The Product Is Sports and Entertainment

transcript

7.1 The Product Mix 7.2 Recruiting Athletes &

Entertainers 7.3 Customized Entertainment

7.4 Product Marketing Strategies

Chapter 7

Introduction Product Mix in Sports Marketing

Winning Strategies

Brad Pitt has used his fame to draw attention to those in need.– children with AIDS in Africa– the plight of Haitian children– global poverty conditions– helped sponsor architectural competition

to rebuild part of New Orleans

Fame and Fortune Used to Benefit Those in Real Need

Lesson 7.1

The Product Mix Goals Define product mix, product

extension, and product enhancement.

List and describe the components of the product mix.

WHAT IS A PRODUCT MIX?

tangible parts– physical features that can be seen and

felt– i.e. Soft Red Blanket

intangible parts– nonphysical service features– i.e. Pedicure

Tangible & Intangible The sport product is a complex package

of the tangible and intangible as well as the experience.

E.g. GOLF Tangible Elements of the Golf Product:

1. Little dimpled balls2. Oversized ‘metal’ woods that are in

different ways, standardized Intangible Elements

1. Golf club membership

Product Mix– the total assorted features associated with the

product product line - various products offered under the

brand product packaging brand name

Product Extensions– items added to a product to make it more

attractive to the target market guarantees warranties instructional CDs

The marketer has little control over the core product, and consequently must focus efforts on product extensions.

E.g. Real Madrid of Spain’s La Liga fashioned a strategy that leveraged the core product (soccer games) to generate product extensions. The team broke world “transfer” (purchase price) records in buying the contracts of star players (e.g. Beckham). Although Real Madrid was confident that it was going to win games, it was more confident that it would expand its global sales of merchandise and sponsorships. Even though the stars stumbled (failing to win a major trophy in 2004), strategy worked.

Basic vs. Enhanced Product product enhancements

– features added to the basic product that satisfy additional needs and wants with the same purchase

– add value to the product and may increase the purchase price

– It is important to give customers options so that products can be matched to their budgets and individual needs.

Basic: Automobile Enhancements: Heated Leather Seats,

Sun Roof, Bose Sound System, Upgraded Engine

Basic: Athletic Shoe Enhancements: Air-cushioned Soles, Lightweight

Fabric

Basic: Stadium Seating Enhancements: Air-conditioned Suites

Provide three examples of a product enhancement.

PRODUCT MIX COMPONENTS

In an attempt to satisfy customers, marketers must make many decisions about their product and Product mix.

Product Mix– the total assorted features associated with the

product product line product packaging brand name

#1 ~ Product Line product line

– a group of similar products with slight variations to satisfy the different needs of consumers

– Coca-Cola (Soft Drink Product Line) Classic, Diet, Caffeine-Free, Cherry, Coke

Zero, etc. Variations in sizes Variations in packaging

See Book Page 174 for further examples.

#2 ~ Packaging Product packaging components to

consider include– ease of use– safety– accessibility– environmentally friendly

Why are the shoes yellow and black?

#3 ~ Brand

brand– the name, symbol, word, design, or combination

of these elements that identifies a product, service, or company

– represents the company’s reputation of quality, reliability, and status in the marketplace

#3 ~ Brand trademark

– the legal protection of words and symbols used by a company

– makes it illegal for other companies to use the brand name.

licensed brand– a well-known name and/or symbol

established by one company and sold for use by another company

– Disney: sells licenses to use their characters on toys and clothing. They then receive a % of the sales from the merchandise bearing their name.

5 stages of brand recognition

non-recognition

unable to identify brand- consumers don’t know or trust the brand yet

rejection will not purchase that brand- poor quality, recalls for safety, too pricey

recognition know brand, but has little influence

preferencebrand is valuable to consumer- will purchase brand if readily available but may purchase another brand if it is not.

insistencemust have this brand- rejects all other even if their preferred is not available

Brand Recognition

GOOGLEGoogle has successfully made its brand, a household name. If you want to search for something on the internet, instead of saying, “Search it”, we now say, “Google it”.

Nike’s Marketing Strategy

Product Mix: – total assorted features associated w/ the

productproduct lineproduct packagingbrand name

What are the components of the product mix?

Lesson 7.2

Recruiting Athletes and Entertainers

Goals Define the bottom line for sports. Explain the high cost of sports and

entertainment events.

THE BOTTOM LINE FOR SPORTS

blue-chip athletes– excellent athletes– demonstrate good character and

leadership qualities on and off the field

The bottom line for sports is winning.

The bottom line for business is profit.

Winning teams generate profit.

NCAA Regulations

NCAA– National Collegiate Athletic Association– a voluntary organization through which the

nation’s colleges /universities govern their athletic programs

– Over 1,250 institutions, conferences, organizations

– Committed to the best interests, education & athletic participation of the student athletes

NCAA Regulations Recruitment Violations:

– paying recruits bribes, – giving incentives recruit families, – altering transcripts

NCAA Punishments:– Limiting scholarships offered– prohibiting post-season play– suspending players – forfeiting games– and even shutting down entire programs.

Compensation for Athletes? Athletes receive scholarships and

grants for their college education.

After signing with an agent, a college athlete can no longer participate in college sports.

In some states, proposals have been brought to the legislature to pay college athletes.

The bottom line for sports is winning.

The bottom line for business is profit.

Winning teams generate profit.

What is the bottom line for sports and how is it related to the bottom line for business?

THE COST OF SUCCESS Success requires

– skilled coaches– top-notch players– popular entertainers

Attracting and Keeping Coaches

The best coaches can command annual salaries in excess of $1 million.– Success = large bonuses, salary

increases, etc.

fringe benefits– incentives received in addition to base

salary~ Medical Insurance ~ Endorsements~ Company Cars ~ Radio Shows~ Paid Travel ~ Extra Income Opps

Attracting and Keeping Star Athletes

Competition for top athletes is fierce. Recruiters compete w/ professional & college

teams.

Recruiters need a well refined sales and marketing effort to attract talent to their schools. (Personal Selling, Financing, & Marketing Info Management)

Convincing while upholding honesty & integrity.

Economic Concept– Supply for Top Athletes Limited– Demand for them is High.

Getting a Top Athlete for NY Jets

The Price for Top Musicians and Other Entertainers

Popular performers can attract large enough crowds to make an event profitable.

Requires legal contracts and large budgets.

Popular celebrities help increase the advertising revenue of their TV shows.

Requires larger salaries for more popular stars

Marketing Women’s Sports

Women’s sports are seriously neglected

U.S. Women’s Soccer Team won the World Cup in 1991 and barely made the news.

They received more exposure in 1999 due to their continued success since 1991.

Why do Women’s Sports Get Less Attention?

Marketing Women’s Sports

Relative to male counterparts, women athletes receive far less pay.

More money and exposure of the male sports means more fans. Fan support = profit.

Creative marketers may develop new products to appeal to females who are relatively new sports fans.

Why is it important for young, talented, and highly sought-after athletes to hire trustworthy agents to represent them?

Unscrupulous (crooked) agents and recruiters may take unfair advantage of poorly informed athletes. They need trustworthy agents who will look out for their best interests and negotiate a fair deal.

Lesson 7.3

Customized Entertainment

Goals Define customizing. Describe the financial impact of Baby

Boomers on the entertainment industry.

CUSTOMIZING PRODUCTS

customizing– changing a product to fit the needs or

wants of a particular market

impromptu – spontaneous and changing– Example: comedian altering their act

based on audience reaction and participation

Local TV American Style Product planning for the majority of

national network TV shows take place in L.A.– Expensive and require large audiences to

attract advertisers to cover the production costs.

Local programming is less expensive to produce, but has fallen out of favor with major networks.– Does not attract enough viewers to

draw in advertisers.

– Used to be produced locally and developed specifically for the children in that area.

– Had large impact on children, so parents requested that hosts not endorse products.

– So, advertisers lost interest in sponsoring locally produced children’s shows.

Children’s Programming

– Sports broadcasted local until Cable changed the distribution system drastically. National Broadcast, Pay-Per-Views, etc.

– Excessive salaries of sports figures have helped drive up the costs of television coverage of sporting events.

tiering– specific sports programs will be offered

outside the basic cable or satellite package

– consumers choose their level of service/channels

Sports Programming

Public TV and Radio Public TV and Radio are viewer- and

listener-supported.

– Mission: entertain and educate audience– Usually non-profits financed through

grants, corporate donations and listener contributions

– programming is tailored to local audiences– know their audiences & work to please

Why is different TV programming shown in different cities or regions of the United States?

– Programming is customized for the audience.– San Fran Giants (West) vs. Boston Red Sox

(East)– 49ers (West) vs. Eagles (East)

Who are the Baby Boomers?• Baby boomers are a huge group of Americans who have

affected the nation’s social, political, and economic life from the day they were born. • The birthrate in this country jumped after World War II and

stayed high up until the mid-1960s, directly related to both the hordes of soldiers, sailors, and marines returning from their service in World War II, and a booming economy that encouraged family-making and children. • The result was a very large number of children born between

1946 and 1964 who have had an impact on society at each stage of their lives. Now, as boomers have reached at least the 50-year mark and as the oldest have moved past age 65, boomers will continue to have a dramatic effect on many aspects of American life in the years to come.

MARKETING TO BABY BOOMERS

Baby Boomers, born between 1946 and 1964, are one of the best-known market segments. (over 76 million)

What are they buying???– 1946: Baby Formula and Clothing– 2012: Leisure/Retirement activities

Boomers Won’t Retire Baby Boomers are softening the line

between career and retirement

– Many will work beyond retirement age– Enjoy recreational activities and

entertainment– And have the discretionary income to pay

for the products and services they desire.

Segmenting the Group The U.S. population is aging. Marketers will need to focus their

efforts on this aging market. Customer preferences Spending habits Incomes Occupations Area of residence

Census ~ Average Age

1994 – 342000 – 35.52035 – 39.1

Entertaining the Boomers Baby Boomers are finding more time

to “Go Out” & increased their movie attendance.– Reel Source – attendance tracker

company– Baby Boomers = 1/3 of movie

attendance

– Movie Producers noticed! Filling niche for Baby Boomers’ tastes Use actors in their age range to increase

popularity

Understanding All Parts of the Group

Through 2002, Baby Boomers will continue to be a major target of entertainment marketing.

As the Boomer group is so large, marketing messages need to be developed for specific subgroups of Boomers.

Fine-tuned for each age group HUGE potential customer base

Why are Baby Boomers important to entertainment marketers?

– Baby Boomers are important because there are so many of them and they have a large amount of disposable income to spend.

Lesson 7.4

Product Marketing Strategies Goals List and describe the stages of the

product life cycle. Explain how products are

positioned in the marketplace.

THE PRODUCT LIFE CYCLE product life cycle (Described over next 4

slides…) introduction growth maturity decline

Introduction Stage– product is a novelty, only one of it’s kind– only one brand of product is available

skimming price strategy– introduces new products at a very high

price quality & uniqueness justify high price higher profits encourages more competition

penetration price strategy– uses low pricing to help capture a large

market share early Establish a customer base Lower prices discourage the competition

Growth Stage Sales of a product and profits increase

Target market knows of and purchases the product regularly

Advertising focuses on customer satisfaction

Competition increases (alternate products)

Products modified/improved to maintain customer loyal

The Maturity Stage Sales are level or slowing down

Target market already purchased product

Marketing costs increase, more promotions due to more competition

Commercials mention/mimic competitors

Sale prices offered to hold off competition

The Decline Stage(Pages 190-191)

sales decrease may no longer generate enough

revenue to justify marketing costs

alternatives include:– drop a product– sell/license– discount

– regionalize– modernize/alter– recommit

Decline Stage Options– drop product: cut company losses, cut

completely

– sell/license:minimize losses, sell or license to another

company

– discount: reduce prices to sell remains faster

– regionalize: commit to geographical location where

product is most popular and profitable

– modernize/alter: “NEW” and/or “Improved”

– recommit: a new purpose found for the product

What are the stages of the product life cycle?

IntroductionGrowthMaturityDecline

Product Life Cycle Examples

POSITIONING A PRODUCT positioning

– used by a company to differentiate its products or services from its competitors’ products or services status, price, brand recognition & other

factors

POSITIONING A PRODUCT Positioning Example

– Honda: safe family car Commercial focuses on family use, safety

awards

– BMW: luxury sports car Commercial focuses on looking fast,

expensive

–Both provide means of transportation.–Both positioned very differently

–Status–Price–Brand

recognition

–Quality–Features –Benefits

List three ways a product may be positioned in the marketplace.

The Product Is Sports and Entertainment

Documents