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Second Class MKT828.docx

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MKT 828
Shavin Malhotra

Second Class MKT828: What is marketing? Marketing is not a department, it is a life skill Definition of marketing, marketing is an organization function and a set of processes for creating, communication, and delivering value to customers and for managing customer relationships in ways that benefit the organizations and its stakeholders. In regards to the chart posted…”sport industry” This chart states 3 segments: sport performance…Sports productions…Sport promotion… “Sport” is… any experience or business enterprise focused on fitness, recreation, athletics, or leisure…includes both SPECTATOR and PARTICIPANT sport and neither are mutually exclusive… Factors influencing the growth of the sport industry… 1) New and different sports 2) Same sport offerings 3) Trades and sport magazines 4) Leisure time 5) Mass media 6) Sport related goods and services 7) Business funding “The NBA’s Mission slide…” Sport marketing is…Sport marketing consists of all the activities designed to meet the needs and wants of sport consumers through the exchange process Sport marketing has developed two major thrusts: the marketing of sport products and service directly to the consumers of sport, and the marketing of other products or services through the use of sports promotions. “Marketing Myopia” Occurs when sport organizations concentrate on producing and selling rather than identifying and satisfying the needs or their consumers The unique aspects of sports marketing  Many sport organizations simultaneously compete and cooperate  Expert consumers  Consumer demand fluctuates widely  Intangible product offering “Figure 1.1 the bundle of characteristics of the sport product” will be posted online… 5 P’s in sport marketing 1) Public relations 2) Place 3) Price 4) Promotion 5) Product Figure 1 will be posted online… “What makes a good sport marketer” Important figures in sport marketing PT Barnum…why he’s important… Mark McCirmack Phill Knight and Jordan Bill Veck Sport Marketing Management Developing consistent, marketing-minded strategies The Marketing Management process in Sport model… will be posted… MMP: Tactical Components 1) Core area of marketing strategy 2) Element in the marketing mix 3) Feedback and evaluation Strategic Step 5: Control and evaluate the MMP implementation Customer satisfaction = product benefits – cost The Frequency Escalator… Posted online… The Chicago Bulls…They focused on the future…. Sport Marketing Studies of sport consumers Who is the sport consumer? Why do people consume sport?  Questions that sport marketers ask consumers  Type of databases available for analysis  Strengths and weaknesses of related studies Frequency and scope of consumer studies  Irregular, limited (commissioned, one-time, demographics, consumption and attitudes)  Irregular, broad (populations)  Regular, limited (large scale trends, annual statistics)  Regular, broad (national)  Indexes (market consumptions) Reading sport consumer studies  Definition (what constitutes a fan or participant)  Methodologies (interview, observations, data collection)  Sampling (random, stratified) Definitions:  Involvement and commitment: (sampling awareness, interest)  Participant: (frequent, core, expert)  Multiple measures: (most effective research on the sport consumer employs clearly defined, multiple measures of involvement and commitments  Consistent samples and methods  Representative samples Sport Marketing (chapter 4) Perspectives in sport consumer behavior: Why do people consume sport Key factors which tell HOW and TO WHAT EXTENT people are involved with and committed to sport 1) Socialization 2) Involvement 3) Commitment Socialization:  The process by which individuals assimilate and develop the skulls, knowledge, attitudes, and other equipment necessary to perform various social roles  Two-way interaction (involvement) between individual and environment Involvement:  Behavioral: hands on doing  Cognitive: acquisition of information and knowledge about a sport  Affective: attitudes, feelings, and emotions that a consumer has toward an activity Commitment:  Refers to the frequency, duration and intensity of involvement in a sport, or the willingness to spend money Consumer behavior in sport Model… will be posted online (will be on the test) Environmental factors:  Significant others (parents, peers)  Cultural norms and values (alternative systems i.e.…Ethnic and regional subculture)  Class, race and gender relations (access to rewards and prestige, availability  Climatic and geographic conditions  Market behavior of sport firms (composition of marketing mix  The sport involvement/opportunity Individual factors: How a consumer makes sense of the sport world  Self-concept (self image, perceived, desired, reference)  Stages in life or family circle  Physical characteristics (real and perceived  Learning (feel-do-learn vs.…learn-feel-do)  Information perception (facility, risk, etc.)  Motivation (achievement, affiliation, health and fitness, fun and entertainment)  Attitude (not always trigger positive behavior: lock in the consumer) Sport Marketing: Market Segmentation Key concept: Creates the bridge between managerial analysis and managerial action Defined: the process of dividing a large, heterogeneous market into more homogenous groups who have similar wants, needs or demographic profiles to better target a product Issues to consider when choosing a market segment  Identifiably: (size and purchasing power  Accessibility (individually/collectivity  Responsiveness (will the products match the wants, worthwhile significance) Segment vs. Niche  Niches arise from the sport market  Segment are imposed on the market Bases of segmentation  Demographics: state of being  Psychographics: state of mind  Product usage  Product benefits 3 Class Strategic Sport Marketing Plan Outline MKT828 Sport Marketing Concepts and Strategy The Marketing Plan Strengthens the relationship between sport marketing and other management functions in the company Become the establish plan of action for the company Objectives  To work in teams as ‘consultants’ to a specific sport organization and /or product (relevant to the Canadian sport industry)  Using sport marketing concepts and strategies discussed in class, as well as supplemental sources to…  Produce a sport marketing plan for your client, which includes recommendations for a comprehensive sport marketing mix strategy, according to market research conducted, and, which best  Corresponds with the consumer segment(s) identified  While your marketing plan will include current marketing strategies used by your ‘client’, your marketing plan must focus on recommended marketing mix strategies which will improve the overall marketing functions of the organization to achieve maximum performance goals  In other words…  Don’t recommend what the are already doing…recommend what they should be doing BITS>Bums in the seats… are they buying tickets? Bases of Segmentation  Demographics: state of being  Psychographics: state of mind  Product usage  Product benefits Demographics (state of being) segmentation  Geography (Proximity, geocluster, outer rims)  Income  Age  Gender  Race and Ethnicity Psychographics(state of mind) segmentation  Asserts that consumers may be divided by personality traits: by lifestyle characteristics (attitudes, interests, and opinions); and by preferences and perceptions  Segments of the adult population (actualizers, achievers, believers, experiences, strivers, strugglers, etc.) Product Usage Segmentation  80% of marketing consumption from 20% of the consumers (80-20 rule)  Not all consumers consume at same rate  The levels of consumption and usage rates vary from sport to sport  Levels of consumption vary from age group to age group, reflecting life cycle pattern  Essential for sport marketers to maintain opportunities for consumer at each level Benefits Segmentation  Assessing the benefits sought by consumers through sport consumption  Motivational factors include affiliation, achievements, status, health and fitness The sport Product: What is the sport product?  Inconsistent from consumption to consumption  The ‘core’ game or performance is just one element of the larger ensemble  The marketer typically has little control over the core product and consequently must focus efforts on product extensions The sport product, its core and extensions Core Sport Product: Event Experience  Game Form (rules and techniques)  Players (star power)  Equipment and apparel (including memorabilia)  Venue Sport Product extension:  Personnel and process  Ticket and other printed materials  Electronic products  The organization  Novelties and fantasies (fan fests, fantasy camps) Key Issues How do you make the product distinctive and attractive your consumer’s minds? 1. Differentiation  Make the product distinct in the consumers minds 2. Development  Generation of ideas  Screening of ideas, market and business analysis, development, testing, commercialization 3. Positioning/Repositioning:  The products’ position in the mind of the target consumers (images and marks) 4. Branding:  Brands can be created or retained in the names of marks, designs, or images of any one or more of the product elements Sports Marketing Pricing Strategies What are the basics of pricing?  In sports, there is a vast range of products that require pricing  These elements are priced according to range of variables: location, images, and time  Price is critical in the Marketing mix: Price is the most readily changes Effective tool (when demand is elastic) Highly visible Core pricing issues (cost, value and objectives): Satisfaction =benefit – cost Cost (of total attendance) versus price (ticket) Value and price -Consumers perceive a higher price to indicate higher quality -Consumer perceptions link price and value (product values include: convenience, aesthetics, risk, availability, durability) Push and pull of pricing objectives -Efficient use of resources, fairness, participation opportunities, positive user attitudes, profits Standard approaches to pricing  Production Costs  Market Conditions-supple and demand  Competitors prices- those competing for the same dollar  Organizational objectives, including profit and distribution agents  Product or event frequency Standard pricing approaches Break-even analysis -FC (fixed costs) + VC (variable costs)= TC (total costs Cost-Plus pricing -Cost + desired profit= Price Market approach -What the market will bear Caption Pricing -Offering a price “per head” Special Factors: Market Demand: sensitivity of market to price change -Elasticity of demand -= %change in quantity demanded/ %change in price -Inelastic demand – a %
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