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Marketing Applications
LESSON 4.1
The Marketing Concept
The Marketing Concept
A philosophy that a company’s success is
ultimately dependent upon efficient
identification of consumer needs and wants
and the ability to satisfy them
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LESSON 4.1
The Marketing Concept
Why Is Marketing Important?
 Financial success is a direct result of an
organization’s ability to effectively market its
products and services
 A business achieves profitability when they offer
the goods and services that customers need and
want at the right price
 Marketers strive to identify and understand all
factors that influence consumer buying decisions
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LESSON 4.1
Needs vs. Wants
A need is something
you have to have and
that you cannot do
without
For example, we need
food. Without eating,
we cannot survive!
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A want is simply
something you would
like to have
You might want a
Nintendo Wii or tickets
to an upcoming game,
but you can survive
without them
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LESSON 4.1
The Exchange Process
 Must be at least two
parties involved in
process
 Some means of
communication must be
present between all
parties
 Each party must be free
to accept or decline offer
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Exchange Process:
Marketing transaction
in which the buyer
provides something of
value to the seller in
return for goods and
services that meet that
buyer’s needs or wants
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LESSON 4.1
Benefits of Marketing
The marketing process serves many purposes and
provides numerous benefits for the consumer
 The ability to add perceived value to goods and
services
 Making the buying process easy and convenient for
consumers
 Creating and maintaining reasonable prices
 Offering a variety of goods and services
 Increasing production
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LESSON 4.2
The Marketing Mix:
The Marketing Mix:
Consists of variables
controlled by marketing
professionals in an
effort to satisfy the
target market
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LESSON 4.2
The Marketing Mix
Product
Involves the goods, services, or ideas
used to satisfy consumer needs
Price
Determined by what customers are
willing to pay and production costs
Place
Involves the process of making the
product available to the customer
Promotion
Involve how the goods or services
are communicated to the consumer
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LESSON 4.2
Discussion Topic
How might the marketing mix apply to
Wilson Sporting Good’s efforts to
maximize sales of tennis racquets?
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LESSON 4.3
Target Markets
A target market refers
to people with a defining
set of characteristics
that set them apart as a
group
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LESSON 4.3
Target Markets Must Be:
Sizeable:
The overall size of the market
Reachable:
Ability for marketers to reach consumers
Measurable: Ability to measure size, accessibility and
overall purchasing power of the target market
Behavioral: Marketers seek to find similar behaviors
within each respective target market
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LESSON 4.3
The Marketing Concept
All organizations must have an
understanding of their target market to
create an effective marketing strategy that
caters to their audience
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LESSON 4.3
The Marketing Concept
Part of Coca-Cola’s marketing strategy is to target
moms. As such, the soft drink giant rolled out a
comprehensive marketing campaign tied to the
2012 Olympic Games based on the knowledge that
the Olympics traditionally attract more female
viewers than almost any other sporting event.
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LESSON 4.3
Niche Marketing
Niche Marketing:
Niche Marketing offers
a unique opportunity
to consumers or one
that has not been
offered in the past
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Process of carving out
a relatively tiny part of
a market that has a
very special need not
currently being filled
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LESSON 4.3
Niche Marketing
Cable television channels often seek niche
audiences to appeal to specific target
groups with a common set of interests,
such as ESPN designing programming to
appeal to sports fans
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LESSON 4.3
Niche Marketing - Discussion
When a business sees a competitor
enjoying success with a particular
niche, often times the market can
become flooded with other companies
exploiting the same niche or another
similar niche.
Can you think of any examples?
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LESSON 4.3
Niche Marketing
Lululemon Athletica is a
Canadian retailer that
distributes product in
Canada and the United
States. The company
targets its branded yoga
and fitness apparel to a
niche consumer of
female athletes.
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LESSON 4.3
Niche Marketing
Lululemon, positioned as a high-end brand, has
enjoyed explosive growth in the past several years
(in 2012 they were named the 7th most valuable
brand in Canada. On the heels of their success,
Under Armour has introduced a new yoga line, Gap
introduced its GapBodyFit line, Forever 21 began
selling active wear and both Nordstrom and Target
expanded their store branded women’s sportswear
offerings (even lingerie company Victoria’s Secret
now sells yoga pants).
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LESSON 4.3
Niche Marketing
When Lululemon was forced to recall product in
2013 because they were see through when
stretched, Under Armour (who has been targeting
women as a key demographic for several years),
responded by featuring the tag line "We've Got You
Covered” on its Facebook page in an effort to drive
customers to its site
Click here for a story on dailyfinance.com to see how other competitors
(including Nike, a new player in the yoga field) have responded
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LESSON 4.3
Niche Marketing
As the running category continues to gain steam (sales
of running shoes were up 14% in the last year), brands
like Vibram and their “five finger shoes”, Fila with
skeletoes, and Adidas with adiPURE (among others)
have carved a niche with “minimalist” running shoes,
designed to create a “barefoot” jogging experience while
still providing protection for the feet
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LESSON 4.3
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LESSON 4.3
Niche Marketing
However, not all niche markets last. For the first quarter
of 2013, sales were of the minimalist shoe were down
10% while motion control shoes were up 25% (another
niche in the running category). Said Matt Powell in an
interview on runnersworld.com, "It appears this fad is
pretty much over."
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LESSON 4.4
Market Segmentation the process of
identifying groups of consumers based
on their common needs
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LESSON 4.4
Market Segmentation
Helps Companies To:
 Understand consumer groups
 Determine target markets
 Develop positioning strategies
 Customize products and marketing strategies
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LESSON 4.4
Five Bases for Market Segmentation
1) Demographic
2) Product
3) Psychographic
4) Benefits
5) Geographic
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LESSON 4.4
Demographic
Psychographic
Geographic
CONSUMER
Benefits
Product
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LESSON 4.4
Five Bases for Market Segmentation
 Age
Demographic
Segmentation:
 Income
 Occupation
 Gender
Focuses on information
that can be measured
 Education
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i.According to knowledgebase.com, the biggest demographic for the artist Shakira is 20-year old women
Marketing Applications
LESSON 4.4
Demographic Segmentation
According to knowledgebase.com, the biggest
demographic for the artist Shakira is 20-year old women
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LESSON 4.4
Demographic Segmentation
Since 2000, the number of NASCAR fans earning
$100,000 or more has doubled from 7% to 16% of
its fan base, and those with incomes of $50,000 or
more has risen from 35% to 48%
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LESSON 4.4
Demographic Segmentation
According to league
data, the average
household income for
NHL fans is $104,000,
highest of the four
major sports with Major
League Baseball
($96,200), the NBA
($96,000), and the NFL
($94,500)
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LESSON 4.4
Demographic Segmentation
According to a report from Leichtman Research
Group, 69% of households in the U.S. have at least
one high definition television set, up from 17% in
2006
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LESSON 4.4
Demographic Segmentation
A survey by CNBC has found that half of all
American households own at least one Apple
device, and the average Apple-buying household
has a total of three
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LESSON 4.4
Demographic Segmentation
Target retail stores understand that 60% of their shoppers
are women, likely playing a significant role in their decision
to sponsor the 2014 ASAP Women’s Surfing Event In Maui
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LESSON 4.4
Demographic Segmentation
Triple A baseball posts its demographic information
online for prospective sponsors to review
 40% of the fan base earns $46-75k per year
 42% of the fan base has an Undergraduate Degree
 91% of the fan base has a major credit card
 69% of the fan base owns their own home
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LESSON 4.4
Five Bases for Market Segmentation
Product Usage
Segmentation:
 Sports season
ticket holders
 Theatre group
ticket coordinators
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Reflects what products
consumers use, how often
they use them, and why
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LESSON 4.4
Five Bases for Market Segmentation
 Sports Fans
Psychographic
Segmentation:
 Music Lovers
 Individuals who
enjoy attending
live events
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Grouping consumers based
on personality traits and
lifestyle
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LESSON 4.4
Five Bases for Market Segmentation
Season ticket holders
enjoy additional “perks”
such as exclusive
invitations to pre-game
chalk talks with the team’s
coaches
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Benefits
Segmentation:
Refers to a perceived
value consumers
receive from the
product or service
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LESSON 4.4
Five Bases for Market Segmentation
 North, South, East and
West Regions of the
United States
 Urban and Rural areas
of a particular state
Geographic
Segmentation:
Dividing of markets into
physical locations
Important to Sports Marketers Because:
Sports consumers are characteristically loyal to
particular regions when making buying decisions
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LESSON 4.4
Selecting multiple segments
Because many segments may be valid in
helping marketers make decisions,
marketers often choose to use several
segments
Ultimately, a decision is made based on
what best fits the organization’s target
market
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LESSON 4.5
Positioning
 Fixing company products
in the Minds of Consumers
 All about “perception”
 Relative to competitor
products
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Positioning:
The fixing your sports
or entertainment
entity in the minds of
consumers in the
target market
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LESSON 4.5
Positioning
Sports drinks (Gatorade as a
performance beverage)
Movie studios (Pixar as a leader in
animated films)
Entertainers (Will Ferrell as a comedic
actor)
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LESSON 4.5
Positioning
Positioning is About Perception
Puma’s “Calling All Troublemakers” spot
launched in 2014 (part of the brand’s new
“Forever Faster” campaign) encourages fans
to be more daring and push boundaries to
achieve “danger, risk and potential fugitive
status” in an effort to differentiate itself from
Nike, Adidas and Under Armour as it
continues its efforts to gain credibility and
position itself as a legitimate performance
apparel brand
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LESSON 4.5
Positioning
Positioning is About Perception
To drive the campaign and assist in their positioning
effort, Puma partnered with athletes with “bad boy”
reputations like Olympic champion Usain Bolt and
soccer player Mario Balotelli
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LESSON 4.5
Positioning
Wheaties cereal has positioned itself as a brand
affiliated with athletic performance and its
slogan, “the breakfast of champions”, has
remained since the brand’s introduction in 1924
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LESSON 4.5
Positioning
With sales declining, General Mills (parent
company of the Wheaties brand)
introduced a new spin off product aimed to
take advantage of consumer perceptions of
the Wheaties brand. General Mills
developed three formulations of the cereal
(dubbed Wheaties Fuel) with the help of a
sports nutritionist and five world class
athletes: the NFL's Peyton Manning, the
NBA's Kevin Garnett, gold medal-winning
decathlete Bryan Clay, the MLB's Albert
Pujols, and triathlete Hunter Kemper.
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LESSON 4.5
High (variable one)
Positioning Map:
Product B
Product A
High (variable two)
Low (variable two)
Product D
Products or services are
grouped together on a
positioning map
where they are compared
and contrasted in relation
to one another
Product C
Low (variable one)
http://www.marketingteacher.com/Lessons/lesson_positioning.htm
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LESSON 4.5
Ticket Sales
Positioning
Map
High Price
Luxury suite
at an NFL
game
Lower level seats
for Disney on Ice
Client Entertaining
Family Fun
Club seats at
an NBA game
“Cheap Seats” at a minor
league baseball game
Night at the
movies
Low Price
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LESSON 4.5
High Price
Courtside
Seats
Lower Level
End Zones
Lower Level Seats
Upper Level Seats
Mid/Upper Level
Sidelines
Top Row Corners
Low Price
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LESSON 4.5
Positioning Strategy
Identify all possible competitive advantages
1) Products, services, channels, people or image
can be sources of differentiation
2) Organizations often position their
products relative to competitor
Weaknesses (5-hour energy)
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LESSON 4.5
Positioning Strategy
Choose the right competitive advantage
1) How many differences to promote?
2) Unique selling proposition
(5-hour energy)
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LESSON 4.5
Positioning
5-hour Energy Drink focuses on
its small packaging size and
claims to provide a long lasting
energy boost without the “usual
jitters associated with energy
drinks.” These purported features
are intended to provide the
competitive advantage necessary
for distinguishing this energy
drink from the many competitors
on the market.
Click here to view the latest endorsement from legendary pro athlete, Bo Jackson
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LESSON 4.5
Positioning Strategy
Positioning errors to avoid
1) Which differences to promote?
2) Are the differences legitimate?
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LESSON 4.5
Positioning
Despite positioning
their product in a highly
successful manner, the
makers of 5-hour
energy were hit with a
lawsuit in 2014 citing
deceptive advertising
charges
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LESSON 4.5
Product Differentiation
Kentwool (a 168-yearold company known for
selling upscale niche
clothing) recently
introduced a $25 pair of
golf socks to the
marketplace, positioning
the product as
“performance” apparel
for the golf aficionado
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Product
Differentiation:
Refers to a positioning
strategy that some
firms use to
distinguish their
products from those
of competitors
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LESSON 4.5
In an interview with CNBC’s Darren Rovell, Kentwool
CEO Mark Kent explains: "Ninety-five percent of all
socks are fashion based. Five percent are
performance based. We basically set out to put
ourselves in the top one percentile of that five
percent to make the highest performing sock in any
market segment. So to differentiate yourself you
have to become in layman's terms
the Ferrari of the market, you have
to be the fastest car on the street
or the best performing sock in the
marketplace."
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LESSON 4.5
Re-Positioning
A private golf course
may be suffering
slumping membership
sales.
Management may
choose to open up the
course to the public,
which will ultimately
require a well planned
re-positioning strategy
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Re-Positioning:
A marketer’s plan for
changing consumers’
perceptions of a
brand in comparison
to competing brands
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LESSON 4.5
Re-Positioning
 Re-positioning involves identifying who the new
target market is and a strategy for creating awareness
and demand within that market
 Part of the re-positioning effort in this case would
require sending a message to the target market that
the club is affordable by public standards
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LESSON 4.5
Re-Positioning
Slogan might be “Enjoy the benefits of a
private club at public course rates!”
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LESSON 4.5
Re-Positioning
The average age of a Major League Baseball fan is 44
years old, but the 18-24 age demographic is the target
audience most sponsors and advertisers try to reach. To
help reposition the brand as a product that would attract a
younger demographic, MLB has focused on developing
their “Fan Cave” program through integration of new, hip
technology, a trendy location and relationships with unlikely
partners like MTV2.
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LESSON 4.8
Advertising
 TV Commercials and
infomercials
 Print Advertisements
 Direct Mail
 Internet (banner
ads, “pop up”
ads, social media ads)
Advertising:
Any paid, nonpersonal form of
communication by an
identified company
promoting goods and
services.
 Social Media
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LESSON 4.8
Why Advertise?
 Effective communication
 Create awareness
 Create / Change image
 Associate a brand with feelings and emotion
 Precipitate behavior
 Establish / Maintain goodwill
 Assist in the increase in sales
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LESSON 4.8
Types of Advertising
Print Media:
Any written form of communication used to
inform, persuade, or remind consumers about
products or services offered
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LESSON 4.8
Types of Advertising
Outdoor Advertising:
 Includes any outdoor
signs and billboards
 Offers a high level
of visibility
 Provides 24-hour
advertising
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LESSON 4.8
Outdoor Advertising
The elevator doors in hotels and business buildings
can even be used for advertising
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LESSON 4.8
Outdoor Advertising
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LESSON 4.8
Types of Advertising
Mass Transit Advertising:
Uses public transportation, such as buses,
bus stands, taxicabs, and subways to post
advertising messages
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LESSON 4.8
Mass Transit Advertising
Hops are a new single A minor league
baseball team from Hillsboro, Oregon a
suburb of Portland.
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LESSON 4.8
Types of Advertising
Broadcast Media:
Any visual and/or auditory form of communication
used to inform, persuade, or remind consumers
about goods or services offered
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LESSON 4.8
Types of Advertising
Radio Advertising:
Advertisers match their target market to a
radio station that segments a particular
market
* Has the ability to reach a wide audience
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LESSON 4.8
Types of Advertising
Television Advertising:
Includes commercials and infomercials
Is traditionally the most expensive form of
broadcast media
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LESSON 4.8
Television Advertising:
The fitness craze known as P90X relied on a
carefully crafted TV infomercial strategy to build a
$400 million-a-year empire. The franchise has been
so successful that they released a third installment,
P90X3, in 2014
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LESSON 4.8
Television Advertising:
Honda assistant VP-advertising Tom Peyton, whose
company spends more than $600 million on U.S. television
advertising annually and sponsors the Honda Classic golf
tournament, the Rose Bowl's Rose Parade, and the NHL's
Anaheim Ducks, recently told Ad Age: "There has to be a
point where the price of sports properties on TV, the price
of tickets for consumers to games, is truly affecting the
amount of sports we can engage in — and the type of
sports we engage in.”
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LESSON 4.8
Types of Advertising
Online/Digital Media:
Advertising through various digital media
platforms
* Banner ads, pop-ups etc.
* Digital broadcasts
* Social media channels
(Facebook, Twitter, etc.)
* Mobile
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LESSON 4.8
Types of Advertising
The $60 million in digital
advertising sales earned by NBC
through its online coverage of
the London Games was three
times what the network earned
for the 2008 Games in Beijing
(sales for the 2014 Winter
Games in Sochi were slightly
down from the 2012 Sumer
Games in London to $50 million)
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LESSON 4.8
Types of Advertising
Online/Digital Media
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LESSON 4.8
Types of Advertising
“Specialty” Media (or Promotional Products):
Includes “everyday” items displaying a company
name or logo
Examples include lanyards, calendars, pens, magnets,
and coffee mugs
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LESSON 4.8
Types of Advertising
Additional Forms of “Creative” Media:
Marketers often use many other creative ways of
communicating advertising messages to consumers
Examples include: blimps (and other forms of aerial
advertising, supermarket carts/bags, hot air balloons,
and in-theater advertisements
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LESSON 4.8
Types of Advertising
In addition to the light rail advertisements, Adidas
and the Portland Timbers prominently featured a
number of advertisements through the Portland
airport to celebrate the 2014 MLS All-Star game
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LESSON 4.8
In 2014, Boeing rolled out a Seattle Seahawks
branded airplane, paying homage to the team’s
famed “12th Man” shout out to fans. In the
plane’s first flight, the aircraft carved the
number “12″ in the sky over downtown Seattle
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LESSON 4.8
LSU Athletics took a unique advertising as part of a
basketball campaign when they teamed with adverCar (a
company that pays individuals to affix advertising messages
to their personal vehicles), essentially paying fans to drive
their message into local neighborhoods, shopping centers
and commuter routes
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LESSON 4.8
Advertising Agencies
Nike contracts the
Wieden & Kennedy
agency to manage
and oversee some of
their advertising
campaigns
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Advertising
Agency:
An organization that
decides on and
implements an
advertising strategy
for a customer
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LESSON 4.8
Advertising Agencies
Wieden + Kennedy won an award at the 2012 Cannes
Lions festival for its advertising spot featuring
Carmelo Anthony, created for the Jordan Brand
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LESSON 4.8
Advertising Agencies
Under mounting pressure
and facing a potential
lawsuit, the Washington
Redskins enlisted the help of
a PR professional to help
make a decision as to
whether the franchise should
change the team nickname
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LESSON 4.8
Why an Agency?
 Expertise
 Time constraints
 Time constraints
 “Fresh” perspectives
 Access to athletes, celebrities,
entertainers?
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