Warm-Up – BRAND JUNKIES 1.06 Position product/services to acquire desired business image Explain the nature of sport/event BRANDING What is a BRAND? All the combined impressions and experiences associated with a particular person, company organization, or product. Intro to Brands http://www.youtube.com/watch?v=JKIAOZZritk&feature=related http://www.youtube.com/watch?v=B2vyfkbNWWg http://www.youtube.com/watch?v=eshWKA9VWX0 Vocabulary • Brand awareness • Recognition among the public • Extent to which a brand is correctly associated with a particular product. • Expressed usually as a percentage of target market • The primary goal of advertising in the early months or years of a product's introduction. • Brand image • Consumer’s beliefs about the company and/or products. • Quality, price, and value may affect a brand’s image. Vocabulary (cont) • Brand equity – Positive feelings toward a brand that accumulate over time when customer’s expectations are consistently met • A highly recognizable brand has a high level of brand equity. • Brand equity is an intangible perception or memory. • Brand loyalty – The extent of the faithfulness of consumers to a particular brand • expressed through their repeat purchases, regardless of the marketing pressure generated by the competing brands. Brand awareness, equity, loyalty or Image The team name, mascot and logo are important elements that a SEM organization uses to CREATE and MAINTAIN:?????????????? BRAND AWARENESS The distribution of licensed sports apparel is an effective way to create team: ?????????? BRAND AWARENESS = Recognition to the public! Brand awareness, equity, loyalty or Image?? Performance, coaches and star athletes are team-related factors that affect: ?????????? BRAND EQUITY Describe the purposes of branding in sport/event marketing. • Branding aims to establish a significant and differentiated presence in the market • Branding attracts and retains customer loyalty • Branding will encourage customers to pay a higher price for goods and services Describe the purposes of branding in sport/event marketing. • Branding simplifies the ability to distinguish products from a wide range of competing products • Branding allows transfer of the brand to new products including licensed products Discuss factors that influence a sport’s/event’s brand image. • Price – Low, middle or high • Quality – Low, middle or high • Value – Low, middle or high • Performance – Win, lose, tradition Describe categories of factors that contribute impact brand equity of a sport/event • Team-related – Star athletes – Popular and successful coaches – Performance – short or long term • Organization-related – Tradition, reputation & strength of schedule – Scandals – recent or past – Public Relations – responsiveness & type • Market-related over time – Population & economic changes – up or down – Fan loyalty due to athletes, coaches and/or performance Explain the consequences of establishing positive brand equity for a sports/event • Attendance increases • Increased sales and consumer loyalty Discuss factors that create BRAND LOYALTY • • • • • • • Entertainment value Authenticity Fan bonding History Tradition Performance Athletes, coaches, owners 20 Clever Logos with Hidden Symbolism What is your Brand? Explain the use of LICENSING in sport/event marketing Vocabulary • Trademark is a word, phrase, symbol, logo or design that identifies and distinguishes the company from others. • A trademark has legal protection through the United States Patent and Trademark Office • Any entity wishing to protect their trademarks must register the trademark and post the designated symbol next to the item they wish to protect • It is these trademarks that licensees wish to use Vocabulary (cont) • Licensing • is the permission to copy the name, logo, or trademark of a league, athlete, sports team, entertainer, film, television show, or character for a fee, also called a royalty • Licensor • is the rights-holder of the name, logo, or trademark • NASCAR, Panthers • Licensee • is the company paying for the permission to use the name, logo, or trademark. • Nike and Reebok Trademarked Property - All teams and sports events MUST copyright their names, logos, slogans and graphics to LEAGALLY PROTECT them - Not doing so would allow other companies to use a name and logo without permission. - Without a trademark- a company CANNOT make money from licensing Define Sports Licensing • Sports licensing – is a contractual agreement by which a sports team, athlete or organization gives a company a license to use its name, logo or trademark on the company’s products. • The company gaining the rights is known as the licensee and the sports body is the licensor Sports Licensing • One of the top four revenue producers in the licensing world • In the U.S., the business is dominated by the five major sports leagues – NFL, MLB, NBA, NASCAR and NHL • Other significant licensing campaigns: – NCAA – Over 300 colleges/universities in the U.S. are involved in collegiate licensing, marketing their rights primarily to the apparel market Process of Licensing A Look at the Top 10 Player Jerseys Top-Selling NFL Jerseys Since Spring 2013 1.Colin Kaepernick • San Francisco 49ers 2.Russell Wilson • Seattle Seahawks 3.Robert Griffin III •Washington Redskins 4.Adrian Peterson • Minnesota Vikings 5.Peyton Manning • Denver Broncos 6.Ryan Tannehill • Miami Dolphins 7.Tom Brady • New England Patriots 8.Ray Lewis • Baltimore Ravens 9.Aaron Rodgers • Green Bay Packers 10.Brian Urlacher • Chicago Bears Top-Selling NBA Jerseys at the end of the 2012-13 regular season 1.Carmelo Anthony • New York Knicks 2.LeBron James • Miami Heat 3.Kevin Durant • Oklahoma City Thunder 4.Kobe Bryant • Los Angeles Lakers 5.Derrick Rose • Chicago Bulls 6.Deron Williams • Brooklyn Nets 7.Dwyane Wade • Miami Heat 8.Rajon Rondo • Boston Celtics 9.Chris Paul • Los Angeles Clippers 10.Blake Griffin • Los Angeles Clippers A Look at the Top 10 Player Jerseys Top-selling Major League Baseball Jerseys at the 2013 All-Star Break 1.Buster Posey • San Francisco Giants 2.Mariano Rivera • New York Yankees 3.Yadier Molina • St. Louis Cardinals 4.David Wright • New York Mets 5.Matt Harvey • New York Mets 6.Bryce Harper • Washington Nationals 7.Derek Jeter • New York Yankees 8.Manny Machado • Baltimore Orioles 9.Mike Trout • Los Angeles Angels of Anaheim 10.Yasiel Puig • Los Angeles Dodgers “You Do” Licensing Activity Students work in pairs and search the internet or through magazines and provide a PPT/poster with 8 examples of licensed sports, entertainment or event products. Explain the use of LICENSING in SEM Continued… Types of Sports License Agreements 1. Brand licensing • Process of creating and managing contracts between the owner of a brand/ licensor (Carolina Panthers) and a company or individual who wants to use the brand in association with a product/ licensee (NIKE) 2. Sponsorship •Supporting an event, activity or organization by providing money or other resources that is of value to the sponsored event •Usually in return for advertising for the event •Business, individuals or organizations can sponsor events 3. Endorsement • Athletes go into contracts with companies to promote their product by “tying” their name to it. Licensing vs. Branding Licensing Agreement Branding •Licensing agreement authorizes a company which markets a product (a licensee) to lease or rent a brand from a brand owner who operates a licensing program (a licensor) •Licensing enables companies whose brands have brand loyalty to unlock a brand's value and satisfy existing demand •The brand or its legal term, trademark, affixed to the product helps the consumer understand where it was manufactured or produced •Trademark simply states “I made this” •From the brand owner's perspective, it distinguishes the products or services from those of its competitors Arrangement to license a brand requires a licensing agreement http://www.youtube.com/watch?v=Z8LYrNhfoQ&list=TLO9Q2hWtVPFEHiV1NmygxzqH4P-2368lX License vs. Sponsorship Trademark License •Underpins all merchandising •Defines the relationship between the owner of a trademark (licensor) and the producer of the goods or services to which the mark is to be affixed (the licensee) •Licensors are not involved in the manufacturing of the products, for their reputation’s sake they must ensure that licensees maintain the quality of the product bearing their trademark Sponsorship •Companies seeking to promote their brand, build their brand awareness and brand image often team up with a sporting organization or associate themselves closely with a sporting event •This offers them massive exposure as the millions of fans and viewers who tune into sports events across the globe see the brands in question many hundreds of times License vs. Endorsements Trademark License •Underpins all merchandising •Defines the relationship between the owner of a trademark (licensor) and the producer of the goods or services to which the mark is to be affixed (the licensee) •Licensors are not involved in the manufacturing of the products, for their reputation’s sake they must ensure that licensees maintain the quality of the product bearing their trademark Endorsement •One constant in the advertising world is companies hiring athletes and sports celebrities to endorse/promote their products •The reason is simple – nothing sells a product like a sports celebrity endorsement •Athletes and sports celebrities appeal to all advertising demographics, and especially to the key younger demographics. •Boost your company’s prestige and as a means for branding your company as a very successful one. •Derek Jeter and Gilette •Cam Newton and Under Armour •Blake Griffin and Subway Recall….. • What is a license? • What is a licensor? • What is a licensee? Licensor’s Compensation • Licensed products are manufactured by licensees governed by a contractual agreement (license) with a licensor • Licensee must gain approval from licensor for any products produced • Additionally, they may also agree on payment with product, advertising, etc. as specified by the contract agreement • Royalties: – Percentage of actual sales – Once the guarantee is paid off- LICENSORS start receiving royalties – Typically between 5% and 15% of sales Licensor Benefits • • • • Enhanced brand image and publicity Increased profit from royalties Increased brand awareness or recognition Increased opportunity for penetrating new markets (especially international) or enhancing existing markets • Increased revenues from sales as a result of brand awareness and expansion of new markets or enhancement of existing markets • Limited manufacturing costs or risks Licensor Risks • Potential for poor quality of a licensee’s manufactured products – Directly affects BRAND IMAGE • Partial giving-up of control over the marketing mix of the brand Licensee Benefits • • • • Existing brand awareness or recognition Lower advertising and promotional costs Increased possibility of success and profitability Connection with an athlete, sports team, entertainer, or corporation • Greater chance of major retailers accepting distribution of your products • International success is probable because sports are universally appealing Licensee Risks • • • • • • Athlete, entertainer, or corporation may become involved in a scandal or lose popularity. Sports teams may suffer losing season(s). Change in styles, trends, and consumer preferences. Royalties and licensing fees can be expensive. Manufacturing costs and risks. Competition (un-licensed) can drive up costs associated with licensing fees and royalties and negatively impact market share International Licensing • Sports Marketers have an advantage over other types of licensors in the International Marketplace because….. – UNIVERSAL APPEAL of sports – Growth of international participation and spectators of sports in general makes international licensing in SEM NECESSARY. Explain the role of ENDORSEMENTS in SEM Endorsements • Endorsement is an action made by a celebrity or wellknown person as follows: • Testimonial (statement or advertisement), by a user of the product proclaiming the product’s benefits • Appearance (association), is an action whereby the endorser appears at an event. The celebrity does not have to do or say anything but consumers believe they like the product http://www.youtube.com/watch?v=fc81q8SMi TY Ways Celebrities can Endorse Products • Product endorsement campaigns • Use the product publicly when possible • Allow their name to be used on products • Written or verbal testimonials • Allow use of their photo with or on the product in advertising and packaging When Celebrity Endorsements can be BENEFICIAL to a Brand • Nothing sells a product like a celebrity endorsement • Athletes and celebrities appeal to all advertising demographics • Especially to the key younger demographics. • INCREASE your company’s brand image, awareness, equity and loyalty When Celebrity Endorsements can be HARMFUL to a brand • When the celebrity: – Loses popularity with the target audience – Gets into trouble • Tiger Woods • Michael Vick – May be injured and/or retire BEFORE the endorsement contract term is over So Why do Businesses use Celebrity Endorsements? Legal Considerations Example • A tennis star appears in ads for a line of polo shirts. – It’s unlikely that the terms of their endorsement contract would have to be disclosed because most people would expect they were paid for that kind of deal • Now they are a guest on a morning talk show. – When asked about recent victories, they credit them to a laser vision correction procedure at a certain clinic. – The athlete doesn’t disclose their contractual deal with the clinic that requires her to speak publicly about her surgery. – Viewers might not realize that a celebrity discussing a medical procedure in a TV interview had been paid to tout the clinic. – The endorsement is likely deceptive without a clear and conspicuous disclosure “You Do” 1. Select an athlete or other celebrity to determine whose product’s the person endorses. 2. Compile a listing of those products. 3. Beside each product, write a rationale for why the person would have been selected to endorse the product. 4. Decide whether the choice has been positive or negative for the company. Explain the use of NAMING RIGHTS in SEM Define the term naming rights. • Naming rights - are a financial transaction and form of advertising (sponsorship) whereby a corporation or other entity purchases the right to name a facility or event, typically for a defined period of time. Explain advantages/disadvantages for teams/events selling corporations naming rights. • Buyer/sponsor/corporation: – Exclusivity at a marketing venue – Maximize promotion of products and services – Promote customer retention and or increase market share – Can be a good public relations plan for community – This can be very expensive and may not be your target market – Team may have losing season or lose popularity Explain advantages/disadvantages for teams/events selling corporations naming rights. • Seller/venue: • Increases revenue and public awareness of venue • A means to pay for construction or maintenance costs at the venue • Venue must be protective of it’s target market and sign with correct corporation • Corporate entity could go bankrupt, engage in fraudulent activities or be purchased NFL Stadium Financing : Naming Rights Stadium Year Opened Reported Contract Naming Rights length (Millions) (years) Source San Fransicso 49ers New Santa Clara Stadium 2014 $220 20 http://goo.gl/zUgzLz . Dallas Cowboys ¹ AT&T Stadium 2009 $340 N/A http://goo.gl/naXo0t . Cleveland Browns ² FirstEnergy Stadium 1999 $102 17 http://goo.gl/fqybJj . New York Giants MetLife Stadium 2010 $400 25 http://goo.gl/R9ZMw6 . New York Jets MetLife Stadium 2010 $400 25 http://goo.gl/R9ZMw6 . Indianapolis Colts Lucas Oil Stadium 2008 $122 20 http://goo.gl/6wZYrq . Philadelphia Eagles Lincoln Financial Field 2003 $140 20 http://goo.gl/hTZIuL . Houston Texans Reliant Stadium 2002 $310 31 http://goo.gl/hTZIuL . Seattle Seahawks CenturyLink Field 2002 $75 15 http://goo.gl/DgNOuB . Detroit Lions Ford Field 2002 $50 25 http://goo.gl/GXAN8l . Average $216 22 . Source: MPR Research. ¹ Deal announced 2013. ESPN reports deal at least $17 million, but no term disclosed; estimate assumes 20 years. ² Deal announced 2013 . Team .