Branding
Licensing
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Section 7.1 – Branding –
Objectives
Explain the concepts of
branding and brand
equity
Discuss the types of
brands
Describe how to
develop an effective
brand name
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Section 7.1 – Branding – The
Importance of Branding
Sports organizations and
companies strive to develop
strong brands to
differentiate themselves
from one another
A Brand is a name, word or
words, symbol, or design
that identifies an
organization and its
products
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Section 7.1 – Branding – The
Importance of Branding
What’s in a Name?
A Brand Name is a word or words, letters, or numbers
representing a brand that can be spoken
– Ex. Gatorade or Los Angles Lakers
A Trade Name is the legal name of a company
– Ex. Reebok
Exclusive rights to a brand or trade name can be obtained by
registering that name with the U.S. Patent and Trademark Office
– Name becomes a Trademark when it is registered
– A trademark is a device that legally identifies ownership of a
registered brand or trade name
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Section 7.1 – Branding – The
Importance of Branding
What’s in a Name? – cont.
Branding is important for building customer loyalty
Customers come to expect the same quality from the brands
they buy or the teams they watch
– Will become repeat customers once satisfied with product
Branding helps a company to introduce new products in a line of
products
– Customers familiar with the original brand are more likely to
trust a new product with the same brand
Creates an image for the product
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Section 7.1 – Branding – The
Importance of Branding
Brand Personality
Attaching human
traits to a brand
name
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Section 7.1 – Branding – The
Importance of Branding
Brand Equity
The value a brand has beyond its actual functional benefits
Brand value becomes a competitive advantage because
customers will equate brand with quality
Establishing the brand name:
1. Develop the brand in the customer’s mind as part of a class of
products
2. Link the product’s brand name to its function and make some
type of emotional connection
3. Help consumers think and feel the way you want them to
regarding your product
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Section 7.1 – Branding – The
Importance of Branding
Brand Equity – cont.
Brand equity also have financial value through licensing
Licensing is allowing another company to use brand name,
patent, or any other item for a fee or royalty
– Ex. NFL or NBA my allow a clothing manufacturer to use its
name or logo to produce and sell sports apparel
Logos, or distinctive symbols, immediately identify a company or
organization
Section 7.1 – Branding – Types
of Brands and Strategies
Manufacturer Brands
Owned by the producer of the product
Use multi-product branding, multi-branding, and co-branding
Multi-Product Branding
– When a manufacturer uses one name for all its products
– Strong promotional campaign can be developed to create an
image for all products
• Ex. All Nike products carry the Nike name
– Brand extension is another strategy which uses an existing
brand name for an improved or new product in the product
line
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Section 7.1 – Branding – Types
of Brands and Strategies
Manufacturer Brands – cont.
Multi-Branding
– Each product in a product line has a distinctive name
– Used for products that target different customers
– Advantages:
• Each product has its own distinctive image
• If product fails, its failure does note effect other products
made by manufacturer
– Disadvantages:
• Cost of creating separate promotional plans for each
product can be expensive
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Section 7.1 – Branding – Types
of Brands and Strategies
Manufacturer Brands – cont.
Co-Branding
– Combines one or more brands to
increase customer loyalty and sales
for each product
– Two different manufacturers may
partner to produce one product
– Works well when products
compliment each other
• Ex. NASCAR Sprint Cup &
Nationwide Series
– Co-branding reinforces both of the
products in the eyes of consumers
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Section 7.1 – Branding – Types
of Brands and Strategies
Intermediary Brands
Carries a name developed by the wholesaler, retailer, or catalog
house
Intermediaries contract with manufacturer to make products
that are sold under their own private labels
Generic Brands
Represents a general product category and does not carry a
company or brand name
Not likely to find generic brands of apparel or equipment in
sports industry
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Section 7.1 – Branding –
Developing Brand Names
Choosing and developing a
good brand name requires
thought and planning
Brand names should:
– Offer a benefit
– Be simple
– Be different and positive
– Reflect an image
– Be previously
unregistered
– Make it last
Top 5 Athletic Shoe Brands
Rank
Brand
Retail Dollar Share
1
Nike
34%
2
Reebok
13%
3
Adidas
6%
4
New Balance
5%
5
Easy Spirit
2%
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Section 7.1 – Branding –
Developing Brand Names
Offer a Benefit
Good brand names will offer the customer value
– Ex. University of Florida football players played better as a
result of the sport drink developed for them (Gatorade)
Be Simple
Simple sports names are more memorable
– Ex. Nike, Reebok, Adidas
Be Different and Positive
Brand names should project a positive image that is distinctive
for the consumers
– Ex. Puma, Eagles, Phillies
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Section 7.1 – Branding –
Developing Brand Names
Reflect an Image
Branding should say something about your product
– Ex. Wheaties being the “Breakfast of Champions”
Positive association with sports industry helps to create a
distinctive image
Be Previously Unregistered
Brand names cannot be previously registered with the U.S.
Patent and Trademark Office
Patent and Trademark Office may prevent names that are too
similar to one already used or one that misleads a consumer
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Section 7.1 – Branding –
Developing Brand Names
Make it Last
Names, symbols, devices, or slogans helps to communicate the type of
business and products to customers
Effective branding comes from understanding the product and
organization and understanding how to get the message across to
consumers
Section 7.2 – Licensing –
Objectives
Discuss product licensing
and how licensed goods
are merchandised
Explain the importance of
sports sponsorships and
endorsements
Discuss how companies
choose sports endorsers
for their products
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Section 7.2 – Licensing –
Licensing and Merchandising
Sports teams and athletes may have licensing agreements with
product manufacturer
– Licensing is an agreement that gives a company the right to use
another’s brand name, patent, or other intellectual property for a
royalty or fee
The licensor is the company or individual granting the license
The licensee is the company or individual paying for the rights
to use the licensor’s name or property
Licensed merchandise can bear the name, logo, or other
characteristics of the licensor
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Section 7.2 – Licensing –
Licensing and Merchandising
Licensed Products
A company may pay a fee to use a league’s, team’s, or
individual’s name, image, or logo on a product or on the
product’s packaging
College sports teams also have licensing agreements with
product manufacturing
Advantages for sports organizations and companies:
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Section 7.2 – Licensing –
Licensing and Merchandising
The Products
Licensing agreements can apply to just about any product
imaginable
– Ex. Apparel, key chains, toys, sports equipment, etc.
Licensor must be careful to select products that reflect the
image its brand name has in the public eye
– If licensing agreement is with a company that produces poorquality merchandise, the licensor’s image may be damaged
– Ex. Licensed products carrying the Olympic logo are viewed
positively
– Ex. Franchises that are successful will generate more sales than
unsuccessful franchises
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Section 7.2 – Licensing –
Licensing and Merchandising
Merchandising Licensed Goods
Most licensed merchandise in
the past were only available
the event venue
Many channels are used today
to distribute products now:
– Department stores
– Chain stores
– League-sponsored retail
outlets
– Internet
– Organization owned Web
sites and retail stores
Retail stores promote the fact
that they carry licensed goods
Special promotional deals create
partnerships between licensor
and licensee to help boost store
traffic and retail sales of licensed
products
– Ex. Sweepstakes and contests
Some licensed products are used
as promotional incentives for
customers to buy a product
– Magazines give away for subscription
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Section 7.2 – Licensing –
Sponsorships and Endorsements
Two forms of licensing:
– Sponsorships
• Ex. Olympics
– Endorsements
• Ex. NASCAR
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Section 7.2 – Licensing –
Sponsorships and Endorsements
Sponsorships
Sports events generate income from broadcast rights, ticket
sales, merchandising, and sponsorships
Sponsorships are the promotional vehicles that financially
support sports events
All major sports organizations use sponsorships to help finance
their operations
Promotional packages for sponsors may include:
– Licensing rights, stadium promotions, products, free tickets, etc.
Additional benefits may include exposure to sponsor’s products
through use by the athletes or the organization
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Section 7.2 – Licensing –
Sponsorships and Endorsements
Importance of Sponsorships
Sports organizations need the money generated from corporate
sponsors to help pay their significant costs and expenses
Sponsorship benefits corporations by:
–
–
–
Exposure of their products through their promotional efforts and free
publicity
Sports events can be used to target consumers and promote products
Corporate image can be enhanced and sales revenue can increase
through association with event
Sponsorship can be seen in promotional activities
–
Ex. Kodak creating a special camera to sell during Olympics and run
contests and sweepstakes surrounding events
Coordinated promotional efforts help generate store traffic and
sales of products
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Section 7.2 – Licensing –
Sponsorships and Endorsements
Types of Sponsorship
Can be flexible
– Sponsor a team for length
of time
– Sponsor just an event
– Sponsor just a portion of
an event (Halftime show,
Pre-game show)
Strategies integrate the
company name into the game
itself, providing a form of
direct advertising
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Section 7.2 – Licensing –
Sponsorships and Endorsements
Types of Sponsorship
Signage
Sponsor names that
appear on scoreboards,
floorboards, rafters, etc. in
a stadium or arena
Purchased by sponsors,
provides direct advertising
for sponsors without
paying for airtime
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Section 7.2 – Licensing –
Sponsorships and Endorsements
Premium Sponsors
Companies pay more to be the official or title sponsor
Receives more options and opportunities
Examples:
– Entitlements – There is only one major sponsor for an event
•
•
NASCAR Sprint Cup Series
PGA entitlement sponsorship for almost all of it’s tour events
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Section 7.2 – Licensing –
Sponsorships and Endorsements
Premium Sponsors
Examples – cont.:
– Facility Entitlements – company purchases the promotional
rights to an entire stadium
•
•
Stadiums/Arenas are renamed to publicize their sponsorships
The sponsor receives exposure in all the events that are held at the
stadium during the season and off-season
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Section 7.2 – Licensing –
Sponsorships and Endorsements
Premium Sponsors
Examples – cont.:
– Product Exclusivity– only
one product in a product
category is granted
sponsorship
• Prevents competitors from
selling or promoting their
products during the
sponsored events
• On-site merchandising that
excludes the competition
results in increased profits, as
well as exposure of sponsored
products
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Section 7.2 – Licensing –
Sponsorships and Endorsements
Endorsements
A statement of approval of a product, service, or idea made by
an individual or organization speaking on behalf of the
advertiser
Involves using a celebrity or public figure to represent and
promote a company and that company’s products
Sports figures image is used in print, broadcast media, product
packaging, billboards, and collectibles
May require a set number of public appearances at various
events sponsored by the company
Sports figure lends familiarity and credibility to the product
Section 7.2 – Licensing –
Sponsorships and Endorsements
Endorsements
Association
–
–
–
Endorsement that involves an association with the product
No direct relationship between product and athlete, but association will
help sell product
Successful athletes who project a positive image will be used
Demographic Match
–
Company choose sports figure who matches the demographic profile of
its customer base
Successful Careers
–
–
Top sports endorsers come from all sports and all have successful careers
or look to have promising careers
Some sports celebrities are so outstanding that companies create
product lines using their name
Section 7.2 – Licensing –
Sponsorships and Endorsements
Endorsements – cont.
Image
Products sell when the endorser has a
positive image and is popular
Sports celebrities who endorse products
of major companies must be role models
in the public eye
Most endorsement contracts have clauses
in them that will release the company
from the contract if that celebrity’s image
is tainted due to problems with the law or
athletic performance
Companies do not want its products
associated with a person who is not seen
as a positive role model
Section 7.2 – Licensing –
Sports Appeal
Companies associate their products will well-known sports
organizations to reach new customers and strengthen their
relationship with their existing customers
Through licensing, sponsorships, or endorsements, companies
can generate positive publicity and achieve their marketing
goals of increasing brand awareness and sales.
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