Sports Management Oklahoma State

the purpose of this class is
the study of business and management of sports
sports related activities are scattered throughout
8 of 20 sectors of the economy
sports management is the fastest growing industry.
2x bigger than car industry and 7x bigger than the movie industry
alternative sports boom
the fastest growing sports segment of the 21st century–lifestyle sports
90’s sports boom
sporting facilities, proliferation of pro teams and leagues, increased corporate involvement, and rise in sporting goods sales.
in college, most sports programs
lose money
challenges ahead for the sports industry
saturated marketplace and taking advantage of emerging technology
working in the sports industry
social networking is essential, its all about who you know. internships are vital
meetings you want to attend ?
any that has a number (budgets, compensation) attached to it is major league and you need to be there
teams you love/hate.. why?
social, psychological, cultural, geography, your parents, etc.
why do we love sports in the usa?
perfect mix of superstars, drama, and entertainment
sports are different from movies because
you don’t know the outcome of the game
sport consumer behavior
don’t have fanatics for brands like sports–its irrational behavior
sport consumer behavior seeks to answer
which fans will buy/watch/attend
why
when
how can marketing team effectively target this
brand image
the perception of your product or your brand to the customer
brand identity
the perception you want consumers to have
brand loyalty
repeat purchases by customers despite alternatives
sports organizations can improve their marketing strategy by:
-better understanding consumer behavior and psychology
-recognizing the effects of the social and sport environment
-providing the right emotional, logical, or attention-getting message
the more you know about your fans and target market,
the more effective you’ll be
sports are a high profile project
involving politicians and the business community
economic impact analysis are often used to “prove” a project will be successful
but who pays for these studies, and are they creditable? not always–there are biases.
how to fudge economic impact analysis
don’t exclude local residents
don’t exclude time-switchers
economic multipliers too large
over-inflate employment aspect
place marketing
moving teams to “destination cities”
benefits sports have on a community
increased community visibility
enhanced community image
major league city
stimulate other business development
if a team leaves a city
there can be major economic damage
mega events vs local teams
wichita vs tulsa
boise vs portland
omaha vs kansas city
okc in 2000 vs okc with the Thunder
direct economic impact
employment numbers, spending for goods and services, tax revenues. immediate impact
indirect economic impact
direct impact times economic multiplier, medium and long term impact.
opportunity cost
is not always considered in the economic impact
voters are approving less and less taxes for new stadiums lately.
they can’t charge property or sales tax to stadiums anymore.
tourist development taxes
hotel (bed) tax
car rental tax
player tax
player tax
tax on money earned by pro athletes while in LOCAL JURISDICTION. Detroit started this and made hella ca$$$$h
with tourist development taxes
cities could build new stadiums on tourists tax. hitting the tourists for more revenue.
sin tax: alcohol, cigarettes
cleveland got creative. indians and browns got new sports stuff mostly from sin tax
are mega events like the super bowl great or not? “splash out” effect
too many people in a town so you lose local, but bring a ton of tourists. balance out? sometimes. meed to look at impact incrementally. long term cons can outweigh short term benefits.
How was st louis proposal unique? baseball village
being put off. they want to rebuild Bush to redo downtown because its sketchy. lost investors when economy when down the toilet. now 7-8 years later and its still not done.
In what ways was the Honolulu Marathon a success?
5K during spikes down in tourism. mostly people from japan because the value of the yin is up. most people agreed they would come back to hawaii just to visit, not for the 5k. very successful.
what was the situation in minneaplois with the Vikings stadium?
gov pushed off getting new stadium and in 2010 a large snow storm caused the roof to collapse in on itself. many political factors involved as well. next two seasons they have to play outside at Gophers. took two years for the money to come in.
financial trends in sports
rising salaries
higher costs to build and maintain
more services demanded
multi-purpose facilities
tv demands
advertising/commercialization
naming rights
long term revenue source
now they can make some money back
tickets represent __________ for the team
salable inventory. aka liquid assets
suites represent an additional ______________ for a team
high profit inventory
licensing
selling the right to print logos/names/images of the team for manufacturers to sell.
while coke is the official soft drink of the NFL,
pepsi is the official drink of Irving stadium. run into sponsorship dilemmas
broadcast rights
tv (old)
radio (old)
internet (new)
mobile phones (new)

new is where all the money is

sponsorships
title
presenting
official
official supplier
asset
a resource having economic value that a corporation owns or controls with the expectation that it will provide future benefit
current asset
will be consumed within one year; ex. cash, accounts receivable, and inventory
fixed asset
expected to keep on providing benefit for more than one year; ex. equipment, buildings, and real estate
time value of money
the idea that money available at the present time is worth more than the same amount in the future, due to its potential earning capacity. money now is money later.
sponsorship vs advertising
SPONSORSHIP IS NOT THE SAME THING AS ADVERTISING
advertising
limited message trying to elicit a response or action (buy a product)
sponsorship
providing money or resources to support a team or athlete to gain a marketing benefit; builds loyalty and brand equity
sponsorships in relation to sports are
growing tremendously
sponsors are willing to
drop some major cash for a relationship with a team
sponsorship strengths
-positioning of products/services; thus, enhancement of image
-can provide both a means to further promotional strategy and meet goals with employees, distributors, and clients
-allow for a more relaxed promotional atmosphere
-also sends subtle message event would not have been as great or happened without them at all.
sponsors don’t just give money, they also
trade goods and services
risks involved in sponsorship
-poor presentation at an event
-poor performance of an event or sponsored participant
-crisis due to aberrant behavior at event
-over-commercialization backlash
-potential for liability for negligence or other intentional torts
sponsorship is more than up front price, you must
ACTIVATE the sponsorship
activation
cost to leverage sponsorship and develop marketing and advertising based on relationship
sponsors want
increased awareness
enhanced image
demonstration platform
hospitality opportunities
sales opportunities
teams want
money/cash flow
gifts-in-kind
improved atmosphere/attendance
title sponsorship
becomes part of the actual name of the event
presenting sponsorship
exclusive rights in some category
official sponsor
usually gets to control product categories not reserved by presenting sponsors
official supplier
provides goods and services, can claim to be “official” supplier of event or team
asset
marks and logos
audience
database
publications and collateral agreements
web site
guaranteed media
merchandise
signage
sites
vip opportunities
events and programs
talent
related benefit
promotional rights
access
recognition
extended reach
visibility and promotional incentive
proprietary platform
appearance/content and promotional involvement
carolina panthers
assets: affiliation with youth groups, charitable initiative, and purchasing power
results: 11% increase in sponsorship revenues
michigan spartans
asset: michigan stadium press box
result: 3 year, $2.4 mill deal with LaSalle bank
ohio state
asset: statewide interest in athletic program
result: tour that broadened reach, gained new dollars from sponsors
NCAA was formed because
football was too dangerous and needed to clean it up
the flying wedge
ancient warfare technique used in football to crush the competition. instead of lines you charge in arrows. it made the already dangerous sport even more dangerous. people were dying–outlawed in 1894
how do bowl games make money?
because mostly cold weather so moved to warmer areas for bowl games
first bowl game?
rose bowl in pasedena 1902. Stanford and Michigan.
no clear champion could be decided because multiple undefeated teams weren’t playing each other, so
the BCS was formed
most bowl game are in the
south because its warmer and brings more tourists
paying college athletes?
stipens? can’t pay them without needing more money or taking away money from university
UCLA is a real basketball dynasty under
Coach John Wooden. 9 titles in 10 years.
outsourcing
selling the rights to market your property outside a company
fundraising
soliciting and accepting money, services, and products in support of athletic programs