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

3. 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

4. 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

5. A Brief History of Leisure
Marketers sell participation in sports and entertainment events to consumers.
consumers people who use products
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 5

6. 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
In the late 1890s, Thomas Edison invented the kinetoscope. 6

7. A Brief History of Leisure
Other milestones in the history of leisure include:
Mary Pickford becomes the first international movie star in 1918.
The first talking movie in 1927 (The Jazz Singer)
Babe Ruth sets records in baseball that would stand for decades.
The development of television
Flintstone Endorsement, Cereal, Recent 7

8. 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

9. Marketing Today
Sports and entertainment vendors compete for a share of the money people spend on recreation.
vendors sellers of 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 9

10. Fan Clubs Grow Online
Fan clubs for athletes and celebrities make good marketing tools. Thanks to the Internet, thousands of official and unofficial clubs are formed. They are run by fans, corporations, and
Operating an e-tail business on an electronic channel—the Web—can be costly, due to design, delivery, returns, and operating expenses.
Though Many larger dot-com companies crashed in the 1990’s, small stores like Harris Cyclery of West Newton, Massachusetts, actually increase sales using a basic Web site. Today, a third of Harris’s bicycle business rides in on the Web to get hard-to-find parts and personal service.
Describe an e-business’s home page to your class after viewing one through marketingseries.glencoe.com.
celebrities. Some fan clubs charge fees, such as Tiger Woods’ tigerfans.com at $30. Other Web sites are free. For example, fanemporium.com, which operates for a group of musical celebrities, charges no dues. Sites offer newsletters, merchandise, contests, event updates, and more.
For more information on sports and entertainment marketing,
go to marketingseries.glencoe.com. 10

11. 1.
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? 2.
Quick Check Answers
Inventions were the creation of public transportation – trolleys and buses – and the invention of the kinetoscope.
William “Bill” Veeck
Rather than showing a ten-minute series of moving pictures, he capitalized on the appeal of dramatic stories and popular stars. 3. 11

12. Changes in Marketing
Communicating through promotion is more important than ever.
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. 12

13. Marketing Similarities
The marketing of sports and entertainment products differs from marketing traditional products in the following four areas:
endorsement approval or support of a product or idea, usually by a celebrity
core product the main product, such as sports event, movie, stage show, or book
Product
Endorsement
Core product
Ancillary product
Revenue
ancillary product a product related to or created from the core product
revenue gross income
continued 13

14. Marketing Similarities
continued
Place
piracy the unauthorized use of another’s music, movies, or copyrighted material
Price
Piracy
Royalty
Copyright
royalty a payment for material that has been copyrighted, or legally declared as belonging to the creator
Place- effected more with traditional marketing (e-commerce vs. going to store) People still want to attend games and events for most part, changing (article on dropping attendance)
continued 14

15. Marketing Similarities
continued
Promotion
Product tie-in
Cross-promotion
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
Cross promotion- sport or movie star on TV shows or in magazines, TMZ 15

16. Marketing Similarities
Convergence expands the potential for profit in sports marketing and entertainment marketing.
convergence the overlapping of product promotion
Convergence and cross-promotion help to develop synergy.
synergy a combined action that occurs when products owned by one source promote the growth of related products
Convergence- website used as promotion but also sells products or links to other sites
Synergy- Oprah 16

17. Risks and Risk Management
In any industry, including the entertainment industry, there are risks.
risks unforeseen events and obstacles that can negatively affect business
Successful sports and entertainment marketers develop risk management strategies.
risk management a strategy to offset business risks
Written into contracts (laryngitis for singer, Injury, DWI clause, stadium leases), insurance policies, (stadium fire, fan injury)
Figure 2.2 17

18. What is celebrity endorsement? 1.
What is celebrity endorsement?
What is the difference between core and ancillary products?
Give an example of synergy. 2.
Quick Check Answers
A celebrity gives approval or support of a product by lending his or her name or image.
The core product is the event or film or show itself; ancillary products are related to or created from the core product.
Answers will vary, but many will use the Oprah Winfrey example in which a magazine and television show create synergy. 3. 18

19. Different Players, Different Games
The differences between sports and entertainment can be found in three areas:
Consumer loyalty
Product
Revenue stream 19

20. Differences in Consumer Loyalty
If sports fans feel their team is trying to win, the team can retain its consumer loyalty.
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.
Skins vs. Bad Movie 20

21. Differences in Product
The sports product is consistent, or stable.
Core product remains the same
The entertainment product is variable, or changeable. 21

22. 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.
Pay-per-view, cable, DVD, Video game, licensing for products, royalties 22

23. Differences in Revenue Stream
Sports franchises earn revenue from sponsorship.
sponsorship the promotion of a company in association with a property
Sports franchises also earn revenue from advertising and broadcast rights.
Sponsorship- name of stadium/gates etc, logo, corporate boxes, scoreboards (digital advertising on field, or backstop)
Local stations (YES, FSNY- they sell more advertising because of exclusive broadcast rights)
Hot Property p. 41 23

24. Similarities and Differences in Marketing
Sports Marketing
Entertainment Marketing
Lack of Consumer Loyalty
Consumer Loyalty
Product
Place
Consistent Product
Variable Product
Price
Few Ancillary Products
Many Ancillary Products
Promotion
Convergence 24

25. 1.
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? 2.
Quick Check Answers
In sports, consumers usually support one or two teams they like, whereas the entertainment consumer is not motivated by brand or team loyalty; film and music fans will see films made by more than one production company, or buy CDs produced by many different record labels, whereas a sports fan maintains his loyalty.
The sports marketer knows what the consumer wants and then tries to deliver it; the entertainment marketer will try to know what consumers want and then create that product.
Entertainment products can be developed into merchandise. A sporting event primarily develops a revenue stream from ticket sales, media advertising, and video games, and so on. 3. 25

26. Checking Concepts
Identify three people in sports and entertainment history. 1.
As new inventions and technology made entertainment more available to the working classes, marketing was affected; it is currently being affected by computer technology and the Internet. 2.
endorsements, ancillary products, convergence, and synergy 3.
William “Bill” Veeck conceived of marketing activities and events that surround baseball games.  Adolph Zukor was one of the first to market dramatic stories and popular stars in movies.  Charles Howard marketed Seabiscuit well enough that some say he invented sports marketing.  Other answers are possible.  1.
Discuss one way that sports and entertainment history has affected marketing today. 2.
Checking Concepts Answers
William “Bill” Veeck conceived of marketing activities and events that surround baseball games. Adolph Zukor was one of the first to market dramatic stories and popular stars in movies. Charles Howard marketed Seabiscuit well enough that some say he invented sports marketing. Other answers are possible. 
As new inventions and technology made entertainment more available to the working classes, marketing was affected; it is currently being affected by computer technology and the Internet.
endorsements, ancillary products, convergence, and synergy
Name three different marketing tools. 3.
continued 26

27. Checking Concepts Define royalty. 4. 5. Give an example of a royalty.
Answers will vary but may include the star of a new movie can appear on a talk show. 6.
Many answers are possible, including damaged property, cancellation, injury to audience, damage to equipment. 7.
Answers will vary because anything that can be copyrighted can earn a royalty if it is used by a person or entity other than the creator. Some examples might be books, songs, scripts, etc. 5.
A royalty is a payment for material that has been copyrighted, or legally declared as belonging to the creator. 4. 5.
Give an example of a royalty. 6.
Give an example of cross-promotion for a film.
Checking Concepts Answers
A royalty is a payment for material that has been copyrighted, or legally declared as belonging to the creator.
Answers will vary because anything that can be copyrighted can earn a royalty if it is used by a person or entity other than the creator. Some examples might be books, songs, scripts, etc.
Answers will vary but may include the star of a new movie can appear on a talk show.
Many answers are possible, including damaged property, cancellation, injury to audience, damage to equipment.
Describe one risk involved in a sports event. 7.
continued 27

28. Checking Concepts Critical Thinking 8.
Explain one method of risk management for one risk.
Answers will vary. One possibility is purchasing insurance policies to protect clients from industry-related risks. 8.
Checking Concepts Answers
Answers will vary. One possibility is purchasing insurance policies to protect clients from industry-related risks. 28

29. Customizable Slide 29

30. End of