Sports, Entertainment, and Recreational Marketing

Chapter 1 World of Marketing Section 1.1 What is Marketing?

Objectives  Define marketing  Explain the marketing concept  Define demographics  Explain the marketing mix  Explain economics and free enterprise  Identify intellectual property rights  Explain the different types of business ownership  Explain the economic impact of sports and entertainment

The Importance of Sports and Entertainment Marketing  Today more than any time in history, the sports, and entertainment industries have become the two most profitable industries in the United States.  Some examples are ____________.

Marketing Defined  Marketing is defined as the process of developing, promoting, and distributing products, or goods and services, to satisfy customers’ needs and wants.  Goods are “tangible” products, such as sports equipment.  Services are “intangible” products such as sports/theater tickets, sports clinics…

The Marketing Process  “Developing” products involves studying consumers to determine what they want, and then designing the products that will satisfy their needs and wants.  Needs are ___________.  Wants are ___________.  “Promotional activities” help to educate consumers, create interest and desire, make a sale, and create an image for the company and its products.

Slogans  Name the following companies based on their slogans: “Just Do It” ______________ “I’m Loving It” ____________ “The Breakfast of Champions_______ Now, name some others.

Distribution  Distribution is the means of getting the product into the hands of the customer.  Some companies sell their products directly to the customer via direct- marketing (direct mail, internet, phone).  Others us “wholesalers” and “retailers” to distribute their products.

The Marketing Concept  The marketing concept is the idea that organizations need to satisfy their customers while also trying to reach their organizations’ goals.  To be profitable, businesses must focus on customers’ wants and needs.

The Market  A market consists of potential customers with shared needs who have the desire and ability to buy a product.

Needs  Needs are basic necessities such as food, clothing, and shelter.

Wants  Wants are things that people desire based on personality, experiences, or information about a product.  Examples are _______________.

Target Market  A target market is a specific group of consumers that an organization selects as the focus of its marketing plan.  An example would be ___________.

Demographics  Demographics are statistics that describe a population in terms of personal characteristics.

Demographic Categories  Age  Income  Occupation  Gender  Ethnicity  Educational Level

The Marketing Mix  The marketing mix is a combination of four basic marketing strategies – the 4 p’s – product, price, place, and promotion.

Product Decisions  Designing, naming, and packaging are extremely important decisions.  Why? _____________?  Examples are _____________?

Price Decisions  Price influences customers’ buying decisions.  The cost of making or buying a product for resale is one factor in determining the price to charge customers.  Other factors include expenses related to marketing the product, competition, and what the customer is willing to pay.

Place Decisions  Place decisions involve making the product available to the customer.  Marketers must determine how and where their target market shops.  Channel of distribution is the path a product takes from the producer to the consumer. Ex.: Nike has a website where you can purchase their products, or consumers can go to retail stores like Foot Locker or Sports Authority.

Promotion Decisions  Promotion decisions involve how the goods or services are communicated to the consumer.  Promotions may use any combination of advertising, sales promotion, publicity, and personal selling. An example of each would be _______.

Section 1.2 Economics of Marketing

Economic Basics  The marketing decisions and plans made by sports and entertainment businesses help determine profits from their products, or goods and services.  Economics is the study of the choices and decisions that affect making, distributing, and using goods and services. Ex.: Making a choice between buying a ticket for a sporting event, or a movie.

Gross Domestic Product (GDP)  GDP is the value of all goods and services produced within the country.  In a free enterprise system profit is a business’s motivation.

Profit  Profit is the money left after all costs and expenses of a business are paid.

Risk  Risk – sports and entertainment companies take financial risks when holding events. Some examples of these risks are ___________.

Competition  Competition is the struggle among companies for customers.

Price Competition  Demand is the customers’ desire to buy products.  Supply is all the products available for sale.  Give an example of a product with high demand & low supply - _______  Give an example of a product with low demand & high supply - ______  Why?????

Non – Price Competition  Non price competition involves factors other than price, such as quality, service, or image.  “When I was in business ….”

Property Ownership and Intellectual Property Rights  Property may include buildings, theaters, stadiums, and equipment (all tangible goods), or may include services (an intangible item).  Intellectual Property Rights – are intangible and are protected by patents, copyrights, and trademarks.

Copyrights  Copyright is the legal protection of a creator’s intellectual property or products. Books, films, video games, and music are copyrighted (for the life of the author + 70 years).  Royalty – payment for usage of copyrighted material.

Patents  Patents are granted for 20 years to protect owners.  The patented product cannot be used without the inventor’s or owner’s permission.  Patented inventions are protected from others making, using, importing, selling, or offering for sale.

Trademarks  Trademarks are words, names, symbols, sounds, or colors that are registered with the U.S. Patent and Trademark Office (USPTO).

Types of Business Ownership  Sole Proprietorship  Partnership  Corporation  Subchapter S Corporation

Sole Proprietorship  Sole Proprietorship – one owner of a business.  Advantages: 1) Complete control of the business, 2) All profits belong to the owner  Disadvantages: 1) Lack of capital resources ($), 2) Unlimited liability, 3) Owner’s time (hours worked)

Partnership  Partnership are where two or more people own a business.  Advantages: 1) Shared financial investment, 2) Shared expertise  Disadvantages: 1) Unlimited liability, 2) Difficulty in withdrawing  “My example __________.”  Limited Partnership – one general partner assumes unlimited liability, but there may be “silent partners.” Ex.: George Steinbrenner put together a group of investors in 1973 to buy the New York Yankees.

Corporation  A corporation is a business entity that has the ability to conduct business and enter into contracts apart from its owner and owners.  A corporate charter is a license to do business.

Elements of Incorporation  Name  Number of Shareholders  Type of Business  Products  Selling Location  Members of the Board of Directors

Subchapter S Corporation  Subchapter S Corporation – follows gov’t regulations just like a corporation, but is taxed as a partnership.  “My example…”

Economic Impact  Local Events – sports games, movies, concerts – provide jobs.  High School Events – generate revenues for schools, and aid the community.

Assignment  Chapter 1 World of Marketing  The 4 P’s: Product, Price, Place, and Promotion  Choose a target market. Then create a basic marketing mix for a sports or entertainment product of your choice. Make your decisions and write them. Add this page to your career portfolio.  Target Market: ________________  1) Sports or Entertainment Product:______________________  2) Price: _____________________  3) Place: _____________________  4) Promotion:__________________

Assignment – Checking Concepts  (100 points)  1) Define “marketing” and give an example.  2) Explain the marketing concept.  3) Describe the concept of demographics.  4) Explain the marketing mix.  5) Explain the concept of economics.  6) Name four types of business ownership.  7) Define Intellectual Property Rights.  Critical Thinking:  8) Describe how sports and entertainment affect national and local economies.  9) Think of a movie or tv show that may have no promotional products. What character from the show would make a good promotional toy? Describe?  10) You work in an athletic shoe store. Teenagers come into the store but do not buy. You believe the store needs to display products that teens prefer. What brand of shoes should you display? Why?

Checking Concepts/Critical Thinking/Cross-Curriculum Skills  (100 Total Points/10 Points Each)  1) Define and give an example of the term marketing.  2) Explain the marketing concept.  3) Describe the concept of demographics.  4) Explain the marketing mix.  5) Explain the concept of economics.  6) Name four types of business ownership.  7) Define intellectual property rights.  8) Describe how sports and entertainment affect national and local economies.  9) You work in an athletic shoe store. Teenagers come into the store but do not buy. You believe the store needs to display more products that teens prefer. What brands of shoes would you choose to display? Why?  10) Upon receiving your college degree in marketing, you aspire to start your own business. What business would you choose, and what would be important in the preparation to open your business?