Chapter 18
Relationship Marketing
in the Business of Sports
McGraw-Hill/Irwin
Copyright © 2010 by The McGraw-Hill Companies, Inc. All rights reserved.
18-1
Two Broad Marketing Objectives
• Attracting New Customers
• Retaining Existing Customers
– Customer Acquisition Can Be Costly
– Customer Retention Deemed Superior
18-2
Customer Retention
• Basic Premise of Relationship Marketing
• Seeking Long-Term Association
• Cost of Customer Acquisition Estimated to
be 6 Times that of the Cost of Taking the
Steps Required to Keep an Existing
Customer Satisfied
18-3
Relationship Marketing
• An Integrated Effort to Identify, Maintain,
and Build a Network with Individual
Consumers and to Continuously
Strengthen the Network for the Mutual
Benefit of Both Parties through Interactive,
Individualized and Value-Added Contracts
Over a Long Period of Time
• Focus on Lifetime Customer Value (LCV)
18-4
Benefits for the Sports Marketer
• Customer Loyalty
• Facilitates Resolution of Complaints
• Sense of Belonging – Not Just a Buyer
18-5
Benefits for the Marketer
of a Spectator Sports Product
• Drop in Box 18.2 Here
18-6
Six Components of
Relationship Marketing
• Mutually Beneficial
– Win-Win Partnership; Buyer & Seller Benefit
• Trust
– Feeling that the Other Party Will be Honest
• Empathy
– Understand Each Other’s Situation
18-7
Six Components of
Relationship Marketing
• Communications
– Interactive and Responsive
• Bonding
– Strong Unified Commitment Viewed by the
Participants as a Partnership
• Continuity
– Seek to Maintain a Long-Term Association
18-8
Fan Bonding as Measured by
Relative Relationship Strength
• The Core Relationship
– Usage
• Length of Relationship
• Intensity of the Commitment
• Frequency of Contact
– Fan Identification
• Emotional Involvement
• Personal Commitment
• Loyalty
18-9
Fan Bonding as Measured by Relative
Relationship Strength
• The Expanded Relationship
– Responsiveness to Product Merchandising
• Purchase of logo Merchandise
– Propensity to Engage in Word-of-Mouth
Advertising
• Talk About Recent Results
• Talk About Future Competitions
• Talk About Acquisition of New Players
18-10
Twelve Applications of Relationship
Marketing in Sports
• Drop in Box 18.4 Here
18-11
Clubs (1)
• Spectator Sports – Fan Club
– New Zealand Cricket Fraternity
• Participation Sports – Club for Players
– PGA Tour Partners Club
• SASS – Club for Users of Particular Brand
– Storm Chasers (Storm Bowling Balls)
18-12
Serial Marketing (2)
• Spectator Sports – Giveaways
– Require Regular Attendance for Complete Set
Drop in Figure 18.2 Here
18-13
Frequency Incentives (3)
• Spectator Sports – Frequent Attendance
– English Rugby Football Union Smart Card
• Participation Sports – Frequent Play
– 10-Pin Bowling: Play 6 Games; Get 1 Free
18-14
Affinity Marketing Programs (4)
• Spectator Sports – Credit Card That Benefits
Both the Sports Property and the Fan
– MBNA NASCAR RacePoints Visa Credit Card
• Participation Sports – Lifestyle-Based Credit Card
– Ducks Unlimited MasterCard Credit Card
• SASS – Credit Card User Accrues “Points”
– Bass Pro Shops Outdoor Rewards Visa Credit Card
18-15
Affinity Marketing Programs
• Drop in Figure 18.3 Here
18-16
Routine Periodic Communications
(One-Way) (5)
• Traditional Print Media or E-Mail
• Spectator Sports – Contacting Fans
– Newsletter, Schedule, Promotions
• Participation Sports – Contacting Participants
– e-mail Asking Marathon Runners to Register Online
• SASS – Magazines
– Callaway Golf Magazine
18-17
Callaway Golf – Communications with
Known Buyers
• Drop in Figure 18.4 Here
18-18
Interactive Opportunities (6)
• Spectator Sports – Internet Chat Room
– Dialog between Fans and Player
• Participation Sports – Real Time Results
– Boston Marathon Participant Tracking
• SASS – Information and e-products
– adidas.com downloads and store locator
18-19
Gifts (7)
• Spectator Sports – Recognize Relationship
– NFL Team’s Holiday Ornament for Season Ticket Buyers
• Participation Sports – Encourage Return
– Golf Tournament that Provides Gift Pack for Players
• SASS – Reward for Past Use
– Bowling Ball Company that Gives Special-Edition Ball to
Recognize Perfect Game by Bowler Using Its Brand
18-20
Fan Appreciation Activities (8)
• Spectator Sport Based
– Player Clinics
– Autograph Sessions
– Celebrations of Team Achievements
18-21
Contests (9)
• Spectator Sports – Win Tickets
– Future Game or Cross-Marketed Event
• Participation Sports –
– Register On-Line; Chance to Waive Fees
• SASS – Win Products
– Titleist.com: Win Year’s Supply of Golf Balls
18-22
Logo Merchandise (10)
• Spectator Sports – Peripheral Product
– Premiums that Incorporate Team Logo
• Participation Sports – Reward Performance
– Bowler Receives Logo Jacket for 300 Game
• SASS – Support Core Product
– Storm Bowling Balls Sell Shirts, Towels, etc.
18-23
Direct Access/
Personal Representative (11)
• Spectator Sports – Ticket Representative
– Assigned to Handle Season Ticket Accounts
– Addresses Exchanges
– Resolves Complaints
– Addresses Renewal
– Provides Constant Point of Contact Over Time
18-24
Recognition (12)
• Spectator Sports – PA Announcement
– Birthday of a Season Ticket Holder
• Participation Sports – Acknowledgement
– Tournament Web Site Identifies Bowlers Who Attain a
Noteworthy Mark in Continuous Participation
• SASS – Identification on Website
– Recognize Achievers Who Used the Marketer’s
Product in a Noteworthy Performance
18-25
Example in Spectator Sports:
NASCAR
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Apartment Building by Lowe’s Speedway
NASCAR Thunder Store
NASCAR Café
NASCAR Amusement Centers
NASCAR Simulators
Daytona USA Theme Park
Pit Stop Challenge
Simulate Role of Race Announcer
18-26
Example in SASS:
Reebok
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Focus on Female Runner Target Market
Focus on Smaller Retailers
Emphasize Running Roots in Promotions
Sponsor US Olympic Track & Field Team
Grass Roots Sponsor of Running Events
Newsletter Sent to Known Runners
Seek Input from Retailers
18-27
Evaluating the Effectiveness of a
Relationship Marketing Program
• Track Sales
• Monitor Complaints
• Customer Satisfaction Surveys
18-28
Evaluating the Effectiveness of a
Relationship Marketing Program
• Monitor Internet Chat Rooms and Bulletin
Boards (Buzz Manager)
• Calculate Click-Through Rate (CTR) for
Internet-Based Relationship Marketing
Initiatives
• Customer Relationship Management
(CRM) Software (data mining)
18-29
Recovery Marketing
• When Things Go Bad, How Do We Get the
Customers to Come Back?
• Formula 1 Racing in USA After 14 of the
20 Cars Entered Refused to Race
because of Safety Concerns about Tires
• NHL After a Cancelled Season
18-30
Five Steps for Recovery Marketing
Drop in Box 18.7 Here
18-31
Recovery Marketing by the NHL
• Lost 2004-05 Season Due to CBA Issues
• Drop in Table 18.1 Here
18-32
Closing Capsule
• Relationship Marketing Is All About
Customer Retention
• Key Issues Are Customer Satisfaction and
Problem Resolution
• Relationship Marketing Encompasses All
Elements of a Marketing Strategy
18-33
Closing Capsule
• Win-Win Environment
• Focus Is on Lifetime Customer Value – In
Other Words, a Long-Term Relationship
• Despite Best Efforts, Things Go Wrong
• Need to Understand Recovery Marketing
18-34