542: Now See This: One CFO’s Data Visualization Mantra | Tim Zue, CFO, Boston Red Sox

Listen to the Episode Below (0:42:52)

­­­When it comes to guessing a person’s email address, most of us would agree that the best way to optimize your odds of success is to first assume that the person was using their actual name as part of the address. From there, your next decision arguably is whether to spell out the individual’s first name or use an initial for it.

For Tim Zue, the calculation behind one guess was a bit more nuanced because although the first name of the person he was emailing was Lawrence, the man was widely known as Larry. With little to lose, Zue addressed the email to LLucchino@redsox.com.

Sixteen years later, Zue is CFO of the Boston Red Sox, and his “initial decision” sticks with him perhaps as a reminder that every carefully built career contains serendipitous moments.

Still, the email that Boston Red Sox then-CEO Larry Lucchino received from Zue did not come from a career-minded controller or accountant, and it was not a job inquiry. At the time, Zue was teaching 8th-grade math in the Boston public school system, and with a summer break quickly approaching, he had a thought: “Hey, wouldn’t it be cool to work for the Boston Red Sox as an unpaid intern?”

Such a thought is not unlike one widely shared today by Zue’s CFO peers, but in this case, there’s one necessary modification: “Hey, wouldn’t it be cool to be CFO of the Boston Red Sox?” Meanwhile, not wanting to overstate the rewards of a correctly addressed email, it’s probably worth mentioning here that Lucchino’s unpaid intern was an MIT graduate with a prior tour of duty at Bain & Company as a management consultant. –Jack Sweeney

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Guest: Tim Zue

Company: Boston Red Sox

Headquarters: Boston

Connect: www.mlb.com/redsox

CFOTL: It may seem obvious – but I suspect we may be a little surprised to learn how a major league baseball team generates revenues these days. Can you break things down for us? What are your top of mind metrics?

Zue: Ticket sales are certainly the most important metric for us. Ticket revenue is roughly 50% of our revenue, so #1 is selling tickets to Fenway Park. We actually use software called Tableau. I have an app on my phone, and we have all sorts of reports available. There’s a report that shows the tickets sold for every game compared to budget, and I it two or three times a day. It’s funny–some of the IT guys will see when I check it, and they’ll go, “Tim, what were you doing at [2:00] in the morning looking at the Tableau report?” So, that’s probably #1–just making sure that our ticket sales are in line with our expectations for the individual games. When they’re not, we can have our marketing and ticketing folks focus in on a game and make sure that they initiate some programs that might help along a game that might be struggling. But ticketing is #1.

Of course, there are other ways that we generate revenue, too. We’re selling concessions, so food and beverages, Fenway Park franks, beers, and so forth. We also have an incredibly loyal sponsorship base that supports the Red Sox, and we have a great team that’s continually reaching out to find unique, creative partnerships on the sponsorship side. We sell TV rights, so we get rights fee payments from NESN, our local broadcast partner, and from our radio partner, WEEI, but we also get payments from the league because they generate revenue from their national deals with ESPN, Fox, TBS, and so on.

So, those are really the core revenue streams. More recently, we’ve expanded our use of Fenway Park for non-baseball game events. When we got here in 2003, there had never been a concert at Fenway Park. Since then, we’ve had 75 major concerts, which have generated over $50 million in revenue, in addition to high school football, college football, Winter Classic outdoor ice hockey, ski jumping, and all sorts of other things. The use of Fenway when it’s not hosting a baseball game has been a really great growth opportunity for us.

We have a focus on providing information. We have a report that shows our game day staffing labor compared to budget that the folks that manage that can look at. We have various ticket sales reports. We have heat maps that show Fenway Park, with the areas of the park that are unsold in red and the areas that are sold in green. We try to put things in a format that is easy to digest–it’s not a massive spreadsheet with 10,000 numbers.