History of Sports and Entertainment Marketing Similarities in Marketing 2 Differences in Marketing

Chapter Objectives Discuss the history of sports and entertainment. Discuss the impact of sports and entertainment history on today’s markets. Explain how sports and entertainment marketers use tools to sell their products. Explain risks and risk management of sports and entertainment events. Identify differences between marketing sports and entertainment products. 3

Sports and Entertainment Connections What do sports and entertainment have in common? They have thrilled and entertained people for centuries—since the ancient Olympic games and Greek plays. 4

A Brief History of Leisure consumers Marketers sell participation in sports and entertainment events to consumers. consumers people who use products 5 discretionary income The growth of the sports and entertainment industries has relied on consumers with free time, discretionary income, and a desire for recreation. discretionary income money left to spend after necessary expenses are paid

A Brief History of Leisure By the late 1880s, both wealthy and working-class families could seek similar forms of entertainment, thanks to public transportation. kinetoscope a device used to view a sequence of moving pictures 6 kinetoscope In the late 1890s, Thomas Edison invented the kinetoscope.

A Brief History of Leisure Other milestones in the history of leisure include: 7 Mary Pickford becomes the first international movie star in The first talking movie in 1927 (The Jazz Singer) Babe Ruth sets records in baseball that would stand for decades. The development of television

Development of Sports and Entertainment Marketing William “Bill” Veeck was a key figure in the development of sports marketing. He conceived of marketing activities and events that surround baseball games. Adolph Zukor, founder of Paramount Pictures, was one of the first film producers to draw big box-office crowds and own a chain of theaters. 8

Marketing Today vendors Sports and entertainment vendors compete for a share of the money people spend on recreation. vendors sellers of products 9 products Sports and entertainment marketing directs consumers toward sports and entertainment products. product a good or service that any for-profit industry sells to its customers

Name two inventions that helped to enable more equal access to entertainment for the wealthy and the working classes in the 1890s. Who was a key figure in the development of sports marketing? How did Adolph Zukor help the entertainment market grow?

Changes in Marketing promotion Communicating through promotion is more important than ever. 11 promotion any form of communication used to persuade people to buy products New technologies have broadened the scope and reach of marketing messages, and they can be entertainment products themselves.

Marketing Similarities The marketing of sports and entertainment products differs from marketing traditional products in the following four areas: 12 endorsement approval or support of a product or idea, usually by a celebrity Product –Endorsement –Core product –Ancillary product –Revenue continued core product the main product, such as sports event, movie, stage show, or book ancillary product a product related to or created from the core product revenue gross income

Marketing Similarities Place 13 piracy the unauthorized use of another’s music, movies, or copyrighted material continued royalty a payment for material that has been copyrighted, or legally declared as belonging to the creator continued Price –Piracy –Royalty –Copyright

Marketing Similarities Promotion –Product tie-in –Cross-promotion 14 product tie-in use of ancillary products such as merchandise as promotional tools cross-promotion any form of communication through which one industry relies on another industry to promote its product continued

Marketing Similarities Convergence Convergence expands the potential for profit in sports marketing and entertainment marketing. 15 convergence the overlapping of product promotion synergy a combined action that occurs when products owned by one source promote the growth of related products synergy Convergence and cross- promotion help to develop synergy.

Risks and Risk Management risks In any industry, including the entertainment industry, there are risks. 16 risks unforeseen events and obstacles that can negatively affect business risk management a strategy to offset business risks risk management Successful sports and entertainment marketers develop risk management strategies.

What is celebrity endorsement? What is the difference between core and ancillary products? Give an example of synergy

Different Players, Different Games The differences between sports and entertainment can be found in three areas: 18 Consumer loyalty Product Revenue stream

Differences in Consumer Loyalty consumer loyalty If sports fans feel their team is trying to win, the team can retain its consumer loyalty. 19 consumer loyalty consumers’ attitude that occurs when they are happy with a company and become repeat customers The entertainment consumer is not motivated by brand or team loyalty, but by a desire for satisfying entertainment.

Differences in Product The sports product is consistent, or stable. The entertainment product is variable, or changeable. 20

Differences in Revenue Stream The streams of revenue created by marketing products in entertainment are very diverse. Sporting events do not usually produce the same amount of revenue from merchandising and royalties as entertainment events. 21

Differences in Revenue Stream sponsorship Sports franchises earn revenue from sponsorship. 22 sponsorship the promotion of a company in association with a property Sports franchises also earn revenue from advertising and broadcast rights.

Similarities and Differences in Marketing 23 Sports MarketingEntertainment Marketing Place Product Price Promotion Convergence Consumer Loyalty Lack of Consumer Loyalty Consistent Product Variable Product Many Ancillary Products Few Ancillary Products

List two differences in consumer loyalty between sports and entertainment. What are differences between marketing sports product and entertainment product? In what one way does the stream of revenue in sports differ from the stream of revenue in entertainment?

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