Lesson 4.4 – Market Segmentation Copyright © 2014 by Sports Career Consulting, LLC

SPORTS ATTRACTION WHY DO WE PARTICIPATE? Personal Improvement – Better Health Sense of Accomplishment Develops Positive Values, etc. Sport Appreciation Enjoy the game and competition Fan Identification with the Team Social Facilitation Spend time with others, feel a part a group

Fan Motivation Reasons to Attend Game Diversion from everyday life Entertainment Value EUSTRESS or Positive Stress Economic Value Aesthetic Value Need for Affiliation Family Ties

Fan Attendance Factors What Fans Value Reasonably priced parking and tickets Adequate Parking and Access Reasonably Priced Food Home Team with Winning Record Close Score Team Star or top 10 player Reasonably Priced Souvenirs Game that ends in less than 3 hours Wide Variety of Snack Foods Taken from Shank Book

Market Segmentation the process of LESSON 4.4 Marketing Applications Market Segmentation the process of identifying groups of consumers based on their common needs Copyright © 2014 by Sports Career Consulting, LLC

Helps Companies To: Marketing Applications Understand consumer groups LESSON 4.4 Marketing Applications Market Segmentation Helps Companies To: Understand consumer groups Determine target markets Develop positioning strategies Customize products and marketing strategies Copyright © 2014 by Sports Career Consulting, LLC

Five Bases for Market Segmentation LESSON 4.4 Marketing Applications Five Bases for Market Segmentation 1) Demographic 2) Product 3) Psychographic 4) Benefits 5) Geographic Copyright © 2014 by Sports Career Consulting, LLC

Marketing Applications LESSON 4.4 Marketing Applications Demographic Psychographic Geographic CONSUMER Benefits Product Copyright © 2014 by Sports Career Consulting, LLC

Five Bases for Market Segmentation LESSON 4.4 Marketing Applications Five Bases for Market Segmentation Age Income Occupation Gender Education Demographic Segmentation: Focuses on information that can be measured Copyright © 2014 by Sports Career Consulting, LLC

Demographic Segmentation LESSON 4.4 Marketing Applications Demographic Segmentation Fans of the PGA and LPGA tours tend to be among the “baby boomer” age demographic (45-64), according to data from Scarborough Sports Marketing Copyright © 2014 by Sports Career Consulting, LLC

Demographic Segmentation LESSON 4.4 Marketing Applications According to knowledgebase.com, the biggest demographic for the artist Shakira is 20-year old women According to knowledgebase.com, the biggest demographic for the artist Shakira is 20-year old women Demographic Segmentation According to knowledgebase.com, the biggest demographic for the artist Shakira is 20-year old women Copyright © 2014 by Sports Career Consulting, LLC

Demographic Segmentation According to knowledgebase.com, the biggest demographic for the artist Shakira is 20-year old women World Champion, #1 in the world, and 17-time US National Tennis Champion and performance coach, Bob Litwin, penned a blog post recommending a demographic rarely targeted by sporting gear manufacturers: baby boomers LESSON 4.4 Marketing Applications According to knowledgebase.com, the biggest demographic for the artist Shakira is 20-year old women Demographic Segmentation World Champion, #1 in the world, and 17 National Tennis Champion and performance coach, Bob Litwin, penned a blog post recommending a demographic rarely targeted by sporting gear manufacturers: baby boomers. His rationale? “Baby boomers want to stay fit, feel younger and have fun.” Copyright © 2014 by Sports Career Consulting, LLC

Demographic Segmentation According to knowledgebase.com, the biggest demographic for the artist Shakira is 20-year old women World Champion, #1 in the world, and 17-time US National Tennis Champion and performance coach, Bob Litwin, penned a blog post recommending a demographic rarely targeted by sporting gear manufacturers: baby boomers LESSON 4.4 Marketing Applications According to knowledgebase.com, the biggest demographic for the artist Shakira is 20-year old women Demographic Segmentation “I’d like to see a sports manufacturer, like NIKE, Adidas or Babolat, create an influencer marketing campaign where players 60 and over can share their stories about growing younger through fitness. Boomers are growing at a faster rate than all other age groups combined and they outspend other generations by an estimated $400 billion a year. With health care plummeting and old age knocking at our doors, it’s time to create an influencer marketing campaign that shows baby boomers defeating aging, getting fit and living brand new stories.” Copyright © 2014 by Sports Career Consulting, LLC

Demographic Segmentation LESSON 4.4 Marketing Applications Demographic Segmentation Since 2000, the number of NASCAR fans earning $100,000 or more has doubled from 7% to 16% of its fan base, and those with incomes of $50,000 or more has risen from 35% to 48% Copyright © 2014 by Sports Career Consulting, LLC

Demographic Segmentation LESSON 4.4 Marketing Applications Demographic Segmentation According to league data, the average household income for NHL fans is $104,000, highest of the four major sports with Major League Baseball ($96,200), the NBA ($96,000), and the NFL ($94,500) Copyright © 2014 by Sports Career Consulting, LLC

Demographic Segmentation LESSON 4.4 Marketing Applications Demographic Segmentation According to a report from Leichtman Research Group, 69% of households in the U.S. have at least one high definition television set, up from 17% in 2006 Copyright © 2014 by Sports Career Consulting, LLC

Demographic Segmentation LESSON 4.4 Marketing Applications Demographic Segmentation A survey by CNBC has found that half of all American households own at least one Apple device, and the average Apple-buying household has a total of three Copyright © 2014 by Sports Career Consulting, LLC

Demographic Segmentation LESSON 4.4 Marketing Applications Demographic Segmentation Scarborough Research released demographic figures relating to fans of the IndyCar, suggesting 29% of the fan base were “blue collar”, while 37% were “white collar” Copyright © 2014 by Sports Career Consulting, LLC

Demographic Segmentation LESSON 4.4 Marketing Applications Demographic Segmentation According to a report released in 2013 by the Entertainment Software Association (ESA), 45% of the entire gamer (video game playing) community are women and they comprise 46% of the most frequent video game purchasers Click here to view a graphic reporting on gamer demographics from USA Today Copyright © 2014 by Sports Career Consulting, LLC

Demographic Segmentation LESSON 4.4 Marketing Applications Demographic Segmentation According to data from Scarborough Sports Marketing published in a 2011 issue of Sports Business Journal, fans of MMA are 78% male and 22% female Copyright © 2014 by Sports Career Consulting, LLC

Demographic Segmentation LESSON 4.4 Marketing Applications Demographic Segmentation Target retail stores understand that 60% of their shoppers are women, likely playing a significant role in their decision to sponsor the 2014 ASAP Women’s Surfing Event In Maui Copyright © 2014 by Sports Career Consulting, LLC

Demographic Segmentation LESSON 4.4 Marketing Applications Demographic Segmentation 68% of NHL fans have attended college Copyright © 2014 by Sports Career Consulting, LLC

Demographic Segmentation LESSON 4.4 Marketing Applications Demographic Segmentation Triple A baseball posts its demographic information online for prospective sponsors to review 40% of the fan base earns $46-75k per year 42% of the fan base has an Undergraduate Degree 91% of the fan base has a major credit card 69% of the fan base owns their own home Copyright © 2014 by Sports Career Consulting, LLC

Five Bases for Market Segmentation LESSON 4.4 Marketing Applications Five Bases for Market Segmentation Sports season ticket holders Theatre group ticket coordinators Individual is either a User or Non-User Season ticket holder Smoker Seat Belt Product Usage or Behavioral Segmentation: Reflects what products consumers use, how often they use them, and why Segmentation based on “Rate of Use” Copyright © 2014 by Sports Career Consulting, LLC

Five Bases for Market Segmentation LESSON 4.4 Marketing Applications Five Bases for Market Segmentation Sports Fans Music Lovers Individuals who enjoy attending live events Cheerleader Athlete Computer User Mini-van Driver Retired Person Marathon Runner Psychographic Segmentation: Grouping consumers based on personality traits and lifestyle Segmentation based on Interests and Activities Copyright © 2014 by Sports Career Consulting, LLC

Five Bases for Market Segmentation LESSON 4.4 Marketing Applications Five Bases for Market Segmentation Benefits Segmentation: Refers to a perceived value consumers receive from the product or service Season ticket holders enjoy additional “perks” such as exclusive invitations to pre-game chalk talks with the team’s coaches Copyright © 2014 by Sports Career Consulting, LLC

Important to Sports Marketers Because: LESSON 4.4 Marketing Applications Five Bases for Market Segmentation North, South, East and West Regions of the United States Urban and Rural areas of a particular state Climate Winter Sports vs Water Sports Hawaii vs Vermont Alaska vs Florida Geographic Segmentation: Dividing of markets into area, region, or climates Important to Sports Marketers Because: Sports consumers are characteristically loyal to particular regions when making buying decisions Copyright © 2014 by Sports Career Consulting, LLC

Selecting multiple segments LESSON 4.4 Marketing Applications Selecting multiple segments Because many segments may be valid in helping marketers make decisions, marketers often choose to use several segments Ultimately, a decision is made based on what best fits the organization’s target market Copyright © 2014 by Sports Career Consulting, LLC

Selecting multiple segments LESSON 4.4 Marketing Applications Selecting multiple segments Young women have played a major factor in the 2013 revival of the Toronto Blue Jays franchise, where the 57% of fans age 18 to 24 are female, representing “one of the fastest-growing segments of our entire demographic slice," according to Toronto's vice-president of marketing and merchandising. Also in the news story from thespec.com, Sportsnet said more women started tuning in as the Jays reeled off wins in June. Viewership for women aged 18-34 increased by 61 per cent (24,000 to 39,000) and 52 per cent (54,000 to 82,000) for women 25-54 when compared to May 2014. Copyright © 2014 by Sports Career Consulting, LLC

Types of Sports Participants LESSON 4.4 Athletes have 2 classifications Amateur An athlete that is not monetarily compensated for performance Collegiate Athletes, Olympic Athletes 2 questions: Go to College?? or Make Money?? Professional An athlete that is compensated with money for his or her performance NBA, NFL, MLB, MLS… Sports have 2 classifications Organized Sport that is controlled by an organizing body Official rules of play, participation, controlled “Sanctioned” sports NCAA, NBA, NASCAR, NFL, Rec. Leagues Unorganized Sport that is not sanctioned or controlled May have Rules of play In back yard with friends… Turkey Bowl Copyright © 2014 by Sports Career Consulting, LLC

LESSON 4.4 REVIEW (ANSWERS) 1) Identify the five bases of segmentation 1- Demographic 2- Behavioral (Product usage) 3- Psychographic 4- Benefits 5- Geographic Marketing Applications Copyright © 2014 by Sports Career Consulting, LLC