business, fans are very vocal about what they like and what they don't like. All you have to do is follow me on Twitter for a few minutes and you'll see I get hit up by fans all the time about suggestions for improvement on the business. That's good. You need to have a little bit of a thick skin, but it's a good way to get feedback.

I'll give you a very simple but compelling story about when I first joined four years ago, because I was a tech guy before I got into the sports and entertainment business. Our marketing mantra – in fact, it's more than that – our brand ethos was called "Sharks for Life" and it was a fantastic brand ethos.

I used to say – in fact, Michael, I might have said this when I was on CXOTalk three years ago – I've never been involved in a brand. I've been a chief marketer. I've been a steward of the brand where people willingly tattooed your logo on their skin. That's brand loyalty. We don't really have that in the tech world, normally.

I really thought "Sharks for Life" was a powerful brand ethos and loved it, but we got feedback from more casual fans, newer fans, people that didn't grow up with the love of entertainment, that that "for life" sense, that tattoo to the skin, which we used to show on social media all the time, that was off-putting. That seemed too high of a bar.

And so, while we're doing a great job of keeping the loyalty of our most loyal fans, we were turning away those that were intrigued by our offerings but weren't ready to commit by burning their skin. And so, we went away from that. We changed our brand ethos by listening to not just our most loyal customers, not those that have the biggest revenue (which I know most of us do in our previous life) but rather, the fringe ones, if you will.

We changed our brand ethos to "Teal Together," which is very much of a community-based brand. There's room for everybody in this, regardless of if you know how hockey works, you've never skated, you just moved to the Bay Area or you've been here since you were born, et cetera.

We created a series of micro-communities of how do we expand the brand dramatically. As positive as I thought we were when we started with "Sharks for Life," I think we have – well, I don't think, I know we have numbers to show – an even broader and stronger brand as well.

The answer is do it outside in, not inside out. Too often, we all sit in our offices, our cubes on our Zoom meetings discussing what we think we need. Let the customers (and your non-customers, more importantly) tell you.

Michael Krigsman: For you, inviting your customers in has been a core aspect of really understanding what they need and, therefore, guiding your decisions and your actions along the way.

Jonathan Becher: Yes, with a caveat, which is, if you say "customers," people think it's the transaction people. Inviting people in that would like a relationship with your brand – call them fans, guests, whatever word you want to use – because if you just say, "Invited your customers in," immediately you're going to sub-select your largest customers that are associated with you, and you want those that don't normally get airtime, you want those in as well.

Michael Krigsman: We have an interesting question from Paul Gratton who says, "What does the end goal look like for Sharks Sports & Entertainment at the end of that five-year period? So, where are you going with all of this?" And he also wants to know, "What are the goals for this year where we still are facing the pandemic?" And he also wants to know, "Where do you see your use of Twitch and overall social media and doing behind-the-scenes videos?"

Jonathan Becher: We run the company with a series of formal organizational objectives. This year, there are six. Last year, there were five. There are normally five or six every year, which have a series of KPIs that are published on a scorecard, et cetera.

I won't walk you through all six of the organizational objectives. I'll just give you a sense of two of them.

One is to reopen our four venues in a way that our guests believe are safe and healthy because safe and healthy is clearly a top of mind for the vast majority of people, not just in the Bay Area but around the world.

As a result of that objective, we applied for and received something that's called GBAC accreditation, which is Global Biohazard Accreditation Council. It just says the airflow inside of our buildings, the cleaning protocols, all those things are as high of standards they were.

We worked with the city and the county, so you can't come into our building unless you have proof of vaccination and you wear a mask.

We'd done things like you can order food in the app and then skip lines (because we don't want people to line up) or have them delivered to your seat. We've done some great things like reverse ATMs, which limit interactions.

One of the strategic objectives is to ensure that guests feel safe. Not that we think they're safe but that they feel safe. And so, there are a whole series of initiatives for that.

We have, we've opened up; 10,000 people for Guns & Roses, 10,000 people for Maluma, the Columbian superstar. We had Monster Jam, which is a monster truck; 25,000 people over 4 days. These are the first and the largest events in northern California, all vaxxed and masked.

Another strategic objective (because there are a bunch in there) is to return to pre-pandemic levels on a run rate by the second half of the year, so we measure a bunch of things like the amount of people buying ice time, the number of events that are in the building, et cetera, to build back up.

Those are two of the six objectives. Now, I've forgotten the other questions, Michael. You'll have to chime back in.

Michael Krigsman: Yeah. He was also asking about social media and your plans for Twitch and, I'm assuming, living streaming.

Jonathan Becher: We were the very first professional sports and entertainment franchise to get a website way back in 1991 or maybe it was 1992. I think we were the second sports and entertainment franchise to get on Twitter, the third or fourth on LinkedIn, so we do a lot of stuff on social media.

Twitch and Discord are relatively new platforms for us. I guess maybe another fun story there, when the pandemic hit in March of last year (and all events were canceled in our buildings for 17 months) April of 2020 was the first time in the U.S. that the 4 major sports teams had not played. Not a single game in April of 2020 was played for basketball, football, baseball, and hockey.

To give you a sense, the last time that happened was 1883, which is interesting in itself because basketball wasn't even invented until 1891. So, it's a long time since we had a month without all those sports happening.

A lot of teams decided to simulate games and stream them on Twitch. We did that as well.

Frankly, one computer simulating a game and playing against another computer gets really boring. It lacks the spontaneity that we all want in live sports, which is why I don't like the idea of games as being a way for us to not say eSports versus live sports, but actually to meld the two together and create a new category entirely.

Michael Krigsman: Chris Petersen wants to know whether the ownership and the home venue dynamic affect your ability to shape customer and fan experiences.

Jonathan Becher: I think the answer is almost certainly yes. We have a single owner. Many sports teams have multiple owners, and our owner is a technology executive. His name is Hasso Plattner, who some of you may know as one of the cofounders and chairman of the board of SAP, so he's a technology person. So, he's much more willing to fund technology experiments maybe than other people that are less comfortable in the technology world.

We are based here in the heart of Silicon Valley, which means – I don't really want to encourage this because I already get it – we get lots of outreach from early-stage companies who have interesting, new technology that they want us to try out, and we're able to try out lots of things before they go to market as well.

It would be too much of a stretch to say we are a technology-driven company. I think we're not there yet, but we are much more influenced by technology now than we ever have been before.

Michael Krigsman: For you, technology innovation is really ingrained in what you're doing and you're using that (it sounds) in every way you can to further that relationship with the customer.

Jonathan Becher: I want to be careful here because something I believe passionately is I don't like putting technology front and center even though I'm a three-time startup CEO, and so I'm a technology guy myself. For technology to really work, it should be invisible to our guests. It should be invisible to our fans.

Let me give you an example. For the safety reason I talked about, we want to limit the interaction between cashiers and guests. We want to drop that time down to as few seconds as possible. That's one of the reasons you can order in the app and skip the lines.

Cash is a difficult mechanism because if you allow cash in a venue, you elongate the time that people are in line. It takes long interactions, et cetera, and we want to reduce that interaction time.

We want to go cashless. But if you go cashless, you create a barrier to a group of fans and guests who may not have access to debit and credit cards. So, you can use technology to solve that problem.

We created something with a company called a reverse ATM. It's just exactly what it sounds like. In an ATM, you normally put a debit card in; you get cashback.

A reverse ATM is you put cash in and you get a Sharks branded debit card back. We eat the fees. No fees are to the guest as well. Now, that fan can use that debit card not just in our building but anywhere a debit card is accepted.

From a technology point of view, we've used technology to solve a problem, but now I'm actually in fans' pockets as well, so I have an idea about share of entertainment. You can see a step along the way of how I become an entertainment franchise based on data not just solving the technology problem of, "What do I do about cash in my building?"

Michael Krigsman: It sounds like there's a heavy emphasis on thinking about that relationship and all of the various points that you intersect with your fans, your guests, customers, and so on.

Jonathan Becher: I'm a little obsessed with words. My personal mantra is "words matter," so I 100% agree with your sentence, but I would say it backward. It's not how we interact with them; it's how they interact with us.

If we don't do a good job, which we don't always, but we have to be obsessed about it of starting with what their needs are or what they see, their barrier. If we do it from our point of view, which too often we do, then we're optimizing what we need as opposed to optimizing what they need.

I've got to flip it on its head. Occasionally, we get it right.

Michael Krigsman: On that note, we have another interesting question from Twitter, again from Arsalan Khan who wants to know what strategic objectives did you not get right that you thought would be really useful but didn't turn out to be what you expected, for whatever reason.

Jonathan Becher: Yeah, I love stories of failures. The word "failure" is so harsh, I don't actually embrace the Silicon Valley mantra of "fail often, fail fast" because I think that barrier, the word "failure" scares people. I like to talk about experiments and the experimental method, and the experiment where the result wasn't at all what we thought it would be.

For example, one strategic objective we had a couple of years ago is how to resolve – and I'll do this in the short version rather than the long version – we have what's called the late-arriving fan problem. Because of traffic in Silicon Valley, between 30% and 40% of fans can arrive within 5 minutes of puck drop or between 5 minutes before and 15 minutes after puck drop.

It's not LA where I hear they come by the first intermission, but it's still late, and that causes lines at the door, difficulty for people getting beer, to seats because, in hockey, you can't go down to your seats until there are breaks in action as well. We talked about how we reduce the number of late-arriving fans by (I think it was) 50% through a whole series of initiatives.

One initiative that we had (we theorized would work) is to create a happy hour where we open the building earlier. We provided incentives for people to come, like significant discounts on beer and wine, assuming that one of the reasons that people arrive late is they went to neighborhood restaurants or they went to their favorite watering hole after work as opposed to coming to the building. If we could shift that behavior so they did it in our building instead, not only would we get more revenue (even though it was discounted), would solve the line problem.

It didn't work at all. Oh, and once they were in the building, if you were in the building an hour or more earlier, we would actually – because we have beacons and stuff like that – send you offers to create even more loyalty to reinforce that you show up early.

All we did was shift people that came a half an hour early to come an hour early. Yes, people came earlier, but the same people that were used to coming earlier. We didn't really solve the problem of people coming late to come any earlier.

Why? Well, as we dug deeper into this, most of the issues (not all of them) were people like to go home and change between work and our building. And so, what we really probably need to figure out is changing areas or alternate modes that don't require them to drive, so they can change on the way here as well.

We were solving the problem that we thought we saw, which was food and beverage. But rather than the problem with them. By again taking an outside-in perspective, we now recognize we need a completely different approach and one that's not easily solved.

Michael Krigsman: Did you ever solve that problem?

Jonathan Becher: We have not.

Michael Krigsman: [Laughter]

Jonathan Becher: Post-pandemic, I hate to use the phrase "post-pandemic," but as we come back out of the pandemic phase, we'll see if we still have a late-arriving fan problem. We did last night for a concert.

We'll see. Hockey season doesn't start until the 16th of October, so it's too early to know how bad the problem is. It's obviously not a problem on weekends and a big problem on weekdays.

Michael Krigsman: What's happening going forward? The world has changed so much. In the work environment, we have hybrid work, working from home, working remotely. How does all of this affect you and what are your plans?

Jonathan Becher: I'll start with a couple of soundbites and then you tell me which ones you want me to kind of push on. One is, we are reopening, as you've heard, and we are creating a next normal of people being in the building vaxxed and masked for the subset of the audience that feels comfortable doing that. Some will feel comfortable in October. Some may not feel comfortable until next year. That's fine, the timeline that you're on.

We're trying to take more of that experience and make it digitally available for people. What I don't mean is just TV broadcast, because people can watch our games streaming right now. They have been since the dawn of television, but I mean the things that go beyond just the game, the behind-the-scenes on more stories about the players and who they are, more about warmup rituals, more about what happens when the game is over, more simulated events.

I think I said this earlier. There's a false dichotomy between eSports and sports. I think those two are very much in an innovator's dilemma. Those two will merge more over time.

I'll give you a "for instance." For all of you who may be involved in sports and entertainment, I'm not suggesting this is available this year. This is a dream to the future sequence we're about to do.

If you're a hockey fan, sightlines are probably more important in hockey than in any other sport. There are fans that are passionate about watching a game from right behind the goalie or watching a game at center ice. Some fans like this high-end view where you see the ice from above. Other fans like to be low. I'm more of a "20 rows back" kind of person, which is why it's just a great live experience because you can choose your view.

Many people believe – I'm one of them – that hockey is the best in-person sport. It doesn't translate currently as well on TV. So, what if we switched the polarity of the sport? What if we programmed it more for digital streaming and television, and not just for in-person?

Well, what that would mean is we probably need dozens of cameras all over the arena and each individual fan could choose what camera they want to watch the game on rather than letting the television stations and the digital streaming choose for you. Maybe you could switch back and forth on the fly.

Maybe there are even cameras that follow the players behind them. These micro-views – not the same as the TV view – might give you that same experience of being in the building.

You can't really do that easily because too many cameras in the building block the in-person view, and so you've got to find ways, as technology moves down and cameras have better quality, and really what you want is the aggregation of multiple views into one view. That's one of the experiments that we're working on is, can you do that or not, and can you program hundreds of views rather than one or two views?

Michael Krigsman: We have another comment from Peter Coffee on Twitter who says, "If you can add communal, those fans will be there." I think the idea here is furthering, bringing the fans together. You spoke about micro-communities earlier and that outside-in perspective. But basically, engagement, fan engagement with you together with fan engagement among themselves, with the teams, the team members, behind the scenes, and so forth.

Jonathan Becher: We do a ton of that, although we can always do more. The old model of watching any kind of game (not just hockey), any kind of sport, was very much of a solo model. Maybe one or two people, right?

Seats are designed that you sit shoulder-to-shoulder and it's hard to have a conversation. Many venues have been ripping up those seats and creating lounge-like environments. I don't mean suites. I mean lounge-like environments where you can mill around, stand, sit, and talk to people.

We have tons of what we call affinity nights where groups of people who share passions get together pre-game, post-game, and during the game to share them. We have affinity nights around cultural heritage, so there could be a Nordic Heritage Night, et cetera. We have affinity nights around cultural and diversity and inclusion things like LGBTQ nights as well. We have affinity nights around tech companies.

Again, I don't want to make up a number. I think it's 40-ish affinity nights a year both in-person and increasingly digital. I think our largest digital affinity night is actually something called Women of Teal, and we do a very large one actually for the Hispanic Latinx movement. We actually steam in Spanish for many of the games. We have a nickname called Los Tiburones, a specialty jersey as well.

Those micro kind of groups, it is a big part of the future. In fact, we have somebody in our organization who is solely responsible for creating and putting on those kind of affinity group nights.

Michael Krigsman: This notion of community is so interesting. I talk to a lot of software companies, and oftentimes they say to me, "You know we want to create a community for CIOS," for example, or CMOs. Let's say CIOs.

My response always is, "That's a great idea because if you have a community, you get people engaged. They interact. All of the kind of loyalty benefits, Jonathan, that you were describing seem to bubble up."

But the question is how to do it. That's the hard part; getting people to show up. But it sounds like, in your case, you don't have that problem. You have people that want to show up, and you need to create opportunities for them to get together.

Jonathan Becher: I worry about companies and brands that try to force communities onto a group of people. Just the phrase, "I'm going to create a community," when we want to create one of these affinity groups, we start the other way around. Is there a group leader that is interested in being accountable for that community, rallying it together?

It's not our community, it's their community, and we're giving them chances to interact with us.

To me, the key to starting, growing, and maintaining a community is the community leaders themselves. If the community leaders are part of your company and part of your brand, again, you're inside out as opposed to outside in.

Start communities with our vocal people. If a tech company wanted to start a CIO company, find a CIO that wants to start it, not you yourself.

Michael Krigsman: As we finish up, maybe you can share advice on how to build a community. That's the essence. Correct me if I'm wrong; community is the essence of fan experience and customer experience for you. Let me ask that. Is that a correct assertion?

Jonathan Becher: One hundred percent correct. I mentioned our large building, SAP Center here in downtown San Jose, does 160 to 180 events per night. I'm going to say something that's going to shock people. We don't program it for the 160 to 180 events that are the most profitable. We program it for the 160 to 180 events that most fit the community needs.

Because we live in such a culturally diverse place, we make sure that we have culturally diverse events. By doing that and by choosing to satisfy those community needs, we think that the corollary is that each event itself will therefore become more popular, they'll engender more loyalty and, therefore, then will generate more revenue. If we started with a mathematical equation of, tell me which events will generate the most revenue, we would probably have 25 pop concerts a year.

Michael Krigsman: Peter Coffee just came back with what he means by communal (getting back to what we were just discussing), and I think he just addresses also the points you were just making. Here's what he says on Twitter. He says, "Communal: Enabling, fostering, discovery of others with whom I share interests and join in celebrating successes and recovering from disappointments. The more communities, the greater the likelihood that others share at least one with us. Perhaps, a less polarized society results," looking even more broadly.

Jonathan Becher: All I can give him – in a social media world, I give him a plus infinity.

Michael Krigsman: What advice do you have for company executives who are not necessarily in the sports and entertainment business who want to cultivate, create that kind of community, and it's really hard for them to do it?

Jonathan Becher: It's hard unless you're willing to be passionate about something. It turns out I like vanilla, so I don't mean to be negative against the flavor of vanilla. If you're peanut butter spread (to use the old phrase) and don't stand for anything, you literally don't stand for something.

People want passion and purpose at a business. Stand for something. Be known for something. Yes, it will probably turn off some collection of people by standing for something, but you'll have a much more passionate community about something else. Make sure everyone knows what your organization stands for and be authentic about it.

Michael Krigsman: I think that's easier said than done.

Jonathan Becher: It is, indeed.

Michael Krigsman: Finally, Jonathan, what else would you like to share that we should know about the Sharks, about you, about life in general? What are your closing thoughts?

Jonathan Becher: We live in a very polarizing world. Sports and entertainment can be the great unifier.

Yes, we compete on ice, on grass, on surfaces as well, but the reason I love our brand of "Teal Together" is the room in this umbrella for everybody. We speak out on social issues, and we don't mind to do that whatsoever.

Whether it's LGBTQ, whether it's Sikh Heritage, it's Los Tiburones, it's anti-bullying, whatever, we are going to state our mind. We love everyone in Sharks territory, and we want to be a unifier in this world as opposed to divider, so come join us.

That doesn't mean you need to spend any money. Spread the message of "we're all in this together." I call it the #TealTogether.

Michael Krigsman: I can't let you go without just asking a follow-up, which is, you want to bring people together but, in today's environment, if you embrace everybody, that means you're embracing people that have different views and conflicting views. If you exclude anybody, then it's the same thing, and so how do you do that? We haven't been able to do it in society at large.

Jonathan Becher: I reach out to people that have different views than myself all the time. Otherwise, I'm stuck in my confirmation bias echo chamber. I follow people on Twitter that probably you, Michael, don't agree with in their viewpoints, and I don't agree with them.

If we don't listen to people with different backgrounds and different environments, we're never going to learn. We're never going to grow as a society. Diversity of thought is just as important as all the other diversity as well, and that's what we're trying to go for here as well.

It doesn't mean I have to agree with people, but I have to listen authentically, try to engage with them, et cetera, because there's always a chance I'm wrong too. I'm certainly not perfect.

Michael Krigsman: All right. A great unifying message as we finish up.

We've been speaking with Jonathan Becher. He is the president of Sharks Sports & Entertainment. Jonathan, thank you so much for taking time to be here. I really appreciate it.

Jonathan Becher: It really was my pleasure. Thank you, Michael.

Michael Krigsman: Everybody, thank you for watching, especially those folks who asked such great questions. Before you go, please subscribe to our YouTube channel, hit the subscribe button at the top of our website so we can send you our newsletter. Go to CXOTalk.com and be sure to tell a friend. Have a great day. We have great shows coming up, and we'll see you next time. Take care, everybody.

Jonathan Becher: Touching hundreds of experiences, all touchpoints, it's just too much. And so, I have to look at the weakest points in the chain and focus on those first.

Michael Krigsman: We're speaking about customer experience and fan experience with Jonathan Becher, President of Sharks Sports & Entertainment.

Jonathan Becher: Sharks Sports & Entertainment is the parent organization of several things. First of all, as you mentioned, the National Hockey League San Jose Sharks, also the American Hockey League San Jose Barracuda, the SAP Center (which hosts between 160 and 180 events every year), a network of three public ice centers, and a nonprofit foundation. All of that together is considered Sharks Sports & Entertainment.

Michael Krigsman: The focus of your business is putting on what?

Jonathan Becher: You kind of hinted at it in the beginning, which is, we're most famous, of course, for ice hockey and for the professional hockey team, which is the Sharks. And so, people think of us in the sports business. But in fact, the reason our name is "sports and entertainment" is we're actually in the entertainment business.

For example, last night in our biggest of the four buildings, a Columbian superstar named Maluma (which is one of the biggest acts in the world) played. Over the Labor Day weekend, we had four shows of Monster Truck. We have the Harlem Globetrotters here quite a lot.

We have plenty of hockey, both professional hockey and you can learn to skate, ice dancing, other ice sports, but we are in the business of entertainment. That's the fundamental thing of which one of the entertainments is professional hockey.

Michael Krigsman: Why is this entertainment dimension so important?

Jonathan Becher: The formula for sports is very simple, and it mostly boils down to: does the home team win or not, and (maybe) is the beer cold? Then the average sports fan is happy.

More and more, people don't come to venues just to see what happens: does the home team win? They come to make memories. They bring their kids, so they themselves want something.

They're coming (if they want to come in person) to remember what their overall experience looks like and what that journey is. The barrier for the entertainment isn't whether they can last nine innings at a baseball game or three periods at a hockey game or four at a football game but, rather, whether they want to get off their couch.

The competition, frankly, is streaming. It's shows like CXOTalk, Netflix, and other things as well. And so, if the whole industry doesn't recognize we're in the experience business (and much like retailers compete for share of wallet), we're competing for share of entertainment. That's the focus of this industry.

Michael Krigsman: Your focus then is the attention of people who will come to you rather than stay home, for example, and watch Netflix.

Jonathan Becher: Yes, with a big caveat, which is, they can stay home and watch us as well, and that's good. Is it better if they come to our physical location? Yes. But we all learned (if we didn't already know it over the last 17 months), we live very much in a hybrid world. And so, while there are reasons for them to show up in our physical spaces, we're okay if they interact with us digitally as well.

In fact, for me personally, my role and my focus (beyond the overall strategy) is I have emotional and practical leadership for two of our strategic objectives.

  • One of those strategic objectives is nontraditional sources of revenue growth. We call it "Think Beyond the Rink." TBTR: Think Beyond the Rink.
  • The other strategic objective that I'm emotionally responsible for is reimagining all of our experiences from scratch so that they are digital and mobile-first as opposed to in-arena first.

Michael Krigsman: You're talking about experience (fan experience, customer experience). Why don't you like that term "customer experience"? It seems kind of the essence of what you're focused on and working on.

Jonathan Becher: I worry about the phrase because it puts the focus on the word "customer." For most practitioners, when you put the focus on the word "customer," they immediately think transactions and how to develop a transactional relationship. Therefore, the focus becomes, how do you make money?

There are many, many experiences – both in our industry and, frankly, in every industry (including the tech industry) – which do not have to be anchored around revenue, do not have to be anchored around the transaction.

In my old life (when I was a tech company person), we used to often say, "We want to turn customers into fans." In this industry, it's almost the reverse. You want them to be fans first and some of them you'll convert into customers (meaning that you'll end up doing revenue).

I think the best analogy for people in the technology world is to think about freemium or try-before-you-buy models. You need your product, your offering to be compelling even when people are not paying for it. Then for the subset of people that make sense, then you convert them into a revenue relationship.

I'm not anti-customer experience. I'm anti-practitioners, which unfortunately is most of them that immediately look for the transaction pivot points and think those are the most important things.

Michael Krigsman: Certainly, for many practitioners, for many marketers, the focus is on the revenue because that's what they're tasked to do by their CEO, and that leads to metrics that involve revenue and, from that, radiating out, we have customer experience that is transactional or, ultimately, comes down to measurements that are about money and transactions.

Jonathan Becher: Right. Therefore, maybe the metrics are set up incorrectly, and they shouldn't start with revenue, but they should start with propensity to buy or loyalty or willingness to consider your offering. Maybe we look at the traditional. Even though everyone likes to say the phrase "The funnel is dead. It's no longer this linear model anymore," in the back of everyone's mind that still drives their behavior.

Michael Krigsman: What's the issue then, fundamentally?

Jonathan Becher: Fundamentally (at least in our world), we think about touchpoints in isolation not just uniformly. People talk about the end-to-end experience. Unfortunately, in many cases, the ends they talk about aren't big enough.

As an example, when people come to our physical building and we send them, which we do every night (a subset of them), "Did you enjoy yourself? What was the best? What was the worst part?" almost invariably the single worst part of the experience was getting to the building, was traffic on the freeways, or difficulty parking.

Now, for most businesses, you could say, "Well, that's not my responsibility. I don't control the real estate. I don't control the freeways. That's outside my end-to-end experience." But yet, my customers, my fans, my guests are telling me that's what they care about the most.

That means I've got to extend my aperture and think about other ways to get people physically to my building. Think about digital experiences in addition to the in-person experience because that's where the satisfaction is coming from.

Yet I've got to be careful, which is, I have to recognize that touching hundreds of experiences (all touchpoints) is just too much. And so, I have to look at the weakest points in the chain and focus on those first.

Michael Krigsman: Your metric, your ultimate metric then is that long-term relationship with the customer. Would that be correct?

Jonathan Becher: That is right. In fact, one of the things we're most proud of is, at our season ticketholder base – our franchise is 30 years old – we have more than 1,000 season ticket holders that are with us from the very beginning. That kind of longevity in relationships, you don't have in many other organizations.

Michael Krigsman: In almost any business, if you were to take that broader lifetime value perspective, it would lead to a less transactional set of interactions and, in a way, it's kind of surprising that more organizations don't do that. There must be reasons why.

Jonathan Becher: In my opinion, the two reasons are, one, we live in an instant gratification culture. I think we all know that. Long-form art is dead.

Unfortunately, Michael, there have not been any CXOTalks in the world where people listen for 45 minutes. We're used to the soundbites.

Transactions are instant gratifications, and many companies, particularly publicly held companies, have to report revenue quarterly. The Street watches them, and so long-term relationships don't become nearly as important as instant short-term gratification.

Most, not all, professional sports and entertainment organizations are privately held, and we're in a situation where we have a single owner who allows us to think two, three, four, five years down the road (long-term) rather than have to worry about the tyranny of the urgent.

Michael Krigsman: We have a really interesting comment from Peter Coffee on Twitter. Peter Coffee has worked for Salesforce for many years, and he was a very prominent technology journalist before that. I've known Peter for a long time.

In response, Jonathan, to your comment, he says, "Do not define the competition as those who do what you do. Your competition are those who satisfy the same need, which may be something as general as entertainment experience rather than something like sports interest."

Jonathan Becher: Completely agree. As you heard me say, I don't think of the other Bay Area sports teams. For those of you who don't know, we're in northern California.

The 9ers, the Warriors, the A's, the Giants, et cetera, I don't view them as our competition. As I said, share of experience, I worry more about streaming digital services and, in the old world, maybe movie theaters and restaurants, because those are other ways of delivering experiences. So, I completely agree with his comment.

Michael Krigsman: So, as you're thinking through this fan relationship, how does that anchor your decisions as the president of this very rich and complex organization?

Jonathan Becher: The first thing is balancing what we call guests versus fans. Guests are those people that physically show up at our building. Fans are those that interact with us in one of the many touchpoints that we have.

There is a limit to the number of guests that you can have. Our building capacity – hopefully, the fire marshal is not listening to us – is about 17,500 people. Maybe there are a few more there for playoffs, et cetera, but that's it. There's a limit to that capacity, which is why I talk about "Think Beyond the Ring."

But of our roughly 1.5 million registered fans, the vast majority of them have never actually been to our building. Many of them don't even live in northern California. And so, most sports and entertainment franchises optimize for the 17,500 that are in your building, and I'm trying to flip that formula on its head and optimize for the 1.5 million that may or may not be able to get into our major building every day.

For example, we've invested a lot of money in something called the 1991 Club – that was the year we were founded – which are experiences for out-of-market fans, including local meetups, but premium content that is designed for them even though they'll never be in our building.

Michael Krigsman: How does all of this ultimately translate into the revenue calculation, because you are a business after all and, ultimately, that's what you're thinking about?

Jonathan Becher: The good news here, Michael, is I actually don't measure that revenue right now. I measure the growth of the loyalty and the footprint, having in the strategy said, "That doesn't become a significant revenue component until fiscal year '23," so we're in the third year of a five-year strategic plan of which we're (actually, to be fair) slightly behind our growth rates – pandemic influenced, like many other business models as well.

The minute that somebody says, "What percentage of revenue is it?" and it's single digits, then a traditional business model goes, "Ah, single digits. It's clearly not working. Stop working on that." But it's the right long-term growth, even if it's not short-term impacting my revenue.

Michael Krigsman: There are not too many people who come on CXOTalk and describe a five-year plan the way you just did. Five-year plans tend to be more abstract. But for you, this is something very visceral and directly impacts your bottom line during the interim.

Jonathan Becher: I'd like to say we had this all figured out in year one and we're doing exactly in year three what we knew we were going to do in year one. That would, of course, be ridiculous.

Like tech companies, we generate a whole series of experiments, and we could certainly talk about some of the experiments that have failed and not worked out. This is one that's been particularly successful.

Each year, we pivot the plan a little bit, pour a little more gasoline on that fire, and grow with what was a more loosely described objective when we started. Each year, we sharpen. We know more about what that fifth year looks like as we get closer to it.

Michael Krigsman: We have a very interesting question from Arsalan Khan, who is a regular listener, and he asks great questions. Thank you, Arsalan, both for listening and for your questions.

Arsalan (on Twitter) says this: "You're describing a holistic customer experience from home to digital to stadium and back. What are the budget constraints to do this and who thinks about this? Is it the CEO, the CFO, the CIO? How do you execute the strategy?"

Jonathan Becher: Yeah, budget constraints are, of course, for every business on the planet, one of the things do to there. What we say is, "Don't start with a budget in mind."

Too often in my career, projects or initiatives that I thought would be transformational died early in their progress because they had too much money or too little money. So, we start with what needs to be done and, later on, assign a budget to it. Frankly, some things get scaled-down and other things get scaled up.

The question about who is responsible for it is, I think, the critical one for us. We don't have any C-level things. We're not a very hierarchical organization.

You notice I called myself the president, not the CEO. We don't have a CFO. We don't have a CIO. We have no C-level titles, no CMO. That's partly to flatten the organization and to recognize that we're all responsible for things like experience.

We do have a woman who runs a team, which is called the Experience Team. She's the x-factor (I joke with her), et cetera. But in the classic racy chart, she's accountable as well as responsible. All of us on the leadership are responsible, but she's the one that holds us accountable to deadlines, to objectives, et cetera.

Michael Krigsman: You're describing this very holistic view of the relationship that you have with your customers. How do you begin? Do you look across all of the various interaction points? How do you begin, and how do you optimize it as you go?

Jonathan Becher: Well, the good news (or the bad news, depending on what you are) is, in our business, fans are very vocal about what they like and what they don't like. All you have to do is follow me on Twitter for a few minutes and you'll see I get hit up by fans all the time about suggestions for improvement on the business. That's good. You need to have a little bit of a thick skin, but it's a good way to get feedback.

I'll give you a very simple but compelling story about when I first joined four years ago, because I was a tech guy before I got into the sports and entertainment business. Our marketing mantra – in fact, it's more than that – our brand ethos was called "Sharks for Life" and it was a fantastic brand ethos.

I used to say – in fact, Michael, I might have said this when I was on CXOTalk three years ago – I've never been involved in a brand. I've been a chief marketer. I've been a steward of the brand where people willingly tattooed your logo on their skin. That's brand loyalty. We don't really have that in the tech world, normally.

I really thought "Sharks for Life" was a powerful brand ethos and loved it, but we got feedback from more casual fans, newer fans, people that didn't grow up with the love of entertainment, that that "for life" sense, that tattoo to the skin, which we used to show on social media all the time, that was off-putting. That seemed too high of a bar.

And so, while we're doing a great job of keeping the loyalty of our most loyal fans, we were turning away those that were intrigued by our offerings but weren't ready to commit by burning their skin. And so, we went away from that. We changed our brand ethos by listening to not just our most loyal customers, not those that have the biggest revenue (which I know most of us do in our previous life) but rather, the fringe ones, if you will.

We changed our brand ethos to "Teal Together," which is very much of a community-based brand. There's room for everybody in this, regardless of if you know how hockey works, you've never skated, you just moved to the Bay Area or you've been here since you were born, et cetera.

We created a series of micro-communities of how do we expand the brand dramatically. As positive as I thought we were when we started with "Sharks for Life," I think we have – well, I don't think, I know we have numbers to show – an even broader and stronger brand as well.

The answer is do it outside in, not inside out. Too often, we all sit in our offices, our cubes on our Zoom meetings discussing what we think we need. Let the customers (and your non-customers, more importantly) tell you.

Michael Krigsman: For you, inviting your customers in has been a core aspect of really understanding what they need and, therefore, guiding your decisions and your actions along the way.

Jonathan Becher: Yes, with a caveat, which is, if you say "customers," people think it's the transaction people. Inviting people in that would like a relationship with your brand – call them fans, guests, whatever word you want to use – because if you just say, "Invited your customers in," immediately you're going to sub-select your largest customers that are associated with you, and you want those that don't normally get airtime, you want those in as well.

Michael Krigsman: We have an interesting question from Paul Gratton who says, "What does the end goal look like for Sharks Sports & Entertainment at the end of that five-year period? So, where are you going with all of this?" And he also wants to know, "What are the goals for this year where we still are facing the pandemic?" And he also wants to know, "Where do you see your use of Twitch and overall social media and doing behind-the-scenes videos?"

Jonathan Becher: We run the company with a series of formal organizational objectives. This year, there are six. Last year, there were five. There are normally five or six every year, which have a series of KPIs that are published on a scorecard, et cetera.

I won't walk you through all six of the organizational objectives. I'll just give you a sense of two of them.

One is to reopen our four venues in a way that our guests believe are safe and healthy because safe and healthy is clearly a top of mind for the vast majority of people, not just in the Bay Area but around the world.

As a result of that objective, we applied for and received something that's called GBAC accreditation, which is Global Biohazard Accreditation Council. It just says the airflow inside of our buildings, the cleaning protocols, all those things are as high of standards they were.

We worked with the city and the county, so you can't come into our building unless you have proof of vaccination and you wear a mask.

We'd done things like you can order food in the app and then skip lines (because we don't want people to line up) or have them delivered to your seat. We've done some great things like reverse ATMs, which limit interactions.

One of the strategic objectives is to ensure that guests feel safe. Not that we think they're safe but that they feel safe. And so, there are a whole series of initiatives for that.

We have, we've opened up; 10,000 people for Guns & Roses, 10,000 people for Maluma, the Columbian superstar. We had Monster Jam, which is a monster truck; 25,000 people over 4 days. These are the first and the largest events in northern California, all vaxxed and masked.

Another strategic objective (because there are a bunch in there) is to return to pre-pandemic levels on a run rate by the second half of the year, so we measure a bunch of things like the amount of people buying ice time, the number of events that are in the building, et cetera, to build back up.

Those are two of the six objectives. Now, I've forgotten the other questions, Michael. You'll have to chime back in.

Michael Krigsman: Yeah. He was also asking about social media and your plans for Twitch and, I'm assuming, living streaming.

Jonathan Becher: We were the very first professional sports and entertainment franchise to get a website way back in 1991 or maybe it was 1992. I think we were the second sports and entertainment franchise to get on Twitter, the third or fourth on LinkedIn, so we do a lot of stuff on social media.

Twitch and Discord are relatively new platforms for us. I guess maybe another fun story there, when the pandemic hit in March of last year (and all events were canceled in our buildings for 17 months) April of 2020 was the first time in the U.S. that the 4 major sports teams had not played. Not a single game in April of 2020 was played for basketball, football, baseball, and hockey.

To give you a sense, the last time that happened was 1883, which is interesting in itself because basketball wasn't even invented until 1891. So, it's a long time since we had a month without all those sports happening.

A lot of teams decided to simulate games and stream them on Twitch. We did that as well.

Frankly, one computer simulating a game and playing against another computer gets really boring. It lacks the spontaneity that we all want in live sports, which is why I don't like the idea of games as being a way for us to not say eSports versus live sports, but actually to meld the two together and create a new category entirely.

Michael Krigsman: Chris Petersen wants to know whether the ownership and the home venue dynamic affect your ability to shape customer and fan experiences.

Jonathan Becher: I think the answer is almost certainly yes. We have a single owner. Many sports teams have multiple owners, and our owner is a technology executive. His name is Hasso Plattner, who some of you may know as one of the cofounders and chairman of the board of SAP, so he's a technology person. So, he's much more willing to fund technology experiments maybe than other people that are less comfortable in the technology world.

We are based here in the heart of Silicon Valley, which means – I don't really want to encourage this because I already get it – we get lots of outreach from early-stage companies who have interesting, new technology that they want us to try out, and we're able to try out lots of things before they go to market as well.

It would be too much of a stretch to say we are a technology-driven company. I think we're not there yet, but we are much more influenced by technology now than we ever have been before.

Michael Krigsman: For you, technology innovation is really ingrained in what you're doing and you're using that (it sounds) in every way you can to further that relationship with the customer.

Jonathan Becher: I want to be careful here because something I believe passionately is I don't like putting technology front and center even though I'm a three-time startup CEO, and so I'm a technology guy myself. For technology to really work, it should be invisible to our guests. It should be invisible to our fans.

Let me give you an example. For the safety reason I talked about, we want to limit the interaction between cashiers and guests. We want to drop that time down to as few seconds as possible. That's one of the reasons you can order in the app and skip the lines.

Cash is a difficult mechanism because if you allow cash in a venue, you elongate the time that people are in line. It takes long interactions, et cetera, and we want to reduce that interaction time.

We want to go cashless. But if you go cashless, you create a barrier to a group of fans and guests who may not have access to debit and credit cards. So, you can use technology to solve that problem.

We created something with a company called a reverse ATM. It's just exactly what it sounds like. In an ATM, you normally put a debit card in; you get cashback.

A reverse ATM is you put cash in and you get a Sharks branded debit card back. We eat the fees. No fees are to the guest as well. Now, that fan can use that debit card not just in our building but anywhere a debit card is accepted.

From a technology point of view, we've used technology to solve a problem, but now I'm actually in fans' pockets as well, so I have an idea about share of entertainment. You can see a step along the way of how I become an entertainment franchise based on data not just solving the technology problem of, "What do I do about cash in my building?"

Michael Krigsman: It sounds like there's a heavy emphasis on thinking about that relationship and all of the various points that you intersect with your fans, your guests, customers, and so on.

Jonathan Becher: I'm a little obsessed with words. My personal mantra is "words matter," so I 100% agree with your sentence, but I would say it backward. It's not how we interact with them; it's how they interact with us.

If we don't do a good job, which we don't always, but we have to be obsessed about it of starting with what their needs are or what they see, their barrier. If we do it from our point of view, which too often we do, then we're optimizing what we need as opposed to optimizing what they need.

I've got to flip it on its head. Occasionally, we get it right.

Michael Krigsman: On that note, we have another interesting question from Twitter, again from Arsalan Khan who wants to know what strategic objectives did you not get right that you thought would be really useful but didn't turn out to be what you expected, for whatever reason.

Jonathan Becher: Yeah, I love stories of failures. The word "failure" is so harsh, I don't actually embrace the Silicon Valley mantra of "fail often, fail fast" because I think that barrier, the word "failure" scares people. I like to talk about experiments and the experimental method, and the experiment where the result wasn't at all what we thought it would be.

For example, one strategic objective we had a couple of years ago is how to resolve – and I'll do this in the short version rather than the long version – we have what's called the late-arriving fan problem. Because of traffic in Silicon Valley, between 30% and 40% of fans can arrive within 5 minutes of puck drop or between 5 minutes before and 15 minutes after puck drop.

It's not LA where I hear they come by the first intermission, but it's still late, and that causes lines at the door, difficulty for people getting beer, to seats because, in hockey, you can't go down to your seats until there are breaks in action as well. We talked about how we reduce the number of late-arriving fans by (I think it was) 50% through a whole series of initiatives.

One initiative that we had (we theorized would work) is to create a happy hour where we open the building earlier. We provided incentives for people to come, like significant discounts on beer and wine, assuming that one of the reasons that people arrive late is they went to neighborhood restaurants or they went to their favorite watering hole after work as opposed to coming to the building. If we could shift that behavior so they did it in our building instead, not only would we get more revenue (even though it was discounted), would solve the line problem.

It didn't work at all. Oh, and once they were in the building, if you were in the building an hour or more earlier, we would actually – because we have beacons and stuff like that – send you offers to create even more loyalty to reinforce that you show up early.

All we did was shift people that came a half an hour early to come an hour early. Yes, people came earlier, but the same people that were used to coming earlier. We didn't really solve the problem of people coming late to come any earlier.

Why? Well, as we dug deeper into this, most of the issues (not all of them) were people like to go home and change between work and our building. And so, what we really probably need to figure out is changing areas or alternate modes that don't require them to drive, so they can change on the way here as well.

We were solving the problem that we thought we saw, which was food and beverage. But rather than the problem with them. By again taking an outside-in perspective, we now recognize we need a completely different approach and one that's not easily solved.

Michael Krigsman: Did you ever solve that problem?

Jonathan Becher: We have not.

Michael Krigsman: [Laughter]

Jonathan Becher: Post-pandemic, I hate to use the phrase "post-pandemic," but as we come back out of the pandemic phase, we'll see if we still have a late-arriving fan problem. We did last night for a concert.

We'll see. Hockey season doesn't start until the 16th of October, so it's too early to know how bad the problem is. It's obviously not a problem on weekends and a big problem on weekdays.

Michael Krigsman: What's happening going forward? The world has changed so much. In the work environment, we have hybrid work, working from home, working remotely. How does all of this affect you and what are your plans?

Jonathan Becher: I'll start with a couple of soundbites and then you tell me which ones you want me to kind of push on. One is, we are reopening, as you've heard, and we are creating a next normal of people being in the building vaxxed and masked for the subset of the audience that feels comfortable doing that. Some will feel comfortable in October. Some may not feel comfortable until next year. That's fine, the timeline that you're on.

We're trying to take more of that experience and make it digitally available for people. What I don't mean is just TV broadcast, because people can watch our games streaming right now. They have been since the dawn of television, but I mean the things that go beyond just the game, the behind-the-scenes on more stories about the players and who they are, more about warmup rituals, more about what happens when the game is over, more simulated events.

I think I said this earlier. There's a false dichotomy between eSports and sports. I think those two are very much in an innovator's dilemma. Those two will merge more over time.

I'll give you a "for instance." For all of you who may be involved in sports and entertainment, I'm not suggesting this is available this year. This is a dream to the future sequence we're about to do.

If you're a hockey fan, sightlines are probably more important in hockey than in any other sport. There are fans that are passionate about watching a game from right behind the goalie or watching a game at center ice. Some fans like this high-end view where you see the ice from above. Other fans like to be low. I'm more of a "20 rows back" kind of person, which is why it's just a great live experience because you can choose your view.

Many people believe – I'm one of them – that hockey is the best in-person sport. It doesn't translate currently as well on TV. So, what if we switched the polarity of the sport? What if we programmed it more for digital streaming and television, and not just for in-person?

Well, what that would mean is we probably need dozens of cameras all over the arena and each individual fan could choose what camera they want to watch the game on rather than letting the television stations and the digital streaming choose for you. Maybe you could switch back and forth on the fly.

Maybe there are even cameras that follow the players behind them. These micro-views – not the same as the TV view – might give you that same experience of being in the building.

You can't really do that easily because too many cameras in the building block the in-person view, and so you've got to find ways, as technology moves down and cameras have better quality, and really what you want is the aggregation of multiple views into one view. That's one of the experiments that we're working on is, can you do that or not, and can you program hundreds of views rather than one or two views?

Michael Krigsman: We have another comment from Peter Coffee on Twitter who says, "If you can add communal, those fans will be there." I think the idea here is furthering, bringing the fans together. You spoke about micro-communities earlier and that outside-in perspective. But basically, engagement, fan engagement with you together with fan engagement among themselves, with the teams, the team members, behind the scenes, and so forth.

Jonathan Becher: We do a ton of that, although we can always do more. The old model of watching any kind of game (not just hockey), any kind of sport, was very much of a solo model. Maybe one or two people, right?

Seats are designed that you sit shoulder-to-shoulder and it's hard to have a conversation. Many venues have been ripping up those seats and creating lounge-like environments. I don't mean suites. I mean lounge-like environments where you can mill around, stand, sit, and talk to people.

We have tons of what we call affinity nights where groups of people who share passions get together pre-game, post-game, and during the game to share them. We have affinity nights around cultural heritage, so there could be a Nordic Heritage Night, et cetera. We have affinity nights around cultural and diversity and inclusion things like LGBTQ nights as well. We have affinity nights around tech companies.

Again, I don't want to make up a number. I think it's 40-ish affinity nights a year both in-person and increasingly digital. I think our largest digital affinity night is actually something called Women of Teal, and we do a very large one actually for the Hispanic Latinx movement. We actually steam in Spanish for many of the games. We have a nickname called Los Tiburones, a specialty jersey as well.

Those micro kind of groups, it is a big part of the future. In fact, we have somebody in our organization who is solely responsible for creating and putting on those kind of affinity group nights.

Michael Krigsman: This notion of community is so interesting. I talk to a lot of software companies, and oftentimes they say to me, "You know we want to create a community for CIOS," for example, or CMOs. Let's say CIOs.

My response always is, "That's a great idea because if you have a community, you get people engaged. They interact. All of the kind of loyalty benefits, Jonathan, that you were describing seem to bubble up."

But the question is how to do it. That's the hard part; getting people to show up. But it sounds like, in your case, you don't have that problem. You have people that want to show up, and you need to create opportunities for them to get together.

Jonathan Becher: I worry about companies and brands that try to force communities onto a group of people. Just the phrase, "I'm going to create a community," when we want to create one of these affinity groups, we start the other way around. Is there a group leader that is interested in being accountable for that community, rallying it together?

It's not our community, it's their community, and we're giving them chances to interact with us.

To me, the key to starting, growing, and maintaining a community is the community leaders themselves. If the community leaders are part of your company and part of your brand, again, you're inside out as opposed to outside in.

Start communities with our vocal people. If a tech company wanted to start a CIO company, find a CIO that wants to start it, not you yourself.

Michael Krigsman: As we finish up, maybe you can share advice on how to build a community. That's the essence. Correct me if I'm wrong; community is the essence of fan experience and customer experience for you. Let me ask that. Is that a correct assertion?

Jonathan Becher: One hundred percent correct. I mentioned our large building, SAP Center here in downtown San Jose, does 160 to 180 events per night. I'm going to say something that's going to shock people. We don't program it for the 160 to 180 events that are the most profitable. We program it for the 160 to 180 events that most fit the community needs.

Because we live in such a culturally diverse place, we make sure that we have culturally diverse events. By doing that and by choosing to satisfy those community needs, we think that the corollary is that each event itself will therefore become more popular, they'll engender more loyalty and, therefore, then will generate more revenue. If we started with a mathematical equation of, tell me which events will generate the most revenue, we would probably have 25 pop concerts a year.

Michael Krigsman: Peter Coffee just came back with what he means by communal (getting back to what we were just discussing), and I think he just addresses also the points you were just making. Here's what he says on Twitter. He says, "Communal: Enabling, fostering, discovery of others with whom I share interests and join in celebrating successes and recovering from disappointments. The more communities, the greater the likelihood that others share at least one with us. Perhaps, a less polarized society results," looking even more broadly.

Jonathan Becher: All I can give him – in a social media world, I give him a plus infinity.

Michael Krigsman: What advice do you have for company executives who are not necessarily in the sports and entertainment business who want to cultivate, create that kind of community, and it's really hard for them to do it?

Jonathan Becher: It's hard unless you're willing to be passionate about something. It turns out I like vanilla, so I don't mean to be negative against the flavor of vanilla. If you're peanut butter spread (to use the old phrase) and don't stand for anything, you literally don't stand for something.

People want passion and purpose at a business. Stand for something. Be known for something. Yes, it will probably turn off some collection of people by standing for something, but you'll have a much more passionate community about something else. Make sure everyone knows what your organization stands for and be authentic about it.

Michael Krigsman: I think that's easier said than done.

Jonathan Becher: It is, indeed.

Michael Krigsman: Finally, Jonathan, what else would you like to share that we should know about the Sharks, about you, about life in general? What are your closing thoughts?

Jonathan Becher: We live in a very polarizing world. Sports and entertainment can be the great unifier.

Yes, we compete on ice, on grass, on surfaces as well, but the reason I love our brand of "Teal Together" is the room in this umbrella for everybody. We speak out on social issues, and we don't mind to do that whatsoever.

Whether it's LGBTQ, whether it's Sikh Heritage, it's Los Tiburones, it's anti-bullying, whatever, we are going to state our mind. We love everyone in Sharks territory, and we want to be a unifier in this world as opposed to divider, so come join us.

That doesn't mean you need to spend any money. Spread the message of "we're all in this together." I call it the #TealTogether.

Michael Krigsman: I can't let you go without just asking a follow-up, which is, you want to bring people together but, in today's environment, if you embrace everybody, that means you're embracing people that have different views and conflicting views. If you exclude anybody, then it's the same thing, and so how do you do that? We haven't been able to do it in society at large.

Jonathan Becher: I reach out to people that have different views than myself all the time. Otherwise, I'm stuck in my confirmation bias echo chamber. I follow people on Twitter that probably you, Michael, don't agree with in their viewpoints, and I don't agree with them.

If we don't listen to people with different backgrounds and different environments, we're never going to learn. We're never going to grow as a society. Diversity of thought is just as important as all the other diversity as well, and that's what we're trying to go for here as well.

It doesn't mean I have to agree with people, but I have to listen authentically, try to engage with them, et cetera, because there's always a chance I'm wrong too. I'm certainly not perfect.

Michael Krigsman: All right. A great unifying message as we finish up.

We've been speaking with Jonathan Becher. He is the president of Sharks Sports & Entertainment. Jonathan, thank you so much for taking time to be here. I really appreciate it.

Jonathan Becher: It really was my pleasure. Thank you, Michael.

Michael Krigsman: Everybody, thank you for watching, especially those folks who asked such great questions. Before you go, please subscribe to our YouTube channel, hit the subscribe button at the top of our website so we can send you our newsletter. Go to CXOTalk.com and be sure to tell a friend. Have a great day. We have great shows coming up, and we'll see you next time. Take care, everybody.