August 16, 2013
CEO Newsletter
I remember reading a statement many years ago, “If it is you versus the world then bet on the world”. It is typically not a good idea to tell the rest of world that their ideas are not right. But that stated, we have to thank many of our forefathers who had the courage to question the current prevailing thought of their times. Otherwise, who knows, we could still be living our lives on a flat world!
Recently, I came across a similar “the world is flat” situation in our space. Earlier this year SportsBusiness Journal (SBJ) published the top ways that 1,100 sports executives thought they could increase concession revenues. The chart below captures the perceived opportunities:
- Faster service – 31%
- More variety – 18%
- In-seat service – 15%
- Healthy choices – 13%
- Discounts – 13%
- Higher prices – 2%
- Not sure – 1%
The answer is that there is not a cookie cutter answer. The operational needs of every venue are different and therefore pose different opportunities. I clearly agree that speed of service is an opportunity but to me that falls into the category of how breathing is to living. A solid operation is the core and with solid operations comes speed of service.
While others in the industry are imitating our commitment to Event Hospitality, we are separating ourselves by our actions. Two recent examples really magnify why we are the leader in Event Hospitality. First, a disgruntled fan posted a photo of the new hot dog being offered by Sodexho at the first pre-season game at Brighton & Hove Albion; the attached comparison speaks for itself and clearly outlines the inferior product from Sodexo. As a sharp contrast, the attached articles ‘Best Places to Eat Before the Game in Seattle’ includes The ‘Pen at Safeco Field and ‘Vive la revolution at B.C. Place Stadium’ gives high praise to our varied offerings. Clearly the message is that Centerplate is the original and authentic authority in Event Hospitality.
We do not subscribe to the industry’s prevailing perceptions of how best to drive revenues. First, and most importantly, we believe that by improving the hospitality offering we will in fact grow the revenue and not the other way around. Therefore how do we improve the hospitality quota of each venue:
- Make accessible the core foods that fans want the most and make them the best ever
- Make sure these core foods have proper distribution
- Give the food local relevance, a real sense of place
- Execute quality hospitality service: smile, thank, care and do it quick
- Connect with and engage the fan
- Deliver meaningful value
- Give the customer choice in spend, i.e., provide a range of price options on each menu board
- Keep the experience honest and fun, it’s hospitality not brain surgery
This is the model we have been following and it is one that has served us well. Proudly our view is in all ways considerate of the customer and full of humanity. Jet Blue’s motto is “People Above All” – think of us as the Jet Blue of our space; smaller than our competitors in total scale, bigger than the competition in our focus, Event Hospitality (often referred to as Sports & Entertainment). At all times we view what we do as personal – we serve people, above all we touch people and we happen to do so by making good food. We’re not food makers who serve people. We serve people by creating hospitality and food. That’s why when we look to sell more, we first focus on driving sales via satisfaction-based growth. Here’s the heavy thought – we sell more by making people happy.
The SBJ survey reminds us that we have a different view of the world and that different view is what has enabled us to get different (and better) results. Yes, in an “us against the world situation” bet on the world but I’ve always believed that any strategy in a service business that does not put the customer first is not a sustainable strategy over time. To footnote this fact, consider that the real #1 source of per cap growth is price increases. Our formula for per cap growth is:
- Do the basics right, simple blocking and tackling
- Affect fan purchase behavior
I am supremely confident that when we look back in a decade we will have the industry fully behind the Centerplate Way. We know that our competitors will be stealing our ideas over the next several years and plying them as their own original thinking. Our solution is to keep shaping the industry and concern ourselves with what we can control which is that we are simply unmatched in Event Hospitality and we need to constantly be challenging ourselves to push forward.
More good news to report on the renewal front with contract extensions inked at Colorado Springs World Arena and Pike’s Peak Center without an RFP process. The new contract has more favorable terms for Centerplate and the facilities will be a case study for our STIR Light concepts. Congratulations to Jeremy Didley, Pamela Dowdell, Kyle Kovalik, Chef Roy Whatley, our entire team in Colorado Springs and involved in making it happen!
E3 moments of the week …
Our second San Francisco 49ers retail store located in Westfield Valley Fair Mall, one of San Jose’s premier mall locations, opened with great fanfare with sales exceeding forecast in its first week of operation. A third store is opening on 9/5 in downtown San Francisco at SF Centre on Market Street. Great job by Ashley Brown and our team at the SF 49ers!
Accent on Indianapolis had a great season of events at Lucas Oil Stadium and over the past two years have brought in 12 events with sales of more than $600,000. Accent’s President took the time to send a letter, “I wanted you to know I truly value the Centerplate team at Lucas. Our relationship and your team’s flexibility, and often times patience, helps us win business over our competitors and really helps install confidence in our clients that they’ve hired the right planner. We are more than confident that the Centerplate team at Lucas will not only deliver, but exceed expectations on service, quality and presentation.” Job well done by Jason Bolden, Frances Dotson, Brandon Fruzen, Anthony Lardiere, Nikki Magee, Dan Mixan, Rita Ramsey, John Stockholm and our staff in Indianapolis!
Here’s to winning by doing the right things. Energy, courage, results and empowered colleagues will take us home.
