Sports and Entertainment Marketing

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Sports and Entertainment Marketing

• Unit 1 Marketing 101

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Introduction to Marketing Sample Product

• What is it?
• What can you do with it?
• What are the benefits it gives you?
• Who uses it?

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Define marketing.What words come to mind?

• Advertising?
• Sales?
• Profits?
• Shopping?

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Marketing defined

• Creation and maintenance of satisfying exchange
  relationships
• Planning and executing the conception, pricing,
  promotion, and distribution of ideas, goods, and
  services to create exchanges that satisfy
  individual/ organizations goals.
• American Marketing Association

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Marketing defined
Creation product development Maintenance
continual marketing Satisfaction meet both
needs Exchange relationships both
give/receive
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Most important aspect of marketing is CUSTOMER
NEEDS!

• Identify the need
• Develop products that customers think are better
  than existing product
• Operate the business profitably

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Marketing Mixis the
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The 4 Ps of the Marketing Mix are

• Product what a business offers
• Place (distribution) locations and methods used
  to get products to customers
• Price amount customers pay
• Promotion ways to encourage purchasing and
  increase satisfaction

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Lets take a look atOpening Act. page 4

• What advertising campaigns feature celebrities or
  athletes?
• Does their strategy influence your purchases?

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Marketing Functions

• Product/Service Management
• Distribution/Place
• Selling
• Marketing/Information Management
• Financing
• Pricing
• Promotion

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Promotion-

• defined ways to encourage purchasing and
  increase satisfaction
• most visible of functions/mix
• directly linked to the companys image

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Steps of Promotion

• Focus the Ads
• Who will be the targeted customer group or target
  market? (done through research)
• Which Media to Use?
• How will it reach your group?
• Most common used media print (newspaper,
  magazines, billboards), broadcast (radio, TV) and
  Internet

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Categories of Promotion

• Advertising- any PAID form of communication
• examples anyone?
• Publicity-a marketing technique using free
  advertising outlets such as press releases.
• 3. Sales Promotion-any action / communication
  that encourages buying
• Can you think of some sales promotions?
• 4. Personal Selling- face-to-face communication
  between seller and customer

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Are you a Millennial?page 267 12

• Consider the Millennials----the group of people
  born after 1979. Name 15 products or services
  this group will want and need within the next
  decade.
• __________________ _____________________
• __________________ _____________________
• __________________ _____________________
• __________________ _____________________
• __________________ _____________________
• __________________ _____________________
• __________________ _____________________
• __________________ _____________________

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Millennials..

• How will sports and entertainment market
  researchers learn about these customers?

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Lesson 2 Economics
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Were going to open a new restaurant..

• what kind of restaurant
• _________________________
• where ___________________
• hours of operation_________________
• average meal price__________
• who is our competition________
• _________________________

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Economics

• Study of how consumers / producers make decisions

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The Business of Democracy

• Free Enterprise System-system which individuals
  start and operate own businesses w/o govt.
  involvement.

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Free Enterprise-Basic Principles

• 1. Freedom of Ownership-
• ? you can buy what you want AND do what you want
  with your property (sell, lease, use, etc)
• ? encourages individuals to own businesses
• ? intellectual property is also included
  (inventions, patents, trademarks, logos, etc)
• ? manufacturer/company who want to make/sell your
  product must pay, this is referred to as a
  licensing agreement (serves as a protection)
• NBA T-shirts (t-shirt company and NBA)
• Tiger Woods (Tiger and Nike, Rolex, Am Exp)
• 2. Competition-
• 3. Risk-
• 4. Profit-

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Free Enterprise-Basic Principles

• 1) Freedom of Ownership-
• 2) Competition-
• ? struggle between companies for customers
• ? forces businesses to produce better-quality
  goods/services
• ? Price competition-focuses on sale price
• ? Nonprice competition-focuses on quality,
  location, financing, reputation
• Can you think of some examples for each?
• 3) Risk-
• 4) Profit-

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Free Enterprise-Basic Principles

• 1) Freedom of Ownership-
• 2) Competition-
• 3) Risk-
• ? Potential loss or failure in relation to
  earnings
• ? 1 out of 3 businesses fail w/in one year
• 4) Profit-

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Free Enterprise-Basic Principles

• 1) Freedom of Ownership-
• 2) Competition-
• 3) Risk-
• 4) Profit-
• ? money earned AFTER all expenses/costs are paid
• Unprofitable companies lay off employees, lose
• investors, hurt their suppliers, and provide less
  
• money to govt in taxes

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Role of Consumers

• Consumers do 2 major things
• 1-they pick the winners
• 2-determine demand for product/service
• which in turn determines pricing

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Economics

• Supply Demand willingness ability of
  producers to provide goods/services at different
  prices
• Supply amount of goods producers are willing to
  make and sell
• As price of product less produced
• As price of product more produced
• Demand consumer willingness/ability to buy
  products
• As price demand As price
  , demand

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Economics Terms..

• Surplus when supply exceeds demand
• Shortage when demand exceeds supply
• Equilibrium when supply and demand equal

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Economic Benefits of Marketing

• Added Value or UTILITY-
• amount of satisfaction received
• by consumption
• Form having the correct physical form/product
• Time making product available when customers
  want
• Place product available where customers want
• Possession affordability of product

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Utility continued.

• Lower Prices- good ole supply demand
• When demand is high, product is made in larger
  quantities lower cost lower price
• New and Improved Products-
• Businesses continually look to (better) satisfy
  customers needs and utility, which results in a
  larger variety of goods/services.
• What examples can you think of?
• What sports / entertainment examples can you
  think of?

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Economic Benefits of Marketing

• Added Value or UTILITY-
• amount of satisfaction received
• by consumption
• Form having the correct physical form/product
• Time making product available when customers
  want
• Place product available where customers want
• Possession affordability of product

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Economics of Sports and Entertainment

• A BIG challenge for any sports team/show/band is
  fan attendance? Why?
• Besides ticket receipts what else generates
  REVENUE ?
• What drives up the value of a team/group?
• Ticket receipts,
• media revenue,
• STADIUM REVENUE (parking, food, merchandise,
  luxury seating, naming rights etc.)

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Naming Rights

• Corporations pay millions of dollars for the
  privilege of naming stadiums and arenas
• Arizona Diamondbacks and Bank One30 million
• Miller Brewing and Milwaukee Brewers-40 million

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Will a new stadium create a better team ?

• Yes!
• Generates jobs
• Generates more revenue which results in franchise
  having a better position to bid for players which
  will result in a better team, which brings in
  more fans, which brings in more revenue

• NO!
• A better team comes from training programs,
  practice and skilled coaching
• Most stadiums have been renovated and modernized

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Economics of Sports Facilities

• Stadium lease agreements cities do get some
  , but so does the franchise.
• Ex. Colorado Rockies contributed 53 mil to the
  215 mil Coors Fieldthey pay no rent, but get
  all from concessions, luxury boxes, naming
  rights and stadium advertising

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Economics of Sports Facilities

• New money enters the economy
• Money spent on sports is money that may have been
  spent elsewhere (opportunity cost)
• Local residents attend, but their money wouldve
  went into the economy anyway!

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Economics of Sports Facilities

• Creation of new jobs construction, office,
  seasonal workers?
• Is the quality of the job high?
• Charitable contributions
• Teams make sizable donations to charities (and
  athletes do too)
• Intangible factors
• Community pride and pleasure and joy are hard to
  measure

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Who will pay for the facility?

• General Public (tax dollars)
• Fans (personal seating prices go up)
• Franchise
• Targeted beneficiaries (restaurants and bars
  impose a sales tax in a geographical area)
• Combination of public and private money

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Wild/Xcel vs. Wolves/Target

• 65 million from State of MN
• 65 million from City of St. Paul
• 45 million from owner Robert Naegele
• 2003 figures
• 21 million in payroll (smallest)
• 12 million in earnings (2nd most profitable)
• 139 million worth (Naegele paid 60 million)

• Owned by Minneapolis and managed by Clear Channel
• Does not receive from concert sales
• One of the oldest arenas (13 years old)
• 20 fewer major events in 2000 (448,000 fewer
  customers)
• Twolves
• 65 million payroll
• 8.8 million in earnings (10th most profitable)
• 213 million worth

Success tied to building and revenues teams bring.
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Lesson 3

• Segmentation and Research

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Lets look at some ads..

• Why did they choose different people for the ads?
• We all identify with different types of people,
  we have different likes and dislikes.. this is
  SEGMENTATION!

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      No tall tale. About 15 of your height is added as a teen and milk helps make the most of it.            Jessica Alba 2002 America's Dairy Farmers and Milk Processors
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      Father knows best.Want to win? Milk has 9 essential nutrients active bodies need. In other words, it's the greatest.            Muhammad Laila Ali 2001 America's Dairy Farmers and Milk Processors
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      Which is better for growing bones?Here's a clue. Both chocolate milk and regular milk have the same good stuff to help your bones grow strong.            Blue's Clues 2000 America's Dairy Farmers and Milk Processors
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      Girls, here's today's beauty tip. Think about you and your 10 best friends. Chances are 9 of you aren't getting enough calcium. So what? So milk. 3 glasses of milk a day give you the calcium your growing bones need. Tomorrow - what to do when you're taller than your date.            Tyra Banks 1996 National Fluid Milk Processor Promotion Board
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      You grow about 15 taller during your teen years. Wanna play?            Kevin Garnett 2001 America's Dairy Farmers and Milk Processors
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      Don't play ball in the house. Joanie, go to your room. Here's another all-time great mom line Drink your milk. Unlike hairdos, milk's 9 essential nutrients will always be in style. Which is why your kids should drink it. Groovy. Another problem solved in less than 30 minutes.            Shirley Jones, Marion Ross Florence Henderson 1998 National Fluid Milk Processor Promotion Board
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      Bones. Bones. Bones. Maybe so, but unlike 75 of women today, there's one way I'm taking good care of mine. By getting lots of calcium. How? From drinking lots of milk. 1 ice cold. And besides, haven't you heard that the waif look is out?            Kate Moss 1995 National Fluid Milk Processor Promotion Board
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      Play big.Milk has 9 essential nutrients active bodies need, no matter what your size.            Jason Kidd 2002 America's Dairy Farmers and Milk Processors
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Market Segmentation

• A way of analyzing a market by specific
  characteristics in order to create a target
  market
• So whats a market?
• Potential customers w/similar needs/wants and who
  have willingness/ability to buy

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4 Methods of Segmentation

• 1) Demographics- statistics that describe a
  populations characteristics
• AGE tend to classify w/generations
• Baby Boomers 1946-64
• Generation X 1965-76
• Generation Y/Millennials 1977-97
• Which generation is savvy and skeptical?
• Which generation has more money to spend?
• Which generation is the computer age?
• GENDER
• INCOME
• ETHNIC BACKGROUND

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4 Methods of Segmentation

• 2) PSYCHOGRAPHICS- studies consumers on social
  and psychological characteristics.
• ?Attitudes, values, beliefs, TRENDS
• Show me who your friends are and I will
  tell you who you are
• hang out w/people w/common interests

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4 Methods of Segmentation

• Demographics-statistics of population
• 2) Psychographics- studies consumers on social
  and psychological characteristics.
• 3) Geographics- segmenting based on where people
  live (local, regional, national, global)
• 4) Product Benefits Looks at benefits of
  product w/customers needs/wants
• For example Sports Shoe Companies sell shoes for
  joggers, runners, tennis, b-ball, etc.

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Market Research

• You open a store and want to see if customers
  find it pleasant and inviting.
• You want to find out if it will be worth it
  financially and economically to build a new
  stadium.
• Both examples above deal with RESEARCH. One is
  doing research AFTER and one is doing research
  BEFORE.
• notice RESEARCH IS WILL BE PERFORMED AT
  ANY STAGE!

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Market Research

• What Methods used to gather info, analyze it,
  and report findings.
• Why It is used for-
• ?identifying market opportunities
• ?solve marketing problems
• ?implement marketing plans
• ?monitor marketing performance
• ?marketing mix how to promote, price, etc
• Who anyone!

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Types of Research

• Attitude info on how people feel about certain
  products, ideas, or companies
• Market systematic gathering, recording,
  analyzing, and presenting info related to
  goods/services
• Media issues of media selection and frequency
• determines WHICH media are most effective for
  reaching market..
• How many of you like listening to a game rather
  than viewing it?
• Product evaluating product design, usage
  acceptance

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5 Step Process of Research

• Define the problem whats most important
• -are customers satisfied? -are prices
  competitive?
• Analyze the situation
• Develop the process for collecting data
• 2 types of data collection
• Secondary Internet, Govt, Biz Info Companies,
  Trade Publications. Also referred to as Data
  Mining
• What would be some pros/cons to this data?
• Primary survey, observation, focus groups
• Can be performed by yourself or hire a company.
• Collect, organize, and analyze the data
• Determine a solution to the problem.

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Lesson 4

• Target Markets Marketing Plans

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Target Market

• A clearly identified segment of the market to
  which the company wants to reach

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Why care about Target Markets?

• ? Cant be everything to everyone
• ? Increases chances of profits and survival
• ? By focusing on a group, a company can persuade
  easier (by looking at buying behavior)

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How to find a Target Market

• Companies learn info on-
• ?demographics ?geographics ?psychographics
• Do these sound familiar?
• Companies use Segmenting and Research
• One must carefully identify the target market(s)
  for families/individuals can have similar
  education levels, occupations, BUT have varying
  needs for entertainment, sports, etc.

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Questions to Ask

• What are the obvious identifying characteristics
  of the target market?
• Is the identified market a unique segment that
  requires a specific marketing mix?
• Is this market currently purchasing the companys
  product/service or a competing product/service?
• What are the important needs/attitudes of the
  identified market that relate to the
  product/service to be provided?
• How does this target market go about making a
  purchase decision? What are their motives

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What is the last thing you purchased (other than
lunch)?

• Need to look at..
• Decision-Making Process Buying Behavior

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Decision-Making Process

• Define the Problem
• Identify the options available
• Gather info determine consequences of each
• Choose the best option
• Take action
• Evaluate Results

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Making decisions is affected by

• Previous experience w/company or product
• How often product/service is purchased
• The amount of info necessary to be wise
• The importance of the purchase to customer
• The perceived risk in the purchase
• The time available to make decision

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Buying Behavior

• Process individuals use to decide what they will
  buy, from where they will buy it, and who they
  will buy it from
• So a marketer would use this info and make their
  decisions about how best they can serve you.

Example Do you want to entice customers to buy
a lot of low-priced items or a few high-priced
items?
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Motives

• Rational-conscious, logical reason for purchase
• Emotional-feeling experienced through association
• social approval recognition
• power love
• prestige
• Putting it all together (functions, mix,
  segmentation, research, target markets)

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RESULTS in a Marketing Plan

• Mission of Business
• Goals of the Business
• Product Planning
• Marketing-Information Management
• Distribution System (place)
• Pricing
• Promotional Strategies
• Financing
• Purchasing
• Risk Management
• Selling
• People
• Internal Communication Systems
• Timelines for Implementing the Plan
• Intervals of Review Evaluation
• The future

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The End

• FINALLY!