Sports Management: Unit 1 Chapter 3/4

What is marketing?
the task of creating, promoting, and delivering goods and services to consumers and businesses.
What is the market’s job?
creating demand
What does sports marketing include?
1. products(equipment, apparel, footwear)
2. services(skill lessons, club memberships)
3. entities(leagues, teams, individuals)
What is the historical development of sports marketing?
1. evolution of sports broadcasting
2. growth of sponsorship
3. development of promotional strategies
4. the birth of research in sport marketing
What was the evolution of sports broadcasting?
changed from pure, reporting aimed at sports fans to sport entertainment aimed at the masses.
What did Roone Arledge do?
the first person to recognize that sport televised in prime time had to be more than sport. it had to be entertainment.
what is sponsorship?
the acquisition of rights to affiliate or directly associate with a product or event for the purpose of deriving benefits related to that affiliation
Who was the first marketer to capitalize on the term official as it relates to sports product?
Albert Spalding
What did Mark McCormack do?
built the sports marketing agency IMG from a handshake with a legendary golfer Arnold Palmer in 1960.
represented thousands of athletes worldwide ex)arnold palmer, tiger woods
What was the second significant force affecting sponsorship in the late 20th century?
What was important about Nike?
it packaged the brand, product, advertising and the athlete into one personality.
When was this achieved?
Nike and michael jordan with “air jordan”
What did Bill Veeck do?
put emphasis on product extensions and the development of team sport promotional strategies. was a sports marketing pioneer in pro baseball
What were the emphasis on product extensions?
1. belief that fans came to ballpark to be entertained.
2. build a loyal fan base making attending a pleasurable experience.
3. create and environment that causes people to talk about their experience.
What did Matt Levine do?
formalizing customer research in the sport industry.
What was the purpose of sports marketing research?
1. profile the consumer demographically, geographically, and psychologically
2. categorize attendance behavior and segment attendance
3. analyze purchasing behavior
4. document viewing and listening behavior
5. offer two way communication with target market
What are the key sports marketing concepts?
sports marketing mix, product, price, place, promotion, segmentation, fan identification, relationship marketing, service quality
marketing mix
the controllable variables the company puts together to satisfy a target group
What the elements with marketing mix associated with sport?
product, price, place, promotion (4 Ps)
the “core” product is the actual event in a spectator sport
any products that must be charged for. ex) tickets, health club memberships, satellite television packages, special access areas on sport websites
where the product is produced and where the product is consumed.
refers to advertising(paid messages through media), personal selling(media exposure not paid for by the beneficiary)
sales promotion (special activities undertaken to increase sales of a product)
entails identifying subgroups of the overall marketplace based on a variety of factors, including age, income level, ethnicity, geography and lifestyle tendencies.
target market
segment of the overall market that has certain desirable traits or characteristics and is covered by the marketer.
age, income, gender, educational background
region or postal code
beliefs, lifestyles, activities, or habits
What are the two popular bases of segmentation are
ethnic marketing and generational marketing
fan identification
the personal commitment and emotional involvement customers have with a sport organization
relationship marketing
strategies can help foster fan identification with sport teams.
What is the aim of relationship marketing?
aim of building mutually satisfying long term relations with key parties including customers, suppliers, distributors. used to earn and retain their business
customer relationship management
the implementation of relationship marketing.
What must be provided to maintain customers and is a competitive advantage for firms?
service quality(high and consistent)
What are the aspects of customer service?
1. regular and meaningful communication
2. personal services whenever possible
3. identifiable procedure to address problems.
4. management program for all people interacting with customers
5. knowledge staff that assumes responsibility
6. quality product or service at reasonable price which customer perceives a value.
oral communication
ability to speak in public, speak in large groups and make persuasive presentations demonstrating knowledge about the product and its potential benefit to the customer.
written communication
the competence to prepare sales presentations, reports, analyses, and general correspondence in a concise and insightful manner.
data analysis skills
use of data to inform decision making process. quanitative skills are increasingly in demand in sports organizations.
computer capabilities
in depth knowledge of presentation software like power point is important to the preparation of professional presentations.
personnel management
the skills to develop, motivate and manage a diverse group of people to achieve organizational goals and objectives.
ability to recognize an opportunity in the marketplace and convince potential consumers of the value and benefits of that opportunity. you must know the wants and needs of the customers. listening is very important.
minimum of bachelors degree in business with an internship in a sport setting. masters degree is wanted for advancement and promotion .
what are current issues with marketing?
1. the rising cost of attending a sporting event
2. the cluttered marketplace
3. image matters
What is one of the key challenges for any one in team sports marketing?
increasing revenues for sport teams
database marketing
involves creating a database consisting of names, addresses and other demographic information related to consumers and then managing database.
What are two factors that have contributed to creating a sponsorship marketplace that is extremely cluttered?
1. rise is number of events and athletes to sponsor.
2. increased focus by SM on increasing revenue by identifying as much saleable inventory as possible.
Regarding image in sports marketing, what is important?
a positive image.
What do corporations identify with?
sports, events or athletes who have unique image.
What has decreased the amount of trust that consumers have in large companies?
corporate ethical scandals.
What should we know about the sport industry?
financially it is both significant and growing.
What is finance?
describes anything to do with dollars, or money or numbers.
What defines finance?
the concepts and techniques used to solve problems and make decisions.
What are the two primary activities of a finance organization?
1. how an organization generates the funds that flow into an organization
2. how these funds get allocated and spend once they are in the organization.
How do funds flow into an organization?
their primary business is to provide entertainment through athletic contests.
How are revenues generated?
ticket sales, concessions, mechandise sales, media contracts, sponsorship revenues.
What must be incurred to generate revenues?
expenses. staff salaries, water, electricity, food and beverage items
What is financial success of an organization based on?
profits or income
What does training in finance do?
makes people evaluate problems using the fundamental concepts of financial analyses.
What are the current issues with finance?
1. last 30 years explosion in spending on recreational and fitness activities.
2. revenues have risen in college sports
3. media revenues grow(internet, TV)
4. all pro sports leagues have increased revenue in past 15 years.
What has increased as revenues go up?
the cost of doing business.
What are some challenges for college sports?
high profile financial successes of major revenue sports(football) overshadow the rest of the sports
What caused the competitive balance issue?
consumers of a spectator sport seeking to be entertained by the game itself.
How have pro leagues altered competitive balance?
1. salary cap
2. revenue sharing
3. luxury tax
salary cap
hard cap: team payroll is absolute
soft cap: payroll limit is set, but can exceed this limit through some exclusions.
revenue sharing
teams agree to share certain types of revenues among themselves.
luxury tax
focused solely on changing the behavior of high payroll teams, such as NY yankees.
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