Nick's Chapter 2 Revised Student Version (5th Ed) PDF

Ever-newer waters flow on those who step into the same rivers. All is flux, nothing stays the still. - Heraclitus  CHAPTER 2 CONTIGENCY FRAMEWORK FOR STRATEGIC SPORTS MARKETING  Learning Objectives Understand the contingency framework for strategic sports marketing...

Ever-newer waters flow on those who step into the same rivers. All is flux, nothing stays the still. - Heraclitus  CHAPTER 2 CONTIGENCY FRAMEWORK FOR STRATEGIC SPORTS MARKETING  Learning Objectives Understand the contingency framework for strategic sports marketing Describe and apply the strategic sports marketing process Define the internal and external contingencies and describe how they relate to the strategic sports marketing process Explain the fundamental planning decisions in the strategic sports marketing process Describe how and why sports marketers understand consumers’ needs Understand the concepts of segmentation, targeting and positioning Identify the elements of the sports marketing mix Describe the implementation phase of the strategic sports marketing process and the activities associated with implementation Discuss the control phase of the strategic marketing process and identify different ways to assess the success of your planning THE STRATEGIC MARKETING PROCESS A. THE PLANNING PHASE STEP 1: UNDERSTANDING CONSUMERS’ NEEDS 1. Marketing Research 2. Consumers as Participants 3. Consumers as Spectators STEP 2: MARKET SELECTION DECISIONS 1. Segmentation Alternative 2. Target Markets 3. Positioning STEP 3: MARKETING MIX B. THE IMPLEMENTATION PHASE C. THE CONTROL PHASE  What is the definition of “contingency?” a future event or circumstance which is possible but cannot be predicted with certainty. "a detailed contract that attempts to provide for all possible contingencies"  Overview of the Contingency Framework for Strategic Sports Marketing Strategic framework that is suited to the sports industry is the contingency framework. Why? 1. Sports marketers operate in unpredictable & rapidly changing environments eg. Mac vs sport product 2. Contingency framework suggests that no one marketing strategy is more effective than another. Eg. Red Sox vs. Blue Jackets 3. Contingency framework assumes an organization does not operate in isolation but interacts with other systems. Eg. Montreal Canadians: What resources are required to produce the CORE product = ENTERTAINMENT? Athletes, owners, management, supply talent, competitors and fans  Overview of the Contingency Framework for Strategic Sports Marketing What different environments do the Canadian’s deal with? Answer: the community, the NHL, sponsors, employees and their families and the sport itself.  Class of 2023 Brainstorm Think/Pair/Share Discuss with your partner, examples of both positive and negative opportunities within the marketing environment. Eg. Star player gets hurt partway through the season. Player (-) media Economic boom scandal coach Star player Hurt player trade Weather  Contingency Framework for Strategic Sports Marketing fit Planning fit 1. Understanding Consumers’ Needs a. Marketing Research EXTERNAL b. Consumers as Participants INTERNAL CONTINGENCIES c. Consumers as Spectators CONTINGENCIES Competition 2. Market Selection Decisions Organizational a. Market Segmentation Vision Legal/Political b. Target Markets c. Positioning Organizational Demographics Mission 3. Marketing Mix Decisions Technology a. Sports Products Organizational b. Pricing Culture c. Promotion Objectives & Mktg d. Place Goals Physical Environment Economy Implementation Org Strategy Org Culture Control  Planning Phase - What Step 1. Understanding Consumers Needs 1st step = conducting marketing research to identify & examine sports consumers’ needs. Eg. Surveys used at events or by phone and mail What type of questions may a sports marketer be asking at an event? Eg. Who attends, reasons for attending, attitudes towards various sports etc.  Step 2. Market Selection Decisions The process of selecting appropriate markets & positioning your sports entity effectively. Sometimes referred to as STP (segmentation, targeting and positioning) Segmentation=how can we break our market down into homogeneous, reachable groups? Target=which of these groups should we commit our resources to reach? Positioning=how do we want the selected target(s) to perceive our offering versus the offerings of our competition?  Step 2. Market Selection Decisions Honda (STP) exercise Odyssey Civic Ridgeline  Step 3: Marketing Mix Decisions The objective of the marketing mix is to implement the positioning established by the chosen target market. Controllable variables (4p’s) are: ✔ PRODUCT ✔ PRICE ✔ PLACE ✔ PROMOTION  Implementation phase - How Quote: “The best plan is only a plan – that is, good intentions – unless it degenerates into work. The distinction that makes a plan capable of producing results is the commitment of key people to work on specific tasks.” During this phase, promotional efforts, distribution plans, product issues and pricing strategies are all carried out. Implementation gone bad eg. Philadelphia KiXX indoor professional soccer team. KiXX not KICKS. KICKS extension connected fans to a fantasy sex line not the teams ticket office – yikes! Activities Associated with Implementation Who will carry out the plans? When will the plans be executed? How will the plans be executed? Activities Associated with Implementation Organizing Leadership and Interaction Resource Acquisition and Allocation Coordination and Timing of Activities Information Management  Control Phase Definition: The process of measuring results, comparing the results with marketing objectives, communicating the results & modifying the plan to achieve the desired results. Sales Analysis Debt load Inventory Food and beverage sales Merchandise sales Profitability Analysis Customer Satisfaction Marketing Audit (systematic & exhaustive appraisal of an organization’s marketing activities)  Chapter Review Questions 1) Describe the contingency framework for strategic sports marketing. Why is the contingency approach especially useful to sports marketers? 2) Outline (or draw a diagram) of the strategic marketing process and comment on how it relates to the external and internal contingencies. 3) How do sports marketers attempt to understand consumers’ needs? Why is this such an important first step in the planning process? 4) Define and discuss segmentation, targeting and positioning. 5) What is the marketing mix? Why is it important to have an integrated marketing mix? 6) What is meant by the control phase of the strategic marketing process? How are the results of the planning phase evaluated? Please hand into our Google classroom tonight. Thanks.  Take Home Portfolio Task #1 1. Provide two (2) examples of corporate sponsorship opportunities and explain how the source company (eg. Molson’s) is segmenting, targeting and positioning their products/services. 10 marks 2. Due October 10 https://www.sportsbusinessjournal.com/SB-Blogs/SBJ-Unpacks/2022/10/06/NHL-sponsors.aspx (Communication 10 marks) EXTERNAL AND INTERNAL CONTINGENCIES  Article Jigsaw Exercise Instructions: 1. Sit in a group of 4 please = HOME TEAM (4 different articles) 2. Access one article each via Google Class or printed format 3. Move into your EXPERT TEAM (i.e. each group member should have the same article) 4. Read your article, take notes and discuss with your EXPERT TEAM 5. Move back into your HOME TEAM 6. Take turns telling each other about your article 7. Class discussion to follow  Environmental Contingencies ▣ Competition - most critical component in the S.S.M.P. - competition is the attempt all organizations make to serve similar customers. - Direct and Indirect competition ▣ In-Class Exercise: using the Toronto Argos as an example, discuss with your partner the direct & indirect competition of the Argos. Prepare to discuss with the class please.  Environmental Contingencies Technology ▣ represents the most rapidly changing environmental factor ▣ technology has an impact on how sports marketers perform their basic marketing functions whereas others aid in the development of new sports products. Example, New advertising, stadium signage & distributing the sports product. (Internet) ▣ Internet not only provides information and game coverage to consumers, it has become a popular way to purchase tickets at a box office. ▣ Social media now has an impact on event attendance  Environmental Contingencies Question: How do technologically advanced products affect sports participants & their performance?  Environmental Contingencies Culture/Social Trends ▪ Described as the shared values, beliefs, language, symbols and tradition passed on from generation to generation by members of society. ▪ Cultural values are widely held beliefs that affirm what is desirable by members of society. ▪ What core American/Canadian values are of interest to sports marketers?  Environmental Contingencies Physical Environment ▣ The physical environment is natural resources and other characteristics of the natural world that have a tremendous impact on sports marketing. Eg. Climate of a region. ▣ Sports marketers may attempt to control the physical environment for both spectators and sports participants. ▣ Eg. Retractable roof stadiums, artificial turf. ▣ Now there is a trend toward “green marketing” ▣ Cardinals stadium in Arizona has the first roll-out playing field!  Environmental Contingencies Regulatory/Legal/Political Political examples: politicians are involved in promoting or discouraging passage of stadium tax issues. Legal examples: - sports officials being confronted with collective bargaining, licensing team logos & other sports law issues. Eg. Title IX; Pistons and Pacers scuffle involving fans Regulatory example: FIFA responsible for promoting soccer through development programs & supervises international competitions  Environmental Contingencies Demographic Trends ▣ Size of population ▣ Age ▣ Shifts in ethnic groups ▣ Population shifts  In-class Exercise Develop examples on how the environmental factors impact the sports industry & sports marketing? Circular Flow Model https://www.youtube.com/watch?v=5usTTo uGlnU  The Economy ▣ Phases of expansion, peak, recession, trough and recovery ▣ Variables include: GDP, unemployment, inflation ▣ Micro vs macro economics  Environmental Scanning Definition: a firm’s attempt to continually acquire information on events occurring outside their organization to identify & interpret potential trends. 5 things an org. can do to enhance its E.S. 1. The org. must devote a position/responsibility to E.S. 2. The org. can provide the individual conducting E.S. with information on the 3 C’s (I.e customers, competition & company) 3. The org. can assure integration of scanned information through structured interactions & communication. 4. The org. can conduct a thorough analysis of ongoing efforts to improve the effectiveness of E.S. activities. 5. The org. can create a culture that values a “spirit of inquiry.”  Internal Contingencies Course pack page 30-31 Textbook pages 53-62 ▣ Organizational Vision ▣ Organizational Mission ▣ Organizational Objectives & Marketing Goals ▣ Organizational Strategy ▣ Organizational Culture  Distinction between Vision and Missions Vision addresses: ✔ Where does the org. plan to go from here? ✔ What business do we want to be in? ✔ What customer needs do we want to satisfy? ✔ What capabilities are required for the future?  RHHS Vision Statement ▣ Richmond Hill High School is dedicated to developing our students’ academic excellence, love of learning, personal growth and sense of responsibility to the global community.  Organizational Mission ▣ Written statement about the organization’s present situation and the direction of the organization (what business we are in and who we serve).  RHHS Mission Statement ▣ Richmond Hill High School maintains a reputation of academic excellence, a strong sense of belonging and a commitment to student involvement in both school and community life.  Green Bay Packers ▣ The Green Bay Packers’ mission is to be a dominating force in professional football’s competitive arena ◼ On the field, the Packers will continually strive to present their fans with the highest level of performance quality available ◼ In their operating activities and relations with the NFL, the Packers will also continually strive for excellence in the quality of work performed ◼ Overall, the Packers will commit themselves to doing their part in representing the state of Wisconsin with competitiveness, respect, and dignity  ORGANIZATIONAL OBJECTIVES vs. MARKETING GOALS ▣ Organizational Objectives - Signposts along the road which help an organization focus on its long-range purpose stated in the mission statement ▣ Typically include both financial and strategic dimensions ▣ Examples of financial dimensions include: growth in revenues and growth in profits ▣ Examples of strategic dimensions include: enhance corporate image and increase customer satisfaction  Organizational Strategies ▣ Are the means by which the organization achieves its organizational objectives & marketing goals. ▣ Organizational Strategies are the “How” (i.e. the game plan) ▣ Remember, flexibility & responsiveness are the cornerstone of the contingency framework!  Examples of Organizational Strategies ▣ Growth and diversification strategies Concentration or diversification ▣ Restructuring and divestiture strategies Liquidation or Restructuring ▣ Global strategies ▣ E-business strategies ▣ Cooperative strategies Types of marketing strategies New Market Penetration: ▣ One pro of being first in the market is having a distinct advantage of securing a firm place in the mind of the consumer i.e. Positioning ▣ Organizations should attempt to shape the perception of their product or service. ▣ Distinguish your product from competitors © John Wiley & Sons Canada Ltd.  Types of marketing strategies Market Expansion: ▣ An organization attempts to increase the volume of products sold to totally new consumers. ▣ Market expansion is achieved by getting a bigger share of the untapped (new) consumers to purchase your product or service, basically attracting a new market. ▣ Example, Penn Racquet Sports, a retailer of tennis balls found new customers in dog owners! R. P. Fetchems were created. ▣ Example, Netflix, founded in 1997, began its international expansion in 2010, and today it is available in over 190 countries. In order to tap into these new markets, Netflix invested heavily in localization, translating its content into more than 60 languages. © John Wiley & Sons Canada Ltd.  Types of marketing strategies Product Development: ▣ An organization can also expand its market by creating new products and services to meet the needs of existing markets. ▣ For example, almost all the major shoe manufacturers have developed apparel lines to compliment their shoes. Another example, For example, Starbucks may have product lines such as coffee, tea, and snacks ▣ A systematic approach to information gathering can be effective in new product development. ▣ New product developments can be grouped into four major categories: new-to-the-company, improvement of existing product, extension of product line, and new-to-the-market. © John Wiley & Sons Canada Ltd.  Types of marketing strategies Diversification: ▣ Is characterized by creating new products for new clients. ▣ Example: a football helmet manufacturer creating impact-resistant plastics thus manufactured cell phone cases. ▣ With existing personnel, equipment and technology, an entirely new product was launched and marketed to new clients. ▣ For example, Coca-Cola does not only produce soft drinks; it also offers juices, bottled water, tea, sports drinks, and more. © John Wiley & Sons Canada Ltd. Relationship Between Levels of Strategy  Levels of Strategy Corporate = the overall game plan! Business level = how a business gains advantage over competitors within the relevant industry. Functional = developed by each of the functional areas within a business unit. Operational = more narrow in scope and support the functional-level strategies.  Marketing Goals Definition: ✔ Marketing goals guide the strategic marketing process & are based on organizational objectives. For example, increase season ticket holders by 5%. ✔ A goal is a short-term purpose that is measurable and challenging yet attainable and time specific.  SWOT Analysis In-class exercise: Conduct a mini-SWOT analysis for a sports or entertainment organization you are familiar with. Present to the class.  Review Questions 1. Define the marketing environment. Are all the elements of the marketing environment considered uncontrollable? Why or why not? 2. What is environmental scanning and why is it so important? 3. What are the different types of competition? 4. Discuss how technology, cultural and social trends affect sports and sports marketing? 5. Define the political and regulatory environment. Give examples. 6. Distinguish between micro and macro elements. Which do you think is more important?  Crossword Puzzles ▣ Please see pages #37-38 in course pack.