History of Sports and

Entertainment Marketing

Similarities in Marketing

2

Differences in Marketing

Chapter Objectives

Discuss the history of sports and entertainment.

Discuss the impact of sports and entertainment

history on today’s markets.

Explain how sports and entertainment marketers

use tools to sell their products.

Explain risks and risk management of sports and

entertainment events.

Identify differences between marketing sports

and entertainment products.

3

Sports and Entertainment

Connections

What do sports and entertainment have in

common? They have thrilled and entertained

people for centuries—since the ancient Olympic

games and Greek plays.

4

A Brief History of Leisure

Marketers sell participation

in sports and entertainment

events to consumers.

consumers people who

use products

5

The growth of the sports

and entertainment

industries has relied on

consumers with free time,

discretionary income,

and a desire for recreation.

discretionary income

money left to spend after

necessary expenses are

paid

A Brief History of Leisure

By the late 1880s, both wealthy and working-class families could seek similar forms of entertainment, thanks to public transportation.

kinetoscope a device

used to view a sequence

of moving pictures

6

In the late 1890s, Thomas

Edison invented the

kinetoscope.

A Brief History of Leisure

Other milestones in the history of leisure include:

7

Mary Pickford becomes the first international

movie star in 1918.

The first talking movie in 1927 (The Jazz Singer)

Babe Ruth sets records in baseball that would

stand for decades.

The development of television

Development of Sports and

Entertainment Marketing

William “Bill” Veeck was a key figure in the

development of sports marketing. He conceived of

marketing activities and events that surround

baseball games.

Adolph Zukor, founder of Paramount Pictures, was

one of the first film producers to draw big box-office

crowds and own a chain of theaters.

8

Bill Veeck – Sports Marketer

1941 – Milwaukee

1942 – Philadelphia

1946 – Indians

1947 – Larry Doby

1948 – Satchel Paige

1948 – World Series

1949 – Good Old Joe

Night

1951 – Eddy Gaedel

1959 – Scoreboard

1976 – Minnie Minoso

1980 – Minnie again

1979 – Disco Demolition

Other Promotions

– Harry Carey

– Curtain Calls

– Shorts

Marketing Today

Sports and entertainment

vendors compete for a

share of the money people

spend on recreation.

vendors sellers

of products

10

Sports and entertainment

marketing directs consumers

toward sports and

entertainment products.

product a good or

service that any for-profit

industry sells to its

customers

Operating an e-tail business on an electronic channel—the Web—can be costly, due to design, delivery, returns, and operating expenses. Though Many larger dot-com companies crashed in the 1990’s, small stores like Harris Cyclery of West Newton, Massachusetts, actually increase sales using a basic Web site. Today, a third of Harris’s bicycle business rides in on the Web to get hard-to-find parts and personal service. Describe an e-business’s home page to your class after viewing one through marketingseries.glencoe.com.

Fan Clubs Grow Online

11

celebrities. Some fan clubs charge fees, such as Tiger

Woods’ tigerfans.com at $30. Other Web sites are free. For

example, fanemporium.com, which operates for a group of

musical celebrities, charges no dues. Sites offer newsletters,

merchandise, contests, event updates, and more.

For more information on sports and entertainment marketing,

go to marketingseries.glencoe.com.

Fan clubs for athletes and celebrities

make good marketing tools. Thanks to

the Internet, thousands of official and

unofficial clubs are formed. They are run

by fans, corporations, and

SECTION 2.1 REVIEW

Name two inventions that helped to enable more

equal access to entertainment for the wealthy and

the working classes in the 1890s.

Who was a key figure in the development of sports

marketing?

How did Adolph Zukor help the entertainment

market grow?

1.

2.

3.

12

Changes in Marketing

Communicating through

promotion is more

important than ever.

13

promotion any form of

communication used to

persuade people to buy

products

New technologies have

broadened the scope and

reach of marketing

messages, and they can be

entertainment products

themselves.

Marketing Similarities

The marketing of sports and

entertainment products differs

from marketing traditional

products in the following four

areas:

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endorsement approval or

support of a product or

idea, usually by a celebrity

Product

– Endorsement

– Core product

– Ancillary product

– Revenue

continued

core product the main

product, such as sports

event, movie, stage show,

or book

ancillary product a

product related to or

created from the core

product

revenue gross income

WHAT DO YOU THINK?

Marketing Similarities

Place

16

piracy the unauthorized

use of another’s music,

movies, or copyrighted

material

continued

royalty a payment for

material that has been

copyrighted, or legally

declared as belonging to

the creator

continued

Price

– Piracy

– Royalty

– Copyright

Marketing Similarities

Promotion

– Product tie-in

– Cross-promotion

17

product tie-in use of

ancillary products such

as merchandise as

promotional tools

cross-promotion any

form of communication

through which one

industry relies on another

industry to promote its

product

continued

Marketing Similarities

Convergence expands the

potential for profit in sports

marketing and entertainment

marketing.

18

convergence the

overlapping of product

promotion

synergy a combined

action that occurs when

products owned by one

source promote the

growth of related products

Convergence and cross-

promotion help to develop

synergy.

Risks and Risk

Management

In any industry, including the

entertainment industry, there

are risks.

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risks unforeseen events

and obstacles that can

negatively affect

business

risk management a

strategy to offset business

risks

Successful sports and

entertainment marketers

develop risk management

strategies.

SECTION 2.2 REVIEW

What is celebrity endorsement?

What is the difference between core and

ancillary products?

Give an example of synergy.

1.

2.

3.

20

Different Players,

Different Games

The differences between sports and entertainment

can be found in three areas:

21

Consumer loyalty

Product

Revenue stream

Differences in Consumer

Loyalty

If sports fans feel their team

is trying to win, the team can

retain its consumer loyalty.

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consumer loyalty

consumers’ attitude that

occurs when they are

happy with a company

and become repeat

customers

The entertainment consumer

is not motivated by brand or

team loyalty, but by a desire

for satisfying entertainment.

Differences in Product

The sports product is consistent, or stable.

The entertainment product is variable, or

changeable.

23

Differences in Revenue

Stream

The streams of revenue created by marketing

products in entertainment are very diverse.

Sporting events do not usually produce the same

amount of revenue from merchandising and

royalties as entertainment events.

24

Differences in Revenue

Stream

Sports franchises earn

revenue from sponsorship.

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sponsorship the

promotion of a company

in association with a

property

Sports franchises also earn

revenue from advertising

and broadcast rights.

Similarities and Differences in Marketing

26

Sports Marketing Entertainment Marketing

Place

Product

Price

Promotion

Convergence

Consumer Loyalty Lack of Consumer

Loyalty

Consistent Product Variable Product

Many Ancillary Products Few Ancillary Products

SECTION 2.3 REVIEW

List two differences in consumer loyalty between sports and entertainment.

What are differences between marketing sports product and entertainment product?

In what one way does the stream of revenue in sports differ from the stream of revenue in entertainment?

1.

2.

3.

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Identify three people in sports and entertainment history.

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Discuss one way that

sports and entertainment

history has affected

marketing today.

Name three different

marketing tools.

William “Bill” Veeck

conceived of marketing

activities and events that

surround baseball

games. Adolph Zukor

was one of the first to

market dramatic stories

and popular stars in

movies. Charles

Howard marketed

Seabiscuit well enough

that some say he

invented sports

marketing. Other

answers are possible.

1. As new inventions and

technology made

entertainment more

available to the working

classes, marketing was

affected; it is currently

being affected by

computer technology

and the Internet.

2. endorsements,

ancillary products,

convergence, and

synergy

3. 1.

2.

3.

Checking Concepts

continued

Define royalty.

29

Give an example of a

royalty.

Give an example of

cross-promotion for a film.

A royalty is a

payment for

material that has

been copyrighted,

or legally declared

as belonging to the

creator.

4. Answers will vary

because anything

that can be

copyrighted can

earn a royalty if it is

used by a person

or entity other than

the creator. Some

examples might be

books, songs,

scripts, etc.

5. Answers will vary

but may include the

star of a new movie

can appear on a

talk show.

6.

Describe one risk

involved in a sports event.

Many answers are

possible, including

damaged property,

cancellation, injury

to audience,

damage to

equipment.

7. 4.

5.

6.

7.

Checking Concepts

continued

Explain one method of

risk management for one

risk.

30

Critical Thinking

Answers will vary.

One possibility is

purchasing

insurance policies to

protect clients from

industry-related

risks.

8. 8.

Checking Concepts

31

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