Chapter 3

Marketing Principles Applied to Sport Management

What Is Sport Marketing?• Create demand

– Create, Promote, Deliver goods to consumers

• Obtain the best possible understanding of what consumers want

• Includes the marketing of – products, such as equipment, apparel, and

footwear – services, such as skill lessons or club

memberships– entities, such as leagues, teams, or individuals

History of Sport Marketing

• Mark McCormack– Founder of IMG; first sport marketing firm in 1960s– Now international and broad categories

• Categories– Sport Broadcasting– Sponsorship– Promotional Strategies– Research

Evolution of Sport Broadcasting• From pure, factual reporting

aimed at sport fans to sport entertainment aimed at masses

• Roone Arledge: ABC Monday Night Football; combined entertainment and sports

• Led to proliferation of sport channels– ESPN (ESPN2, etc.)– Big Ten Network

© Comstock Images/Getty Images

Sport Sponsorship • Sponsorship:

– The acquisition of rights to affiliate or directly associate with a product or event for purpose of deriving benefits related to that affiliation

• Albert G. Spalding – Use of the word official

• Mark McCormack – Built IMG through golfer Arnold Palmer

• Nike and Air Jordan – Packaging of the Nike brand, product, advertising, and

athlete into one personality– Ambush marketing

Product Extension and Promotion

• Bill Veeck– Team must provide reasons other than the

game itself for people to attend and support franchise.

1. Create the greatest joy for the greatest number of people

2. Ensure a pleasurable attending experience

3. Create conversation

Research in Sport Marketing

• Matt Levine – Credited with formalizing customer research in

sport industry; audience audit, intercepts, focus groups

• Pass-by interviews: – On-site interviews in heavy traffic areas such as

malls – San Jose Sharks logo and colors changed as a

result of pass-by interviews

The Marketing Mix• Controllable variables that company puts together

to satisfy a target group

• 4 Ps: – Product (actual event vs. experience) – Price (depends on value or perceived value) – Place (preselling and exceptional locations)– Promotion (advertising, personal selling,

publicity, and sales promotion, public relations)

Segmentation• Identifying subgroups of overall

marketplace based on demographic, geographic, psychographic & product usage

• Ethnic marketing – Growth of Hispanic population, ESPN

Deportes

• Generational marketing – Generation Y and action sports

Fan Identification

• The personal commitment and emotional involvement customers have with sport organization

• Enhanced long-term loyalty in sport fans

• Sponsorship opportunities resulting from ability to tap into strong emotional connection between a fan and his or her sport team © Photos.com

Relationship Marketing• Builds mutually satisfying long term relations with

key parties (consumers, suppliers, distributors)• Begins with customer and encourages integration of

the customer into the company• Builds relationships through communication,

satisfaction, and service• Examples:

– Loyal fan gift rewards, special access to players, and special access to information

Key Skills

• Oral and written communication• Data analysis• Computer capabilities• Personnel management• Sales• Education• Understanding of the sport

product

© Photos.com

Current Issues: Cost of Attendance

• Drastic increase in cost of attending MLB, NBA, NHL, and NFL games

• Increasing evidence that sport fans are not willing or able to pay such prices– Do not see the value of attending a game

• Significant challenge for sport marketers is to develop relationship marketing strategies

• Key challenge for anyone in team sport marketing is increasing revenues for sport teams

Current Issues: Database Marketing

• Creating a database that includes consumer names, addresses, and other demographic information

• Managing database by developing and delivering integrated marketing programs – Including promotions and sales offers to

targeted consumer segments• Database marketing is often an integral factor in a

company’s decision to sponsor an event

Current Issues: Cluttered Marketplace• Numerous and varied entertainment options are

available to a consumer with leisure time• Added technological options for the next generation

of sport fans • Marketplace cluttered for sponsors

– Rise in number of athletes and events, increase in number of advertising opportunities available

• Future – Heightened focus on marketing mainstream

sports to youth; increased challenge for sport entity to demonstrate how sponsor will benefit from a sponsorship

Current Issues: Image• Development and cultivation of a positive image is

becoming increasingly important in sport marketing.

• Cluttered marketplace: Imperative that corporations identify sports, events, or athletes that have unique images

• Corporate and athlete ethical scandals• Result:

• Corporations are more discerning in ways that they spend their sponsorship and endorsement dollars; they may now spend more on nonprofit organizations and causes.