Director of Business Strategy for the Orlando Magic, Anthony Perez, recently spoke at the SAS Global Forum Executive Conference on how analytics is molding the NBA - both on and off the court.
The Orlando Magic is currently one of the top teams in the NBA, and that is no accident. They have one of the nation’s top centers in big man, Dwight Howard, a state of the art new facility, the Amway Center, and analytics providing the team’s edge over the competition.
A few years ago, the team found itself facing several challenges with their business strategy - challenges that are all too real and frequent:
- Multiple data systems with no communication.
- Manual reporting.
- Lack of data inventory.
- Limited data mining capabilities.
In the case of customer retention, the team found that ticket sales represented 28 percent of revenue, with 80 percent coming from season ticket holders. Perez and his team wanted to discover how they could get smarter about “at-risk" accounts? What was the best way to approach renewal? What could the renewal cycle look like?
The deployment of SAS Enterprise Miner, another solution in the SAS for Sports package, allowed the team to develop three pillars for predicting renewals:
- Tenure (how long had they been a ticket holder).
- Ticket utilization (did they actually attend the games).
- Secondary market activity (were the unutilized tickets successfully sold on secondary sites?).
Ultimately, using these tools allowed the team to accomplish more accurate scoring that lead to a difference in the way they approached customer retention and marketing.
And of course, they are using this approach on the court as well: From matchup analytics to performance forecasting and player valuation, the Orlando Magic is harnessing the power of analytics to catapult their team into the upper echelon of NBA teams. Did I mention they are currently in the playoffs?
