Sports Marketing - Chapter 4 Notes

Sports Marketing                                                                      Chapter 4 

Marketing Concept, Marketing products thru sports 

Marketing Concept – “satisfy the customer’s needs”. 

Companies will produce goods and services in relation to what the customer needs; this is called Productivity. 

Companies need to calculate what their Break Even Point is when producing a product or service to see if the venture will be reasonable and profitable. How much of that product needs to be sold to cover what it costs to make it and market it.

Companies will also investigate Opportunity Costs - which is what is the alternative that customers are giving up in order to purchase your product. It’s about choices. 

Two major goals of a marketer are to determine what customers want and how much they are willing to pay. All of the consumers who are part of the target market are referred to as the Economic Market. By knowing customers needs companies can respond to those needs quickly. 

Companies will determine two factors prior to producing a produce or providing a service:

-          What value do people believe they receive from this product or service? This is called Benefits Derived

-          Do we have the capability to produce the product or service more efficiently and economically than the competition? – Competitive Advantage 

Companies will also keep in mind consumer wants and needs, they use           

Maslow’s Hierarchy of Needs Pyramid. (see handout) 

Consumers make two types of purchases:

-          Emotional – purchase with little thought, impulse

-          Rational – recognize needs and wants and assess their priorities, do research, and consult a budget. This is careful thought and sound reasoning. 

Companies make these decisions by gathering and collecting information.  They do this with Internal sources about customers buying habits from sales and production records on their customers. They will also use External sources such as industry trade organizations and gov’t reports.  

By using this information the TARGET MARKET, a specific group of consumers you want to reach, can be determined. 

Within each target market is a MARKET SEGMENT; a smaller group of consumers inside a larger group. Ie Jet football fans inside NFL football fans.  

NICHE MARKETING – A specialty in a specific area or sport. (adiddas is soccer, Rawlings is baseball).  

AFFINITY SPORTS – also a specialty but along the lines of small traditional sports. (bass fishing  with Bass Pro Shops, Brine with Lacross) 

There are 4 elements of Market Segmentation.  These elements make it easier to determine the target market and even further the specific market segment. 

-          Demographic Segmentation – Focuses on information that can be measured. (age, income profession, gender, education, family, marital status)

-          Geographic Segmentation – Divides markets into physical locations. (regions of the U.S.)

-          Psychographics - Characteristics that cannot be physically measured. (values, interests, lifestyle choices)

-          Behavioral-based Segmentation – Focuses on a customers attitude toward products and services. This utilizes Product Usage which reflects what products you use and how often. 

These tools help to determine what your Market Share is. Market share is the percentage of total sales of a product or service that a company expects to capture in relationship to its competitors. 

They also help you to decide on the message you want to send with your product and what it is you want to accomplish so you can design an affective marketing campaign. This is considered your Promotional Objective:

-          Try a new product

-          More information on a current product

-          Educate the consumer 

The most sought after target market group is males age 12-34. 

Public opinion can drive decisions that marketing firms make about a product or person. Celebrities who are chosen as sponsors would be people of high ethical standards who are popular in the public eye.  They would appeal to a specific target market. (Dereck Jeter, Eva Longoria, Johnny Deep, Tiger Woods, Michael Jordan, Shaq) 

Companies will become sponsors of events to promote a positive image for their company.  A sponsor is a person or organization that donates money, products, or services in exchange for public recognition. ( Cadilac with golf tournaments, Cable Vision with the Lustgarten Foundation, Recording industry with the TJ Martell Foundation, Joe Torre with the Safe at Home Foundation, Tostios Superbowl Halftime Show, Postal Service bike team.) They do not profit financially from this. 

Reasons to become a sponsor: (companies use celebrities).

-          to increase sales

-          to introduce a new product

-          to compete for a customer base

-          to be identified with an event

-          to earn goodwill

-          to show a commitment to the community

-          to enhance their image

-          to receive a guaranteed amount of exposureCompanies look for a high return when they become a sponsor. Return is the profit a company receives from giving its support. Companies also look for positive role models. 

Loss of sponsors

-          Forced by Gov’t regulations – Cigarettes, and alcohol on public TV

o       Cigaretts, and alcohol at events where participants are under 18 (NCAA, concerts)

o       Multi State Tobacco Settlement of 1998

-          Forced by the economy – GM, AIG

-          Forced by personal decisions – Tiger Woods, Kobe Bryant  


-          The publicizing or advertising a product, service, or event with the goal of selling it.

-          It is getting information about the service or product out to the public by using name or brand recognition.

-          The maintaining of customer satisfaction, loyalty, and getting customers to be repeaters.

-          Determines what the company wants the public to do

o       Try a new product

o       Go to an event

o       Buy more of the product

o       Give information about a product 

Create a Promotional Plan

-          Personal Selling – in person, face to face, eliminates hesitation by buyer

-          Advertising – paid communication between the product maker and consumer that clearly explains the benefits.

-          Publicity – free information about a product given to potential customers

-          Sales Promotion – any action that will encourage a consumer to buy a product. (coupons, personal apperances)  


-          A person’s public expression or support of a product or service

-          Celebs and athletes can endorse, actors in roles can’t.

-          Make public appearances

-          Mention products in interviews FTC Rules on endorsements:

-          The person must be real

-          They must believe in the product

-          They must have used it or is currently using it

-          It is their personal opinion

-          Can’t be deceptive

-          If the product changes, the company must notify the endorser 

What to look for in an endorser:

-          Positive, well spoken

-          Trustworthy, Charismatic, Respected

-          Popular and well known

-          Flourishing current career

-          Believable, not risk

-          Positive Public Image 

Public Image

-          Starts with Public Relations

o       The portion of marketing that concerns itself with creating a favorable public opinion for an individual or organization.

-          Attractive presentation

-          Reputation for excellent service, or work ethic

-          Create Goodwill – A general willingness to work for something to create a positive image. Create a good reputation. (ie parades, free autographs, public appearances.) 

A companies ACTION PLAN – what they intend to do to promote the person:

-          What form of media is most appropriate for the person or event. A budget will be formulated to accomplish the objective.

-          What will be used to create a favorable image. (ie Public cause, events, appearances)

-          How will the company promote the person or event. 

Create avenues that will bring positive results:

-          Fan clubs

-          Charities

-          Causes 

Firms look for:

EVERGREENS – Products or people that remain valuable from year to year. Trading cards, Michael Jordan, Dallas Cowboys

LICENSING – Selling rights to something that you own.

MOTOVATIONAL SPEAKING, & Public speaking and appearances


Top Sports Endorsers:  

Top Celebrity Endorsers: