A Passion for Sports Fuels Business and Social Change

Pau Gasol and John Carlin at the 2nd Sports Management Meeting

22/05/2014 New York

Pau Gasol

Without a doubt, the passion for sports attracts massive media audiences and shapes a billion-dollar industry. But sports are also the focal point of a unique set of political and social forces.

In recent years, the sway that the sports industry has in both politics and society has come to the attention of many businesses. This phenomenon opens up a debate about how sports business models can cater to new objectives. Inspiring figures such as NBA player Pau Gasol, best selling author John Carlin and the prestigious cardiologist Valentín Fuster joined top sports media executives to discuss these and other sports industry trends at IESE’s Second Sports Management Industry Meeting.

Sport changes minds

John Carlin, journalist and author of Playing the Enemy: Nelson Mandela and the Game that Made a Nation, set the stage for the day’s discussion by sharing some key leadership lessons from Nelson Mandela, who understood the power of sports to change minds.

Through a series of progressive displays of support for the white South African Springbok Rugby Association, Mandela turned a nation rife with racial tension and civil unrest on its head. Wearing the quintessential green Springbok cap the day before a pivotal match, he won over the support of his white, former “enemy” population. This gesture, seen as a betrayal to his own base, initially elicited boos from his black followers. But the crowd soon recognized the greater implications of the action, and their boos melted into fervent cheers.

The Rugby World Cup Finals of 1995 was not only a “complete overlap between politics and sports,” but also as the most moving, transcendental and significant political event in history, says Carlin. “It was the first time since the arrival of the first white settlers in 1652 that the black and white South Africans shared a common goal.”

In that moment, sports became an instrument for changing minds, effectively turning attitudes of retribution and revenge into peace and acceptance, transforming centuries of fear and strain into mutual respect.

Live broadcasting’s rebirth

According to Founder and President of Octagon Inc., Philip de Picciotto, over the last 20 years the fabric of our society has been shifting toward sports. Today, 75 of the top 100 shows on television are sports, 97% of which are watched live.

Bill Squadron, President of Bloomberg Sports, attributes this growth to the uncertainty that makes sports such an appealing form of entertainment. “Sports will never lose its luster because it is all about the story’s unpredictability,” he says.

As technology advances and provides new mediums through which consumers can experience what once only existed on cable, new questions arise regarding the future of the sports business and its role in media.

It is important for industry professionals to adapt to this digitalization, and a sports business’s development depends upon its ability to monetize its growth.

“That is where you go into the depth of experience,” says Squadron. “Companies should focus upon expanding the ways in which their committed fan bases can experience sports, rather than attempting to dramatically expand the size of their audiences.”

Europe vs. America

The distinctive cultural landscapes that distinguish Europe from America have produced two very different outlooks on sports, and consequently two unique sports industries.

While the U.S. recognized sports as a business early on in its history, Europe has historically approached it from a social angle, emphasizing the industry’s capacity to instigate social change over its financial potential.

Professor Toni Dávila explained that this disparity is evident in these regions’ business models. The American sports industry’s collective ownership model provides more stability than Europe’s ownership models. While in the U.S. decisions are driven by economics and the maximization of profit, in Europe teams are often member-owned and, thus, the main focus in most cases is winning. The result is a fundamental difference in the way these nations think about sports.

Sports stars go social

Players are a central figure in the business. “Players are essentially the brand of the league,” says basketball star Pau Gasol, the second Spaniard to make it into the NBA, facing tremendous pressure to succeed.

With recent technological advances, athletes are increasingly in control of their own marketing. According to Google’s Sports Partnership Manager Max Goldstein the company has created digital platforms for players to share their own experiences. On Draft Day this year, players used Google Plus to video-broadcast their experiences worldwide.

While this is a powerful tool, it also has the potential to be quite dangerous for athletes and their reputations. “Social media exposes things,” says Gasol. “That’s where the agent comes in.” As technology breaks the barrier between professional athletes and the public eye, agents and athletes should work together to protect their brand, their authenticity, and their privacy.

Agents, according to Gasol, become surrogate families. But the agent-athlete relationship itself is quite complex. “To be surrounded by people that share your mission eliminates a lot of issues and makes you feel supported,” he says.

Mike Principe, CEO of Legacy Agency, explains that agents must consider athletes on two distinct planes: on the field, as a player, and off the field, as a marketable “brand.” The extent of an athlete’s “off-the-field marketing” is that athlete’s decision, and it is the responsibility of the agent to know and understand the goals and priorities of the talent they represent.

Resilience and values

Sportswoman Alexandra Panayotou’s story exhibits this life-altering capacity. At age 34, utterly depressed and at what she has deemed “rock-bottom,” she discovered a gift for running that she never knew she had. After hardly three weeks of scanty training, she miraculously won second place in the 2004 Barcelona Marathon—an undeniable sign of her athletic talent.

“Everybody has a gift, something that they really should be doing,” Panayotou says. “Know your weaknesses, but focus on your strengths.” 

Today, as an ultra-endurance athlete completing seemingly impossible challenges such as running 315 km nonstop across Spain, Panayotou lives according to a philosophy of personal excellence.

When faced with major obstacles, she turns to the step-by-step principle, dividing her challenge into smaller incremental goals. But more than any personal strategy, Panayotou attributes the bulk of her success to her team. “No leader is a success because of himself,” she says. “My success is my team’s success.”

Health issues

Beyond the competition scene, sports have an impact on individual health. According to Dr. Valentín Fuster, a cardiologist at Mount Sinai Hospital, we live in a society that no longer feels vulnerable or really considers the impact of its daily habits. With this attitude comes a rise in obesity and cardiovascular disease. For athletes, such an attitude increases the risk of injuries, which could jeopardize athletic careers.

“Sports is the door of entry to get people moving,” says Fuster. They have the potential to change lives.

According to Fuster, the key to healthy living is the circle of motivation, a cycle fueled by a combination of talent, time, education and optimism. He believes that professional athletes can kick-start this cycle as role models for healthy living for children worldwide.

All in all, sports is a business with overwhelming corporate, social and even political potential. Practicing sports teaches resilience and team values and promotes healthy lifestyles. Sports have the power to change minds and allows us to experience unparalleled levels of passion. This complex industry has much to say. Despite changing technologies and social norms, its influence is here to stay.