Cleveland Cavs VP of Ticket Operations Makes the Business Case for Digital Tickets [Q&A]

Ron Velazquez, Vice President of Ticket Operations for the Cavs, explains how his team went from all paper tickets to scoring 98 percent digital ticket adoption, and the impact it has had on the organization

Imagine telling your fans that the way they’ve been doing something for as long as they can remember — such as how they manage their tickets — is about to drastically change.  How do you think they will react?

One of the biggest challenges for any organization is getting buy-in for new initiatives. Even more difficult is getting the thumbs up for an initiative that requires the company (and its key stakeholders) to adopt brand new technology that prompts major operational shifts. And while there are plenty of benefits associated with being an early adopter (i.e. being seen as an innovator, solving a customer problem, differentiating from the competition), convincing people to change their behavior is a lot easier said than done.

The Cleveland Cavaliers are no strangers to early adoption. Back in 2006, the Cavs did something that few teams were doing at the time — they began phasing out paper tickets in favor of Flash Seats® digital tickets. At the time, the concept of digital tickets was revolutionary for the sports industry, but also very unfamiliar to fans. So how did the Cavs get their customers on board? Ron Velazquez, Vice President of Ticket Operations for the Cavs, explains how his team went from all paper tickets to scoring 98 percent digital ticket adoption, and shares the impact this move has had on the organization.

Paper tickets have had a long history in the live entertainment industry. What did you think of digital tickets back in 2006?

Ron Velazquez: We knew that Flash Seats was innovative and ahead of its time. With paper tickets, and even e-tickets/PDFs, you know who is purchasing your primary inventory, but tickets often change hands many times leading up to the event. With those types of delivery, it’s impossible to know exactly who is attending events and enjoying your product once the tickets pass from one fan to another.

With Flash Seats being ID-based, we could capture the complete lifecycle of a ticket, giving us the ability to track who tickets were being transferred and resold to leading up to a game.  We knew this data would not only help my (ticketing) team, but departments across the organization, such as sales, marketing, operations and corporate partnerships.

What was the Cavs’ strategy for introducing fans to digital tickets?

RV: Before we did anything else, we wanted to get internal buy-in from staff. We couldn’t sell digital tickets to fans without their support, so we distributed Flash Seats to them for an event, allowing them to experience the benefits firsthand. I think this strategy helped them explain the value and process more easily our fan base.

We did not have complete adoption right away. Sure, the airline industry had already gone digital with tickets, but consumers weren’t familiar with them in a sports context.  We slowly rolled out Flash Seats to season ticket holders level by level throughout the arena by promoting them as the most cost-effective option. We also hosted education sessions and provided them free tickets to chalk talks and select-a-seat events that were digital-only.

Despite some hesitation at first, fans eventually had ‘aha’ moments when they tested Flash Seats out for themselves. You can sell the perks to them all day, but they had to experience it to believe it. Once they realized that their ID was their actual ticket and how easy it was to transfer tickets to guests without having to wait for them outside the arena, they were hooked.

How did you continue to increase digital ticket adoption over the years?

RV: As of today, we’re at 98 percent digital ticket adoption, but that didn’t necessarily happen overnight. In addition to continued education, we also took advantage of some other timely opportunities to push Flash Seats out to a big part of our fan base. In 2007, the Cavs made a last-minute cut into the NBA playoffs, and we made the decision to go all in with digital tickets, allowing us to deliver tens of thousands of tickets to fans instantly without worrying about paper ticket fulfillment or fraud.

Heading into the 2010-2011 season, we had some major on-the-court changes, causing us to be concerned about ticket demand. We knew we needed to keep attendance up to continue bringing in revenue not only from ticket sales, but also sponsorships, merchandise, food and beverage, etc. As a result, we worked to get as many fans as possible on board with Flash Seats so we could learn more about them and cater to their interests and needs.

With a higher digital adoption, we worked with our business intelligence team to pinpoint non-season ticket holder fans that were frequently being transferred tickets or purchasing them on our resale marketplace. By leveraging their ticket purchase history, we could reach out to them with customized game packages that aligned with the types of games they liked to attend at price points they were willing to pay.

What are the benefits of having 98 percent of your fans entering your building with digital tickets?

RV: We’ve definitely reduced expenses by nearly eliminating paper ticket fulfillment, but by far the biggest benefit is the ability to make better decisions based on data. For every digital ticket, we can zero in on information about the initial ticket purchaser, plus anyone who has interacted with the ticket from a transfer or a resale on our marketplace. These insights translate into the ability to develop targeted, relevant marketing campaigns based on our fans’ purchase behavior.

Also, Flash Seats gives fans much more convenience and flexibility when it comes to managing their tickets. They don’t have to worry about the possibility of having their tickets lost or stolen, and they can easily transfer unwanted tickets to friends/family or clients. Both season ticket holder retention and ticket utilization rates have improved exponentially over the last few years, and I think a lot of it has to do with the ease of digital tickets.

Many teams encounter pushback from season ticket holders who value paper tickets as a piece of memorabilia or a souvenir.  How does your organization respond to fan objections?

RV: We’ve always valued the opinions of our fans and listened to their feedback. In the past, we’ve offered fans commemorative tickets for NBA Playoff or Finals games, as well as other types of souvenirs for them to go home with. We also took a very conservative approach with Flash Seats at first because it was so new to the industry and our fans. As more and more of them experienced how convenient Flash Seats was for them, they ultimately became our best advocates.

I will say that other teams shouldn’t see digital tickets as a hurdle to making a sale or just another thing to sign fans up for. The information that we get from Flash Seats far outweighs the small percentage of sales we may have lost because of our decision to forego paper tickets. Instead of selling to the same fans over and over again, we’ve discovered a whole new audience that we knew existed, but couldn’t tap into because we didn’t know who they were. The information and extra leads we’ve obtained have driven so much business growth that it would be silly to pass up this opportunity.

If you were talking to another team or venue, what would you say to convince them that they should adopt digital tickets?

RV: It all boils down to the data. We’ve been able to improve how we communicate with our fans because we can track exactly what they’re doing with their tickets and the people they are giving them to.  If we had nothing else, digital tickets would be enough to fuel our lead generation efforts and create sales funnels that we’ve never had before. Because we can zero in on the journey of every single ticket beyond the initial purchaser, we have opened up a whole new pool of prospects to market and sell our products to, and we can continue to fill our arena with loyal, deeply engaged fans.