Luker: It Makes No Sense to Talk About Generations

Generation Z kids are bombarded by a tsunami of highly accessible and enticing alternatives to sports each day.

What effect will this have on the long-term outlook for the professional sports industry? How can the sports industry adapt to this reality in a manner that builds a relationship today so that kids will be engaged with sports tomorrow?

In this session from Hashtag Sports 2017, Rich Luker, the Founder of the ESPN Sports Poll, and Terence Burke, SVP of Research and Editor-in-Chief of KidSay’s Trend Tracker report, discuss a new alliance of the two groups and present the first, ever, “State of Sports for Generation Z” convergenceing kids from 5–17.

Check out the full video and transcript below!

Keith Friedenberg: Good afternoon. So this is a bit of a quick introduction, I know it’s just been done a moment ago, but just to go a little deeper on it. I’m Keith Friedenberg — I’m a partner and the Executive VP at WME | IMG, the global sports and entertainment agency.

I’m joined to my left by Terence Burke, Senior VP of Research and Editor-in-Chief of KidSay’s Trends Tracker. I should say that KidSay is an expert in the youth space, working with the likes of Disney, Hasbro, Netflix and Google. And obviously to the left of Terence is Rich Luker, founder of the ESPN Sports Poll, and Luker on Trends. Clearly a long time expert in the field of analytics in the sports realm. Very happy to have you both here today.

Rich Luker: Keith, thank you for being with us. In a sentence, let me tell you where we’re headed. And it is this raw because it’s happening this quickly. You’re going to see slides with data on it, but we’re rapid firing what we’re doing here. Please yell out if you have questions, we’ll stop as much as we can. They do have microphones on this side, but we’re going to go.

Here it is: 73% of kids between the ages of 8 and 11 now have their own smartphones. 73%! Now let’s put that in perspective. Their parents, the parents of a ten-year-old today, when they were ten, they didn’t have Google.

This changes everything, and it’s happening so quickly because what it means, we might think about it as technology, but what really is happening is, those kids now have control of everything they do in our space. And the only thing I really want to say about that before I really jump in is: We don’t see this as bad news at all.

Friedenberg: It’s a massive opportunity.

Luker: This is not a sky is falling moment, it’s a “We’re incredibly fortunate [moment]” because we’ve kind of been sensing that something was going to come along and go “You’ve got to pay attention.” And it’s not that the sky isn’t blue anymore, it’s just kind of greenish. And that’s okay. Nothing bad is going to come from that. So, with that, would you talk a little bit now about the changes that are happening?

Terence Burke: Sure. So, you’ve known, you’ve been hearing all day about — particularly with the millennial audience, and the engagement on social and mobile — how leagues and sports have to adapt to that new universe. We’re here to tell you that that new universe is even more compelling when you look at the younger ages. Take a look at kids five to seven. 77% of them have, at their disposal, the ability to choose their content anytime, anyplace, anywhere they go.

Luker: Their own tablet tablet right. It’s not that they’re using a family tablet; they have their own tablet.

Friedenberg: And the main issue there is, is that now they’re able to dictate terms when it comes to content consumption.

Burke: And that idea has transpired to the tween market, to the 8-11’s. And for the last couple of years we tell you, you know the Hasbro’s and the Nickelodeon’s, and also there was a clear divide where below 11 was a tablet space. It was less mobile sometimes. You could take it in the car if you had one that had a cellular signal, but the reality is now that smartphone on that next slide — that smartphone is now heading into that young kid space. And that’s changing everything like you said. Ownership of content and when and where they are going to consume it.

Friedenberg: Well I think it’s a really interesting issue where people talk a lot of lip service. “Oh, this is going to be the digital natives.” And you know that hits the trades and everyone reads about it. Now from a business perspective, from a P&L perspective, from a content development perspective, from a distribution perspective, it’s actually hitting the actual market in a real way today.

Luker: Yeah, in other words, if you’re waiting until 18–34 to think about them, you’re done. Everything changes, and again put this into context: they don’t know life without a smartphone if they are seven years old or younger. It’s like saying “What’s a chair?”

Its part of their DNA, right? And for anybody who’s in that 30+ group, so their parents, it’s not that case. We’re adding that on and still coming to terms with it. They have come to terms; they’re there. But that’s just the beginning of the problem, or the challenge should I say. What you have on the top are the percentage of people who say “This is my favorite thing to do on the internet.” I may not have a pointer here so I’ll just kind of fake it.

Upper left it’s 12–13 year olds, and it’s in a very narrow window in a period of six years where it goes from 16% to 29% saying streaming is important. If you look at the age 14 and 15 over that seven-year period what you’ll see is that it happens in a different way, that streaming ends up being in the middle, but not as powerful as it has already for 12–13.

Here’s my point: We’ve been spending our time looking for 12–17 year olds, I’ve been yelling at the sports audiences that they’re in decline and you have to do something about it. And I stepped back and said, “What happens if you just look at 12–13, 13–14, 14–15, and 16–17?”

They are three completely different patterns. And what that means is that it makes no sense anymore to talk about generations.

 

What are millennials? That’s a 20-year-wide period. The front end of that group didn’t have Google. Those who are ten years into it didn’t have a smartphone. Everything changes within two years.

Within two years, when you make business plans, are you going to base them on something that was from before Google twenty years ago? Why do you talk about generations like that? Would you build a business plan on something that was true but based before smartphones? So tell me what’s going to be true five years from now? We got nothing.

And it’s not just in those age groups. The thing that made it very sobering for us was the fact that their data, collected in a different way from ours, showed the exact same results.

Burke: And that’s where the synergy between Rich and Luker on Trends and KidSay came in to say “We’re telling the same story.” We’re seeing the same progression, and that’s the idea that looking at a generation is so moot, so counterproductive. You’ve really got to look at what’s happening on the ground now. And you see it with the 8–11 year olds, you see an even more dramatic spike. Are 8–11 year olds doing less social networking then they were doing in the past? No, of course they aren’t. They are doing more of it. Are they playing games less? Of course they’re not. But what they say they do most often is watch video. They find the content. They find the content that’s for them. They have a myriad of choices that they can go to. And they say “I want the one that’s for me, I’m a nine-year-old girl. I will find it.”

Friedenberg: I’ll also say, what’s really happening here is the psychographic definition of these age groups are more important than the demographic definition of these age groups.

Luker: Well, that’s going on developmentally too. So they’re parents, they’re kids, they’re teenagers, and those dynamics which are constant.

Friedenberg: Meanwhile, historically from a generational perspective, probably nuanced as we got about this stuff was “Oh you’re a leading-edge generation or trailing edge generation.” It’s just too much of a big bucket to be effective on what your business plan is going to be, to execute against this plan.

Luker: So now here’s another really critical part of this change. Not only are they in control, but if they’re in control, as compared to what? Now most of you are closer in age to them than you are to me. When I was growing up we had primetime television, we had very few things we could do. It was sports, it was watch TV. And, the providers of things we could do on our free time, they controlled it all. It was on their time, on their day, in their way, in their places, we’re not going to change when the football season is, we’re not going to change the football teams. We’re not changing any of that. What we could do in our free time controlled us.

Anyone over eleven is able to deal with the ambiguity between properties which are trying to control them with time and the fact that they have this freedom.

If you’re under the age of eleven, you’re not going to put up with this. I was in a discussion with one of our clients yesterday who says “Yeah, that’s right. I’ve got a four-year-old, she has her only tablet, she only gets a half-hour a day and then we put it up. And then you know later in the day we go to watch TV, she says “I want to watch this show” and I said to her “It’s not on now.” But it has to be on now. That four-year-old can’t imagine not being able to watch the show she wants to watch on TV. That’s not her world. This changes everything.

Friedenberg: From an opportunity perspective, which is really interesting, is that it does empower a whole new suite of potential content that can be empowered to a new generation of consumers, which is really intriguing to content creators and sports as well. And then also on top of that, if you happen to be an MLB fan sitting in China, or sitting in India, you now have a much broader global reach of fandom that you can leverage into. So thats why the sky is not falling, the landscape is shifting. If it’s played well and architected appropriately, there’s actually massive opportunity that comes along with it.

Luker: Well, and the people who are going to win are the ones who, first embrace it. What does that mean? They’re starting younger to understand what the new world looks like, that’s where [KidSay] is really good. Realize you get moments, you don’t get days. And the fact that they control it, and there’s massive amounts of competition. But now let’s take another dynamic; there’s yet another dynamic in this. Not only is it out of control for us, but there is this sense of relevance overall that we’re mistaken because we’re saying for example with games. “Games are too long” [complaints] could not be further from the reality of what the problem is. That is the perspective of somebody who comes from a cultural constant who controls content, right?

So if we’re saying these 11 year olds who are younger are doing everything in bits and drabs that’s largely right. But then how do you explain binge watching where they will watch six, seven, eight hours, nine hours, ten hours of the same show?

I confess, me and my wife, the most common statement between us when we’re watching TV at night is “Another?” Right! But the point is this, I could start a show, watch 30 seconds and say “No. Gone, I’m done. You lost me.” Or I could go “That’s okay…” Get through one and go “Alright, another.” It may be 53 episodes, and if I so choose, if I am so stupid I could watch all 53 in a row if I want. So I’m willing to spend the 53 hours, and every age group is. The point is, they get to decide how much they watch, when they watch, and how they watch. And that’s what this is all about.

Friedenberg: It’s the modality of engagement.

Burke: And then there is the engagement. The idea that they are compelled to be there for something that’s satisfying them. It’s helping them be a kid in the moment. It’s helping them become who they wish to be. It’s that medium for them that enables that happening.

Luker: No, I know. I think that’s funny because in the earlier discussions we didn’t talk about this at all. But again they are already in that world, but in a time in their life when they’re creating their world. So we’re all creative, we’re all post-adolescent, and we kind of have a sense of who we are. So that’s even more powerful. So that’s not just what they do in their free time that’s being defined by this, it’s intricately involved in who they are as human beings.

Friedenberg: Well, and you mentioned it earlier but that’s the seminal point in which you want to hook them. If you can hook them in that developmental stage, you likely have a fan for life. And the lifetime value of that fan is going to be unprecedented, if you get them at that young of an age.

Luker: Let me give two illustrations of that from baseball. First, if you take your kid to a game, their first game, before the age of five, they will go to 58% more games per year for the rest of their lives than somebody who doesn’t’ go to their first game until they are 14. Powerful, absolutely.

Now let’s debunk generations a little bit more. What’s the average age that a parent today takes their kid to a game? And by the way, better than half of all parents do. Most people tell me seven-, eight-years-old. It’s two.

You know what that means? They’re millennial parents. They’re not wanting fast, wild and crazy. They want the same experiences. That’s why we’re saying that the sky isn’t falling, we just need to recognize where the sky is forming now, and it’s in those greater in-depth relations.

Friedenberg: And this youth market issue is tethering into millennials who value the experiential economy, far greater than goods. So, for example, for my generation, having a house and a Mercedes in the garage was my badge of honor that I’ve made it professionally.

Now, for millennials and younger, it’s about having that shared experience, and the value of that shared experience. Not only the intimacy at the game amongst nuclear family, but also how they broadcast that out to their general network, sort of proving to the world “Look how close we are. We’re actually sharing this experience together at a baseball game.”

Burke: And this is what Rich and I really see coming. Kids at this age, there’s that universal element of the bond to the family, and that experience, and the richness of that. You’re not only tapping into the fun of the moment, you’re tapping into the existential love that’s there — and that really brings meaning. That’s why that engagement between parent and child at these younger ages is so crucial.

Luker: Well, we’re going to come back to that because that’s really the solution in a large sense. But just in case there’s anybody in the room who thinks there isn’t a problem, we left this slide up here for a while.

We have seen these declines coming for 15 years, and if this was an eraser, i’d erase millennial. Because it’s only in the last month, we’ve figured there’s no value to the title “generations.” But we still use those age groups right, those born 1980–2000 drop from General Avid Fans from 48% to 28.9%. We’ve been saying “You’ve got to do something, you’ve got to do something.” And we really didn’t do anything about it. And so some of you are saying, well part of the reason is…aging.

Couple of things here that are really pretty powerful. If you look at it by age group, the greatest losses we’ve seen are males 12–17 in sports overall across the board, and then about five years ago we started seeing the critical mass of males 18–34 decline. And that’s when people got nervous about it.

At the same time, why aren’t we doing anything about this? Because we are still making money. And the biggest problem I have is that our clients won’t act for the future if the quarterly reports are good [right now]. And the people who work for them, won’t have the courage to step up and do those kinds of things either. And what you see on the bottom lines are males who are growing in interest.

My generation is much more vital and lively than my parents generation was, by far. And because I’m a baby boomer, it’s a lot bigger. So we’re still giving you the cash. Not for long!

And the problem is, we’ve done nothing to invest in that love of sports. You know what happens if you do? Look at Title IX, and look at females. In the face of twenty years of explosive competition from things online, they’ve remained stable and even grown. Title IX is the only thing investing in the love of sports on a play or on a fan level.

Don’t make a mistake about this. Sports don’t build fans, fans build sports. The previous presentation talking about FANchise — I love that. The idea that they would be truly involved is really powerful. And make no mistake about this either. 2016 is the year that it hit.

We’ve been talking about it for 15 years, I honestly thought we had a couple more [years]. It’s here. Double digit declines in media for sports, for all the major sports. EPL had 19% this last year. And people will say to me “But Rich, look at the Finals for the NBA, the best since 1998.” We all love fireworks, and we’ll still come for fireworks. Is that going to sustain the sport for the season? Is that going to keep the audience’s there? Is it going to keep the intensity of what we do in place? And the answer is no.

Friedenberg: By the way, just to bring this to life a little bit. Formula E, which is mostly in Europe and actually a great new circuit on the scene. From a social media perspective, if you actually vote for your teams, the car on the track will get a boost, an actual performance boost based on that fandom coming through. If you’re a legacy motorsports enthusiast, that might be considered sacrilege, that the fan can actually control what’s happening on the circuit. But in this next generation it’s actually very intriguing, they’re leaning into the issue, and saying alright, if the fans actually vote for these top three teams, on race day they can actually boost those cars and get more power into the engine, which is very intriguing.

Burke: And that’s where we see with younger kids, and all of these experiences, the more that they are involved, the more that there is that relationship between the brand or the leagues and the kid, in a sense that feels like, “They get me, and they want me” and I feed back to them — a relationship is where the answer will be with kids.

Luker: Well, if you step back and think about it, I’m going to keep building the negative case just for a minute. Before we talk about the good side of this let’s be sure what we’re talking about. So we saw these declines for 12–17, and you’re going to show this in a slightly different way in a migration for the younger kids. And we decided to look at 12–17 year olds in a bigger picture. We have a lot of variables on technology as a whole. And so what we did, the key factor here that really alarmed us was: from 2012–2016 the percentage of 12–17 year olds who said that they were online for most of the day went from 20% to 40%.

Now let me be clear about that, if I asked you how many of you spend most of the day online, I mean is that something that we’re proud of? Is it something we’re even conscious of. So I’m telling you, it may be 40%, but it’s actually more than that. Now, what does that mean in terms of sports? If you’re online most of the day, what we did is the two on the right are the dominant things for 12–17 year olds in general online activity, the two on the left are sports. On the far right is streaming, 18% of the population says that’s very important to them, 52% of 12–17 year olds, and 44% of 18–34 year olds.

Social networking, 20% overall, 50% — draw a line there. The percentage who watches 8+ hours of sports on TV, that’s a big deal, 20% of the population of those who are online most of the day, 19%. 12–17 year olds dominate everything in sports. It’s less there.

Friedenberg: This is important from an opportunity perspective. Overall consumption of media is skyrocketing. It’s shifting, it’s changing. Scripted television, non-scripted television, news, sports, it doesn’t matter. The actual total tonnage of consumption is skyrocketing upward. For the most part people are working an additional work week of just consuming media. So on top of their 40 hour work week, or 50 hour work week, they are doing the same on a consumption basis as well. So there’s a lot of tonnage here. How it’s shifting, and how it’s maneuvering, and how it’s being consumed is the question. And how do you lay into that and plan for that in the future. But it’s actually a good thing from a consumption standpoint.

Luker: That’s absolutely right, Keith. There’s another piece of that. When I was growing up, there was no competition. And we’ve measured for 30 years, what are the priorities? Time with family and friends are the highest priority in free time. You have personal activities, productive activities, outdoor, going out on the town, movies and such. And always, for the 30 years we’ve measured it, the two bottom things have been sports fan activity, not playing sports, but watching sports TV. I’m a social psychologist, I should have known this.

My dissertation was on how media affects adolescents, and I completely blew this. The issue was, there was no competition! Here’s how it works: If I want to do something and there’s only one thing I can do, I don’t have to make a choice. As soon as I have to make a choice between two things, whatever I choose is a priority. And that’s what happening.

We now have to prioritize, and what we’re losing in this space is that people aren’t prioritizing. And I’ll tell you why. Because we aren’t doing anything to earn that priority. We’re not doing the things that say “This has heritage value to you, it’s more important than other things, it has a lot of legacy to it, it’s a great experience.” We’ve assumed for 50 years that fans would be there. That if you built it they will come, and they did. Sports hasn’t changed. It’s just as valuable, it’s just as powerful. We just have different work we have to do to get them there.

Burke: Yeah, so where Keith was talking about that shift you see this very dramatically in this slide. What it’s measuring is you have kids 5–7 years old right here reporting themselves on the devices in their room. Basically the things that help them consume the media that’s traditionally for them (and I’m talking traditionally five years ago… And then their mom is reporting the same thing.

And from 2013–2017, why have all those devices left their room? Now they have a tablet. Now they have control and can go, as Rich was saying about choice, now they have choice. They’re not limited to that disk and the choices of that disk. They have an infinite variety of places to do, to gain, to watch video, to do all sorts of different things, and so that access to the internet is where they’re at.

Luker: Well, and it wasn’t 20 years, it was five years…

Burke: And so we see this again with moms and their reported use of tablets. Kids 5–7, in that same four year period, everyday use reporting of tablets doubles. As Rich had said, moms are not always proud to report these kind of things so the numbers are often depressed because they’re not going to want to be like “My kid’s on a tablet all the time.” And so, I would say those numbers are a little bit depressed. But you see it right there with kids 5–7, that’s where those kids are at, that’s where their engagement is.

Luker: Let’s give a little context to that. So how many of you caught the story in Colorado about a guy who’s starting a petition to make it illegal to sell a smartphone to anybody 13 or under or to buy it for them? So you can’t buy it if you’re that age or younger. That’s irrelevant! When this many people already have a smartphone that’s like saying “Okay, you don’t get pants anymore.” You can’t do that.

Friedenberg: You can’t put the genie back in the box.

Luker: Yes, that’s exactly what we’re saying. So now CBS I think did a video series, a very very long segment, where they had families put cameras all over their house, and then they had kids 5–7, and they’re on tablets at the supper table. And they’re substituting out people for their families, it’s somebody else sitting there that nobody knows, somebody in a gorilla suit; they put a horse in the living room and the kids don’t even notice it.

So there are these concerns about how absorbed and attached they are to these devices. And now pediatric doctors are saying you’ve got to limit the amount of time a 2–3 year old has on a smartphone. Right, that’s how pervasive this is. These are all in the last month.

Friedenberg: But are sports leagues creating that surprising delight that the younger generation is looking for? We do have to talk about the content. I know there are aspects of how you control what’s on field, and that makes perfect sense. But the ancillary programming, how you bolt on additional engagement that can be re-architected to build in more surprising delight, get kids more engaged, and actually put them into the fan funnel? Which is my main point, ultimately, these kids have to engage the fan funnel and we have to drive them down. To your point earlier, that fan funnel is organic 5–15–20 years ago. It’s not organic any longer. You actually have to lean into it and push them down the funnel. And that’s a new paradigm for the sports industry overall.

Burke: And something you had said earlier, regarding this idea, this change might not be good news for Fox, and those companies short-term. But for league sports, with all the different ways you can engage — the kids are looking for it.

If you find them, if you give them that kind of engagement, that kind of thing they are looking for, they’ll be there for you. They might consume you, they might create a relationship in a different way than we did, which is sit down and watch a three hour ball game. But they’re watching Aaron Judge highlights, and they’re doing all sorts of things. They’re engaged in the sport.

Friedenberg: The point is options. Whether it’s linear broadcasts, whether its SVOD, whether it’s the internet, social media engagement, digital, snackable content, three-hour football games, whatever it might be. The point is, the power and control has shifted to the consumer. And on any platform, or any device, or any distribution mechanism, we have to acknowledge what the value proposition is of that mechanism and then lean into it and really offer and enhance services through it.

Luker: Before we kind of start getting to the best of the best news, are there any questions?

Audience Member: Given that with binge-watching you don’t have to watch the commercials and we’re talking about doing shorter things, aren’t there things the leagues can do for example to remove that, find another way to monetize it to make it work?

Luker: I’m going to piggyback off your question and shoot this at Keith. Because she’s right.

Friedenberg: It’s a valid point. How do you safeguard the existing ecosystem, and financial mechanisms around sports even though the landscape is kind of shifting at your feet. I think that’s the multi-billion dollar question that everyone’s asking right now. I don’t think anybody has the solution, I think what is changing though, is the older paradigm was we have to make these absolutely ginormous bets and bet the house on it. That it’s going to end up being this way and that bet’s going to win for us.

Now I think the industry as a whole is moving toward an ecosystem of death by 1,000 cuts. How do we dabble in dribs and drabs and find a million different ways to engage consumers. And hopefully that total tonnage of engagement will start to level the playing field from an advertising perspective, or a sponsorship perspective as well.

So it’s yet to be known exactly what will happen, but I think what was maybe 10 years ago of a major player in sports being like “Here’s my big ginormous bet, double down on this and see if it will work.” Now everyone is saying “Hey listen, we need to try all these avenues of engagement, and whatever one seems to win, we’ll start pushing more behind; the ones that fall off, fall off.” It was a half answer, I admit it was a bit of a half answer.

Burke: I would say something else that kind of echoes on that idea. Extremist came out with some data that said the “Netflix kid” is watching six days less of advertisements than that traditional “cable TV kid.” And that’s six 24-hour days. If you narrow that down to about a six-hour watching day, that’s a month less of ads. And then you’ve got the other thing, kids are actively looking for that “Skip Ad” . If they can’t get that “Skip Ad,” then they’re going onto another video. They’re being trained to actively ignore any of these messages, and so it is a concern, and I think Keith is right on that idea.

Luker: For those who may not know Keith, he’s at WME | IMG, but he’s in charge of all their intelligence and insights globally, and it goes across sports, it goes across entertainment a lot of things, and again it is globally. He’s interfacing with everybody involved in the chain — the producers, the sponsors, and everybody else. This woman has raised a very bold kind of statement and question. And what I want to ask you is, so we’ve seen this coming for 25 years, we’ve had the internet for 25 years, and the attitude in the industry has been, “Well we know it’s coming, but it’s not here yet.” How do we get them past the fact that we have? It’s here.

Friedenberg: I think the legacy mentality of kind of circling the wagons is actually finally imploding. I don’t think anybody believes in really circling the wagons anymore. You have to re-engineer what your content offering is, and what platforms it’s going to flow through. I think there’s a myriad companies doing a myriad of things to try to engage on a different kind of level with consumers. Advertising, sports sponsorship, all of it will come into the funnel as well. But I think that the most opportunistic issue coming up right now is the fact that people are acknowledging that it’s going to happen, it’s already here. There is no delaying it, there’s no circling the wagons, there’s no defending it.

You cannot build a moat around some of these issues. Because the genie is already out of the box and what are you going to do. But it’s difficult because you’re looking at a multi-billion dollar, traditional ad inventory ecosystem that’s being pressured by new platforms. Younger generations trained to not engage in commercials, right? And of course, clearly commercials can be more engaging, be better created, and actually be better embedded, whether its integrated vs. a 30-second ad. There’s a lot of options there, but no one truly knows exactly how it’s going to net out. It’d be a fallacy for me to say this is a completely known issue.

Luker: Well and saying everything is going to change in two years, you know, my clients ask me what’s going to happen in five years. With VR and the impact of AI, we can’t have any idea.

Friedenberg: But do issues, for example of AR/VR, create new opportunities for content distribution, and for advertising as well? So now, again, what was considered a threat, is something to lean into, and is an opportunity for Madison Avenue to engage.

Burke: And kids have told us that they will engage with advertising of brands that they have a relationship with. That they trust will give them something that they want. They will do that. They will seek it out and be like “oh, I welcome that.”

Friedenberg: If it’s relatable enough and authentic, and it’s given to them in the right ecosystem, in the right form of content, they will engage with it.

Luker: Here’s the punchline. We have no clue what’s going to be true with technology in five years. Nobody can predict it, no question. So is there anything constant we can build on? Yes, there are four things, and they’re all part of the same thing, and that is, being human will never change.

You’ll never be an adolescent and then a baby. So the process of growing up will always be the same, number one.

Number two: The consumer purchase model will always be the same. Babies will never buy clothes and food for their parents.

Number three: Human emotions will always be the same. Sadness will be sadness, frustration, frustration, happiness, joy etc… all will be the same, just delivered with different systems.

And number four: We’re not all going to move into pods where we live by ourselves and go online. We need this, we want this, and relationships are critical. 77% of kids 12–17 say “I’ve maxed out. I’ve actively looked for ways to get offline.” The opportunity here is to build relationships with people, with family and friends, that we know will be true. And sports does that better than probably just about anything.

Audience Member: Adding on to this question here, we’re talking about advertisements and the 30 second spot kind of fading away, not being as effective. But now, we’ve got user-generated content. So you look at Snapchat, the Taco head, the Gatorade shower, influencer marketing, and those influencers creating branded content. What do you guys think about that space? What’s your opinion in that area?

Burke: So, you talk to the kids themselves, and they will tell you that the number one thing they will search for looking for new video, is from a YouTuber that they like. So those influencers are really powerful, but here’s the thing. If you’re taking on that YouTube influencer onto your brand, and it’s not an authentic feel, and that person is selling it and not living it, is not a fan boy, or is not really engaged with the product, they are going to sniff that out in a second.

They have now become experts, right? Malcolm Gladwell’s 10,000 hour rule that that he kind of surmised from social scientists. I say they have a 10,000 image rule. They’ve seen so many images they know authenticity from what’s being sold to me. Right, they can intuitively know that difference. And so if you’re tacking on a YouTube influencer, you’re going about it the wrong way. If there’s a genuine connection, if there’s an authentic relationship between that YouTuber and that brand or experience that kid will get that and say “Boom!” then that’s exponentially more powerful than just getting a spokesperson.

Friedenberg: From a WME | IMG perspective we have a huge roster of social influencers that we offer to multiple brands, multiple properties, scripted television, non-scripted television, the entire ecosystem of media is now being influenced by these influencers that are part of our roster of talent.

Luker: Other questions, we still have a few minutes left.

Audience question: Is there one thing that you would tell all three major leagues that they need to do over the next few years?

Luker: No question about it — focus on the parents of kids under the age of 11 because the extent to which they…. Here’s the challenge, we’ve learned this bizarre thing in research. We have 100,000 stories about the love of baseball, and we go through it, and all of the sudden they’d say “And that’s when I got the tattoo.” So, we started focusing on tattoos, and sure enough if you do what we call Google ink research, so say [Google]“NBA tattoos.”

But then do teams — that’s much more powerful — and see what comes up. You’re going to be astounded by how many, and how rich they are. They’re incredible. I’m here to tell you, MLB didn’t put a St. Louis Cardinals tattoo on this guy, and certainly the Cardinals didn’t either. But I’ll tell you who shows up doing it most. Grandfather, mother, brother, somebody who is connected to it. The love was so great that it ended up being a tattoo.

Here’s the deal, we have maybe five years, and I’m saying five years is the only thing that you can count on, that people who still have tattoos, who have a love of sports that’s so strong that they want to be identified by it for the rest of their lives. So what is it? It reminds them why they love the game, number one. Ask them if it was so important to them in their lives and growing up, do they really want their kids to not have that same experience, and make it possible for every single kid to play and attend? If you’re baseball, go straight to the game, if it’s the NFL, it’s before they’re in high school. It’s the high school bucket list, “I’m going to take you to an NFL game.” It’s the parent of those kids that are priority number one.

Friedenberg: By the way my favorite shots now that I actually seek out, I love when there is a dad at a baseball game with a baby in his arms, and the foul ball is coming over, and he sacrifices his kid to catch that. That’s fandom.

And it’s actually good on both fronts, because he’s obviously a fan willing to sacrifice his kids. But that kid, that’s a baby, somebody under the age of five, probably under the age of a year actually at a game, and enjoying baseball for the first time. So it’s actually a double-whammy of a positive whenever I see those crazy videos on the evening news because if that can be replicated a million more times, sports will be rocking and rolling for years to come.

Luker: Well sports, with all the games when they are collecting all the video, and they go to do tests to see which are most popular, it’s not the plays on the field. It’s what the fans do that is the most popular. No question about it.

Burke: When I heard the MLB, Tennis, and NASCAR and La Liga up here, the thing that I heard that was best from a kids perspective is listen to them. Give them the content the way they want it, not the way you think they want it, not the way you think would be best for your sport to get across. Give it to them the way they want it. If they want Aaron Judge with puppy ears and shooting a rainbow, give it to them that way. Whatever way that will give you that kind of real engagement.

Friedenberg: Brands for the first time, both brands and leagues I believe are starting to let loose of the tight grip on ownership of their brand. They are finally starting to let people play with it a bit. I think that in and of itself is a massive change.

Luker: If you take away nothing else, take away that fifth point. It’s not coming, it’s here. If you don’t know them by the time they are 11, you won’t have them when they are 18.

Friedenberg: And we are out of time. Thanks everyone — appreciate it!

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