Written by Jason DaWayne Smith

I can remember March 11th, 2020 pretty well. It was a fairly normal day. An early morning workout and climb at Avondale’s First Ascent in my hometown of Chicago. 6:10am. Stretch. Click on a podcast to get the day going.

Recode’s Peter Kafka kicked off an interview with ESPN’s Brian Windhorst to discuss the NBA. Just a day before, word of COVID-19 speading through Utah Jazz locker room started to swirl. Golden State had already banned fans at the games. Peter and Brian were just “theorizing” that the league could possibly cancel the season, but, C’mon…really??.

Sure, the TV contracts with ESPN, Turner, etc…are guaranteed, but what about that $250MM playoff ticket revenue at Staples Center? Or the estimated remaining $450MM in regular season ticket sale revenue on the table? The $200MM non ticket revenue (merch, parking, vendors…), down the drain? The millions of lost revenue ad dollars? The league must go on…right?

Sorta.

Later that same March 11 afternoon, Adam Silver announced that the NBA would be “suspending” the 2019-2020 NBA season. The ripple affect was HUGE with the NCAA tourney cancelling, NHL “suspending” the season, the “delaying” of MLB season. Too early for the NFL, but even the “league” was paying attention.

But no one was “cancelling”. Again, just TOO MUCH money on the table. Never mind the threat of a pandemic causing health panic across the globe. Never mind the fear that even touching a table that another player touched before you, could send COVID-19 sprinting through the locker rooms. None of that mattered more than keeping sports on the money train. So, the league…MUST…GO…ON.

I believe it was Chicago’s Mayor, Rahm Emmanuel who said…”You never let a serious crisis go to waste”…

On June 4, 2020 - the NBA announced, after months of research, that the league would return in a new “Bubble” format. In short, NBA players would resume regular season and playoff season play in an isolation zone costing $170MM, but complete with state of the art contact tracing, testing, behavior protocols, and game simulation. Thus far - The Bubble’s lived up to it’s name and gone off without a hitch.

Meanwhile, MLB’s commissioner Rob Manfred made baseball into a day time soap opera, fighting over contracts and resumed play - with almost no clear isolation protocols. Current MLB play has been plagued with infections and game stoppage.

The NHL resumed play, allowing it’s players to travel stadium to stadium and beyond.

NFL’s Roger Goodell - arguably, continued to treat the NFL season as business as usual. Owners decide, players just follow the rules, health and safety…meh.

And NCAA Football crumbled into a Game of Thrones episode of conference vs. conference. Individual school decision making with no player input, no clear protocols, Nick Saban still collecting a massive check.

The NBA seemed to be the only BUSINESS getting it right? The only BUSINESS seizing Rahm Emanual’s suggestion to take this disaster and turn into an opportunity.

So what happened? Why was the NBA, as a BUSINESS, handling this differently? ”THE RIGHT WAY”?

Culture as a “Differentiator.

According to Nielsen, in the 2016-2017 season, 47% of the NBA’s TV viewers were African American, significantly more than any of the other major US sporting leagues. Many of these viewers, when not watching the NBA, are impacted by the cultural uprising happening in the country - driven by the police murder of George Floyd. With nearly 72% of avid NBA fans supporting a show of solidarity with Black Lives Matter, it’s clear that “the opportunity” for the NBA was to latch on to this cultural wave as a differentiator.

In stark contrast the NFL’s Roger Goodell, Jerry Jones, and other NFL owner’s harmful treatment of Colin Kaepernick and other voices in support of racial justice, the NBA has historically been quite democratic in it’s approach to social statements from its players. The league built on it’s fan base, it’s history of social justice engagement, and innovated a completely new form of merchandisable social statements on jerseys, court signage, player interviews. Is it the right thing to do for society? Probably. Is it the right thing to do for long term financial gain and fan growth?- Absolutely. When done with class, there is money to be made in differentiating your business as supportive and engaged with the massive economic opportunity of multicultural customers.

Employee Equity and Decisioning

Approximately 75% or 338 of the NBA’s 450 players are African American. 8 of the 30 head coaches are Black. There is 1 Black NBA team owner.

In comparison, 68% or 1,156 of the NFL’s 1,700 players are African American. There are only 3 Black head coaches across the spread of 32 teams. 0 Black NFL owners.

Sadly, across the major 5 US sports, there are only 6 non white owners of ANY major sporting team, despite the dramatic makeup of players of color. It’s a stark reminder of the lingering racial bias impacting the financial imbalance in the US. However, there’s one MAJOR difference in how the NBA manages this situation vs. the other leagues.

Of the 9 NBA Players Union exec members, arguably, 5 of them are amongst the highest paid and admired in the league. The voice and decision making of the player/league relationship sits with it’s most prolific talent. A critical differentiator.

In contrast, within the NFL, outside of Richard Sherman, I’m pretty sure no one has heard of the other players sitting on the exec board.

And let’s not forget NCAA football. Despite the $10B in annual NCAAF revenue, none of which goes to the players on the field, not one single player was involved in the decisions around this year’s NCAAF season.

The NBA’s player equity amongst star Black players is critical. The coronavirus has been reported to impact African American communities at higher rates than other ethnicities in the US. When your player’s union is made up of people from that same community AND those players are your top money makers - the decisions around how and when league play resumes, you’d imagine, is greatly impacted by the players voices and equity input.

It’s a great example of why having your businesses best Black talent in decision making roles.

It’s a great example of why having your businesses best Black talent in decision making roles. It’s not enough to simply form a diversity coalition, etc…. The employees must have equity and must represent critical draws to your business in order to create what we see happening with the Bubble. A well financed, but strategically precise approach to safe and smart money making.

Innovate or Suffocate

It doesn’t take a rocket science to see what the NBA is doing as light speed ahead of the NFL, NCAAF, and MLB. Coming into the 2019-2020 season, the NBA had a long list of innovation problems.

Absolutely no scarcity issue. With over 80 games, even the players are deciding to skip games aka “Load Management”. How can anyone expect continued fan engagement week in and week out with this volume of events? The All Star game and weekend is dated. The NBA lottery is the least interesting event known to man. NBA is fun in the playoffs, but everything outside of it can feel like a loooong drag.

You could say the same for the NFL. Yes, the NFL has a much bigger “event” draw with it’s 16 regular season - once a week games - but the stop and start of play and abundance of advertising makes games unbearable to watch at times. Staying up until midnight to watch games on Monday night? Who cares? Oh, there’s a Thursday night game as well. Ugh.

MLB…well it’s MLB. If you’ve got time on your hands, like beer, and enjoy afternoon naps - it’s the sport for you.

Adam Silver and the NBA knew this and looked at the pandemic as a way to trial a “new look” with really, NO RISK

While we all love sport, the format of nearly all major sports is dated. Adam Silver and the NBA knew this and looked at the pandemic as a way to trial a “new look” with really, NO RISK. The TV money is in the bag. The merch is in the bag. Season ticket holders are also in the bag for 2020-2021. Player salary was cut, so overhead, much much lower. It’s a no brainer to simply try something new.

The NCAA Basketball Tournament has long gathered hype for it’s “play in” format, it’s multi-game days, and constant drama of the unexpected. The MLB, when it does get interesting, thrives on series play (let’s go White Sox!). The idea of virtual fans - whoa - wait, possibly new incremental revenue opportunities outside of the full seating capacity at the arena? Brilliant!

These core features limit player travel, increase intensity of play, and give more fans more reasons to view AND more importantly, PAY more, to watch the sport.

Trial of these enhancements in the Bubble have led to moderate gains for the NBA, with first “play in” game attracting more than 2MM viewers. Up 7% on previous year seeding games.

In parallel, the NFL, MLB, NCAA, NHL for the most part, business as usual. I’m an avid football fan, but am absolutely dreading watching a 2.5 hour long game on Sunday, with no fans, and at least an hour of TV ads.

What Can We All Learn? Attack Adversity with Diversity

It’s likely clear to you at this point, but the NBA has shown the world exactly how attacking adversity with diversity can be a game changer for your business. Take these 3 takeaways and make the change inside your walls as well.

Real genuine connectivity to the culture, from the inside out, can grow your customer commitment.
Formal and diverse equity in decision making across the riskiest assets of your business improves brand equity and longevity.
Bucking the trend of watching the bottom line, in favor of top line growth, leads to game changing product development and innovation.

All critical keys to future business success, and future business leader innovation within their organizations. Here’s to the NBA for showing an imperfect, but inspiring new way to conduct business.

HOW THE NBA BUBBLE TAUGHT BUSINESSES TO ATTACK ADVERSITY WITH DIVERSITY