1. Vocabulary Review PPT 2 Sports and Entertainment Marketing Class – Mr. Sherpinsky Council Rock School District

2.  profit  profit motive  economics  economic utility

3.  Profit  the amount of money remaining from revenues after all expenses are paid

4.  the money a business receives from the sales of goods and services  making decisions to use resources in ways that result in the greatest profit  The greatest reason for being in business! revenue profit motive

5.  Worldwide distribution revenue is critical for movie profits.

6.  Economics  the study of how goods and services are produced, distributed, and consumed

7.  the study of the economics of the entire society (big picture or global)  the study of the relationships between individual consumers and producers  Sports and entertainment marketers are focused on microeconomics.  relationships with consumers Macroeconomics Microeconomics

8.  Economic Utility  the amount of satisfaction a person receives from the consumption of a particular product or service

9.  Form Utility  when the physical characteristics of a product or service are improved  Time Utility  making the product or service available when the customer wants it  Place Utility  the product is available where it is wanted  Possession Utility  the product or service is available at an affordable price

10.  risk  risk management  liable

11.  Risk  the possibility of financial gain or loss or personal injury  Risk can be controlled!  Risk can be classified as: ▪ Controllable ▪ Insurable ▪ Involving gain or loss

12.  Natural Risk  occurs from unavoidable weather conditions (tornados, blizzards, etc)  Human Risk  dishonest customers and employees  inadequately trained employees  Economic Risk  occurs due to changes in the economy

13. Gain or Loss Risk  speculative risk ▪ either a gain or loss could result ▪ purchase of a new sports franchise would be considered speculative  pure risk ▪ a chance of an event occurring that could only result in a loss

14.  if a loss can be prevented or the likelihood of its occurrence reduced  nothing can be done to prevent the risk controllable risk uncontrollable risk

15.  a pure risk for which the chances of loss are predictable and the amount of the loss can be estimated  the chance that a dollar loss could occur  the amount of the loss cannot be estimated insurable risk uninsurable risk

16.  Risk Management  preventing, reducing, or lessening the negative impacts of risk by using the strategies of risk avoidance, risk insurance, risk transfer, and/or risk retention

17.  Risk Insurance  pays for predictable losses  Premium  cost of insurance

18.  Risk Retention  assuming the cost of an uninsurable risk  Risk Retention Groups  similar businesses facing similar risks pool resources  resources are distributed to members that have a loss

19.  ethics  principles

20.  Ethics  a system of deciding what is right or wrong in a reasoned and impartial manner  Business should be conducted with integrity, trust, and fairness.

21.  Principles  high standards of rules and guidelines  “Don’t Kill” or “Don’t Steal” or “Don’t Cheat”  Character Development  a progression in behavior where people advance from childish behavior to mature behavior based on principles Young people need good role models.

22.  return on investment  forecast  budget  balance sheet  income statement

23.  Profit is the primary purpose of sports and entertainment marketing.

24.  the income from a venture that is distributed to investors return on investment Return On Investment

25.  Forecast  a plan that predicts the expenses to be incurred and the revenues to be received

26.  Budget  a plan for how available funds will be spent  purpose of a budget is to control costs so they do not exceed the funds available.

27.  Balance Sheet  net worth = assets – liabilities  shows net worth at a specific point in time  Income Statement  shows revenues and expenses for a specific period of time  reveals company’s profit or loss

28.  Review pages 51, 52, 53  Class Discussions, pages 54, 55  Case Study, pages 56