SPORT AND ENTERTAINMENT

MARKETING
SPTE 380
 OBJECTIVES

 To understand the market forces that create the need for

enlightened marketing strategies in the sport industry
 To understand marketing myopia and other obstacles to
successful marketing strategy
 To recognize the components of the sport product and the
sport industry
 To recognize factors that demand a different approach to the
marketing of sport
KEY INGREDIENTS OF A SUCCESSFUL
SPORT BRANDING EFFORT
• Stickiness of an idea: How does brand capture
fans’ imagination?
• Nike – Find Your Greatness
• Reach of brand: How far does influence of
brand extend?
• Social identity: Do different segments of the
population relate to the brand in a personal
way?
• Marketing the Cubs
KEY INGREDIENTS OF A SUCCESSFUL
SPORT BRANDING EFFORT
• Media interest: Are members of the media
captivated in some way by the influence of a
brand?
• Monetization and marketing metrics: Can
marketers put a number on brand’s value or
success?
 SPORT INDUSTRY

Plunkett Research 2017

An estimate of the size of the American sport industry
 Measures tend to employ different methods and
assumptions = inconsistent numbers
Significant number, yet still a relatively small piece of
the economic pie
Gross Domestic Product (GDP)
 Total value of all goods and services produced over a period of
time
 Approx: 17 trillion (USA)
 SPORTS

 Time, Attention & Money

 Education
 Mass media
 Art
 Economics
& Business
 Politics
 Religion
 SPORT INDUSTRY TRENDS

Growth
 “In the space of a few decades, the world has come to take
sport more seriously than ever before” (Kuper, 2012)
 At the gate and beyond
 SPORT INDUSTRY TRENDS

 Competition
 “Time is the greatest commodity someone has” (Steve Hank, Arizona
State Athletics)
 “Our biggest competitor, everyone’s biggest competitor, is HDTV.
There’s no doubt, to view a game in your own living room, the beer is
colder and cheaper, the restroom is closer, and there’s no line.” (Bill
Prescott – formerly with the Jacksonville Jaguars).
 Technology can lead to media challenges and opportunities
 Mobile
 Apps
 Television
 Grassroots Sports
 Greatest number of fans
 Tremendous opportunities
 COMPETITIVE MARKETPLACE

 Leisure spending on spectator sports has decreased in the

United States.
 Expansion of sport entertainment and participation options
creates greater marketplace competition.
 Maintaining market share can be difficult for sport products.
 Popularity of some sports, such as action sports, is plateauing
or declining.
 MEDIA CHALLENGES

 The way that fans consume sport has evolved considerably,

particularly with the explosion of new technology such as
social media, mobile devices, and high-definition televisions.
 Popularity of newspapers is in sharp decline.
 Sport and media organizations must adapt to new means of
reaching consumers.
 SPORT MARKETING

With the increase in media exposure and public

interest, sport marketing has become more difficult.
 Rising expenditures and high costs for average fans
 Increased competition for leisure dollars
 Increasing number of entertainment options
 Marketing clutter
 “People’s time is that much more
precious these days…”
(John Rizzardini, formerly of
the Seattle Seahawks).
 SPORT MARKETING

• Sport Marketing
• The specific application of marketing principles and processes
to sports products and to the marketing of non-sports products
through association with sport.
• Marketing goods and services pertaining to participation in
sports.
• Marketing sports leagues and sporting events to attract
consumers.
• Using association with sports (athletes, teams, sports themes,
etc.) for marketing other goods and services.
 SPORT MARKETING

Sport marketing consists of all activities designed to

meet the needs and wants of sport consumers
through exchange processes.
1) Marketing of sport products and services directly to
consumers of sport.
2) Marketing of other consumer and industrial
products or services through the use of sport
promotions.
 SPORT MARKETING ATTEMPTS TO:

Identify and satisfy the needs and wants

of prospective sport consumers.
Build and sustain volume for an
organization.
 EXAMPLES

Consumer Need = Entertainment and diversion

Consumer Want = Watch pro baseball game,
follow via app

Consumer Need = Exercise

Consumer Want = Work out at health club

Consumer Need = Image enhancement for a

company
Consumer Want = Align with positive image of a
successful athlete (e.g., have Tom Brady endorse
the company’s product)
 THE EXCHANGE PROCESS

An exchange is a marketing transaction in

which the buyer gives something of value to
the seller in return for goods and/or services.
 THE EXCHANGE PROCESS

 Three Methods are used to achieve this goal:

1. Attract new customers
2. Conduct more business with existing customers
3. Reduce the loss of existing customers
 CUSTOMER LIFETIME VALUE

 Customer lifetime value (Pedersen, 2015)

 Amount of money a customer will spend at your business over their

lifetime
 Each customer is more valuable than his or her CLV reveals
 Drive new business
 Bad experiences
 Customer will tell up to 16 people; therefore,
 17 people may never visit your business
 If the customer was valued at $1,000/annual revenue
 $17,000
 Social costs
 Online reviews
 Difficult to quantify
 SATISFYING CONSUMER NEEDS

Why can’t a sport organization focus on

consumer needs of all individuals?
Target Market - selected group of consumers
 MARKETING MYOPIA

A lack of foresight in marketing ventures

 Focus on selling rather than satisfying needs
and wants.
 Belief that winning absolves all other sins.
 Confusion between promotions and marketing.
 Ignorance of competition inside and outside of
sport.
 A short-sighted focus on quick-return
sponsorships, instead of long-term
investments and relationship marketing.
 MARKETING MYOPIA

Poor quality research

Poor sales, delivery techniques and service
Arrogance and laziness
Failure to adapt to industry, market and
consumer change
 SPORT MARKETING IMPROVEMENTS
OVER THE PAST 15 YEARS
 Improvements in sales training
 Broadening of knowledge
 Degree programs
 Academic and trade journals
 Professional organizations
 Broadening diversity
 WHAT MAKES THE MARKETING
OF SPORT GAMES UNIQUE?
Intangible and subjective
Strong personal & emotional identification
Simultaneous production and consumption
Social facilitation
Inconsistency and unpredictability
Little control of core product
SPORT PRODUCT
 SPECIAL FEATURES OF THE SPORT
MARKET
Simultaneously compete and cooperate
Sport consumers consider themselves to be
experts
Demand can fluctuate widely
Universal appeal
 SPECIAL FEATURES OF SPORT FINANCE

 Pricing the individual sport unit (i.e., ticket) using traditional

methods is difficult.
 Marketers make pricing decisions based on demand
 Indirect revenues frequently greater than direct operating
revenues
 Hidden costs for consumers
 SPECIAL FEATURES OF SPORT
PROMOTIONS
 Media exposure can be a double-edged sword
 Focus on individual celebrities/athletes can lead to
difficulties for the overall team or organizational brand