1. Chapter 2 Sports and Entertainment: Connections and Contrasts

2. 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. Section 2.1 History of Sports and Entertainment

4. Case Study: New Kind of Kick (Danny Way & DC Shoes) Assignment (100 points = 25 points each) Read the Case Study (p.27 & p.35). Answer all four questions in detail.

5. Sports and Entertainment Connections What do sports and entertainment have in common? ___________________________________ ___________________________________ ___________________________________ ___________________________________ ___________________________________

6. A Brief History of Leisure Consumers are people who use products. Discretionary Income is money left after necessary expenses are paid. Sports & entertainment growth has relied on consumers who desire recreation.

7. Entertainment for Everyone Kinetoscope – a device invented by Thomas Edison in the 1890’s for viewing a new phenomenon – moving pictures.

8. Development of Sports and Entertainment Marketing Bill Veeck was a key figure in the development of sports marketing. In the 1940’s he owned the Cleveland Indians & Chicago White Sox. One of his most famous promotions was the “Disco Demolition Night” in the 1970’s. Veeck also signed Eddie Gaedel, a 3’7” midget to play baseball for his Chicago White Sox in 1951.

9. Assignment (100 points) Scenario: You are the General Manager of a professional sports franchise (i.e Yankees, Redskins, Capitals, D.C. United, Wizards etc.). Sales are down, your team is losing, and is in last place. Create a promotional event that will A) boost ticket sales, B) excite the crowd, C) make them want to continue to buy tickets and support this team. Your promotion must include: 1) Team Name 2) Promotion (“Event Name/Description”) 3) Place 4) Price (Ticket Price) 5) How? How will you promote this event, get the fans excited, and keep them coming back?

10. Marketing Today Sports and entertainment marketing professionals cannot simply rely on the entertainment value of products. Vendors – sellers of products, compete for a share of the money people spend on recreation. Product – a good or service that any for-profit industry sells to its consumers.

11. Section 2.2 Similarities in Marketing

12. Changes in Marketing People – some marketers consider “people” to be a fifth P in the marketing mix.

13. Marketing Similarities Do sports and entertainment products belong in the same category? A sporting event, just like a movie is entertainment. Professionals agree that sports and entertainment products are “similar” in that they are marketed differently than traditional consumer products. Students explain ________________ Marketing differences are in product, price, place, and promotion.

14. Product Sports products may not be physical goods. Ex.: Going to ESPN Zone. ESPN Zone does not sell tickets, it sells burgers, drinks by using the appeal of sports.

15. Endorsement Endorsement is approval or support of a product or idea, usually by a celebrity lending his name or image to a product.

16. Core and Ancillary Products Core Product – the main product (Ex.: 1) The sports event, 2) Movie, 3) Stage Show, 4) Book Ancillary Product – a product related to or created from the core product. (Ex.: A DVD recording – Magic Johnson’s basketball how to videos). Revenue – gross income earned by the sale of core & ancillary products as promotional tools to promote and market more unrelated products.

17. Place The changing nature of the place component in the marketing mix has affected traditional marketing. E-commerce has changed the way people shop. What is E-commerce? ________

18. Price Pricing sports and entertainment is radically different from pricing traditional consumer products. (Ex.: 1) Movie theaters, 2) Stadium (game) pricing

19. Ticket Pricing – Real World Connection Why have ticket prices continued to go up, or remained high even though our economy is in a recession? ______________

20. Price Problems Price becomes an issue when high price players, and actors/actresses go on strike. Piracy – is the unauthorized use of an owner’s or creator’s music, movies, or other copyrighted material. Intellectual Property is an idea, concept, or written or created work that is protected by copyright. An example of piracy is ___________. A royalty is a payment for material that has been copyrighted, or legally declared as belonging to the creator.

21. Promotion Sports and entertainment marketing uses two tools to promote goods: product tie-ins and cross- promotion. Product tie-in is the used of ancillary products such as merchandise as promotional tools. (Ex.: Buy a Happy Meal at McDonald’s, and get a free toy). Cross-Promotion is any form of communication through which one industry relies on another industry to promote its product. (Ex.: Johnny Depp goes on the Tonight Show to promote a new movie). Word of Mouth – the buzz created by people talking about a product (Ex.: I-Phone), that stimulates product sales.

22. Convergence – Part of the Marketing Mix Convergence is the overlapping of product promotion. Ex.: Web sites that are used as both promotional tools and as sources of revenue – i.e. redskins.com

23. Synergy Synergy is a combined action that occurs when products owned by one source promote the growth of related products. Ex.: Oprah Winfrey (core product – her TV show), (ancillary products – her magazine, her production company HARPO).

24. Risks and Risk Management Risks – unforseen events and obstacles that can negatively affect business. Risk Management – a strategy to offset business risks. What are some risks sports franchises have to face? ______

25. Section 2.3 Differences in Marketing

26. Different Players, Different Games The difference between sports and entertainment can be found in three areas: 1)Consumer loyalty 2)Product 3)Revenue Stream

27. Differences in Consumer Loyalty Consumer loyalty occurs when consumers are happy with a company’s product and become repeat customers. Most sports fans (sports consumers) are loyal to their teams (i.e. they buy their favorite team’s merchandise). Entertainment consumers are “not” motivated by brand (ex.: A certain movie company like Warner Bros.), but by the desire to get satisfying entertainment (i.e. video game, amusement ride, CD, DVD).

28. Job of the Entertainment Marketer Find a “winning formula.” Try to KNOW what consumers want. CREATE that product. An example is _________________.

29. Job of the Sports Marketer Find a “winning team.” KNOW what the consumers want. Try to DELIVER that product. An example is _______________.

30. Differences in Product Another big difference between sports product and entertainment product is the consistency, or stability, of the sports product and the variability or changeability, of the entertainment product.

31. Differences in Revenue Stream Entertainment products can be made into merchandise, used for promotion, and create profit through sales of these products. (Ex.: Movie – Pirates of the Caribbean could create revenue streams through movie ticket sales, cable tv, pay per view, or rented as videos and DVD’s.

32. Sponsorship Differences Sponsorship is the promotion of a company in association with a property. (Ex.: Nascar – Dale Earnhardt Jr’s #88 – sponsored by Amp Energy & Chevrolet

33. Super Bowl – Hot Property Beyond the Gridiron (read p.41 and answer the questions below). Why is the Super Bowl important to networks and advertisers? What do you think viewers remember most after watching the Super Bowl – the game, the commercials, or the halftime show?

34. Advertising and Broadcast Rights Virtual advertising is a new phenomenon that has created revenue for sports teams. Sports franchises also earn revenue by landing broadcast deals with tv companies. Big Ex.: NFL – revenue sharing.

35. Assignment (100 points) Expanding Products. Name three favorite movies as core products and list some ancillary products for each film. Think of some new ancillary products that would help market each film and create more revenue.

36. Assignment – Portfolio Works Exploring Marketing Careers (100 Total Points/20 Points Each) Research five careers in sports and entertainment marketing that interest you. Answer the following: 1)List five careers. 2)Use the internet to explore at least one career. Describe that career. 3)List your skills and interests. Then list the jobs that match these skills and interests. Create names for the jobs if they are applicable. 4)Review your list of skills and interests. What stands out? Think of as many jobs as you can that relate to your skills and interests. 5)Describe an ideal job that involves these skills. Include the location of the ideal job and the kinds of coworkers, customers, and employees you would meet.

37. Checking Concepts/Critical Thinking/Cross-Curriculum Skills (100 Total Points/10 Points Each) 1) Identify three people in sports and entertainment history. 2) Discuss one way that sports and entertainment history has affected marketing today. 3) Name three different marketing tools. 4) Define royalty. 5) Give an example of a royalty. 6) Give an example of a cross-promotion for a film. 7) Describe one risk involved in a sports event. 8) Explain one method of risk management for one risk. 9) Imagine you work at a sports marketing agency. Write a banner ad for a new sports drink. 10) Write a radio script to advertise a local business that is sponsoring the Gar-Field vs. Woodbridge game.