Customized Entertainment Chapter 7 Lesson 3 Sports and Entertainment Marketing

Journal Entry Date: 3/10/11 Objective: The student will define customizing and describe the financial impact of Baby Boomers on the entertainment industry. Question: What age group are Baby Boomers? Why would they have an impact on the entertainment industry?

Opening Act For more than a decade, regional corporations have been building cineplexes containing as many as 30 screens in suburban areas. Magic Johnson, a retired basketball legend, created Magic Johnson Theaters as a way of counteracting this trend. Johnson chooses the locations of his theaters based on the economic needs of minority neighborhoods. In February 2004, 5 theaters were opened - one each in the inner cities of Cleveland, Atlanta, Los Angeles, Houston and New York City.

Johnson wants his theaters to be community centers focused on distribution of a personalized service to a market segment. Concession areas are stocked with food and beverages that appeal to minorities. Customizing allows marketers to promote to a specific segments of the population.

Think Critically What information would Magic Johnson need in order to determine locations for more movie theaters?

Customizing Products One of the first steps in developing the marketing mix is to collect marketing information about the consumers of the product Customizing is changing a product to fit the needs or wants of a particular market

Customization Example In Southern California, Killer Entertainment provides live impromptu, or spontaneous and changing, entertainment based on audience reactions A production can include audience participation in a comedy, drama, or murder mystery By understanding the audience, entertainment can be customized for its tastes

Local TV Planning and production of shows are expensive and require a large viewing audience to attract advertisers to cover the production costs Local television programming has been consolidated and barely exists anymore but requires knowledge of the market segment’s interests

Children’s Programming Children’s programming began with locally produced programs Local news anchors or weathermen often dressed up as clowns to host the shows The hosts often had such a strong influence on children that parents pressured broadcasters to prohibit the hosts from personally endorsing children’s products

Sports Programming Sports programs used to be broadcast only on a regional level until cable television Now viewers can watch their teams through either regional sports networks or national sports networks via cable or satellite, sometimes on a pay-per-view basis

Rising Costs of Sports Programming Excessive salaries of sports figures have been pushed onto cable networks which have been pushed onto subscribers Tiering was suggested to help with rising costs and involves specific sports programming being offered outside the basic cable or satellite package

Public TV and Radio Viewer- and listener-supported TV and radio stations generally have as their mission to entertain and educate their audiences Usually non-profit organizations financed through grants, corporate donations, and listener contributions Stations know their audiences and and work to please them

Intermission Why is different TV programming shown in different cities or regions of the United States?

Baby Boomers Born between 1946 and 1964 Over 76 million baby boomers who are said to reach their peak spending level at age 46 Their spending on leisure time and entertainment activities will continue the major economic impact started in 1946

Boomers Won’t Retire Expected to soften the line between career and retirement Enjoy recreational activities, personal fitness, and all types of entertainment, from concerts to fine arts These consumers have discretionary income to pay for the products and services they desire

Segmenting the Group Knowledge of the customer’s spending habits, incomes, preferences, occupations and areas of residence can provide the marketing information needed to focus the marketing message Baby Boomers vary greatly so marketers must be careful when targeting them

Aging Population Average age of the population is increasing 1994 it was 34 2000 it was 35.5 2035 it will be 39.1 Marketers have to keep this in mind

Marketing Myths The United States has a long history as a “melting pot” that welcomes all immigrants. However, for marketing purposes it was primarily viewed as a white, Anglo-Saxon nation. This will change if the latest studies by the census bureau prove to be accurate. The bureau estimates the fastest growing segment of society to be Hispanic.

This group contributed 32 percent of the nation’s population growth from 1990 to 2000. It is expected to contribute 39 percent of the nation’s growth from 2000 to 2010, 45 percent from 2010 to 2030, and 60 percent from 2030 to 2050. By 2010, the Census Bureau estimates that Hispanic spending in the United States will be nearly $200 billion.

Think Critically What does this information tell entertainment marketers and marketers in general?

Entertaining the Boomers Boomers are finding more time for entertainment Large increase in movie theater audiences Boomers account for 1/3 of all attendance Boomers like to see stars of their own age

Understanding All Parts of the Group Marketers must be careful not to exclude part of the group To assume that all people in a large group have the same interests is a costly mistake Boomers will continue through 2020 to be a major target of entertainment marketing

Intermission Why are Baby Boomers important to entertainment marketers?

Encore An advantage of customized entertainment over entertainment for the masses is More people will buy it It can be impromptu, based on the audience No information is needed about the customers None of the these Baby Boomers are important to entertainment marketers because They have discretionary income They are interested in leisure-time activities They are expected to be active throughout retirement Of all of these

3. If Baby Boomers are the largest age group in the nation, why is so much sports and entertainment advertising aimed at 12- to 24-year olds? 4. Break down the Baby Boomers into four different niche markets based on age and gender. Name two sports or entertainment products or services to market to each niche.

Class Work Make a list of people you know that are Baby Boomers What niche market do these people fall into? What types of sports and entertainment products/events do they enjoy? What products/events would you try to market to them?