CHAPTER 7
SEGMENTATION, TARGETING, AND
POSITIONING
Segmentation - Grouping consumers
together with common needs
Segmentation Bases:
• Demographic
• Geographic
• Psychographic
• Benefits
• Geodemographic
• Behavioral
Segmentation – Modern Family Life Cycle
Targeting - Evaluating the various
segments and selecting the one(s) that
promises the best ROMI
Successful Targets Must (Be):
• Sizable
• Measurable
• Reachable
• Demonstrate Behavioral Variation
Positioning - Finding a way to fix your
product in the minds of consumers
Perceptual Mapping
high price
conservative
extreme
low price
Six Attributes of Sports
• Strength, speed vs. methodical, precise movements
• Athletes only as participants vs. athletes +
recreational participants
• Skill emphasis on impact with object vs. skill
emphasis on body movement
• Practice primarily alone vs. primarily with others
• A younger participant in the sport vs. wide age
range of participants
• Less masculine vs. more masculine
Perceptual Map for Sports
CHAPTER 8
SPORTS PRODUCT CONCEPTS
CHAPTER 7
SEGMENTATION, TARGETING, AND
POSITIONING
Segmentation - Grouping consumers
together with common needs
Segmentation Bases:
• Demographic
• Geographic
• Psychographic
• Benefits
• Geodemographic
• Behavioral
Segmentation – Modern Family Life Cycle
Targeting - Evaluating the various
segments and selecting the one(s) that
promises the best ROMI
Successful Targets Must (Be):
• Sizable
• Measurable
• Reachable
• Demonstrate Behavioral Variation
Positioning - Finding a way to fix your
product in the minds of consumers
Perceptual Mapping
high price
conservative
extreme
low price
Six Attributes of Sports
• Strength, speed vs. methodical, precise movements
• Athletes only as participants vs. athletes +
recreational participants
• Skill emphasis on impact with object vs. skill
emphasis on body movement
• Practice primarily alone vs. primarily with others
• A younger participant in the sport vs. wide age
range of participants
• Less masculine vs. more masculine
Perceptual Map for Sports
Sports Product Concepts
• Sports Product - Good, Service or
Combination of the two that is designed to
provide benefits to a sports spectator,
participant, or sponsor.
Goods and Services as Sports Products
(The Good/Service Continuum)
• Intangibility – cannot be seen, felt, tasted
• Inseparability – simultaneous production
and consumption
• Heterogeneity – potential for high
variability
• Perishability – cannot be inventoried or
saved
Classification Of Sports Products
• Product Mix - All the different products and
services a firm offers
• Product Line - Groups of individual products
that are closely related in some way
• Product Item - Any specific version of a
product that can be designated as a distinct
offering
Product Characteristics
Branding
Total
Product
Product Quality
Product Design
Branding
• Name,design, symbol, or any combination
• Broad purpose of branding is for a product to
distinguish and differentiate itself from all other
products
• Some great sports names include the Macon
Whoopie, Louisiana Ice Gators
Brand Names
• What’s in a name?
– Easy to say, generates positive feelings and
associations
– Translatable into a successful logo
– Consistent with rest of product lines, city, or
organization
– Legally and ethically permissible
Branding Process
Brand Awareness
Brand Image
Brand Equity
Brand Loyalty
Model of Brand Equity
Licensing
• Contractual agreement whereby a company
may use another company’s branding in
exchange for a royalty or fee
• Booming business (e.g., NBA has 150
licenses) with $13.65 billion
• NFL (3.6) NBA (2.6) Colleges (2.0) MLB (1.9)
NHL (1.2)
• CAPS (Coalition to Advance the Protection
of Sports Logos)
Sports Product Quality
• Quality of Services
• Quality of Goods
Nature of Service Quality
EXPECTED SERVICE LEVELS
PERCEIVED SERVICE LEVELS
Expected Service Levels
• Service Promises (ads, price)
• Word-of-Mouth
• Past Experience
Perceived Service Levels Service Quality Dimensions
• Tangibles – Physical facilities, appearance of
personnel, equipment
• Reliability – Ability to perform the service
dependably, accurately, consistently
• Responsiveness – Willingness to provide prompt
service to customers
• Assurance – Trust, knowledge, and courtesy of
employees
• Empathy – Caring, individualized attention to
customers
Quality of Goods Dimensions
•
•
•
•
•
•
•
Performance
Features
Conformity to Specifications
Reliability
Durability
Serviceability
Aesthetic Design
Product Design - Aesthetics, Style and
Function of the Product
RELATIONSHIP AMONG PRODUCT DESIGN,
TECHNOLOGY, AND PRODUCT QUALITY
Technological Environment
Product Design
Product Quality
CHAPTER 9
MANAGING SPORTS PRODUCTS
New Sports Products From the
Perspective of the Organization
•
•
•
•
•
New-to-the-World Products
New Product Category Entries
Product Line Extensions
Product Improvements
Repositionings
New Sports Products From the
Perspective of the Consumer
• Discontinuous Innovations
• Dynamically Continuous Innovations
• Continuous Innovations
New Product Development Process
•
•
•
•
•
•
Idea generation
Screening
Business analysis/Concept testing
Development
Test marketing
Commercialization
New Product Screening Checklist
General Characteristics of New Product/Service
•
•
•
•
•
Profit potential
Existing and potential competition
Size of overall market
Level of investment
Level of risk
New Product Screening Checklist
Marketing Characteristics of New Product/Service
•
•
•
•
•
Fit with marketing capabilities
Effect on existing products and services
Appeal to current consumer markets
Existence of differential advantage
Impact on image
Production Characteristics of New Product/Service
• Fit with production capabilities
• Ability to produce at competitive prices
• Availability of labor and material resources
Product Life Cycle
INTRO
GROWTH MATURITY
Total Industry Sales
$$
Maintain
Differentiate
Awareness
TIME
DECLINE
Eliminate or
Extend
Selected Product Life Cycle Patterns
Diffusion of Innovations –
Rate at which new sports products spread
throughout the marketplace
Factors influencing the rate of diffusion:
• New product characteristics
• Perceived newness of the innovation
• Nature of the communication network
Diffusion of Innovations
Types of Adopters
•
•
•
•
•
Innovators
Early Adopters
Early Majority
Late Majority
Laggards
Model of the Rate of Diffusion
CHAPTER 10
PROMOTION CONCEPTS
Promotional Concepts
• COMMUNICATION - Process of establishing
a “oneness” between the sender and
receiver
• PROMOTION MANAGEMENT - Focus on the
promotional element of the marketing mix
Promotion Mix Elements
•
•
•
•
•
Sales Promotions
Public or Community Relations
Sponsorship
Personal Selling
Advertising
Communications Process
Source
Encoding
Message
Feedback
Medium
Decoding
Receiver
Noise
Promotion Planning
•
•
•
•
Target market considerations
Promotional objectives
Establishing promotional budgets
Choosing an integrated promotional mix
Target Market Considerations
• Push strategy
• Pull strategy
Promotional Objectives The Hierarchy of Effects
•
•
•
•
•
•
•
Unawareness
Awareness
Knowledge
Liking
Preference
Conviction
Action
Promotional Budgets
•
•
•
•
Arbitrary allocation
Competitive parity
Percentage of sales
Objective and task method
Integrating the Promotional Mix
• Integrated Marketing Communications - Concept
by which a sports organization carefully
integrates and coordinates its many
promotional mix elements to deliver a unified
message about the organization and its
products.
CHAPTER 11
PROMOTION MIX ELEMENTS
Building An Advertising Strategy
MARKETING STRATEGY
AD
OBJECTIVES
BUDGETING
CREATIVE
DECISIONS
MEDIA
STRATEGIES
AD EVALUATION
Ad Objectives
(awareness, inform, change attitudes, purchase)
• INDIRECT OBJECTIVES - ENHANCE
CORPORATE IMAGE
• DIRECT OBJECTIVES - STIMULATE DEMAND
FOR THE SPORTS PRODUCT
Ad Budgeting
•
•
•
•
ALL YOU CAN AFFORD
COMPETITIVE PARITY
PERCENTAGE OF SALES
OBJECTIVE AND TASK
Creative Strategies
• IDENTIFYING THE BENEFITS OF THE SPORTS
PRODUCT
• DESIGNING THE AD APPEAL
• DEVELOPING THE AD EXECUTION
Designing The Ad Appeal
•
•
•
•
•
Health Appeals
Emotional Appeals
Fear Appeals
Sex Appeals
Pleasure or Fun Appeals
Designing The
Ad Execution
•
•
•
•
•
One- or Two-Sided Messages
Comparative Message
Slice-of-Life or Lifestyle Message
Scientific Message
Testimonials
Media Strategy
• SPECIFY THE MEDIA OBJECTIVES (REACH,
FREQUENCY, CONTINUITY)
• SELECTING THE MEDIA VEHICLES
Personal Selling:
The Strategic Selling Process
•
•
•
•
•
•
Buying Influences
Red Flags
Response Modes
Win-Results
The Sales Funnel
Ideal Customers
Sales Promotions
•
•
•
•
•
Premiums
Contests and Sweepstakes
Sampling
Point-of-Purchase Displays
Coupons
Public Relations
•
•
•
•
Publicity (news releases, press conferences)
Participation in Community Events
Producing Written Materials (press guides)
Lobbying
CHAPTER 12
SPONSORSHIP PROGRAMS
Sponsorship
• Investing in a sports entity to support
overall organizational objectives and
marketing goals
• IEG estimates in North America $11.19
billion spent on sponsorship and of this
$7.69 billion will be spent on sports
• Not unlike other forms of communication,
sponsors must fight the clutter and find the
perfect match
The Sponsorship Process
SponsorshipO
bjectives
Sponsorship
Budget
Sponsorship
Acquisition
Implementing and
Evaluating the
Sponsorship
Sponsorship Objectives
• Direct
– Sales Increases
• Indirect
– Awareness
– Competition (ambush marketing—planned effort to
associate themselves with an event – I Love LA)
– Reaching Target Markets (allows us to reach consumers
where they live and play)
– Relationship Building
– Image Building
Sponsorship Budgeting
• Sample costs of sponsorship
–
–
–
–
Corporate Box at the United Center $220,000
Title sponsor of Tot Trot
$7500
Official Supplier for MLB
$10 million
Premier League sponsor
$15 million
• Initial costs, but there is maintenance and
leveraging
Sponsorship Acquisition Model
Sponsorship Acquisition
• 1) Determine Scope of the Sponsorship
(sports event pyramid with global,
international, national, regional, and local
events)
• 2) Determine the athletic platform (entity
and level of competition)
Sponsorship Implementation and
Evaluation
•
•
•
•
•
Number of mentions in popular media
Media equivalencies
Sales figures (pre and post)
Attitude change (pre and post)
Number of distributors (pre and post)
CHAPTER 13
DISTRIBUTION CONCEPTS
Distribution Concepts
• Ability of consumers to gain access to
products in a timely and convenient fashion
• Moving product from producer to consumer
via the various channels of distribution
Sports Distribution Issues
• Sports Retailing
• Stadium as “Place”
• Sports Media
Sports Retailing Mix
•
•
•
•
Products
Pricing
Distribution
Promotion
Retail Image/Store Personality
• Factors include (in general):
–
–
–
–
–
–
atmospherics
location
employees/sales personnel
clientele
merchandise assortment
promotional activities
Stadium as “Place”
• New Sports Venues
• Ticket Distribution Issues
Sports Media as Distribution
• Delivering the Sports Product to Consumers Via
Media
• Rising Cost of Media Rights
• Media as a Portion of the Revenue Mix
• New Trends in Sports Media
CHAPTER 14
PRICING CONCEPTS
Pricing Concepts
• Price is a Statement of Value
• Value = Perceived Benefits
Price of Sports Product
• Essence of pricing is the exchange process
- An attempt to quantify the value of what
is being exchanged
Internal and External Determinants
of Pricing
•
•
•
•
RELATIONSHIP OF PRICE TO SOME OTHER
MARKETING MIX ELEMENTS
Related to product life cycle
Communicates something about the product
Promotion geared towards information
about price
Product lines with different prices attract
different segments of consumers
Estimating Consumer Demand
• Consumer Tastes
• Availability of Substitute Sports Products
• Consumer Income
Price Elasticity of Demand
Consumer Pricing Evaluation Process
CHAPTER 15
PRICING STRATEGIES
Pricing Strategies
•
•
•
•
•
Differential Pricing Strategies
New Sports Product Pricing Strategies
Psychological Pricing Strategies
Product Mix Pricing Strategies
Cost-Based Pricing Strategies
Differential Pricing
• Second Market Discounting
New Sports Product Pricing
• Penetration Pricing
• Price Skimming
Psychological Pricing
•
•
•
•
Prestige Pricing
Referent Pricing
Odd-Even Pricing
Traditional Pricing
Product-Mix Pricing
• Bundle Pricing
• Captive Pricing
• Two-Part Pricing
Cost-Based Pricing
• Cost-Plus Pricing
• Target Profit Pricing
• Break-Even Pricing
Price Adjustments
• Price Reductions and Price Increases
• Price Discounts
CHAPTER 16
IMPLEMENTING AND CONTROLLING
THE STRATEGIC SPORTS MARKETING
PROCESS
Implementation Issues
•
•
•
•
•
•
•
Communications
Staffing and Skills
Coordination
Rewards
Information
Creativity
Budgeting
Implementation Phase
Strategic Control Issues
• Planning Assumptions Control
• Process Control
• Contingency Control
Planning Assumptions Control
• “Are the premises or assumptions used to
develop this marketing plan still valid?”
• Examine the external environmental factors and
the sports industry factors
Process Control
• Monitoring Strategic Thrusts
• Milestone Review
• Financial Analysis
Contingency Control
• “How can we protect our marketing strategy
from unexpected events or crises that could
affect our ability to pursue the chosen strategic
direction?”
• Developing a Crisis Plan