- Professional sports are expected to resume in empty stadiums and arenas.
- In Major League Baseball, the Oakland A's and San Francisco Giants are offering fans the opportunity to purchase a cardboard cutout that will appear in the stands.
- There is strong interest among U.S. teams and leagues in this new concept and fan response has been strong.
When Major League Baseball kicks off its abridged season this month, its fan base is going to look dramatically different and they won't be nearly as loud.
That's because teams like the Oakland Athletics, San Francisco Giants and a handful of others will be filling their stands with cardboard cutouts of fans. The trend, which we first saw in European soccer leagues, has now made its way to the United States.
When MLB returns after a lost spring due to coronavirus, fans will not be permitted in the stands. That has forced teams to look for creative solutions to recoup in-stadium revenue and create fan engagement.
The A's announced the start of the "Coliseum Cutouts" program on Monday, which allows fans to put their image on an 18 x 30 cardboard cutout and for the chance to see their cutout appear on television. In 24 hours, the A's said they have already sold 1,000 "season tickets" for the cardboard cutouts.
"Response has been extremely strong," Oakland A's president Dave Kaval told CNBC in an interview. "People are especially interested in the foul ball dunk, where if your cutout gets hit, we send you the authenticated ball to your house."
The price of cutouts varies by team, but in Oakland, prices start at $49 and go up to $129, depending on location in the stands.
The fine print says that commercial advertisements, slogans, websites and social media handles will not be permitted on the cutouts. Offensive or negative references and names of MLB players are also prohibited.
The A's said the cutouts will remain in the ballpark for the 2020 regular season and fans will have the option to take home their cutout as a souvenir when the season ends. The A's do not guarantee the condition of cutouts from weather and other elements.
Kaval said that there's also a visual component to having cardboard fans at the ballpark.
"It has a better feel for the broadcast experience versus seeing empty stands, so I think you will see more and more teams adopt something like this, not only for the fan engagement but for the broadcast experience," he said.
The San Francisco Giants are running a similar cardboard cutout program for season ticket holders, which they plan to open to the public beginning on Monday. The Giants plan to put the images of the season ticket holders in their actual seat locations.
Both California teams say they are using a local small business, AAA Flag, to create the cutouts.
The MLB also endorsed the program.
"We appreciate the creativity of our clubs, their commitment to fan engagement and their eagerness to embrace the different opportunities that have resulted from this unprecedented situation," a league spokesperson said in a statement to CNBC.
Lara Smedley, founder of My Fan Seats, has pivoted her sports events company to go all in on the cardboard craze. Since doing so, she said she has received thousands of inquires on her website from fans looking to bring the concept to their teams. She's currently working with professional and collegiate sports teams to develop and launch their programs.
When fans do return, Smedley said the cutouts can also be used as an effective way to promote social distancing.
"When you do have restricted attendance come back, using a cutout system could look better from an aesthetic perspective than a covered or roped of seat and also be used a very simple social distancing tool... so you'll start to see that later on," she said.
With nearly 40% of MLB's $10.3 billion in revenue coming from local gate and other in-park sources, the league is looking at at least a $4 billion shortfall this season due to the empty stadiums. That's caused teams to look for new ways to generate new revenue.
"The reality is, this is not making up the full revenue that has been lost by them not able to have games returned with full fan attendance," Smedley said. "But this is a way for the teams or organizations to be able to recoup some of their lost revenue."
The Oakland Athletics said their Coliseum Cutout program is not designed to make money for the organization, but to raise money for local charities that have been impacted by Covid-19.
The San Francisco Giants said it's less about the money and more of a fun way to engage with its fans.
The Giants are charging $99 for their program and are providing the cutouts to season ticket holders that have agreed to roll their money to next season.
"The goal is more of a marketing move, and to have fun with the business that were in and give fans a way to still be part of a very different kind of season," said Mario Alioto, executive vice-president of business operations for the Giants.
Yet in Germany, Bundesliga's Borussia Mönchengladbach sold 23,000 cutouts, according to Be At the Game, the company behind the program. With an average price of $26, that's about $600,000 in revenue.
Tom Hickson, co-founder of Be At the Game, said his company has been in discussions with the NBA, NHL and MLS teams about utilizing this new type of fan.
"As sports fans, we're all obviously aggrieved about the fact that the Covid-19 pandemic has prevented fans form entering into sports stadiums and arenas across the world," Hickson said. "So it's a way in which fans can be re-engaged."