CHAPTER 1

Marketing Basics

What is Marketing?

Creation & maintenance of satisfying exchange relationships. Creation suggests product development Maintenance indicates marketing continues

as long as the business operates Satisfaction implies marketing must meet

the needs of both the business & customers

Sports & Entertainment Marketing

Huge industry offering numerous products and services.

People must choose which sports & entertainment activities/events they will enjoy with their limited time and resources.

Marketers must assess consumer demand, the competition, and financial valuation of goods and services.

Athletes and entertainers play a prominent role in marketing by endorsing products and services. Former NFL player Brett Favre endorses Snapper riding lawnmowers, and comedian David Spade is associated with Capital One’s ‘What’s in your wallet?” campaign. People like to be identified with celebrities and sports stars. Product endorsements by famous people are good marketing strategies.

Work with a group. Identify four advertising campaigns that feature celebrities or athletes. Discuss how the campaigns have affected your thinking about the products. If you were in the market for products, would you buy the celebrity endorsed brands? Why or why not?

GROUP ACTIVITY

Related Articles

Celebrity Endorsement Ads http://www.celebrityendorsementads.com/celebrity-endorsements/

Nike re-signs Vick to endorsement deal http://www.wcpo.com/dpp/sports/nike-re-signs-vick-to-endorsement-dea

l

Nike endorsement deals http://money.cnn.com/2003/08/18/news/companies/nike_endorsements/i

ndex.htm

Celebrity deals gone wrong http://www.businessinsider.com/lost-celebrity-endorsement-deals-2009-

12#

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Do Celebrity Endorsements Really Work? http://www.cnbc.com/id/41081075/Do_Celebrity_Endorsements_Really_

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at-celebrity-brand-ambassador-022

NBA Finals: The Good, The Bad, The Ugly Marketing http://thebiglead.com/index.php/2011/06/13/nba-finals-the-good-the-ba

d-the-ugly-marketing/

Collage Project

Research and create a list of 5 athletes/entertainment celebrities and the products/brands that they endorse.

Design a collage on poster board or on the computer that shows the 5 celebrities and the products they endorse.

Collage Project

Collage needs to include a combination of at least 5 celebrities from the sports and entertainment industries. (10 pts.)

Identify at least two products/services that each celebrity endorses. (20 pts.)

Write a brief paragraph describing what effect you think these celebrity endorsements on the sales of these products. (25 pts.)

The Marketing Mix

Describes how a business blends the 4 marketing elements of…1. Product2. Distribution3. Price 4. Promotion

Marketing Mix Considerations Individuals have many entertainment

options for their discretionary income.

The amount of money individuals have available to spend after paying for necessities.

PRODUCT

What a business offers customers to satisfy needs. Product offerings for sports and

entertainment marketing must be constantly evaluated & updated.

Too much of a product might = price mark downs

Too little of a product might = lost sales

PRICE

Amount customers pay for products. Influences consumer decisions. Businesses must offer products/services

they need and want at prices customers are willing to pay AND cover costs and earn a profit. Championship teams will increase consumer

demand and ticket prices.

DISTRIBUTION

Involves locations and methods used to make products available to customers. Involves transporting or delivering goods to

final customers. Ex: Athletic uniforms arriving by UPS. Turf for a football field arriving by a semi truck.

Involves planning the location of events. Ex: A 3-day outdoor music concert event must

be held in a location near customer base and other business such as hotels and restaurants.

PROMOTION

Describes ways to make customers aware of products and encourage them to buy. Essential to inform prospective customers

about sports & entertainment events and products

Ex: TV commercials, newspaper ads, special offers on ticket stubs

Requires creativity AND can be costly

SUPER BOWL

Billion $ event that results in large sums of money from sponsorships and ticket sales.

What is the PRODUCT? What is the PRICE? How is DISTRIBUTION involved? How is it PROMOTED?

SUPER BOWL

PRODUCT? Game matching best AFC & NFC teams

PRICE? Actual is $400-600. Some pay more.

DISTRIBUTION? Selecting a city that is easily accessible for fans. Near airport, major highways, nearby

accommodations Ticket sales (NFL offices, Ticketmaster, Internet)

PROMOTION? TV commercials, Sports magazines

STATE FAIR

What is the PRODUCT? What is the PRICE? How is DISTRIBUTION involved? How is it PROMOTED?

STATE FAIR

PRODUCT? livestock shows, exhibits, carnivals, wide

array of musical & other entertainment PRICE?

Admission (must be sensitive to demand). DISTRIBUTION?

Location of fair and outlets where people can buy tickets

PROMOTION? TV commercials, radio ads, newspaper ads

TIME OUT

In 2006, a family of four could expect to pay an average of $352 to attend one Chicago Cubs baseball game. This price includes… Four tickets Parking Four hot dogs Four drinks Two programs Two souvenir caps

Get a Partner….

With new technology, live cybercasts of music concerts can be heard and viewed around the world through the Internet. Movie companies are using the Internet to broadcast movie trailers and to market movie-related merchandise to consumers.

Think Critically: You and your partner need to visit the home pages of 3 movies that have related merchandise for sale.

1. Determine what information is collected from customers.

2. Discuss how the marketing information gathered could be used in the future to promote and sell other products.

6 CORE STANDARDS OF MARKETING

1. Distribution2. Marketing Information Management3. Pricing4. Product/Service Management5. Promotion6. Selling7. (Financing)

CORE standards OF MARKETING

1. Distribution Determining the best way to get a

company’s products/services to customers

EX: Sony sells its products through retailers like Best Buy

EX: (Sports) Involves selecting right location for event and making tickets available

CORE standards OF MARKETING

2. Marketing/Information Management

Gathering and using information about customers to improve business decision making

EX: Domino’s Pizza used research findings to adapts its pizza to Japanese tastes

CORE standards OF MARKETING

3. Pricing Establishing and communication to

customers the value of goods and services

EX: prices may be set high if the seller knows people will buy the high price

EX: Super Bowl ticket prices go through the ceiling since there are limited number of tickets and huge demand

CORE standards OF MARKETING

4. Product/Service Management Designing, developing, maintaining,

improving, and acquiring products for the purpose of meeting customer needs and wants

EX: Fisher Price tests toy ideas with children and parents to make sure kids enjoying playing with the toys

CORE standards OF MARKETING

5. Promotion Using advertising and other forms of

communication to distribute information about products and services, images, and ideas

EX: Sports fans often find coupons on the back of ticket stubs

CORE standards OF MARKETING

6. Selling Direct and personal communication with

customers to assess and satisfy needs and wants

Usually includes Internet purchases

CORE standards OF MARKETING

Extra: Financing Requires the company to budget for its

own marketing activities. EX: A company can obtain financing from

sponsors and investors Sponsors spend lots of $$to be visible

during sports and entertainment events

6 CORE standards (LaRosa’s Pizza)

1. Distribution (delivery, dine in, carry out, events)

2. Marketing Information Management (what kind of toppings, what other pizza places, kind of deals/specials, other products)

3. Pricing ($6…inexpensive to encourage customers)

4. Product/Service Management (add new toppings, offer specials/deals, improve ingredients, use taste tests, use surveys)

5. Promotion (coupons on ticket stubs, commercials, specials for teachers)

6. Selling (surveys, online ordering)

What do you think???

Think of one of your recent purchases. List and describe how the six core standards or marketing were involved with the purchase.

Design an advertisement…

Design a newspaper advertisement for an upcoming concert. Incorporate all of the marketing mix elements, including product, distribution, price, and promotion.

FCA#1: Include the 4 elements of the marketing mix. (20 pts.)

FCA#2: Write a paragraph describing why you selected the specific product, distribution, price, and promotion. (10 pts.)

What is Sports Marketing?

Using sports to market products. Marketers research demographics and

spending habits of fans in order to maximize profits Demographics: common characteristics of a

group such as age range, marital status, gender, ethnic background, income level, and educational level

Price fans are willing to pay for a ticket depends on interest of market, national importance of event, the popularity of event/athletes

What is the GOAL?

Use the right marketing mix to meet customer needs while generating a profit. To be successful, marketers must consider…1. New Opportunities: endorsement and

marketing opportunities Ex: Arena football (founded in 1987) – offer

affordable ticket prices ($17.50); players meet fans and sign autographs after every game; work with video game creators

What is the GOAL?

2. Gross Impression: the # of times per advertisement, game, or show that a product or service is associated with an athlete, team or entertainer

Ex: Every time you see a product or logo on the back of a pair of shoes, in a scene in a movie, or on the license plate of a car, your brain records that image.

Advertisers hope you will remember it when you’re ready to buy such a product.

What is the GOAL?

3. Timing: Popularity of teams and sports figures is base on sustaining a winning record.

Fans want products/services that identify with a winner.

If one major athletic company has a successful marketing campaign, competitors will increase their marketing efforts. Competition must be monitored so a company’s marketing can remain unique.

The Value of Sports Marketing

Multi-billion $ global industry that impact the economy. Automobile industry…parents transport

families to numerous sporting events Restaurants, hotels, and service stations that

count on business generated from these events

Entertainment and venues must be maintained…requires building managers, security personnel, maintenance crews, etc.

Athletes need trainers, handlers, personal attendants…also hire agents.

The Value of Sports Marketing Emotional Value

Fans have emotional ties to their favorite teams

Emotions often compel fans to buy tickets and other sports related merchandise

People will freely spend discretionary income on sporting events that capture their hearts so marketers try to appeal to emotion

The Value of Sports Marketing So Many Channels

Marketers for the hundred of TV network must consider strategies to capture the highest possible percentage of the viewing audience for the least amount of $

Must find right mix of programming to reach audiences, attract sponsors, and maximize profits

CINCINNATI - ESPN The Magazine ranked the best franchises in sports and for the second year in a row, the Cincinnati Bengals were dead last. Out of 122 teams across the MLB, NFL, NHL and NBA, the Bengals were ranked by the magazine as the worst sports franchise. The rankings were based on team analysis that examines a team’s efficiency in spending fan money compared to its on-field performance. It also factors in feedback from more than 70,000 fans nationwide in 21 categories including the players' likeability, fan relations, affordability, stadium experience, ownership, title track (which consists of the championships won or expected to be won in a fan's lifetime) and coaching. The Bengals ranked last in fan relations, likeability of players and title track. Peter Keating of ESPN.com wrote "Who Dey? Fans are asking, 'who cares?'“ It's easy to see from Cincinnati's perspective how the Bengals might fall in to such a rating: They haven't won a playoff game in 20 years, they continue to make head-scratching decisions on personnel and the starting quarterback has decided he'd rather retire than continue playing for them. On the flip side, the Cincinnati Reds ranked 15th overall, a 28-spot improvement from last year in lieu of their 2010 playoff run and the extension of reigning NL MVP Joey Votto's contract.The reigning Super Bowl champion Green Bay Packers took the top spot of the 122 teams examined. The Tampa Bay Lightning came in second with the New Orleans Saints, the Los Angeles Angels of Anaheim and the San Antonio Spurs rounding out the top 5.

Bengals rated worst sports franchise

What do you think? Are the Bengals the worst team in sports? From a marketing standpoint, what suggestions would you give the Bengals organization?

Do the research!!

Watch a college or professional sporting event on television. Select a sports brand represented in association with the event, and keep track of how many gross impressions are made during the telecast.

Entertainment for Sale

People have a limited amount of leisure time & money. What is Entertainment?

Whatever people are willing to spend their money and spare time viewing rather than participating

Can include sports or the arts. Sports: generally applied to games of athletic

skill. Entertainment: generally applied to movies,

theater, music concerts, the circus, etc. Must maintain accurate info. about customers

in order to succeed in marketing to them

Evolution of Entertainment Mktg.

1888 -- 1st moving pictures in Britain1895 -- 1st projected movie to a paying

audience1927 -- 1st movie with sound, Jazz Singer1928 -- Mickey Mouse arrived1955-- Disneyland opened

Evolution of Television

1945 – 9 TV stations; fewer than 7,000 working TV sets existed in US

1946 – NBC & the Gillette Co. staged 1st televised sports spectacular (heavyweight boxing)

1949 – # of TV stations grew to 98

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