San Francisco Giants pitcher Tyler Anderson (31) pitches during the first game of the MLB double header between the San Diego Padres and the San Francisco Giants on September 25, 2020 at Oracle Park in San Francisco, CA.
Brian Rothmüller | Icon Sportswire | Getty Images
The San Francisco Giants have partnered with sports marketing agency Pivot to save money on portions of their team travel expenses.
As part of the pact, Pivot will book all Giants hotel stays for the 2021 Major League Baseball season. The company doesn’t charge the Giants a fee and generates revenue from the deal by sharing 7% to 10% with hotels at room-only rates. Sports clubs spend over $ 1 million on hotel rooms alone. According to Pivot, teams can save up to 10% on annual costs.
In an interview with CNBC on Monday, Mario Alioto, executive vice president of business operations at Giants, said the pandemic has forced the team to rethink its operations, including team travel. Strategy. Alioto added that the Giants are already forecasting savings this season by adding Pivot.
“The prices were better than we thought,” said Alioto. “I think this is going in the right direction. They can bring us better prices and frankly better prices in some cases [hotel] Characteristics.”
MLB teams said they suffered losses in 2020 due to the pandemic, as fans were not allowed in the stands and the season was shortened to 60 games. Los Angeles Dodgers CEO Stan Kasten told CNBC in October it would take years to reverse the club’s more than $ 100 million in losses. In December, the Associated Press reported that MLB clubs are suing insurance companies to recover from billions in losses.
“We like to control as much as possible in-house, but in this case it made sense to outsource some of our team trips,” said Alioto. “It takes a long time to negotiate with many [hotel properties]. This saves us money over time and we are also more efficient internally with our own time. “
The Giants are the first Major League Baseball team to add Pivot. Founded in 2013, the company has active partnerships with National Basketball Association teams including the Brooklyn Nets, Los Angeles Clippers, and San Antonio Spurs.
Pivot also has departments that include branding, college naming rights, and competitive video games. Travis Wade, vice president of travel at Pivot, said other “big deals” with pro teams are in the works but could not reveal clubs due to active discussions.
“We built a foundation in three years with an incredible customer base,” said Wade, the former Spurs equipment manager. “This is a unique niche market. We classify ourselves in this small, unique niche: a travel agency that comes not only from the hotel, but also from the gaming experience.”
Wade said the company is also aiming for a $ 25 million donation to expand its White Glove service and advertising, and to create a mobile app for customers.
“This isn’t just for an angel investor,” said Wade, referring to the “technical dynamics” that Pivot is trying to establish for its travel division. “And that’s something that scales based on the unique relationships we can build.”
The hotel industry was one of the hardest hit sectors due to the pandemic. The American Hotel & Lodging Association estimates that half of all U.S. hotel rooms will be vacant in 2021 as the effects of Covid-19 continue. A total of 36,000 hotel-related employees were hired in February, according to the Labor Department, showing signs that the travel industry may rebound.
“Nine out of ten travel agents are currently dying from a pandemic, but we are thriving because our customers are traveling,” said Wade.