NFL Fantasy Football? SAP? When I read a recent press release describing an agreement how SAP would enhance the NFL’s Fantasy Football platform, I was a bit shocked. Was SAP becoming a gaming company? Out of curiosity, I tweeted about the motivations behind such agreements. Much to my surprise, SAP chief marketing officer Jonathan Becher answered.
Based on this exchange, I decided that there must be more behind this decision than the usual corporate sponsorships. This blog concerns an analysis of this particular agreement with the NFL and its wider implications.
Note: I quote a number of SAP press releases in this blog – I do so in order that readers may see the patterns that are present in such documents.
SAP and Sports: A selective chronology
SAP sponsors a variety of sports and doesn’t hide its involvement. As I started to research such sponsorships, I noticed an interesting trend. Recently, the character of such sponsorships and other sports-related activities has changed.
Here are a few of the more recent sponsorships:
The NFL will utilize cloud solutions from SAP to support the continued innovation and enhancement of NFL.com’s Fantasy Football platform.
The real-time data platform will enable the league to bring virtually unlimited amounts of official NBA statistical information directly to fans’ fingertips on the league’s official website.
The partnership will take the 49ers fan experience to the next level by using SAP’s expertise in analytics, mobile and real-time systems to decipher the information gathered from all digital fan touch points such as 49ers.com, Twitter and Facebook. That knowledge will help the team integrate new applications and features within the stadium on game day, and improve customer service throughout the year.
MetLife Stadium, the Jets and Giants will explore utilizing EMC and SAP technology to introduce a new, advanced level of fan interaction and activation throughout the entire building to enhance the game day experience for fans.
The SAP Extreme Sailing Team, formerly the Danish Extreme Challenger Team, is racing as part of the 2012 Extreme Sailing Series and SAP will look to implement a range of innovative technology solutions to deliver cutting-edge analytics to the team in order to improve overall race and training performances.
Here are some of SAP's older sports-related activities:
With the exception of the last application, the older applications were primarily created to demonstrate the Business Objects / BI technology with which they were built. Although the tools used data from the sports organizations in question, the tools were created / marketed by SAP primarily to promote existing offerings.
Note: This strategy isn’t restricted to SAP. Many of IBM’s sports-related applications are created with the same motivation.
With advanced analytics, such as those embedded in the SlamTracker at Wimbledon, organisations can tackle the explosion in data," says Provan. "Whether it is getting a better understanding of customer buying patterns to increase sales or providing more efficient services to consumers, the power of information analytics must be harnessed by businesses and be a key driver of business intelligence. Real-time analytics is now mainstream." [SOURCE]
The more recent agreements with the NFL, NBA etc, however, are different in character and don’t focus on a particular application that demonstrates the Business Objects Explorer or other particular BI-related offerings. The focus for these more recent sponsorships is less on the technology but rather on the end-users themselves.
A focus on fans
Although some of the recent sports-related agreements involve providing software for the teams themselves (for example, for the 49ers), the focus is usually somewhere else. As demonstrated by various press releases regarding the agreements, fans are the primary focus (bold is my emphasis).
"The National Football League sets a standard in consistently delivering game-day excitement for its fans," said Jonathan Becher, chief marketing officer, SAP. "SAP is proud to join the NFL in re-imagining the fan experience through innovation. Together, we will connect fans in new ways and allow them to experience the NFL like never before." [SOURCE]
“SAP is honored to partner with the NBA, one of the world’s most respected sports organizations,” said Bill McDermott, co-CEO, SAP. “Through SAP HANA, fans will be able to experience the NBA as never before. This is a slam dunk for SAP, the NBA and the many fans who will now have access to unprecedented insight and analysis.” [SOURCE]
SAP will integrate innovative technologies and capabilities to help map out fan experience into the 68,500-seat stadium set to open in time for the 2014 NFL season, as well as across the 49ers business operations. [SOURCE]
Giants / Jets
SAP co-CEO, Bill McDermott, added: “SAP is honoured to partner with EMC and the Giants, Jets, and MetLife Stadium to re-imagine the fan experience by delivering cutting-edge apps that make the action of game day even more gripping, for fans both inside and outside the stadium.” [SOURCE]
We have to recall that we are talking about SAP here - a B2B company that is usually associated with enterprise software. These are applications for end-users / consumers rather than those typical business users associated with SAP’s software. These are users many of who have no idea what HANA, ERP or indeed SAP is. In reality, they usually have no interest to learn what these terms mean. Such users are primarily interested in sports - the large majority are not potential buyers of enterprise software.
Note: It is important to note that this focus on end-users isn’t restricted to sports but rather is more of a general trend at SAP. A recent ASUG article by Courtney Bjorlin about SAP’s usability-related efforts also describes a similar focus.
Instead of starting the overhaul of SAP’s software design by teaching developers how to build business software that incorporated the design principles of the consumer world, Yen and his team looked at it from a different angle: He had developers build consumer applications leveraging the principals of SAP business applications. The SAP AppHaus initiative, Yen thinks, was successful in proving to SAP developers that they had the capacity to build consumer-grade experiences.
“When you have goals that are audacious, it forces you to think differently,” Yen says. “It was a successful initiative, and it really showed that SAP as an organization had the talent to build consumer application and consumer grade experiences.”
Although the desire itself to create beautiful consumer apps that have the potential to be successful in this market segment is a laudable goal, one of the main motivations is the desire to move beyond supplying software purely to business users to including the larger consumer market.
The desire to gain a foothold amongst sports fans is no exception. Sport activities are a global phenomenon that span professional and amateur groups spread across all ages, nations, etc. The potential user base is huge. For example, the number of Fantasy Sports users in US and Canada in 2011 was estimated at 32 million.
Why are statistics so important in modern sports?
If you remember the movie and book MoneyBall, you will remember the importance of statistics in the success of this particular team. But the use of big data in most sports has recently gained even more importance.
“The ability to effectively use data to analyze and enhance the experience in sport for fans and for professionals has never been more important than it is today” [SOURCE]
This statistical data is not only of interest to players and coaches but also to sports fans who have a desire to better understand their teams.
Fantasy sports are excellent example of the importance to fans of statistics in sports.
The game is simple, pick a team of existing players from any sport. Then compare your team's performance -- based on statistical analysis of real-life games -- with those of your opponent, who, given the same option may have chosen alternative players.
The concept, which rewards the most knowledgeable and passionate of participants, has proved a powerful draw to fans keen to participate in the greater drama of their sport in some small way. [SOURCE]
Many of SAP’s recent sports agreements mentioned above involve statistics.
By creating a fantasy football experience for these fans that surpasses anything they’ll have played before. So from next season NFL Fantasy users will discover a raft of new features. A click of the “Analyze Performance” tab will introduce them to “Player Comparison”, the ability to compare two players week on week and see who’s performing better; “Open Analysis”, the ability to compare a whole group of players at one time; and “Predictive Engine”, allowing them to predict player performance and decide selection. Millions of passionate NFL fans are suddenly as close to being NFL coaches as they will ever be. [SOURCE]
The NBA statistics team will implement SAP HANA to run the league’s enhanced statistical offering on NBA.com, which previously was accessible only to NBA employees and select media members. NBA fans will be able to access large volumes of statistical information and analysis tools on the SAP HANA platform, which will enhance their overall experience. [SOURCE]
As a new SAP HANA customer, the NBA is hoping to develop a new data platform that will deliver plenty of statistics in real-time to fans on the league’s official website, creating an "unprecedented statistical experience." [SOURCE]
On game day, Jets and Giants fans use these team apps to complete their second screen experience, watching replay video in MetLife Stadium, checking fantasy football statistics, and interacting with the teams, as well as other fans, via social media. [SOURCE]
Not your grandfather’s sports analysis
Statistics have long been part of sports and the amount of player-related data available is unbelievable.
There have been almost 18,000 baseball players in its history, according to the web site Baseball-Reference.com, and scores of available statistics for each. (Major League Baseball) has statistics going back to 1871. [SOURCE]
Some may consider these sports-related statistics as primitive in comparison to those inhabiting the more sophisticated world of enterprise software but I’d think you’d be surprised of the complexity of many of these sports-related statistics. Here are few examples:
VORP: Value Over Replacement Player: The number of runs contributed beyond what a replacement-level player at the same position would contribute if given the same percentage of team plate appearances
FIP: Fielding Independent Pitching: Includes the things pitchers can control -- home runs, walks, hit by pitch and strikeouts -- and eliminates everything else (hits, errors, quality of fielders, etc.). FIP does what it says: It looks at pitching independent of fielding and other variables that impact a pitcher's performance. [SOURCE]
These are non-trivial metrics that match the complexity of many KPIs in the corporate world.
In order to understand these sports-related statistics, dashboards are necessary. Here is a dashboard from Bloomberg Sports comparing two quarterbacks.
Other SAP competitors are also active in this field. Here is a dashboard from IBM for Wimbledon.
Thus, the expectations of fans regarding sports statistics are high and the associated visualizations are very sophisticated. SAP has an advantage in that it can use these sports dashboards to showcase HANA. Indeed, a recent blog about HANA demonstrates how it could be used to create such analysis.
A recent article about Sanjay Poonen describes in broad terms the motivation behind such actions – “SAP wants to get a billion people using its software by 2015.”
The “1 billion users” article was less revealing than an article about SAP’s sponsorships which directly associates these activities with the consumer market..
The primary driver behind the new strategy is the growing trend of "consumerization", around which new information technology is first adopted by consumers before spreading to business and government applications.
As such, SAP is partnering with sports, arts and entertainment organizations to reach B2C audiences and humanize its brand.
We identified sports, arts and entertainment as platforms for the strategy. We kicked off the initiative with sports. Part of our strategy is to work with teams, leagues, arenas and stadiums to figure out how we can help them reimagine their fan experience, or, to take a phrase from our marketing platform, ‘To run like never before.’
We want to create the most amazing fan experience and help stadiums deliver increased profitability by giving fans in-seat dining or purchasing opportunities.
We’re a B2B brand, but we’re acting like a B2C brand.
What is most interesting is the fact that sports is just one of the areas in focus. If you start thinking about the possibilities present in arts and entertainment settings (merchandising at rock concerts via mobile devices, etc), the potential number of users using such apps expands rapidly.
A focus beyond ERP / business software
With the emergence of strong cloud competition (for example, Workday and Salesforce), some say that SAP is an OnPremise dinosaur and its efforts in the Cloud are still in its infancy. Yet, the development of consumer-facing apps (regardless of whether it is RecallsPlus, CareCircles or a sports App) demonstarte that SAP is looking beyond business software. Try and find similar consumer-facingefforts from these Cloud-based competitors. You will be hard pressed to find anything. Oracle’s sports-related activities – for example, sailing, appear to be more associated with improving the success of the sailing team rather than focusing on sailing fans.
I’m not saying that SAP is not going to stay a B2B company – that will definitely remain its focus. I’m suggesting that it is evolving into something more than just a B2B company. SAP is positioning itself for the next wave – the one that takes a much broader view of what the Internet can be – M2M, etc.
Play to its strengths
HANA is the core of much of what SAP does and, as Jonathan Becher suggests, sports applications that focus on real-time statistics fit this strategy perfectly. The focus on mobile applications for fans also fits well with SAP’s strategy in this area.
The benefits to SAP customers
SAP customers can also benefit from SAP’s efforts in this area. For example, customers who use the new SAP Precision Retailing solution could have possible merchandising / advertising links in these sports apps.
US sports have an international market
The agreements that I found were primarily US-based. However, the fact that such sports are based in the States doesn’t mean that the fans – SAP’s intended audience for these applications – are US-based.
Once we figured out how to help them run better we looked at our core geographies. We found a sweet spot for the NBA in China. Chinese NBA fans are absolutely the most passionate fans that we have ever seen.
The NBA is a global property. It works well in Europe as well as China. And China has the largest percentage of our activation dollars as it relates to the NBA. [SOURCE]
I could also imagine excellent opportunities for baseball-related applications in Japan. Soccer applications could also have a global audience although the current absence of high-speed Internet connections in some countries might be a problem.
A common application pattern
Ideally, SAP would create a sports application framework that could be reused for different applications. The data / metrics are different for each sport but the basic technical foundation (HANA, Mobile, visualizations, etc) is the same for all sports / teams. Thus, a lucrative market could be exploited. There are some competitive applications (Bloomberg, etc) that provide similar functionality but SAP’s direct cooperation with teams and sports leagues combined with the ability to scale quickly to many sports, teams, etc, provides SAP with a definite advantage.
Technical foundation is secondary
I have no idea what the technical foundation of these future sports applications might be. It could be HANA AppCloud, NetWeaver Cloud or even HANA XS based. For the sake of this blog, the technical foundation is less relevant. More important is the focus on the sports fan as the primary user group.
These apps / agreements are between SAP and various sports organizations. These aren’t partners who are creating these applications but SAP directly. In the goal to reach 1 billion users, I always assumed that SAP would primarily use its extensive ecosystem to achieve this goal. Furthermore; I also thought that the majority of these end-users would be usually be the customers of SAP customers. As this blog suggests, SAP isn’t delegating the achievement of this goal to others but is actively pursuing it itself.
Note: I've decided to publish this blog in the HANA section of SCN, because HANA underlies all of these applications and without it - many of these applications won't be possible.