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The Exchange Process

The exchange process has evolved from a 

system of bartering to a monetary system. 

At the heart of marketing is something called the ​exchange process.​ Since

the beginning of civilization, we humans have been involved in this

exchange process​—that is, the process of exchanging one item of value for

another. That's right! The origins of modern-day marketing began before the

concept of money ever entered anyone's mind. Back then, we would ​barter

with one another, meaning we would trade one item of value for another. If,

for instance, you had an extra vessel for holding water and needed a knife

for hunting, you might seek out someone who had an extra knife and try to

market your vessel to him. That is, you would attempt to persuade him that

your vessel was useful so that he would engage in the exchange process

with you, swapping his knife for your vessel. This type of "primitive"

marketing still exists today, but to a much lesser degree. Why? Because

we've replaced the bartering system with a ​monetary system,​ a system of

exchange based on money such as paper currency.

You see, when everyone in a society places value on something (in this case,

money), the exchange process becomes much easier because instead of

having to look for that one person to trade with who may have a need for

your item of value, you can simply use money to buy what you need from

anyone with a desire to sell it. Because everyone values money, anyone will

be willing to take it from you!

Perceived Value vs. Real Value

At the core of any kind of marketing is the notion of ​perceived value.

Perceived value is how valuable someone ​thinks​ a product or service is; this

type of value exists only in the person's mind. This is different from real

value, which is the cost of providing the product or service. In order for

businesses to make a profit, they have to raise the perceived value of their

offerings in the minds of their customers. This is where​marketing​ comes

into play. The term​"marketing"​ refers to a set of tactics used to increase

the perceived value of a product or service in the minds of consumers. The

higher the perceived value, the more a company can charge for a product,

and the greater the demand will be for the product. This leads to increased

sales and profit. As you can see, ​marketing​ is a very important principle for

businesses as it directly affects how much money they make!

PERCEIVED VALUE AND UTILITY: A MATCH MADE IN HEAVEN

As we discussed, real value has nothing to do with the usefulness of an item,

only the cost of its production. Perceived value, however, is directly related

to how useful the customer views the item to be. This is the item's

utility.​Despite its connotation, an item's ​utility​ is not always practical. In

fact, it can often be quite superficial. There are several different types of

utility:

● Form Utility:​ Form utility is the value a consumer sees in a

final product. For example, a pre-made swing set is more

valuable than all of the individual parts combined because of the

convenience of not having to build the swing set. Therefore, the

form—that is the swing set as a whole—is valued. That's why if

you went to the store to buy a pre-assembled swing set, it

would likely cost you more than if you bought a set that

required assembly.

● Time Utility:​ Time utility refers to how useful an item is at a

certain time. For instance, on a rainy day, umbrellas are

perceived as much more useful than on a sunny day. Therefore,

their time utility increases on these days. A store that places

their umbrella rack at the front of the store on stormy days is

taking advantage of the item's time utility in order to increase

their sales.

● Place Utility:​ Certain items are more useful in certain places

and are perceived as more valuable. For example, there is a

much greater demand for snow shovels in the Northern states

than in the Southern states because of the frequency of snow in

these places. Therefore, snow shovels have greater value in this

part of the country. Moreover, a store takes advantage of place

utility when they put convenience items at the front of the store.

Do you know people who are willing to pay more for a snack at

a gas station than they would pay for it at the grocery store?

That's because they're paying for the convenience of purchasing

the item at that particular place.

● Possession Utility:​ Possession utility refers to the value a

buyer perceives in owning a product. For example, a person who

has to haul things back and forth frequently may see more value

in owning a pickup truck rather than borrowing or renting one

than someone who rarely has to haul items. The notion of

scarcity also affects an item's possession utility. Because we

tend to value things more if they are rare, people are willing to

pay more to own something that few others have access to.

● Image Utility:​ Image utility is the imagined usefulness an item

may have for a person's self-worth, popularity, or confidence.

For instance, a trendy, name-brand pair of jeans will cost more

than an off-brand pair because of their perceived image utility.

PERCEIVED VALUE AND TARGET MARKET

The utility of a commodity such as a new car, for instance, is comprised of a lot more than just the  commodity's practical use. 

We all have different wants and needs, so it stands to reason that our

perceived value of certain goods and services would be different. A teenager

desperate for popularity may be more willing to spend all of his allowance on

a certain brand of tennis shoes, for instance, whereas an older man on a

fixed income may prefer to buy his shoes from a discount store. No matter

how hard the name-brand shoe company tries to market their products to

this man, he will never buy their shoes because he simply doesn't value

them enough to fork out the money for them. That's why it's important for

companies to determine their ​target market​—the group of people most

likely to value their products.

Different consumers have different ideas of how  

valuable a commodity is; therefore, companies must accurately identify their target markets.  

Once a company determines its​target market,​ it can focus all of its

marketing efforts on that particular group of people, taking into account

their needs, wants, likes, dislikes, and lifestyle, etc. when formulating their

brand and advertisements. Therefore, the company is much more likely to

see success as a result of its marketing efforts, and it won't waste time,

money, and effort marketing to someone who will never purchase their

products and services.

Market Research

Marketing professionals engage in market 

research in order to make their products and 

services more appealing to their target markets.  

Seasoned marketers all over the globe recognize the value of the exercise

you just completed, but they take the concept of determining and describing

their target markets to an entirely different level! Entire departments of

major companies are devoted to performing ​market research.​Market

research is the gathering and analysis of data related to the demand,

competition, and consumers (i.e., target market) of a product or service.

Have you ever received a survey in the mail from a company? This is a type

of market research. Companies have a lot to gain by finding out more about

their target market. After all, the more they know about you, the better they

can market their products to you.

TYPES OF MARKET RESEARCH

There are two main types of market research—primary and

secondary.​Primary market research​ occurs when a company conducts

new studies to find out more about their market. ​Secondary market

research​ refers to the study of existing data about the market.

Primary market research is considered by many marketers to be the most

valuable because it can be tailored to the company's specific goods and/or

services. Primary market research may consist of:

● Surveys

● Questionnaires

● Focus groups

● Paid product reviews

● Free samples

Building a Brand

Another important aspect of marketing is building a ​brand.​ Contrary to

popular belief, a brand is more than just a company name or logo. It is a

promise that the company makes to the consumer about the experience

they can expect from the company's products or services. Many a marketing

guru will tell you that a brand is a company's most important asset.

Therefore, everything about a company right down to its colors,

spokesperson, promotions, messaging, and the like must complement and

work toward building the brand.

A company's brand is its promise to 

consumers; therefore, it must be consistent.  

Once a company has decided on a brand promise, they will often construct a

brand guide with strict rules, regulations, and guidelines for all company

messaging including advertisements, online content, promotions, and

anything else that may reflect on the company. These brand guides can be

as specific as dictating what type of font to use in company headings! All of

this effort is warranted, however, because in order for a brand promise to be

effective in attracting customers and promoting customer loyalty, it must be

consistent. After all, a promise is no good if it keeps changing from day to

day. That's why companies work hard not to dilute their brand. This can be a

complicated balancing act as trends change and their target market evolves.

7 Steps to Creating a Marketing Plan

Marketers must engage in careful planning 

before launching a new product or service. 

Smart businessmen and women carefully plan out their marketing approach

before they launch a new product or service. This process can take months

or even years to complete. Although there are various ways to develop such

a strategy, the process usually consists of the following steps:

1. Determining the utility/utilities of the product

2. Determining the current and projected demand for the product

3. Identifying any existing competitors

4. Using market research to determine an ideal price point for the

product

5. Determining the target market for their product

6. Using market research to develop a brand promise

7. Creating plans for promotional strategies to attract and keep

consumers

How the Internet Has Changed Marketing

A unit about marketing in the 21st century wouldn't be complete without a

section on ​Internet marketing.​ Whereas this type of marketing didn't even

exist a few decades ago, it is now an essential component of any serious

marketing campaign. In fact, it is sometimes the only component because

some companies use the Internet as their sole means of marketing their

product or service.

The Internet has allowed many companies to reach a broader market of consumers. 

In many ways, the Internet has made marketing easier, more economical,

and some would say, more effective. For instance, print advertisements cost

money to produce and have to be delivered either by hand or by snail mail

to the company's target market. Today, similar advertisements can be sent

online instantly with the click of a mouse via e-mail.

The Internet has also made the exchange process more convenient. For

instance, when your parents were your age, they had to make a trip to make

any kind of purchase or exchange, even for video rentals! Now, you can buy

almost anything imaginable online and have it shipped directly to your

house. And of course, you can rent new releases and watch them instantly

on the computer.

The Internet has also expanded the target market for many companies.

Whereas businesses used to be limited to the consumers in and around their

communities, the Internet has made it possible to sell products to practically

anyone in the world.

COMPONENTS OF AN INTERNET MARKETING CAMPAIGN

An Internet marketing campaign can be as simple or as complex as a

company wants it to be. There are so many marketing tools online that

creating an exhaustive list would be nearly impossible. The following is a list

of some of the most common components of an Internet marketing

campaign:

● A Website

● All major companies have a website, but not all of them use

these sites in the same way. For instance, some companies use

their website primarily as a portal of information for their target

market and as a way to build their brand. Other companies

actually sell their products directly from their website.

● A Social Media Presence

● Most major companies have not only a website, but also a social

media presence—that is established accounts on one or more

social media platform such as Facebook, Twitter, and Google+.

These accounts allow businesses to interact with customers and

potential customers in real time. It also allows them to get the

word out about promotions, new products, updates, and the like

quickly and easily. ​Social media marketing​ is the use of social

media to attract new customers and promote a product or

service.

● E-mail Marketing

● E-mail marketing​ is the use of e-mail to nurture prospects and

try to persuade them to become paying customers. E-mail

marketing is usually conducted through complex automated

software that detects where the customer is in the purchasing

cycle and sends them an appropriate e-mail. E-mail marketing

seeks to educate the potential customer about a product or

service while building credibility for the brand. The idea is that

the more the prospect knows about the product and company

and the more contact the company has had with the prospect,

the more comfortable the consumer will be with the idea of

doing business with the company.

● Content Marketing

● Content Marketing​ is the use of informational text such as

articles, white papers, infographics, blog posts, and the like to

provide value to the customer in hopes of gaining their trust and

making them feel beholden to a company. For instance, many

companies will give away valuable content for free so that when

the consumer decides that it's time to make a purchase, they

will feel obligated to do business with the company that they

received free information from. For instance, if a customer

shows interest in a hot tub, a particular hot tub provider may

offer the customer a guide to affording a hot tub with useful

information about how to choose the right hot tub for your

budget. If the potential customer finds this information helpful

and is therefore able to afford a hot tub as a result of reading

the article, it only stands to reason that the consumer would be

more likely to do business with the company that gave him the

valuable content.

● Search Engine Optimization (SEO)

● There are many different components of a successful Internet marketing campaign  ● including a website, social media presence, 

● email marketing, search engine optimization (SEO), and content marketing. 

●   ● Search Engine Optimization,​ or SEO for short, refers to a set

of tactics that a company uses in order to have their website

appear in a prominent place on search engine results pages

when users search for a product or service they offer. The goal

is to be top-ranked on search engines like Google and Bing so

that the company will receive more visitors to their website and

potentially make more sales. One popular SEO tactic is the use

of keywords on the company's website, blog, articles, and any

other online publication. The more the keyword is used, the

higher the company will rank.

Learning these basic tenets of marketing will provide a foundation for you to

build on as you progress through the remaining units in this course. It's

sometimes difficult to think about marketing a human being such as an

athlete or musician, for instance, but these individuals are as much

commodities as anything else. These people (or in many cases, their agents)

work hard to build a personal brand that is marketable to consumers. Just

think about Oprah, for instance! Her personal brand has led to her to create

her own television show, magazine, and even her own TV channel!

Oprah Winfrey is a good example of someone who has created a strong personal brand for herself in the  entertainment industry.  

As strange as it may sound, the easiest way to think about this type of

marketing is to equate the person to a product. Just like any other product,

athletes and entertainers must provide some sort of utility in order to be

perceived as valuable to the consumer. The higher their perceived value, the

more they can charge for their events, autographs, memorabilia, etc. They

also have a target market they must cater to and a brand promise that they

must adhere to in order to be successful in their market. Of course, there

are also many ways in which this type of marketing is different, but at its

roots, it's still all about the exchange process. We'll be exploring the

similarities and differences further as we delve into the world of sports and

entertainment marketing in the units ahead.

The Sports and Entertainment Industry: How Does It Make Money?

When you think of an industry, manufacturing plants or biochemical labs

may come to mind, but an industry is really the production of any type of

commodity in an economy. Whether or not you've ever thought about sports

and entertainment as an industry, it definitely fits the bill. Are athletes and

entertainers produced? Well not exactly, but they are certainly marketed,

and their popularity allows for the production of other ancillary products. An

ancillary product is a secondary product that has a value directly related to

the core product. Take, for example, the widely popular book and movie The

Hunger Games. If you read the book or saw the movie, you know that the

heroine, Katniss, wore a mockingjay pin into the arena as a token of good

luck and a reminder of her district. Because of this one detail in the film,

reproductions of mockingjay pins are being sold in retail stores all over the

country. In this case, the book and film are the core products, and the

mockingjay pins are the ancillary products. Of course, there are many other

ancillary products associated with this book and film including posters,

T-shirts, backpacks, and much more. Core products and ancillary products

are huge sources of revenue for both the author and the film company.

The same concept can be applied to sports marketing. An athlete or coach

alone can be a core product as can an entire team. Take, for example, the

popular golfer Tiger Woods. Not only has he made millions by playing in

prestigious golf tournaments such as The Masters and winning sponsorships

and endorsements, but he also has an entire series of video games for

consoles such as the Wii, Xbox, and PlayStation. In this case, Tiger Woods is

the core product, and the video games are the ancillary products.

BUILDING A FAN BASE

One of the primary reasons that sports and entertainment marketing has the

potential to be so lucrative is that unlike traditional marketing, this form of

marketing seeks to create a fan base rather than a customer base. A fan

base is a group of people who not are not only loyal to a brand, but who also

identify themselves with the brand, meaning they feel as if the brand is an

extension of themselves. A fan base is very different from a customer base.

Here's how:

CUSTOMERS VS. FANS

Unlike customers, fans identify themselves

with a brand and are therefore, more loyal (and valuable) to the brand.

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Customers are price conscious whereas fans are usually more willing to pay

top dollar for brand-related events and products because of their emotional

investment in the brand.

Customers are much less likely to become walking advertisements for a

brand than fans. Fans often buy T-shirts, hats, and even paint their entire

bodies with the brand's logo.

Customers seek to be satisfied whereas fans seek a much more intense level

of emotion—one that borders upon elation.

Customers may switch to another brand if they have a less-than-satisfactory

experience whereas fans are often diehards, meaning they will remain loyal

to a brand despite negative experiences (i.e., losing a game). It's very rare

that a fan will "switch brands" whereas customers do it all the time

One of the largest branches of sports and entertainment marketing is event

marketing. Event marketing is a type of marketing that employs the

popularity of a certain event to market a product, service, or brand. The

event could be a local little league sports team, the Super Bowl, or an

American Idol Tour. The concept is simple: Wherever large groups of people

are amassed—whether it is at the event or around the television—marketers

want to be there. One of the key purposes of event marketing is to promote

brand awareness. Brand awareness is a measure of how well-known the

brand is amongst its target market.

A popular event gives marketers the

opportunity to increase brand awareness.

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Just take, for example, Super Bowl advertisements. Companies pay millions

of dollars for the opportunity to air their commercial during the Super Bowl.

Although these commercials last only a minute or two, they reach a lot of

people (over 111 million people watched Super Bowl XLVI), and they have a

lasting impression on the audience—an impression for which companies are

willing to pay big bucks. Super Bowl commercials have become so popular

that many "fans" watch the game for the commercials alone, and these ads

generate nearly as much post-game conversation as the game itself.

CORPORATE SPONSORSHIPS

Another way that the sports and entertainment industry generates revenue

is through corporate sponsorships. When corporations have a similar target

market as a sports team or entertainer, they can sponsor the

team/entertainer in exchange for placing their product alongside the

team/entertainer at an event or in advertisements. Ideally, this creates a

win-win situation for both the company and the team/entertainer. For

example, NFL players don't drink Gatorade at their televised games because

they like its taste; they drink it because Gatorade pays the team a lot of

money in order to be the "official sports drink of the NFL." You might be

wondering: Why would the company pay people to drink their product?

Because when professional football players drink Gatorade on TV, the

millions of people watching associate Gatorade with the popularity and

prowess of these players—at least, that's what Gatorade hopes anyway. If it

works, the sponsorship and associated advertisements and product

placement increase the brand awareness and perceived value of the product

among the target market.

Corporate sponsors associate themselves with

popular competitors and entertainers in hopes of

adding value to their brands.

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Recent studies have shown that these corporate sponsorships often have the

intended effect of heightening brand awareness. For example, in a recent

survey of "avid" NFL fans, 43 percent of respondents said they make an

effort to recognize the NFL's corporate sponsors, and of that 43 percent,

one-third of them said they make an effort to buy products from sponsors

and recommend them to friends and family.1

Of course, these corporate sponsorships benefit the sports team/entertainer

as well. For example, by wearing the Nike symbol and endorsing many other

products, Tiger Woods makes approximately $70 million a year, and that's

aside from the millions he makes winning golf tournaments.

The History of Sports and Entertainment Marketing

Discretionary income is the money one has left over after all of his or her

necessities have been paid for.

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No one knows exactly when this now-enormous industry first got its start. It

could be said that sports and entertainment marketing began when someone

realized that people were willing to pay to be entertained. After all, any kind

of formal entertainment was once reserved only for royalty. Court jesters

were commissioned to provide entertainment to kings and queens as a sort

of comic relief from the burdens of monarchy. At that point in our history as

a civilization, average people had little to no discretionary income—that is,

income left over after all of the necessities are paid for. Discretionary income

can be spent as one wishes on things such as sweets, nice clothes, and

yes—entertainment. In other words, people have the option to spend their

discretionary income on things that they want rather than things they need.

Sports and Entertainment Demand

In order to market any kind of commodity, there must be a demand for it. In

economics, demand is the consumer's want or need for a product or service.

Typically, as demand increases, so does price. That is, the more people want

or need a commodity, the more they are willing to pay for it. There are

many environmental factors that affect the demand for a commodity. Some

of these include:

Supply, or availability of the commodity

Price of the commodity

Price of related commodities

State of the economy in general

Distribution of wealth in society (i.e., the number of rich people vs. poor

people)

Changes in societal preferences

Any change in one or more of these factors will have either a positive or

negative effect on the demand for a commodity. The reason that an entire

course of study is devoted to sports and entertainment marketing, however,

is that the marketing of these types of commodities is very different from

the marketing of other commodities. Therefore, not all of these factors will

affect the demand for sports and entertainment.

Let's look at each of these factors in more detail to determine which of them

impact the demand for sports and entertainment commodities.

SUPPLY/AVAILABILITY OF THE COMMODITY

Celebrity entertainers can charge such high

ticket prices because they are truly one of a kind,

which increases their demand.

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One of the reasons that professional athletes and popular entertainers are

paid such high salaries is because of their very limited supply. They are truly

one of a kind! If no one can play golf as well as Tiger Woods or sing as well

as Carrie Underwood, for instance, then going to an event and seeing this

person in action becomes a very valuable opportunity. These people are in

demand! That's why these celebrities and others like them can charge so

much for tickets to their events or in-person appearances.

PRICE OF THE COMMODITY

Typically, the higher a commodity is priced, the lower the demand is for that

commodity. That's because not everyone is able or willing to pay a high

price. This is true of the sports and entertainment marketing industry as

well. For example, the supply of Aerosmith concert tickets is low as they

haven't been on tour for a very long time, so tickets to their 2012 concert

tour will cost you a pretty penny. Because not everyone can afford hundreds

of dollars to see a show that lasts a couple of hours at best, the demand for

this commodity will be relatively low—not low enough, however, to keep

Aerosmith from turning a hefty profit!

People often seek out entertainment in

periods of in order to

escape their financial worries.

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STATE OF THE ECONOMY IN GENERAL

Typically, the state of the economy has a big impact on commodities that

are nonessential. Nonessential commodities are ones that aren't necessary

for survival. Given this information, you would think that sports and

entertainment commodities would be heavily affected by a dip in the

economy, and, to some extent, they are. However, an interesting trend is

that during periods of depression, people are eager to spend any

discretionary income they might have on entertainment—perhaps as a way

of forgetting about their financial woes, if only for an hour or two.

DISTRIBUTION OF WEALTH IN A SOCIETY

The distribution of wealth in a society affects nearly all commodities to some

extent, and sports and entertainment commodities are no exception. Take

our society, for instance. We have a pretty equal balance of rich people,

middle-class people, and poor people, but there are only a few truly wealthy

people—we're talking billionaires here. These people can afford the kinds of

entertainment that the rest of us could only fantasize about. Think about

being personally serenaded by Shakira or taking a dip in the pool with

Michael Phelps. Does that affect the demand for these entertainment

options? Absolutely! Yes, lots of people would love to have these

experiences, but very, very few can actually afford to pay for them.

CHANGES IN SOCIETAL PREFERENCES

As trends come and go, so too does the demand

for certain entertainment commodities.

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Changes in societal preferences, otherwise known as trends, have a big

impact on the demand for many different kinds of commodities. For

instance, when it became trendy to protect the Earth and practice "green"

habits, the demand for paper towels went down. Likewise, when the

technology for cell phones was invented, the demand for landlines decreased

dramatically. These trends or fluctuations in taste have a huge impact on the

entertainment industry as well. As people's entertainment preferences

change, television ratings go up and down, singers' careers are either made

or broken, and films either break box-office records or crash and burn.

That's why it's necessary for entertainment marketers and agents to be

visionary in their strategies—so that they can stay on top of what's currently

in demand. Although trends may affect sports marketing to some degree,

especially when it comes to the marketing of ancillary commodities, they are

not as big a factor as they are for the entertainment industry. Perhaps this is

because sports have set rules and guidelines that make them resistant to

the effects of others' opinions or tastes.

Laws Affecting Sports and Entertainment Marketing

INTELLECTUAL PROPERTY

Intellectual property laws that protect trademarks and logos serve both

companies and consumers alike.

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Intellectual property laws protect people in the sports and entertainment

community by preventing others from stealing their ideas. This includes

trademarks such as sports logos, for instance. The law prevents other

companies and individuals from using the trademark because it reflects a

specific brand such as the sports team. If you'll recall from the last unit, a

brand expresses a promise to the consumer. Trademark law protects

consumers as well so that they won't be fooled into accepting this promise

from anyone other than the brand itself.

Burning copies of CDs or DVDs is a crime calle

piracy that strips entertainers and producers of

their revenue potential.

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PIRACY

Piracy is a term that refers to copyright infringement that occurs specifically

within the entertainment industry. Piracy is an issue that mostly affects the

film and music industries. When someone burns copies of a newly released

CD or DVD, for instance, and either sells them at a discounted price or

distributes them to friends and family, this person is committing piracy. It's

easy to see how piracy can negatively affect revenue for the entertainment

industry. If it were legal to burn copies of CDs and DVDs and everyone did

it, virtually no one would purchase these products from the manufacturer or

the copyright holder.

BANNED DRUGS

The sports industry has banned the use of performance enhancing drugs

such as steroids.

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There are certain drugs that are banned by sporting associations. These

drugs, sometimes called performance enhancers, can give one athlete an

unfair advantage over another, making the individual more marketable. If

these drugs are found in the bloodstream of athletes, they can be kicked off

a team or their medals and awards can be revoked.

Roles in Sports and Entertainment Marketing

According to the Bureau of Labor Statistics, there were a reported 403,900

people working in the sports and entertainment industry as of May 2011.

Obviously, not all of these people do the same thing. There are certain

distinctive roles that individuals take on within the realm of sports and

entertainment marketing:

An amateur athlete is not paid to play a sport,

but may receive opportunities such as

scholarships and recruitments.

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Amateur: An amateur athlete is one who is not paid to play a sport. These

athletes may receive other benefits such as scholarships to a school or the

opportunity to play professionally based on their performance as an

amateur. Amateur athletes often have a strong desire to play their sport

professionally and make a career out of what they love doing. Unfortunately,

only a small percentage of amateur athletes actually go on to become

professional athletes. In order to make it to this next level, amateurs must

adhere to an intensive regimen of training and practice. Often, they must be

willing to sacrifice other enjoyable activities such as hobbies or social events

in order to pursue their dreams. It is essential that these amateurs have a

secondary career goal in case their plans to become a professional come up

short.

Professional: A professional athlete or entertainer makes money by either

playing sports or otherwise entertaining for spectators (i.e., acting, singing,

etc.). The salaries for professional athletes and entertainers can vary widely

depending upon their popularity and how well they are marketed. Some may

barely scrape by while others are billionaires. A professional athlete or

entertainer must have some degree of natural talent for their sport or art.

They must also be dedicated to continually improving their skills and talents

through rigorous training and practice in order to remain competitive.

Typically, professional athletes and entertainers will be required to travel

frequently in order to attend games, competitions, and/or concerts as well

as other required events.

Agent: Some professional athletes and entertainers have agents. These

agents negotiate contracts and schedule events and appearances for their

clients. In order to be an agent, one must have a great deal of personal

motivation. Agents have to work hard to promote their clients' success and

ensure that all contracts are legitimate and beneficial to their clients.

Athletes and entertainers aren't the only players in the sports and

entertainment industries. Agents and publicists also play a key role.

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Publicist: It's a publicist's job to draw media attention to an entertainer,

athlete, or sports team. The publicist is also in charge of managing the

reputation of the brand. For instance, if a journalist wrote a negative review

of the entertainer or athlete and published it in a national news syndication,

it would be up to the publicist to respond in a manner that would minimize

the damage to the brand's reputation. A publicist must have intimate

knowledge of the brand in order to attract the right kind of media attention.

A publicist must also have excellent interpersonal and communication skills

because they will often have to speak to media on the brand's behalf.

Sponsor: A sponsor is an individual or corporation that supports the

entertainer, athlete, or team monetarily or by donating supplies, hosting an

event, or providing a venue. Typically, there will be some benefit to the

sponsor as well such as the ability to advertise their own brand alongside the

entertainer or athlete, for instance.

Conclusion

As you can see, sports and entertainment marketing has its own set of rules

and tactics. Although it may share similarities with traditional forms of

marketing, some may argue that there are just as many differences. Even

so, those working within the sports and entertainment marketing industry

can benefit from having a solid understanding of the basic principles of

marketing. Likewise, traditional marketers could take a hint from sports and

entertainment marketers, especially as it pertains to tapping into a

customer's emotions and sense of identity. As we'll discuss in the next

chapter, social media has opened up new—and very wide—doors for them to

do just that. For a sneak preview, take a look at how many "fans" Coca-Cola

has amassed on Facebook!

How Technology Is Changing Sports and Entertainment Marketing

THE BAD

A Fragmented Audience

Today's sports fans can watch live events

from a variety of different digital devices.

Event marketing used to be fairly simple, for both sports teams and

entertainers. Let's take a baseball game, for instance. A century or so ago,

there used to be just one place where fans could gather to watch the

game—the stadium. (If you could even call it that at this point in history; in

reality, it was just a grassy field or wide-open space.) With the advent of

television, though, a new element of event marketing was born. At this

point, fans had two places to view the game—at the stadium or from the

comfort of their homes huddled around the TV set. Decades later, however,

the audience for a baseball game (or any other sporting or entertainment

event) is more fragmented than ever. In addition to in-person and television

viewing, fans can watch an event online or from a myriad of different

high-tech devices including tablets and Smartphones. The proliferation of

social media has also enabled people to talk about the game in real-time

with people from across the globe. Although this is good for consumers as it

certainly makes things more convenient, it poses a unique challenge to

sports marketers. How can they ensure that they market to each segment of

their fan base effectively without diluting the brand? People get paid big

bucks to answer this question correctly!

The 21st Century Brings Increased Competition

Prior to the 20th century, an individual's entertainment options were limited

to say the least. Aside from playing games, reading, or listening to the radio,

there were very few ways to spend one's leisure time (what little there was

of it). It is certainly fair to say that this has changed. Today, we are

continually and increasingly inundated with entertainment options. Many of

us have hundreds of channels to choose from on television, and if we still

can't find something to watch, we can order a movie and watch it instantly,

without even needing to get up from our chairs, much less drive to the video

rental store. (Yes, believe it or not, those used to exist!)

Digital games are now everywhere. There are dozens of video game

consoles to choose from such as the Xbox, Wii, and PlayStation as well as

hand-held video game systems such as the Nintendo DS and PSP.

Speculators are predicting that even these will soon become obsolete,

however, because one can just as easily use their Smartphone or tablet to

play one of hundreds of different high-tech games, many of them for free.

E-readers and tablets such as the iPad, Kindle, and Nook, for instance, are

also changing the book publishing industry. Because ebooks are easily

downloadable and often cost significantly less than the traditional hardback

variety, more and more avid readers are going digital, accessing books,

magazines, and even newspapers from these devices. Many ebooks are also

offered free online and can be downloaded by anyone with a computer and

an Internet connection.

YouTube makes it possible for anyone with a camera or Smartphone to

become a producer by uploading their videos and sharing them with the

masses free of charge. All of this free content is driving down the prices of

multimedia and forcing Hollywood to compete on a much larger scale than

ever before. Although most amateurs don't have access to the technology

and equipment that professional film producers have, you'd be surprised

how many people will opt for a low-quality video of a cute kitten or giggling

baby over a blockbuster hit these days.

Today's technology offers consumers more entertainment options than ever

before.

As more and more alternative forms of entertainment are made available to

the general public, sports and entertainment marketers become faced with

the increasing challenge of making their entertainment commodity the most

appealing out of the growing multitude of low-priced and even free options.

In essence, with the ever-growing number of distractions, the sports and

entertainment marketing industry must fight harder than ever before for the

attention (and money) of their potential consumers.

THE GOOD

More Advertisement Opportunities

Earlier, we discussed the challenge sports and entertainment marketers face

in reaching a fragmented audience. Although that may be perceived as one

negative of the technological revolution, there's also a flip side to the coin.

With more ways to stream sports and entertainment events, there is more

advertising space available. For instance, a team can sell advertising space

on its website, sell ads for commercials that will play on different channels

and devices, run banners on stadium Jumbo-Trons or scrolling LED displays,

and the list goes on. There is a fine line that these marketers must walk,

however. Consumers are notorious for expressing disdain over frequent

commercials and other such in-your-face advertising efforts. Therefore,

savvy sports and entertainment marketers must determine how much

money they can make via ad revenue while being careful not to turn away

fans.

Technology has afforded marketers a

variety of diverse advertising options.

The marketer must also conduct amarginal analysis to determine which of

the many advertising options to pursue and to what extent.Marginal analysis

is a strategy that marketers use to determine how much benefit (i.e. profit)

the advertising will provide versus the cost of the advertising. This often

consists of keeping a very close eye on which advertisement methods are

working for their competitors and meticulously tracking the success (and

failure) of their own advertising methods once they are implemented.

Marketers must construct a media strategy based on their budgets as well as

the habits and preferences of their target markets.

Teams and entertainers with a limited budget must also formulate a media

strategy. With all of the different types of media available to marketers

these days, not everyone can afford to leverage all of them. That's not to

mention that some types of media advertising are more expensive than

others. In fact, the cost of media advertising can vary from one minute to

the next. For instance, it's much more expensive to run a commercial during

primetime—the time when the biggest number of people is watching

television—than it is at any other time of the day. A solid media strategy can

help athletes and entertainers determine how to spend their marketing

dollars based on what kind of media is likely to reach their target market

most effectively. Developing a media strategyoften consists of conducting

market research to determine how the specific target market interacts within

the market—whether by television, radio, computer, tablets, or the like. The

results of this research can help marketers determine the reach of the

specific type of advertising—that is, how many people within the target

market are likely to receive the message.

Marketers must also be aware of wear-out—the phenomenon that occurs

when an advertisement, promotion, or campaign becomes ineffective

because it has been used too frequently.

A New and Improved Fan Experience

Aside from the obvious technological enhancements made to sports

stadiums themselves which often feature interactive score boards,

Jumbo-Trons, and widescreen LED displays, technology has also increased

the fan experience in other ways.

Sports engineers enhance the fan experience by developing new

technologies that increase player performance.

Take, for example, the effect technology has had on the performance of the

athletes. For example, in tennis, new balls are being implemented that will

create drag in order to slow the ball down. This will give the receiver a 10

percent increase in response time, making rallies more likely, thereby

increasing the excitement of the sport for spectators. Sports engineers are

continually working to create new developments such as this that will

enhance the fan experience and provide greater levels of safety and

performance potential for athletes.

Of course, the more satisfying the fan experience, the more goodwill they

will feel for the team, the entertainer, the brand, and/or the sponsors. In

marketing, goodwill is the customers' positive feelings associated with the

brand or business. Goodwill causes consumers to become loyal and to refer

the commodity to their family, friends, and acquaintances.

Sports and Entertainment Marketing Best Practices

THE LOW-TECH

Despite the infiltration of technology into the industry, there are still

fundamentals of sports and entertainment marketing that have little to do

with technological advancements. Although technology can enhance these

elements of marketing, it certainly doesn't define them.

A rehearsal is an example of a quality control

measure that event marketers use in order to

ensure a satisfying experience for attendees.

Quality Control

The term quality control refers to efforts on the part of a product or service

provider to ensure that the commodity is of high quality. Although it is easier

to think of quality control in terms of a tangible product such as apparel or

food, for instance, this concept applies to services and events as well.

Whereas a clothing manufacturer might use an inspection process to ensure

the quality of the garments he makes, an event planner might use

rehearsals or practice runs to ensure that everything will go off without a

hitch when the actual event takes place. Whether it's a T-shirt or a concert,

the idea is the same—to make every effort to guarantee a quality experience

for the consumer.

These days, quality control in sports and entertainment marketing is more

important than ever before. As we discussed in the previous unit, people did

not always have discretionary income to spend on sporting events or

concerts. These were rare luxuries that a family may splurge on

occasionally, if at all. As our standard of living has increased, however, more

and more people have enough discretionary income to enjoy sports and

entertainment as a routine part of their lives. This means there is more of a

market for these types of commodities. As the market expands to make

room for more providers of sports and entertainment, competition increases,

and so too do the consumers' expectations for quality. Competition is good

for consumers because it forces providers to compete with one another to

offer the highest quality commodity at the lowest price.

Product Enhancements

A backstage pass at a concert or event is

one example of a product enhancement.

Product enhancements, informally known as upsells, are an important part

of the sports and entertainment marketing mix as well. In fact, for sporting

events and concerts in particular, product enhancements make up a large

portion of the profit margin. A product enhancement is an added "extra" that

goes beyond the basic commodity that is being sold. For example, when you

pay to see a football game, the commodity is the opportunity to see the

game in person and experience the excitement of actually being at the game

in the presence of the athletes and fans. However, product enhancements

can add extra value to this experience and therefore can be sold for higher

prices. Think about the dramatic fluctuation in ticket prices to see an NFL

football game. Depending on the view from your seat, you could pay less

than $100 or more than $500. Of course, if you want to be in the sky box,

then you're talking even more money— a lot more! Because this enhanced

experience is considered more enjoyable or valuable, the price goes up.

The same concept holds true for entertainment venues such as concerts, for

instance. If you want to see a famous singer in concert, you can get a ticket

in the nosebleed section for substantially less money than it would cost to be

in the front row. Additional product enhancements, such as backstage

passes to meet the entertainer, will cost you even more.

Successful sports and entertainment marketers align their brands with the

preferences of their target markets.

Hitting the Target

One major goal of any company's marketing plan is to hit the target market;

that is to employ colors, images, language, sponsors, etc. that will appeal to

the group of people most likely to buy their products. Most

companies—sports and entertainment marketing companies

included—conduct market research before they even begin building their

brand. That way, they can ensure that everything about their product—right

down to the color and font of the logo—is something that will be perceived

as attractive and even compelling to their target market. As we discussed in

the previous unit, this process can include primary market research,

secondary market research, or a combination of these two strategies.

THE HIGH-TECH

Social Media

Sporting events and concerts have always been social affairs. Even when the

masses began consuming professional sporting events and concerts via

television rather than in person, a big game or celebrity appearance has

always been a good excuse to gather together with friends and family or

even throw a party. The world of social media has taken this social aspect of

sports and entertainment to an entirely different level altogether. Fans are

no longer limited in whom they can interact with; instead, they can now

communicate with the entire virtual world in real-time as the event is taking

place.

Social media enables marketers to create

viral campaigns that reach a broad audience

via the Internet.

Social media websites like Facebook and Twitter have given fans and

marketers alike a new venue for expressing themselves. These platforms

enable fans to comment on the game or event while marketers can interact

with fans, host online contests, and share insider secrets—all in an attempt

to promote brand visibility and engagement. Of course the ultimate goal for

marketers would be to create a viral campaign—that is, a promotion that

spreads rapidly on the Internet and creates excitement surrounding a

particular athlete, entertainer, team, or event.

So far, the sports team that has taken the most visible move in the social

media direction is the National Lacrosse League team, the Philadelphia

Wings. Instead of putting the players' last names on the back of their

jerseys as is traditional practice, the team is now using this space to

advertise the players' Twitter handles! Of course, that means every member

of the team must have a Twitter account and use it to interact with fans.

Of course, as with any other marketing tool, social media has the potential

to go wrong, and in this case, dramatically wrong! Athletes and entertainers

must be very careful to think before they tweet or post anything to other

social media sites. Because of the immediacy of this type of interaction and

the high visibility of celebrities, one social media post could cause a whole

lot of damage. Many celebrities have found this out firsthand. Take, for

example, the case of Mark Cuban, owner of the NBA Dallas Mavericks. After

his team got beat, he used his Twitter account to let off some steam at the

referees who apparently—he thought—made some bad calls. His public

venting cost him $25,000 in fines from the NBA. When he was notified about

the fine, Cuban again used Twitter to vent, posting the following tweet on

his profile: "can't say no one makes money from twitter now. the nba does."

The wide variety of sports apps available on mobile devices allows fans to

access sports events and news at the touch of a button anytime, anywhere.

Mobile Apps

We discussed how technology has changed the way people are using

phones. In fact, these days, a phone may be more likely to perform any one

of a variety of different functions rather than simply making a call. One of

the ways that sports and entertainment marketers can leverage this trend is

by creating mobile apps for their commodities. For example, the MLB.com

Scoreboard app enables fans to view the scores for all daily games with the

swipe of a screen. Real-time news and live streaming also enables fans to

keep up with the latest happenings and watch games live.

The Faces of Diversity

America is a diverse nation made up of people of different ages,

backgrounds, and ethnicities.

Sports & Entertainment Marketing Image

Typically, when we think of diversity in America, the first thing that comes to

mind is race or ethnicity. Perhaps this is because the color of someone's skin

is the most obvious distinction between that individual and the masses, but

in reality, there are a host of different factors that make us different from

one another. To illustrate, think about the last time you went to the mall or

the grocery store. Recall the faces that you encountered, whether it be the

neighbor you bumped into or the cashier who checked you out and wished

you a good day. How were these faces different from each other? If you live

in a town similar to most in America, you likely encountered a variety of

different people—young, old, and middle-aged; black, white, Hispanic, and

Asian; rich, poor, and middle-class; and of course, those are just the

surface-level distinctions. Underneath, we are all individuals with vastly

different personalities, opinions, and preferences.

Most of us have a natural desire to identify with a group, which predisposes

us to sports fandom.

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Still, there are likely more things that connect us as human beings than

those that separate us. As a species, we have lots in common. Generally

speaking, we all feel the same emotions from time to time, and many of us

have similar wants, needs, and goals for our life. One thing is for

certain—we all like to be entertained, and most of us like a good-natured

game or competition. It just seems to be ingrained in us, and it's not a new

trend. Sure, the world of sports and entertainment has canged drastically

over the years, but people have always found ways to entertain themselves

and one another whether it be making up songs and stories to pass the time

or constructing elaborate games as the Greeks did in the ancient Olympics.

Roman gladiators would even fight to the death for the mere entertainment

of onlookers. There's simply no doubting our intrinsic need for some kind of

amusement, and most people would agree that life would be a bit bland

without it. Plus, the need for entertainment is just one part of the equation.

Another reason we find sports so compelling is that we have a natural desire

to be a part of a team or group of people united by a goal or other

commonality. This is often referred to as a tribal mentality. According to a

2011 Marist Poll, 61 percent of American adults now consider themselves

sports fans. A fairly substantial 19 percent of respondents could be labeled

as "avid fans," meaning they read or watch sports-related content daily. Of

course, that's not to mention the fact that nearly everyone enjoys a good

sitcom, movie, or concert of some kind from time to time. Market

Segmentation

The fact that virtually everyone is inclined to enjoy a good concert or

sporting event is a good thing for sports and entertainment marketers,

right? Absolutely! It means they have a commodity that is in great demand

across the globe. However, there is also a flip side to the coin. This broad

target market also creates a unique challenge. The question becomes how

can entertainers, athletes, and organizations market their commodities in

such a way that a diverse group of consumers finds them appealing?

Market segmentation enables marketers to account for differences amongst

members of their target market.

Sports & Entertainment Marketing Image

The answer is market segmentation. Market segmentation is the process of

identifying and grouping different portions of a target market so that

businesses can market to these groups of people more effectively. The end

goal may be the same—to get the individual to buy a ticket to a professional

baseball game, for instance—but the marketing strategies implemented can

(and many marketers would argue should) be very different. When a

company or organization uses market segmentation to influence their

marketing campaigns, they are using what is referred to as differentiated

marketing. Unlike undifferentiated marketing, which takes a one-size-fits-all

approach to advertising and promotions, differentiated marketing

acknowledges the distinctive wants and needs of individual segments of the

target market.

Of course, this is a very simplistic example of how companies segment their

markets. The process of market segmentation can get much more

complicated as you will see as the unit progresses. Factors Influencing

Differentiated Marketing

Once a company or organization has defined its target market and properly

segmented it, the next step is to determine as much information as possible

about these different segments of their market. This information generally

falls under four different categories: demographics, geographics,

psychographics, and behaviors.

DEMOGRAPHICS

Being aware of their target markets' demographics enables them to create

differentiated marketing campaigns.

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The term "demographics" refers to any clear, definitive, and perceivable

characteristic of a market segment. Demographics includes a customer's

race, age, gender, income, family size, education level, religion, and any

other observable trait that may affect an individual's purchasing decisions.

While on the surface, these things may not seem to have a significant

impact on what products or services a person may buy or what marketing

efforts they might respond to, savvy marketers know that these factors do,

in fact, play a key role in buying behaviors. Knowing exactly how these

factors influence purchasing decisions can help marketers create

advertisements and campaigns that resonate with different segments of

their target markets and cause them to make purchases, refer their friends,

and become brand loyalists.

Sports and entertainment marketers use geographics to determine which

advertisements and promotions certain segments of their target audience

will likely respond to.

Sports & Entertainment Marketing Image

GEOGRAPHICS

In marketing, the term "geographics" refers to the location of the different

segments of an organization's target market. While you may not think your

geographic location influences your purchasing decisions, you're wrong!

Where you live has a direct influence on your need for specific commodities

(think snow tires, for instance). In addition, city dwellers versus those who

live in the country have different cultures and lifestyles that directly affect

their buying behaviors. Geography plays an especially important role in

sports and entertainment event marketing. People who live in big cities have

greater access to concerts, major sporting events, and the like, so they may

be marketed to more heavily. These people are also more likely to take

advantage of certain promotions such as season passes, for instance,

because of their proximity to these events.

PSYCHOGRAPHICS

Marketers know that a consumer's personality affects his or her purchasing

behaviors.

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Marketers use the term "psychographics" to describe any psychological

aspects of consumers that may have an impact on their buying decisions.

This could be their personality, secret desires, attitudes, worldviews,

interests, or basically anything else going on in their heads!

As you might guess, this aspect of a consumer is the toughest to predict as

it's not something that can be perceived by the naked eye. Marketers usually

ask themselves, "What different kinds of people are likely to purchase my

commodity?"

Although marketers can't actually get inside the heads of their target

markets (thank goodness!), they have identified the following characteristics

to be influential in determining which types of sports a consumer may be

interested in as well as how frequently he or she views sports and

entertainment content:

Self-esteem

Physical fitness

Risk taking

Stress management

Competitiveness

Social tendencies (i.e. extrovert vs. introvert)

Self-actualization (i.e. the ability to see oneself participating in the sport)

Aggression

Once they've segmented their market by potential psychographics, sports

and entertainment marketers can then attempt to develop marketing

campaigns that resonate with these different personality profiles.

BEHAVIORS

From a marketing perspective, the term "behaviors" refers to any behavioral

response a consumer has to a certain commodity or brand. This could be the

frequency that a consumer uses or experiences a commodity or the

customer's awareness of or loyalty to the brand. It could also refer to an

emotional response that the customer has to the commodity, whether it be

positive, negative, or neutral. By identifying a behavioral profile for

segments of their target market, marketers can better predict how these

consumers will respond to a certain marketing campaign or tactic. For

example, if an event marketer knows that a consumer will likely only attend

a concert once a year when the tour hits their local area, then sending him

coupons year-round for discounted tickets would be an ineffective marketing

technique. A better tactic may be inviting this person to join the

entertainer's online fan club where he can share his individual experiences at

the concert with other fans around the world via social media, thus

becoming a virtual advertisement for both the entertainer and the event.

Savvy marketers know that a consumer's emotional response to a

commodity directly affects his or her purchasing habits.

Sports & Entertainment Marketing Image

Likewise, an event marketer knows that his consumer is likely to experience

excitement over seeing a famous entertainer perform or witnessing his

favorite athlete play, so they make an extra effort to include as many

product enhancements as possible to their marketing mix. After all,

consumers are much more likely to open up their wallets when they're

feeling ecstatic, and of course, they'll want to have something to take home

in order to remember the special occasion. Therefore, they'll dole out their

hard-earned cash for items like T-shirts, jerseys, posters, and more.

CULTURAL DIVERSITY AND MARKETING

America has been called the "melting pot," and for good reason. We are a

country made up of many different cultures and ethnicities, from Caucasians

to Hispanics, African Americans, and Asians among other ethnic groups.

According to data from the US Census, at least half of the country's

population will be comprised of minorities by the year 2042. Anyone with a

respect for their upbringing and ancestry will tell you that their culture is an

important part of who they are, and as such, affects everything that they

do—including making purchases!

Marketers must acknowledge the cultural diversity of their target markets

when creating promotions and advertisements.

Sports & Entertainment Marketing Image

Unless marketers recognize and cater to the cultural diversity of their target

markets, then they will no doubt alienate a large group of potential

customers, which will result in a loss of sales and revenue. Although

communicating to diverse segments of their market in their native languages

is a good first step for organizations, it's really just the tip of the iceberg. In

order to effectively gain the trust and loyalty of a diverse market, businesses

must seek to understand their unique values, traditions, family structures,

worldviews, and more. At the same time, these companies must avoid

stereotyping or overgeneralizing a certain ethnic group or culture. After all,

despite race or ethnic group, we are all individuals and should be treated as

such. Gender and Sports Marketing

No course of study on diversity and demographics in sports and

entertainment marketing would be complete without acknowledging the

growing female fan base for major sporting associations such as the National

Football League (NFL), National Hockey League (NHL,) Major League

Baseball (MLB), Major League Soccer (MLS), NASCAR, and National

Basketball Association (NBA) among others. Whereas the group of sports

spectators used to be dominated by males, females are now showing an

increased interest in the games. Although NFL has the largest percentage of

female fans (41.3 percent), every major sports league in North America is

attracting women spectators in droves:

Percentage of Female Fans per Sports League

Major North American Sports League Percentage of Female Fans

NFL 41.3%

MLB 41.2%

NBA 39.8%

MLS 39.5%

NASCAR 36.9%

NHL 36.4%

From Scarborough Sports Marketing, 2009

According to Marie Claire, approximately 43 million women watched the

Super Bowl last year—more than the number of females who tuned in for

the Oscars. The Huffington Post reports that women make up a third of all

major sporting event spectators including the World Series, Daytona 500,

and Stanley Cup Finals. With this enhanced engagement in popular sports

comes commercialism—that is, more women than ever before are making

sports-related purchases for themselves and for their moms, sisters,

daughters, and friends. What does that mean for marketers? A brand new

(and fairly substantial) segment of their market, of course!

Sports marketers face the challenge of

caterin to a growing female fan base.

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According to marketing experts, 70 percent of a household's decisions

(including purchasing decisions) are made by women. Because of this, the

sports marketing industry could see quite the boom as a result of female

fandom. Plus, many marketers realize the unique value a female consumer

brings to the market; Meghann Malone, marketing manager for IMRE Sports,

says that women are much more likely to remain loyal to a brand than male

consumers.

So far, the trend has been a lucrative one for sports marketers. Data from

sales at the nbastore.com reveals that half of all shoppers buying from their

online store are women. According to SportsOneSource, a whopping $330

million worth of sales was attributed to licensed female apparel for sports

such as baseball, football, and basketball. And that's just clothing!

In order to maintain the interest of their female fan base and make the very

most of this female fan phenomenon, marketers will need to tap into the

unique wants, needs, and purchasing concerns of this segment of the

market. Only time will tell if sports organizations are up to this challenge.

TARGETING FEMALE FANS

Some sports marketers have been accused of overgeneralizing their female

consumers by "shrinking and pinking" their apparel.

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The sports marketing industry has taken huge strides to acknowledge and

appeal to their newfound female fan base. In this section, we will explore

two of the most notable marketing campaigns geared toward women in the

sports industry and evaluate their overall impact and potential effectiveness.

espnW

In the fall of 2010, ESPN made one of its boldest moves yet to appeal to a

specific segment of their target market—women. By creating an online

presence exclusively for female sports fans, the mega-sports channel hoped

to attract more loyal female fans and engage them in sports talk about

men's and women's events alike. The site is targeted toward women ages 18

to 34 and features sports news, articles, videos, and the like.

NFLShop.com

NFLShop.com is not just a shop for women, of course. The online store sells

licensed National Football League merchandise for men, women, and kids

alike, but more and more, the virtual store is being frequented by females

looking to get in on the sports action. In 2011, for instance, merchandise

targeted toward women increased two-fold.

Conclusion

As their target markets become broader and more diverse, sports and

entertainment marketers will have the challenge of developing creative

campaigns that appeal to individuals of different ages, genders, income

levels, ethnicities, personalities, and more. Their success in doing so will

determine the company's revenue and profit when it comes to both core and

ancillary products, so there's a lot on the line. As Bill Cosby said, attempting

to please everyone may be a recipe for failure, but failing to recognize the

differences amongst consumers may be equally ineffective.

What Is Event Marketing?

Event marketing is just what it sounds like—the marketing of a specific

event. While any company or organization in any industry can utilize event

marketing as part of their marketing mix, nowhere is event marketing more

crucial than in the sports and entertainment industry. Think about it. Sure,

there are ancillary products to be marketed and sold, but none of these

commodities would exist if it weren't for the core product, and in this

industry, the event is the core product! Without the football games, there

would be no T-shirts; without the concerts, there would be no posters. You

get the picture. In the sports and entertainment industry, everything

revolves around the event. Still, the event itself is just one part of a

three-part equation called the ​event triangle.

The Event Triangle

The ​event triangle​ is a model for expressing the relationship between

products and consumers in sports and entertainment marketing. The ​event

triangle​ consists of three distinct parts: the event, the sponsor, and the fan.

Of course, the event is the game or the concert. It could be a Little League

baseball game or the Super Bowl. Furthermore, an event could be a dance

recital or a stop on a popular country music star's tour. Big or small,

amateur or professional, the principles of event marketing are the same. The

event will likely provide some sort of entertainment, whether it is a show or

a game, and it will provide a venue for sponsors to gain brand visibility.

At the core of the sports and entertainment marketing industry is the event. 

The next part of the event triangle is the fan. The fan is usually drawn to the

event out of a desire for entertainment. Typically, the fan will pay for a

ticket to the event and will be exposed to the marketing efforts of the

sponsors, whether or not he or she is consciously aware of it or not.

The final aspect of the event triangle is the sponsor. The sponsor usually

pays the athlete, team, or organization a fee in exchange for the opportunity

to market their brand and/or product. Alternatively, the sponsor may

provide the athlete, team, or organization with something else of value. For

example, they might provide the ​venue​—that is the location where the

event is to be held— or pay for the players' uniforms or trophies. The

sponsor will use the attraction of the event to draw in potential prospects to

whom they will then market. This is a technique sports and entertainment

marketers refer to as ​borrowed equity.​The sponsor may actually sell

products or services at the event, distribute promotional materials like flyers

or business cards, or simply advertise their brand through banners, jerseys,

and the like. In some cases, sponsors may utilize a combination of these

different strategies. No matter which technique or combination of techniques

the sponsor uses, the end goal is the same: to promote the brand, increase

brand awareness and visibility, create brand loyalists, and ultimately,

increase sales and revenue for their companies.

THE FAN/THE EVENT

During an event, certain exchanges are made between each player of the

event triangle. For example, the primary exchange made between the event

and the fan is money. The fan pays for the ticket to get into the event, and

sometimes the fan pays more money for product enhancements and

merchandise while attending the event. Nonmonetary exchanges can be

made as well. For instance, the fan may tell others about the event,

providing the event holder with advertising in exchange for a positive

experience at the event.

THE EVENT/THE SPONSOR

As we discussed, the exchange between the event and the sponsor is more

complex. Although the sponsor may exchange money for the right to

promote their brand and commodities at a sports or entertainment event,

this isn't always the case. Sometimes the sponsor provides products or

services instead.

THE SPONSOR/THE FAN

The sponsor and the fan also have a relationship, albeit a less direct one.

The sponsor uses the borrowed equity of the event in hopes that an

exchange will take place between the sponsor and the fan. This exchange

could be something tangible like a purchase, or it could be something

intangible but equally valuable, such as a referral.

Event Marketing Best Practices

ATTRACTING AN AUDIENCE: PUSH AND PULL MARKETING

Passing out flyers advertising an event 

is an example of push marketing.  

Of course, the first step in ensuring that the event is a successful one is to

get people to attend. After all, an event just isn't an event if no one shows

up. Thus, the first task of an event marketer is to attract attendants. There

are two fundamental ways of doing this, and in the marketing world, these

two distinct methods are referred to as ​push marketing​ and ​pull

marketing.

Push marketing​ is a method of attracting prospects (in this case,

attendants) by pushing out information about the event. For example, if an

event marketer were to pass out flyers at a local retail store advertising a

concert, he would be using a​push marketing​ technique. Push marketing is

an effective method of getting the word out about a relatively unknown

event.

Pull marketing campaigns attempt 

to attract attendees to an event. 

Pull marketing​ is a much less invasive form of marketing. With pull

marketing, event marketers attempt to make the event as appealing as

possible to their target audience in order to pull them in. You might think of

this technique as a magnet that attracts attendants to the event. The

stronger the magnet (i.e., the more appealing the event), the more

attendants it will attract.

Components of an Effective Pull Marketing Campaign

There are many different considerations event marketers must contemplate

when attempting to create a solid pull marketing campaign. In essence, they

must do what all good marketers do—put themselves in the shoes of their

target audience. From this perspective, they can better determine how to

structure the event in a way that potential attendees would find the most

appealing. Marketers must analyze the motivators people have for attending

the events and find ways to make these motivators even more powerful.

CONTENT

The primary motivator for event attendance is content. The content of the

event is the value or takeaway that the attendee will gain from going to the

event. In the sports and entertainment industry, the content of the event is

usually some form of entertainment. Depending on the popularity of the

athlete, entertainer, or team, the content alone may be enough to pull in

attendees. In other cases, marketers may need to employ techniques

tailored to create ​hype​ and ​buzz​ around the event. Although these two

things are closely related, they are not the same thing, at least in marketing

speak.​Hype​ is the excitement that a company or organization intentionally

creates around an event. ​Buzz​ is what other people are saying about the

event. Thus, hype can be used to create or influence buzz, but buzz is not

something that the company or organization has exclusive control over.

Whereas hype is the excitement a company intentionally creates, buzz refers to what others are saying about  the event. 

To illustrate the difference between hype and buzz, consider the case of

Taylor Swift's recent album campaign. Five weeks before the album Red was

set to premier, Swift began appearing on ABC's​Good Morning America.​ Every

Monday morning leading up to the release, the country/pop star performed a

portion of one of the songs on the album. Following the show, fans could go

to iTunes to purchase the entire song. Along with the TV appearances, Swift

also posted reminders for her fans on Facebook, all in an effort to create

hype​ surrounding not only the Good Morning America appearance but also

(and more importantly) the release of ​Red.​ One of these Facebook posts

garnered 654 comments. Although the overwhelming majority of these

comments were positive, some of them were quite negative. This Facebook

chatter is part of the ​buzz​ created as a result of the hype. Although the

hype was all positive (because it was controlled by Swift's PR agency), some

of the buzz was negative because not even Taylor Swift can control what

other people say. Unfortunately for marketers, people are much more likely

to respond to another consumer's personal testimonial than a plug from a

company spokesperson. Therefore, buzz can have a much more powerful

influence than hype, especially if it's overwhelmingly negative.

CONVENIENCE

Careful scheduling can result in higher attendee turnout for an event. 

Another important motivator is convenience. People are more likely to

attend events that are proximal to their homes and held at convenient

times, such as after work and on the weekends. Of course, convenience will

always take a backseat to content. If the event features an extremely

popular entertainer, athlete, or sports team, people with the means to do so

will drive or fly across the country to see them in person. A good event

marketer will also research other events occurring at the same time as the

one they're promoting. Ideally, the event will be strategically scheduled

around any competing events so that prospects won't have to choose

between the two. Proper scheduling can increase the odds that an event will

have a good showing.

Mythological Amazon illustration from 1875 

  CONNECTIONS

Although the opportunity to make connections and network at events is

more of a concern with corporate events such as tradeshows and

conferences, connections can also be a factor within the sports and

entertainment industry. To put it simply, people will be more likely to attend

an event if their friends are also attending or if they will gain a certain

amount of prestige as a result of being seen at the event. Marketers can

play on this motivator by emphasizing the popularity or exclusivity of the

event in their advertising campaigns.

In most cases, event marketers will use a combination of push marketing

and pull marketing techniques; however, it is imperative that they strike a

good balance between the two. Too much ​push marketing​ could literally

push a prospect away, whereas too little could result in prospects being

completely unaware of the event. Of course, the more well-known an

athlete, entertainer, team, or organization is, the fewer push marketing

techniques an event marketer will need to employ. Instead, the popularity of

the eve​Setting the Stage

Marketers have long competed for the attention of their target markets.

Because many of us have such busy lives that often include work, family

responsibilities, and social obligations, it can be difficult to find time to slow

down and focus on anything. This is exactly what marketers want us to do

though—focus (on their brands and commodities, that is). This is where

event marketing has a distinct advantage.

Events allow people to escape from their everyday lives, thus making them a captive audience for marketers. 

When you attend an event, you are, in essence, taking yourself out of your

"normal" life and experiencing something new. In these situations, most of

us want to completely submerse ourselves in the experience, blocking out

any worries we might have at the moment or problems we're currently

facing so that we can truly enjoy the event. In many ways, these events

provide us with an escape from the realities of everyday life, including our

hectic schedules. Whether we realize it or not, this is exactly the state of

mind marketers want us to be in. After all, if we're not thinking about the

bills piled up back at home, we're much more likely to splurge for nachos at

a sporting event or purchase a T-shirt after the concert.

Creating Positive, Memorable Experiences

Of course, driving attendance for an event and setting the stage for success

is only half the battle. Once event marketers get people to the venue, they

are then charged with making sure that everyone has a good time. After all,

at an event, the primary commodity is the experience. If attendees have a

good time, they'll develop a good feeling about not only the entertainer,

athlete, or team, but their sponsors as well! On the flip side, if attendees

have a bad experience at the event, they may very well take out their anger

or disappointment on the event holder or the event's sponsors. In other

words, they may be less likely to engage in transactions with the event or

sponsor in the future, whether it is by declining to attend a future event or

refusing to purchase a sponsor's products or services.

98% of people who have a good time at an 

event will tell someone about it. 

Furthermore, the attendees' experience at the event (whether positive or

negative) has a potentially wide-reaching effect. Studies performed by The

Event Marketing Institute confirm what you might already expect—people

readily share their experiences at events with others. Researchers surveyed

over 1,100 event attendees and found that 98 percent of people who have a

positive experience with a product at an event will recommend that product

to their friends, family, or acquaintances. Nearly as many people (95

percent) tell others when they have negative experiences at an event.1

nt will serve as the primary pull.

Event Marketing in the 21st Century

Like virtually everything else, event marketing has been impacted by

advancements in technology, especially the Internet and social media. This

new medium has given entertainers, athletes, teams, and organizations a

new way to get the word out about their upcoming events, but that's not all.

Social media has also provided fans with a new way to interact with the

event holder, participants, and each other, thus creating buzz that draws in

other attendees.

Social media allows event attendees to become informal spokespeople for

the entertainer, athlete, team, or organization, and they're seizing this

opportunity in droves! According to research conducted by The Event

Marketing Institute (2012), 45 percent of people surveyed reported having

posted a video or photo from an event on their own social media page.

Furthermore, 60 percent of respondents said they "friended" the event

holder on a social media network, and over 60 percent said they invited their

friends to do the same.2

With the use of social media come certain risks, however. Many brands have

been scarred by a tweet or status update made in haste. Furthermore, if

there's no planning for or oversight of a social media campaign, it will likely

fail to have its intended effect—or worse, it may do more harm than good.

Thus, there are some best practices that successful event marketers use

when bringing their event marketing efforts into the 21st century.

Keeping Things Organized

Event marketers will often construct a website, 

which serves as a source of information for prospective attendees. 

The Internet is a big place, so in order to implement an effective online

marketing campaign for an event, event marketers must have a clear vision

and a feasible plan. Like any other marketing effort, this requires a great

deal of organization. Many event marketers attempt to keep things simple

and manageable by creating one page or website dedicated to information

about the event. Ideally, this web page/site would include any pertinent

information about the event including the date, time, required attire (if any),

cost of tickets, where to buy tickets, driving directions, and anything else

that might be helpful to those prospects interested in attending the event.

For tech-savvy event marketers, this page would also include the links to the

event pages on other social media networks like Facebook, LinkedIn (for

corporate events), and Google+.

Event marketers can assign hashtags to events in order to create conversations about an event on Twitter. 

Because Twitter is the ideal social media outlet for sending out information

blasts to the masses, any event with a social media campaign should also

include a distinct Twitter ​hashtag.​ A hashtag is a tag used to categorize

messages on Twitter by topic. A​hashtag​ must be ten characters or less and

is always preceded by the pound (#) sign. For example, if you were tweeting

about the topic of quantum physics, you might include the hashtag,

#quantphys. If other people began using that same ​hashtag,​ you would be

able to identify these collective tweets as messages related to the topic of

quantum physics. By assigning a unique ​hashtag​ to their event and letting

all of their prospects know about it, event marketers can create a live,

ongoing conversation about the event in the months, weeks, and days

leading up to the actual event.

The Colliding of Two Worlds: Real and Virtual

Another increasingly popular technique for event marketers is the merging of

real and virtual worlds. As more and more people have the desire and

capability to interact on social media sites wherever they are via their

smartphones or tablets, attending an event and posting a status update or

comment about the event at the same time is not only possible, but it's

becoming prevalent as well. Event marketers can (and do) take advantage

of this trend by making these social media updates visible during the event

and encouraging attendees to share their thoughts about their experience on

the web in real time. Because everyone likes to see their name in lights, so

to speak, the public display of tweets and updates (usually broadcast via a

Jumbotron or huge monitor) gives participants an incentive to let the whole

world know what they're thinking at any given moment during the event.

You might be wondering how event marketers and their sponsors benefit

from such a strategy. The answer is simple—increased exposure. Social

media gives event holders the potential to reach not only those people in

attendance at the actual event, but all of the attendees' social media

connections as well!

THE CASE OF KATY PERRY

To illustrate just how this merging of the real and virtual worlds occurs

during an event, consider the case of celebrity pop star, Katy Perry. In 2011,

she decided to bring Twitter along for the ride during her California Dreams

concert tour. After assigning unique ​hashtags​ to each concert stop along

the tour, Katy's team equipped the stage with huge "Twitter Jumbotrons"

and encouraged her fans to tweet their thoughts during the concert. Of

course, these tweets were reviewed before being displayed on-screen, and

only the best tweets were shown. This strategy not only allowed Katy's PR

team to censor tweets, but it also provided a little competition for concert

attendees as they attempted to get their tweets seen on stage.

The underlying strategy for this event marketing campaign was to create

hype surrounding Katy's tour and personal brand and allow her to reach a

much broader audience than the one that showed up to her concert. In

essence, you didn't have to be at the concert to experience it to some

degree. Instead, you could "watch" the event unfold from home by following

the unique concert hashtag on Twitter. Of course, that experience pales in

comparison to actually watching Katy perform, but it certainly has the

potential of making you wish you were there! This is exactly the intent, of

course. Katy's event marketers knew that the online buzz would likely

compel other fans to buy tickets to an upcoming concert or, at the very

least, purchase one of the singer's albums.

LEVERAGING SOCIAL MEDIA AFTER THE EVENT

A good event marketer knows that his or her job isn't done after the

currents drop at the end of the show. In fact, it's just beginning! After the

concert, game, or other event is over, the marketer's goal is to keep people

talking about their experiences at the event. Social media provides an ideal

way to keep the buzz going for days and even weeks. Posting pictures from

the event on social media networks, encouraging attendants to tag

themselves, and asking for feedback are all good ways to keep fans talking,

and as they do, each of their social media connections will be listening!

Depending on the quantity and quality of this buzz, marketers can bank on

increased brand exposure and potentially even more attendants at their next

event.

Conclusion

At the core of the sports and entertainment industry is the event. Without

the event, there would be no fans, no sponsors, and no ancillary products to

be sold. Thus, event marketers have an important job on their hands.

Although the field has certainly changed because of advancements in

technology, namely social media, the fundamental goal remains the same:

to attract attendees to the event, to create the best possible experience for

these attendees, and to compel them to share those experiences with

others. Thus, a successful event is one that leaves the fan feeling good

about the event holder and their sponsors so that they will become walking

(or typing) advertisements for the athlete, team, entertainer, organization,

and/or sponsor.