Murray Barnett: A Masterclass on the Business of Sports (Full Transcript)
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Ronen Ainbinder 1:00
Today's guest of the show is one of the most electrifying individuals I've ever met.
This man has over 20 years of experience working in different sports industry sectors, including ESPN, Formula 1, World Rugby, and the NBA.
He's a master in the future of sports, tech & innovation, commercial partnerships, media, and sponsorships, amongst other topics.
Today, he is the Founder of Sports Consultancy 26West– where they specialize in the business side of sports, Media Rights, Sponsorships, and more.
It is my honor to host such a legend for a quick Halftime Snack!
Ladies and gentlemen: Murray Barnett
Murray Barnett 1:28
Thank you very much for having me. That's a very good over-the-top intro to somebody that's just been slaving away for 20 years rather than knowing anything special.
Ronen Ainbinder 1:40
It's an absolute pleasure to host you. Thank you for accepting my invitation to the halftime snacks. And I want to start off with an icebreaker. And I want to ask you what your favorite meal is at a game of your favorite sports, which I guess is soccer. So if you go to a soccer match, what's your favorite meal that you like to eat there?
Murray Barnett 2:01
Well, it's a good question. I would say that eating is cheating at a soccer match. But I think the interesting thing is that you have such different rituals for what you eat and what you drink in each individual sport. So for example, if you go to a Wimbledon, It's famous for sort of more like champagne or a Pimm's cocktail, and strawberries and cream. Whereas if you go to an NFL match or a college football match in the States, it always makes me think of burgers and ribs and beer. And I think it's interesting how every sport has its own different rituals around the food and drink you have.
Ronen Ainbinder 2:40
Yeah, I agree with you. I feel like everyone has their own favorite snack. But mine, I would say my favorite snack is probably a hamburger on any of the matches. And I want to switch over now to talk about your consultancy business. Because while you started the consultancy business in the middle of a global pandemic, I wonder what was that like? Or what were some of the challenges of doing that? Can you tell us about that specifically?
Murray Barnett 3:08
Yeah. So what I left Formula One just before the start of the pandemic, and I had originally planned to take a chunk of time off, try and recharge after such a long time of continuous work. And the consultancy came up almost by accident. Because the interesting thing is, although everybody's going through these very difficult times, or I should say because people are going through these very difficult times. There are lots of people out there that are looking for support and advice. While I was taking some time out to recharge my batteries, people were calling me up and saying, could you help me out with this project? Or could you give me a bit of advice here? Because the road forward is so unclear, they wanted to make sure that they had the right commercial strategies, a good understanding of where their revenues were going to come in the future, how they should think about dividing their commercial assets up? And the answers to those questions became much more important in a time of uncertainty than perhaps they would be when everything's functioning as normal. So it's gone surprisingly well in terms of many people out there needing support and advice. And the other thing that I've enjoyed with it is that I enjoyed it because it's a new thing for me. After all, it allows you to be quite indulgent and work on a wide variety of different projects. I've learned that you have to tell yourself not to say yes to everything, just because it sounds kind of fun. You have to kind of make sure that you keep yourself limited to the number of projects to make sure that you're devoting the right time and attention to those because it's easy to get, like all consumed by too many things, all sort of crashing together at the same time. And that's not often a problem that you have, I think when you've got a sort of a full-time job, but it's been fascinating, and you get to, number one, reconnect with people you haven't spoken to for a long time. Meet a whole bunch of new people and work with some cool people. And my knowledge has gone through the roof over the last year, probably more so than any sort of permanent job I've had in terms of being exposed to more different types of sporting environments and different supporting challenges. So, yes, it's been surprisingly successful considering the environment that we're in.
Ronen Ainbinder 5:22
Yeah. And that's interesting because you work for some awesome brands, such as ESPN, Formula 1, the NBA. So I wonder which one of them was your favorite? And why do you remember that to be your favorite place to work? Or what are some of the most important takeaways that you had from working at some of those companies,
Murray Barnett 5:44
I think you always look at the beginning of your career in a particular industry as perhaps being the most important because it sort of forms your outlook and your perspective on where you go. And so, to that end, the NBA was the first job that I had in sports. And it was, and still is, the benchmark for many sports marketing organizations. I often catch myself thinking, what would the NBA do in this particular situation or challenge? Because I do think that number one US leagues, in general, are lightyears ahead of everybody else in sports marketing. The way that the culture was set up inside the NBA, I think, was very conducive to being very creative. What do I mean by that will, the very clear purpose of what they were trying to do, very well structured management, which encouraged people to develop creative ideas, discuss things, and a very meticulous and methodical way plan everything that they do? So the general consumer can often look like, they're just Hey, look, it's like the swan, right? They're floating over the surface, and everything's going great. But they're paddling like mad underneath and putting a lot of time and effort into every decision they make and everything they do. As I said, they're meticulous, and they do everything to a very, very high level. So I have a lot of affection for that. But again, I can pick out things from ESPN and Formula One that are just incredible about those organizations. So it's a very difficult question to ask me,
Ronen Ainbinder 7:26
Would you say that you have a specific idea of how you wanted to structure your sports career or kind of developed as it went? Or you were in your mind when you were just starting you were thinking that you want to do work, probably first in a global brand, and in a more niche, or more specific like, such as the word rugby. And it's not so specific, but it's less popular than the NBA? And then just try to find your path slowly, slowly, or, or did you feel that it developed? Opportunities came up as you went? And then you just took them as they came?
Murray Barnett 8:05
Great question. I think you need to have a plan, but you have to accept that that plan will change. So the analogy I always like to use is you've got to have a map, and you've got to know where your destination is and try and plan a route towards that destination. But as you're taking those steps along the road, you have to have to accept that you may end up taking a different route. And you may be, and you may end up going to a different path. And you may even end up at a different destination. But if you don't have that kind of idea of where it is you want to go in the end, you'll never take that first step. For me, I started off more in the sort of the marketing side of media in general. And then two things happened. As I was kind of working for a bunch of TV stations and TV broadcasters, I started to realize that sport was the content that people cared about the most. And so it had this immediacy it was you have to watch sport live. And people are completely irrational in what they'll pay to watch their favorite teams and so on. There's that real passion with it, which is, you get it sometimes with certain theories and certain movies and certain entertainment forms, but you don't get that as viscerally or as deeply as you do in the sport and as consistently as you do in the sport. As I kind of went on that journey, I definitely realized that sport was an area that I would like to if I got the opportunity to specialize more in. And then as I moved into the sport, I very frankly say that if you are bringing money into the organization, that people take your opinions more seriously, and you get invited to more of the big meetings, shall I say? And so I realized I wanted to move more from that marketing side of sport into more of the sort of revenue generation side. So when I was allowed to move more into the sales side of things, I grabbed it with both And then, and then I believe that you just have to keep your eyes open for the right opportunities. And sometimes, if you're too prescriptive about how you're going to go with something or what your goal is, you don't see the opportunities arising around you. So I think that there's no such thing as lucky people. Some people just recognize everybody gets luck, but only a few people can recognize what luck looks like. And so I think you have to keep your eyes open to what it is. And that's why my career has taken a few different directions. And perhaps I expected because some great opportunities came up that I thought, well, it feels right. And that's probably an important thing. I've always gone not to try and overanalyze everything too much, to try and go with a little bit more about how I feel about the right opportunity. And back to your sort of comment earlier that the NBA being a big sport compared to rugby, in some markets, rugby is a much bigger sport than the NBA. One of the reasons I ended up going to world rugby was the opportunity to work on a Rugby World Cup in my home country. I just thought if I don't say yes to this opportunity, I will always be wondering what if. That another important point is I always said to myself, I don't ever want to look back on the things that I've done and say, Well, what if I had done that? Or what if I had done something else? When the opportunity that feels right in my gut comes along, I tend to want to leap at it.
Ronen Ainbinder 11:37
Yeah, I love the analogy of the map having an idea of where you want to go and then try to work it backward. No, it's just gonna work your way. But having that idea kind of gives you a projection, a projection of how the path looks like. And I feel like, in your case, you kind of took opportunities, and you realize things that you weren't aware of before and that you had in your original map. And you just need to update the map; I would say that's the idea. Roads change paths; quicker paths are better paths are more lucrative paths may change on the way. So that's how you readjust, and you update what you want to do. So I think that's awesome.
Murray Barnett 12:18
The one other thing I would add to that is, and I'd say to anybody that if I was giving a talk at a high school or to somebody that was just coming into the industry, I'd say always be curious. And that was one of the things that I think worked for me was I've always just been genuinely fascinated by the media and the sports and entertainment businesses. And so whether it's an NBA, whether it's that Disney, ESPN probably to an annoying level, I'd be going to different colleagues and saying, oh, tell me how you did that? Or why did it work that way? Or what's the background for that decision? And it's just because I was interested. And I think two things happen it makes you much better at your job if you understand everything else that kind of impacts their will. Why are the decisions that they're not your responsibility have been made? But it also means that other people want to collaborate with you if they see that you're interested in what they do. And also, frankly, it's a way to get noticed. People will recognize what you do more if they see that you're actively interested in what they did.
Ronen Ainbinder 13:21
Yeah, I like this quote that says, "Don't tell me but show me." So I feel like being curious actively, instead of just talking about something, just involve yourselves in the topics or the things that you are interested about, either if it's media, or if it's sponsorships, or whatever tried to get, try to get along with the people there. And then see what they're up to and see what the projects are. They're working and try to get involved as much as you can; I feel like that's how you can have a proactive practice of your curiosity and innocence. I think that that's a high-value recommendation from you, Murray. So I appreciate it. And now I do want to switch over to the topics where you're an expert around. We talked about some of the things you work on and some of the things you were thinking about. So I want to touch on the first one that is electrification in sports. And the moment you told me this, I was like, why is this guy talking about I've never in my life heard about this thing. So I want you to explain to us as if we were five-year-old children, my listeners, and me because potentially no one knows what you're going to be talking about. So explain those that like if we were five years old, what's electrification in sports? How is it tied to mobility and sustainability? And what types of technologies can we expect to be leveraged for it in the future,
Murray Barnett 14:51
If you think about motorsports, bikes or cars, there's a huge sport today, there's increasing Vogue in terms of road-going vehicles to be electrified. And there are some challenges like in formula E, the cars had to change batteries halfway through, and various things like that. But as technology has developed, you're now getting to have cars which don't need the batteries changing, which are faster than they've been before. The whole electric car thing largely through Tesla, but through others, has become very much in Vogue in terms of, I guess, you could say that Elon Musk has made electrification sexy. Now that the technology used in the automotive industry is now expanding out into others. So we've seen some electrification around bikes, you're obviously got electric scooters, you've got electric boats now, and they're all number one, environmentally friendly. Number two can offer a compelling spectacle. And our high tech now to just take each of that one by one. So the sustainable aspect of it means that it can get to places where it wouldn't be otherwise formulary races and city centers; it wouldn't be able to do that if it was a normally aspirated car engine of the exhaust fumes and so on. Number two is that it's now become a great spectacle because the technology has got to a level where it's completely able to create a spectacle that's worth watching. And perhaps most importantly, several huge companies are heavily invested in the technology. And they need a proof of concept to be able to show people how great this is. Whether we're talking about bikes, formula E, extremely, electric boats, etc. These are all technologies, which people are investing a ton of money now, which means that they are highly invested in seeing great operating showcases. For those that technology and sports offer an emotion like nothing else. And so it's natural that you want to have the fastest bike, the most spectacular, extremely expensive car, whatever it is. And those are the most successful against everybody else in the market because ultimately, that's going to help sell your technology. I think this marriage of sport and technology is something we're seeing in a much wider context. Outside of electrification, more and more to deal with, partly to do with eSports, and just our general exposure to technology in our daily lives, means that that link between sport and technology is becoming close. And people are much more open to understanding the technology input that goes into the sport and what that can mean for entertainment. Sports are no longer competing against each other; sport is now competing against video games as competing against other forms of music. And so it's all about how to make it the most entertaining. Technology has a massive part to play with that either in terms of the technology employed, say, an E-bike or whatever, and create an on-screen experience compelling for the viewer.
Ronen Ainbinder 18:27
Yeah, I see what you mean. I think I never thought about the sustainability side of the electricity brought into sports. I was thinking about the systems in, let's say, a soccer stadium that would require energy derived from diesel, for instance. I thought maybe the trucks they used to cut the grass, probably a sum of some of the machines, or how they produce the stadium's energy. So I thought it was more directed towards that. Still, I understand how it can be applied mostly on the automotive side of the industry, which is, as you mentioned, Motorsports Formula One car. We will also see more of the electrification side on stadiums and on renewable energy used to power specific events. And as I like, as you mentioned, how it's all about comparing it between the entertainment industry, not soccer versus football, or versus baseball, it's more about the sport versus Netflix versus Spotify, versus the cinema. And I think that's, that's super interesting. And now I want to switch over to Murray to talk about your role in the industry. I remember you mentioned you, you vow a lot for sport for all, so I want to know if you can share a couple of the steps required to Create economic gender and race equality in sports and how is your company 26 West, consulting, working towards it.
Murray Barnett 20:09
And when we talk about gender and sort of equal opportunities for all races, I'm not necessarily talking about, like on the pitch or on the court, I mean it more in the sense of the people running it. Like, if you take gender equality, 50% of the planet is female. So it's just good business sense to have more women working in senior management positions within the sport to make sure that the female audience is also addressed. And I'm not saying that women only understand what women want. But the point being is that if you have a good mixture of men and women running a particular sports organization, you're more likely to have a strong, rounded, and inclusive type environment. And I think that that's what we all strive for. It is a sport in sports where you want to go with you and your family and friends. And it's not sports that are very tribal, but the tribe should be a large, inclusive tribe. In my opinion, it shouldn't be about a license to go and behave badly. And I think if you look at soccer, and especially sort of English soccer in the past, South American soccer probably has a very bad reputation for sort of violence, and so on. And I think that that's, that's not the right attitude. One of the great things about a sport like a rugby is you don't have any segregation in stadiums. And you can sit next to somebody who's supporting the opposite team. And you can have support in the best possible way where you're ragging on each other, you're kind of making fun of them, if they screw things up, or whatever. And it's all just accepted as part of the sporting experience. And nine times out of 10, you'll be walking out of that stadium, whether you win, lose or draw arm in arm and go have another beer together somewhere. And, And that, to me, is what sports should be all about. It's about enjoying the experience; you can sort of be emotional about it and be attached to it. But that shouldn't become a sort of something where you're better than somebody else, just based on the soccer team that you support or something like that. I think you need to create an environment that projects that kind of support if you like; it's okay to sit together. You don't have to worry that it will be violent sports that should create an inclusive environment for everybody and their opinions and views. And it should be about the emotion that that generates on the pitch, not that it shouldn't spill out into the crowd, in terms of them behaving badly. And then, as I mentioned earlier, when you think about behind the scenes, the more diversity of opinion that you have, and thought that you have inside your organization, which will largely come from a diversity of the workforce, I think it's just a very good business decision.
Ronen Ainbinder 23:01
Agree. Diversifying the type of people that runs these businesses, the ones that operate this business. The ones that face these organizations face can help the lower end, meaning just like just the fans or followers or even people on social networks, you don't need to be in the stadium to see or feel violence. I remember every time I'm a Chelsea fan, and so every time I go on, on Twitter, and I and I see that Chelsea loses, I know you're a Tottenham fan, but whatever. I remember that every time Chelsea loses, I just go into their Twitter page, and I see the comments that are like people defending, commenting around Chelsea losing. Sometimes I get offended by things that they say or the language that they use. I guess it's all about changing the perception of what being a fan could mean for people. It probably will come from the organization and the hand and the administration by just being able to set specific limits to what they're able to accept, as attitude and as a language in their website, in their, in their social media, in their state views. And just working towards that as a process. I feel like you need to solve that from the management and in every single because, at the end of the day, it's a brand, and it's also how people outside of the brand will perceive you. So it's also like trying to heal your brand, in a sense. And that could potentially come from diversifying and creating equal opportunities around race, gender, social and economic status in society, and just creating Opportunities equal for everyone else. And since we don't have so much time, I want to jump into more topics before leaving. So I'm just gonna switch over the question. And I want to ask you specifically since you've been so much of your time surrounded by your media rights, traditional broadcasting the sort of like the business around it. I want to know how the direct-to-consumer business model, the sport's democratization, would disrupt that area of sports? The media rights and the traditional broadcasting business? What's the timeline that you think will happen and would like if you think it's being potentially mismanaged in a way now, meaning that big companies do not realize the change. They're going to be eaten by startups that are just developing easier and better things for the industry?
Murray Barnett 25:56
I think there are two main points in here. One is the diversification of platforms. So what you're seeing is that all sports organizations or sports rights holders have many more distribution mechanisms, which require a lot more effort. So in the old days, you pretty much just had TV stations, and you'd put out a live match or game, and maybe some highlights, and that was it. With Snapchat, YouTube, Facebook, Twitter, whatever it is, you now have to create 1000 different content types for 1000 different platforms. And you must address the audiences that are on each of those. And even in the early days, you would see people just taking the TV feed, cutting a little bit out, and putting it out on Twitter. You can't do that because the audience on Twitter wants constant content that's very different from somebody sitting there watching it on TV. And so increasingly, the rights holders or the sports that are being successful are the ones that are addressing all of those different platforms; you're also seeing this, this kind of trend of lots of new platforms coming up. And people are not sure whether they're going to be successful or not. So you have situations where you're creating content for our platform that may not be there tomorrow. And so, you're trying to work out; you have to be on all of them. But you also have to be constantly analyzing their success or failure. So we've seen the clubhouse come out in the last few months. And you see a ton of people starting to use that. Now, none of us know if the clubhouse is still going to be around in a year. But the important thing is that you jump on it, you learn something from it, and then if it's not resonating with your audience, you move on to a different type of platform. So content creation has become super important, making sure that that's highly targeted for every platform and audience you're trying to reach. And that's a good segue into the other part of your question, I think, which is about increasingly, sports and rights holders have a direct to consumer relationship. So let's take the US, for example, before the NFL, just to pick somebody at random goes and signs a deal with ESPN, where it becomes an ESPN problem to work out how they're going to make the NFL relevant for the audience. What all this different, all these different contents, opportunities, brings up. The desire to create an over-the-top direct-to-consumer product means increasingly in that example. The NFL has to understand directly who their customers are. Tou could argue that 10 years ago, NFL customers only had like five or six, Fox, CBS, NBC, ABC, ESPN, NFL Network, maybe that's simple, you only have to understand how those six let's call them people worked. Now they've got to understand how 110 million people work to continue to make their product relevant and understand how they price it and what kind of content to push to them if they want to go direct to the consumer. And so increasingly, you're seeing that data is becoming very important to leagues; I think you'll see massive growth in research departments in terms of people being able to analyze and unlock the value that exists with customers and exactly what those customers want to do. And you won't see people like ESPN as a content aggregator going away. But I think you'll see that their role will change over time. You've seen how successful ESPN has been with ESPN+ as an aggregator of content but differently. I think what you'll see is that I'm gonna keep using the example of the NFL just to articulate the point is; there always be a bunch of people that are desperate to know everything that they can about the NFL. So they may buy NFL Ott product or NFL TV, but then there's gonna be a whole bunch of other people who are NFL casuals; they like NFL. But they also like a bunch of other sports; they don't necessarily stay in for a particular match. Therefore, they appreciate ESPN, which is aggregating content that they like in an environment that they understand along with news and other curated content that they've got with the pundits that they like, and so on and so forth. And so I think you're just seeing it as yet another different mechanism for how the NFL, in this case, reaches their consumers. But it's becoming more and more complex and difficult. The industry is maturing to need to go that extra mile to extract value from their customers.
Ronen Ainbinder 30:47
Yeah, that's so much, so much to think about. And halftime is not enough time to discuss it fully. But I think that's a great answer. And I think that it gives us a lot of thinking and creates expectations for the industry's future. And I think that's exciting. Well, thank you for sharing. And we have been out of time, but I want to ask you this one last question. And that's one quote that you live by, and a Why do you live by that?
Murray Barnett 31:16
One that seems to resonate a lot at the moment, And I guess partly because of the crisis that we've just been through, Mike Tyson said that everybody has a strategy until they get punched in the face. He never quite knows what's around the corner. But to me, that means you have to be agile; you have to know how to adapt and figuratively duck and weave around the punches as they come at us.
Ronen Ainbinder 31:42
I love that. Murray, thank you so much for sharing. And I want to thank you so much for coming for the Halftime Snacks. It was an absolute pleasure to host you make your legend your year. You're an expert in so many topics that I feel like we can go on and have a conversation for hours. But sadly, halftime is only 30 minutes long. Thanks again for coming to the Halftime Snacks and devoting your time to the listeners and me.